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To
OTC Journal Members:
I hope you saw this afternoon's news
from UFood Grill. If not, I've attached the press release (and some thoughts)
below. Before I get to today's highlight though, I want to bring your attention
to some recent activity in the blog. Remember, the blog is the best and
easiest way for you to interact with me, as questions and see what other
traders are thinking.
 Here
are some of the latest entries; click on each heading to go straight to
the blog entry where you can post a specific message.
Now, on with the show.
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Raising
Money in a Tough Environment |
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Though the last six weeks have been
great as far as the market is concerned (despite Monday's implosion), it's
not like we're in the "can't lose" era we witnessed in the 90's.
Then, raising money was easy, even if the business premise was bad. Now,
being able to raise money - even if your idea is flawless - is a
feat in itself.
This alone makes the UFood Restaurant
Group, Inc. (UFFC) news today an impressive event.
In short, UFood garnered another
$2.2 million worth of financing through a private placement deal. Adding
that to the $2.8 million we reviewed in late March brings the recent total
up to right around $5.0 million. The money will be used to fuel the company's
ongoing expansion. I'm not going to dive back into all those details; you
can click
here to review the in-depth look we took last month.
Is it a game changer? That's
a matter of perspective. On the surface, no, it's not a game changer. With
a deeper look though, I think the money is part of a game-changing
saga.
 As
of our last count, there are fourteen UFood Grill locations in operation.
Five of them are company-owned, and nine of them are franchised. The company
added six of those units since the end of 2007. Here's the interesting
part though - four have been opened in the last six months:
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A unit in California was opened in November
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A unit in Chicago was opened in January....the
city's third.
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A unit was opened in Draper, UT in February.
-
A unit opened at Dallas/Fort Worth Airport
in March.
Translation? The growth is real...
UFood
is doing real stuff with their cash. That's a lot more than
most
companies can say right now. The dollars are starting to flow in thanks
to the expansion too.
Though I don't expect today's press
release to ignite the stock, I do think this recent news is going
to be part of a long string of news centered around expansion. I
hope you're in a position right now.
As a reminder, I think UFFC is a
buy at 25 cents, and a strong buy at 20 cents. For the time being,
I'm targeting a move 50 cents within a few months. At 24 cents per share,
the market cap of only $8 million is stunningly low for the kind of growth
opportunity UFood poses. Some significant 'investors of means' just
agreed, to the tune of another $2.2 million. Those might be coat-tails
worth latching onto.
Here's the official news release.
Press Release Source:
UFood Restaurant Group, Inc.
UFood Grill Announces
$2.2 Million Proceeds in Second Round of Private Placement Offering
BOSTON, MA--(MARKET WIRE)--Apr
21, 2009 -- UFood Restaurant Group, Inc. (OTC BB:UFFC.OB) announces it
has received proceeds of a Private Placement offering in the amount of
$2,226,330, net proceeds after deducting the expenses of the offering,
to fund its ongoing growth and operations. This marks the second and final
round of fundraising for the company, which brings the total amount raised
to $5,070,380, net proceeds after deducting the expenses of the offering.
The first round was completed on March 20, 2009 in the amount of $2,844,050,
net proceeds after deducting the expenses of the offering. Garden State
Securities, a New Jersey-based full service brokerage and financial planning
firm that has been in business for over 25 years was the exclusive placement
agent to raise the funds.
About UFood Restaurant
Group, Inc.
Headquartered in Boston,
MA, UFood Restaurant Group, Inc. is a franchisor and operator of fast-casual
food service restaurants. UFood Grill offers a healthy lifestyle alternative
to consumers in the fast-casual restaurant space and is positioned to become
a leading player in the "better-for-you" quick serve restaurant category.
The Company is led by franchise innovator George Naddaff, who founded Boston
Market and led the franchising of several companies including Sylvan Learning
Center and Ranch*1. Mr. Naddaff has a veteran management team with a record
of success in the franchise market. UFood is currently launching a growth
plan to franchise nationwide. To learn more, please visit www.ufoodgrill.com.
Forward-Looking Statements
This press release contains
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995 involving known and unknown risks, delays,
and uncertainties that may cause our actual results or performance to differ
materially from those expressed or implied by these forward-looking statements.
These risks, delays, and uncertainties include, but are not limited to:
risks associated with the uncertainty of future financial results, our
reliance on our sole supplier, the limited diversification of our product
offerings, additional financing requirements, development of new products,
government approval processes, the impact of competitive products or pricing,
technological changes, the effect of economic conditions and other uncertainties
detailed in the Company's filings with the Securities and Exchange Commission.
The Company undertakes no obligation to update any forward-looking statements.
Contact:
Alexis Miminos
(617) 787-6000
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