Unique Pizza and Subs Corporation (pinksheets: UPZS) today announced that it has signed a Definitive Agreement to acquire privately held Pizza Fusion Holdings, with closing expected by the end of the third calendar quarter. Pizza Fusion will become a wholly owned subsidiary of the parent company Unique Pizza and Subs. The Company announced on March 2 it had signed a binding LOI for the transaction.

The business combination capitalizes on Pizza Fusion’s acclaimed organic menu offering, eco-friendly practices, sector leadership position and global growth business plan. Further, it brings together and leverages Unique Pizza’s highly cost effective franchise business model, which enables the prolific roll up and rebranding of existing ‘mom & pop’ pizza restaurants under the Unique Pizza and Subs brand.

Additionally, it combines both companies’ veteran, restaurant industry senior management — and their successful track records — into one integrated team to exploit the operating synergies between the companies. Collectively, the two companies will seek to capture market share with both the organic and conventional pizza business in carefully targeted markets in the U.S. and globally.

Recipe for Global Growth: Healthy Organic Food Meets Casual Dining
Boca Raton, Florida-based Pizza Fusion blends America’s strong appetite for pizza, with consumers’ rapidly growing preference for healthy, natural and organic foods. Founded in 2006, Pizza Fusion is an eco-friendly provider of handcrafted, organic and all natural gourmet pizzas that opened the nation’s first fast casual restaurant serving organic pizza, salads, sandwiches & beverages.

Pizza Fusion was the world’s first restaurant chain to adopt organic restaurant certification. Today, it has 21 franchised locations, with 13 in the U.S., and eight in Saudi Arabia.

In the next twelve months, the Unique Pizza and Subs Corp. business plan envisions: 1) Opening at least one flagship Corporate Unique Pizza and Subs sports bar and training center in the Pittsburgh market; 2) Opening at least one flagship Corporate Pizza Fusion restaurant and training center in the U.S.; 3) Replicating its success by franchising both restaurant concepts throughout North America and internationally in the primary markets and converting existing ‘mom and pops’ in the secondary markets; 4) Forging strategic partnerships with major U.S. and transnational food service industry leaders.

Winner of Nation’s Restaurant News “Hot Concept” award for 2010, Pizza Fusion has been covered by more than 30 local network TV affiliates, 120 local media outlets and 100 national media outlets, including: The New York Times, Men’s Health, Franchise Times, USA Today, CNN Headline News with Robin Meade, Inc. Magazine, MSNBC, ESPN Magazine, Entrepreneur Magazine, Nation’s Restaurant News and many others. Visit www.pizzafusion.com to see a complete list of all press and awards, as well as menus, franchise information and more.

Commenting on the transaction, Pizza Fusion Co-founder and CEO Vaughan Lazar said, “This is a win-win transaction for shareholders and pizza aficionados everywhere. As a newly public company, Pizza Fusion will raise its profile nationally and gain access to public capital markets to support future growth plans. As we grow, many more thousands of Pizza Fusion customers will have a new healthy casual dining choice as well as the opportunity to participate in our future success.”

James Vowler, Unique Pizza and Subs President & CEO said, “The acquisition will merge two industry leading pizza companies which emphasize innovation and place extraordinary value on products of unrivalled quality. Having these two great Pizza brands under the same roof will create a diversified international franchise with the ability to succeed in any type of market or economy and meet the rapidly evolving food and health conscious preferences of today’s consumers worldwide. Whether we enter into a new market as a result of an interest in Unique or Fusion, we will deploy our resources and team to expand both non competing brands within that region.”

Unique Pizza and Pizza Fusion Merger
Under the terms of the Definitive Agreement, UPZS will acquire 100 percent of the shares of Pizza Fusion Holdings in exchange for restricted UPZS shares which, upon issuance, will constitute approximately 20 percent of the issued and outstanding shares of common stock of the Company. UPZS will also make a capital infusion into Pizza Fusion of $1 million for working capital. Pizza Fusion will be operated as a wholly owned subsidiary of Unique Pizza and Subs. Closing is contingent upon these and other customary conditions including completion of due diligence by both parties.

$36 Billion Pizza Marketplace and Fast Growing $29 Billion Organic Sector
Three billion pizzas are sold annually in the U.S. The pizza sector is inherently fragmented, with no other pizza company distinguished by a comprehensively healthy organic menu and eco friendly service offering as is Pizza Fusion. U.S. pizza store sales are $36 billion annually. The average consumer eats pizza nearly three times per month.

By offering affordably priced, natural and organic food, Pizza Fusion also addresses the fastest growing segment in the food industry. U.S. organic food sales rose from $6.1 billion in 2000 to $31.4 billion in 2011, a compounded growth rate (CAGR) of about 16 percent vs. 3.3 percent for conventional food. This trend has driven sales, earnings and share prices at industry leaders, such as specialty grocer Whole Food, to record levels.

In its August 3, research update on Whole Foods, titled “Strong Organic Food Trends Provide an Underpinning for Comps,” Morgan Stanley Smith Barney analysts reported: “US sales of organic products have increased steadily over the past decade, and demand is showing no signs of slowing down. Total sales in organic categories increased from $26.6B in 2009 to $28.7B in 2010 and $31.4B in 2011 (9.5% y-o-y growth).”

Looking ahead, the secular macro trends are strongly positive as 75 percent of U.S. families buy organic products at least occasionally, chiefly for health reasons. One third of consumers now use organic foods at least monthly and 31 percent of U.S. families report they are actually buying more organic foods compared to one year earlier. Organic food sales account for almost 11 percent of all product sales in the U.S.

Randy Romano, Pizza Fusion President, said, “Now, a growing number of pizza lovers don’t have to choose between the food they enjoy or food that is good for you. They can do both. Economically, we are merging the casual serve dining segment, which historically has been one of the most growth intensive areas of dining, with the organic foods industry, which is experiencing a dramatic and lasting increase in popularity – outpacing supply in many sectors.”

Pizza Fusion: Proven Concept for the New Age — and Global Growth
Pizza Fusion offers a new take on America’s favorite food. It proudly serves up delicious, gourmet pizza in its purest form – untainted by artificial additives, like preservatives, growth hormones, pesticides, nitrates and trans fats (to name a few). While famous for its pizza, its 75 percent organic menu features an eclectic variety of gourmet sandwiches, salads, desserts, beer and wine. Additionally, it proudly offers health conscious alternatives such as its delicious gluten-free pizza, brownies and beer and tasty vegan selections.

Pizza Fusion is distinguished by its exceptionally green business model from delivering food in company owned hybrid vehicles, and offsetting 100 percent of its power consumption with the purchase of renewable wind energy certificates, to building restaurants to LEED certification standards.
Pizza Fusion offers: a one-of-a-kind alternative to fast food products; eco-friendly oriented restaurant design; attentive and friendly service; and moderately priced, high quality food healthy based themes. Through its spirited philosophy and principled leadership, Pizza Fusion intends to redefine the fast casual restaurant industry.

April 29, 2012