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Stocks O / O'Charley's Inc.


Subject:  Re: 2002 Q3 Conference Call Notes Date:  11/27/2002  2:28 AM
Author:  kh Number:  24 of 35

Looks like long term debt could be as much as $285 million after the acquistion, according to the recently-filed Form 10-Q.

The SEC filing also said that the company is considering a sale-leaseback of certain restaurants. It was unclear to me whether such a transaction would involve the O'Charley's stores, the 99 restaurants, or both.

Regarding the franchising of O'Charley's restaurants, the SEC filing said: "We completed our feasibility study on franchising our O'Charley's restaurant concept and expect to have our first franchise agreements in place in 2003. We will incur certain legal and administrative expenses during the development stage of this program which will not necessarily be offset by franchising revenue. The establishment of franchising operations could have an adverse effect on our operating results until such time, if ever, as those operations begin to generate revenues in excess of their related expenses. We anticipate approximately $600,000 in expenses for this program in fiscal 2002."

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