(1888PressRelease)
January 03, 2007 - Today at a press conference in Mt. Pocono, MBE President Steve Bolles announced that a three year old civil suit brought by five former franchisees was settled out of court without any any admissions of guilt nor wrong doing. The litigation involved franchisees from Cleveland, Philadelphia, Georgia, Dallas, and Miami who alleged that they received no administrative support and were allowed to fail. In exchange for a refund of their franchise fee with three year's of interest, all five parties agreed to drop their pursuit of a trial and agreed not to seek any further damages nor criminal actions. "This whole mess has been draining for all of us, and basically was created by old contracts that were somewhat vague and easy to misinterpret" explained Bolles who then added "There was never any deliberate fraud involved and I regret that it progressed this far. We have solved the contract problems with a new contract that is clearly easy to read and understand".
In other ralated news, Bolles announced that their operations in Miami, Phoenix, and Atlanta have temporarily ceased operations, but a new office will be opened soon in Los Angeles and Chicago. "It seems like we're always taking two steps forward and one back, but I accept this as normal growing pains in a very competitive market."
In unrelated news Bolles also announced that all outstanding issues with the IRS were also recently resolved and that they involved only him personally and not MBE in any way.
"2007 will be a great year for MBE - just watch and see" concluded Bolles. MBE still operates successfully in five of the 28 locations opened since 2005. Sales for 2006 were down only 7% due to all the down time lost with administrative problems linked to the allegations. With all these problems now behind us our future looks brighter than ever added MBE CFO Marty Bolles.
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