1. What has made Zos Kitchen successful so far? Provide the key elements of Zos Kitchens business model that have contributed to its success.

2. From the point of view of Brentwood Associates, the PE firm that invested in Zos Kitchen, what are the main benefits of taking Zos Kitchen public? What are the main risks?3. From the point of view Zos Kitchens management, what are the main benefits of taking Zos Kitchen public? What are the main risks? What, if anything, will management need to change if Zos Kitchen becomes a public company?

4. Use the information and assumptions posted here to estimate ranges for the potential payouts to Brentwood Associates under each of the following three exit scenarios. Include the costs of IPO, being public, or the cost of an acquisition:

a. An IPO in early 2014 that values Zos Kitchen at a multiple of its 2013 Adjusted EBITDA.

b. A sale to a strategic acquirer in early 2014 that values Zos Kitchen at a multiple of its 2013 Adjusted EBITDA.

c. An IPO in early 2016 that values Zos Kitchen at a multiple of its projected 2015 Adjusted EBITDA.

Assume that Brentwood owns 100% of Zos Kitchens equity, and that Zos has no debt or excess cash at the time of exit.

5. In light of your prior answers, which of the following three options for Zos Kitchen should Brentwood pursue? Why? Discuss these options and the benefits/costs of each that lead you to your answer:

a. Brentwood should take Zos Kitchen public in 2014.

b. Brentwood should sell Zos Kitchen to a strategic acquirer in 2014.

c. Brentwood should continue to hold Zos Kitchen for at least two additional years, and re-evaluate its exit options then. [hint: comparing a and c could benefit from calculating different IRRs for Brentwood]

Please provide the risk for the business and transaction associated with the each exit option.

Fill in the below sheet for answers and computation