800-JR CIGAR, Inc. Announces Signing Agreement For Going Private

WHIPPANY, N.J., Aug. 28 /PRNewswire/ -- 800-JR Cigar, Inc., (Nasdaq: JRJR), the world's largest retailer and distributor of premium cigars in the United States, reported today that it has signed a definitive agreement to be acquired by JRC Acquisition Corp., a wholly owned subsidiary of L&LR, Inc. which in turn is owned by Lewis I. Rothman, LaVonda M. Rothman, and the Lewis I. Rothman 1998 Trust #1. Under the terms of the agreement, a tender offer will be made to all holders of common stock of 800-JR CIGAR other than the Rothmans and the 1998 Rothman Trust for $13.00 in cash per share of 800-JR CIGAR common stock. Lewis I. Rothman is the Chief Executive Officer, President and Chairman of the Board of the Company. LaVonda M. Rothman is an Executive Vice President, Secretary and Director of the Company. The Rothmans and the 1998 Rothman Trust currently control an aggregate of 9,300,000 shares of the Company's common stock, or approximately 78.4% of the outstanding shares.

The transaction was approved on August 28, 2000 by the Board of Directors of 800-JR CIGAR, acting upon the unanimous recommendation of a Special Committee of the Board comprised of three independent directors. In making its recommendation, the Special Committee was advised by Merrill Lynch, Pierce, Fenner & Smith Incorporated, which rendered a written opinion that the consideration offered is fair from a financial point of view to the holders of the common stock other than the Rothmans, the 1998 Rothman Trust and certain other Rothman trusts. JRC Acquisition Corp. was advised by First Union Securities, Inc.

The tender offer, which will commence shortly, is subject to customary conditions and on a majority of the common stock, other than the stock controlled by the Rothmans and the 1998 Rothman trust, be tendered pursuant to the offer. The offer price represents a 20.9% premium over the closing price on August 25, 2000 and a 26.5% premium over the average closing price over the 30 trading days through August 25, 2000.

800-JR CIGAR sells over 150 brands of premium cigars, including 52 proprietary brands, and ranks as the largest single customer of most of the world's leading manufacturers of premium cigars.

Along with cigars, 800-JR CIGAR distributes smokeless and pipe tobacco, tobacco accessories, cigarettes, fragrances, apparel, jewelry and gifts.

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