BAB Holdings, Inc. Announces Stock Repurchase Plan.

CHICAGO--(BUSINESS WIRE)--Oct. 8, 1998--BAB Holdings, Inc. (NASDAQ:BAGL), the Chicago-based franchisor of Big Apple Bagels, My Favorite Muffin, and Brewster's Coffee concept stores, today announced that its Board of Directors has approved a plan to repurchase up to 1,000,000 shares of the Company's publicly held common stock.

The purchases are to be made from time to time in the open market or directly from shareholders at prevailing market prices and will be dependent upon various business considerations and the long-term interests of the Company's shareholders.

"With our back to back profitable quarters and continued growth in revenues and numbers of units, we see our stock at recent prices as being severely undervalued," said Michael W. Evans, the Company's President and Chief Executive Officer. "As the only publicly-held Company in the bagel segment which can claim both growth and profitability, we believe the Company is excellently positioned to take a leadership role in an industry which is ripe for consolidation."

Certain statements contained in this press release, including statements regarding the development of the Company's business, the markets for the Company's products, anticipated capital expenditures, and the effects of completed and possible future acquisitions, and other statements contained herein regarding matters that are not historical facts, are forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995). Because such statements include risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Certain risks and uncertainties are outside the control of the Company and its management, including its ability to attract new franchisees, the continued success of current franchisees, the effects of competition on franchise and Company-owned store results, and consumer acceptance of the Company's products in new and existing markets. Readers are cautioned not to place undue reliance on these forward-looking statements which may be made to reflect events or circumstances after the date hereof to reflect the occurence of unanticipated events.

BAB Holdings, Inc., operates, franchises, and licenses Big Apple Bagels, My Favorite Muffin, and Brewster's Coffee concept stores and currently has 288 units in operation in 32 states and two Canadian provinces, 22 of which are Company-owned. The Company has licensing agreements with Host Marriott, Mrs. Fields Cookies, Oberweis Dairy, Miami Subs Corporation, and Choice Picks Food Courts. The Company's stock is traded on the Nasdaq Small-Cap market under the symbol "BAGL".