Finish Line to Exit JackRabbit

INDIANAPOLIS–(BUSINESS WIRE)–$FINL #FINL–Athletic retailer The Finish Line, Inc. (NASDAQ: FINL) (the “Company”)
today announced a plan to exit the unprofitable JackRabbit business
(formerly Running Specialty Group). The Company has entered into a
definitive agreement with affiliates of CriticalPoint Capital, LLC, a
Los Angeles based private investment firm. The Company’s Board of
Directors has approved this transaction which is expected to close by
the end of its fiscal fourth quarter, subject to customary closing
conditions.

“As we exit the running specialty business, we dedicate our entire focus
to serving our core Finish Line and Finish Line Macy’s customers and
driving profitable results that provide return to our shareholders,”
said Sam Sato, Chief Executive Officer of Finish Line. “The JackRabbit
team – both in their main offices in Denver and throughout the field –
genuinely work hard to serve running and fit enthusiasts within their
local communities. With CriticalPoint retaining those employees, they
will continue to deliver a high level of customer service and offer
industry leading branded footwear, apparel and accessories.”

Under the terms of the definitive agreement, affiliates of CriticalPoint
Capital will become the owner of JackRabbit as specified in the purchase
agreement which includes 65 retail stores currently operating under
several banners, all JackRabbit leasehold interests and lease
liabilities, intellectual property and the JackRabbit trademark and
name. JackRabbit staff will be employed by an affiliate of CriticalPoint
Capital.

With exiting the JackRabbit business, Finish Line expects to incur a
pre-tax charge in the fourth quarter of approximately $33 million to $36
million which includes cash costs of approximately $11 million to $12
million and non-cash charges for the remainder related to the net assets
of JackRabbit as well as certain other exit costs. The costs to exit the
JackRabbit business and the resulting tax benefits will be reported in
discontinued operations. The Company also expects to realize a cash tax
benefit on this disposition of JackRabbit totaling approximately $29
million to $31 million which includes a benefit associated with the
projected fourth quarter pre-tax loss and the benefit associated with
the goodwill impairment charge of $44 million recorded during the
Company’s third quarter. The Company expects to receive a portion of the
cash tax benefit in the fourth quarter of the Company’s current fiscal
year and the remaining portion in its fiscal 2018.

Peter J. Solomon Company LLC advised the Finish Line Board of Directors
and management team with respect to the sale.

About The Finish Line, Inc.

The Finish Line, Inc. is a premium retailer of athletic shoes, apparel
and accessories. Headquartered in Indianapolis, Finish Line has
approximately 970 Finish Line branded locations primarily in U.S. malls
and shops inside Macy’s department stores and employs more than 14,000
sneakerologists who help customers every day connect with their sport,
their life and their style. Online shopping is available at www.finishline.com
and www.macys.com.
Mobile shopping is available at m.finishline.com.
Follow Finish Line on Twitter at Twitter.com/FinishLine
or Twitter.com/FinishLineNews
and “like” Finish Line on Facebook at Facebook.com/FinishLine.
Track loyalty points and find store and product information with the
free Finish Line app downloadable for iOS
and Android
customers.

Finish Line also operates JackRabbit (previously referred to by the
company as Running Specialty Group), which includes 65 specialty running
stores in 17 states and the District of Columbia under the JackRabbit,
The Running Company, Run On!, Blue Mile, Boulder Running Company,
Roncker’s Running Spot, Running Fit, VA Runner, Capital RunWalk,
Richmond RoadRunner, Garry Gribble’s Running Sports, Run Colorado,
Raleigh Running Outfitters, Striders and Indiana Running Company
banners. More information is available at www.jackrabbit.com
or www.boulderrunningcompany.com.
Follow the latest about the brand on Twitter at Twitter.com/JackRabbit
or Instagram via @JackRabbitNYC.

Forward-Looking Statements

This news release includes statements that are or may be considered
“forward-looking” within the meaning of Section 27A of the Securities
Act of 1933 and Section 21E of the Securities Exchange Act of 1934.
These forward-looking statements generally can be identified by the use
of words or phrases such as “believe,” “expect,” “future,” “anticipate,”
“intend,” “plan,” “foresee,” “may,” “should,” “will,” “estimates,”
“outlook,” “potential,” “optimistic,” “confidence,” “continue,”
“evolve,” “expand,” “growth” or words and phrases of similar meaning.
Statements that describe objectives, plans or goals also are
forward-looking statements.

All of these forward-looking statements are subject to risks, management
assumptions and uncertainties that could cause actual results to differ
materially from those contemplated by the relevant forward-looking
statements. The principal risk factors that could cause actual
performance and future actions to differ materially from the
forward-looking statements include, but are not limited to, the
company’s reliance on a few key vendors for a majority of its
merchandise purchases (including a significant portion from one key
vendor); the availability and timely receipt of products; the ability to
timely fulfill and ship products to customers; fluctuations in oil
prices causing changes in gasoline and energy prices, resulting in
changes in consumer spending as well as increases in utility, freight
and product costs; product demand and market acceptance risks;
deterioration of macroeconomic and business conditions; the inability to
locate and obtain or retain acceptable lease terms for the company’s
stores; the effect of competitive products and pricing; loss of key
employees; execution of strategic growth initiatives (including actual
and potential mergers and acquisitions and other components of the
company’s capital allocation strategy); cybersecurity risks, including
breach of customer data; a major failure of technology and information
systems; risks associated with the sale and exit of JackRabbit; and the
other risks detailed in the company’s Securities and Exchange Commission
filings. Readers are urged to consider these factors carefully in
evaluating the forward-looking statements. The forward-looking
statements included herein are made only as of the date of this report
and Finish Line undertakes no obligation to publicly update these
forward-looking statements to reflect subsequent events or circumstances.

Contacts

The Finish Line, Inc.
Dianna L. Boyce, 317-613-6577
Corporate
Communications