MIDDLEBY CORPORATION

Moderator: Tim Fitzgerald

December 29, 2004

10:30 am ET

Operator: Good morning. My name is (Lawanna) and I will be your conference facilitator today. At this time I’d like to welcome everyone to the Middleby Corporation conference call.

All lines have been placed on mute to prevent any background noise. After the speaker’s remarks there will be a question and answer period. If you would like to ask a question during this time simply press star then the number 1 on your telephone key pad. If you would like to withdraw your question press the pound key.

Thank you. Mr. Fitzgerald you may begin your conference.

Tim Fitzgerald: Thank you. Good morning. Thank you for attending today’s conference call. I’m Tim Fitzgerald, CFO of the Middleby Corporation. Joining me today is Selim Bassoul, our President and CEO.

I have some initial comments about the stock repurchase transaction that took place last week and then we’ll open up the conference call for questions and answers. Our comments this morning will be limited to a discussion of the stock repurchase transaction and we will not be commenting on the results for the fourth quarter.

Last Thursday the company entered into an agreement to repurchase 1,808,774 shares of its common stock and 271,000 options from the company’s Board Chairman Bill Whitman and members of his family in a private transaction for a total aggregate purchase price of $83,974,000.

The repurchased shares represented approximately 19.6% of the company’s 9,251,000 outstanding shares and were repurchased at a price of $42 per share.

The repurchase price represented a 12.8% discount to Middleby’s closing market price of $48.19 on December 23, 2004, and the 27 - or I’m sorry the 21.7% discount from the $53.64 average closing price over the three trading days prior to the repurchase.

The 271,000 options were purchased at a price equal to the difference between $42 and the exercise price of the option. The repurchase will reduce the amount of outstanding shares to approximately 7.4 million and as a result the transaction is anticipated to be accretive to the company’s earnings per share.

The company also agreed to file a registration statement with the Security and Exchange Commission to permit the Whitmans to sell the remaining 1.8 million shares of Middleby common stock pursuant to a registered unwritten public offering.

The Whitmans have agreed to certain restrictions on their ability to sell the remaining shares in private transactions and with respect to their ability to vote the remaining shares.

In conjunction with the stock repurchase transaction Bill Whitman, who will turn 65 in February, retired from his post as Chairman of the Board after 26 years of service. In addition Robert Henry and Bill’s children -- Laura Whitman and Fife Whitman -- have resigned as directors of the company.

The Board of Directors appointed Selim Bassoul to replace Bill Whitman as Board Chairman. Selim will also continue to serve as the company’s President and CEO.

With this appointment the company entered in a new seven year employment agreement with Selim which was approved by the independent directors on the company board including all the members of the company’s compensation committee.

The stock repurchase transaction was negotiated and approved by a special committee of Middleby’s Board of Directors consisting of all the independent directors. The special committee retained Scadden Arps as its independent legal advisors and Lehman Brothers as its independent financial advisors to assist in the valuation and negotiation the transaction.

Lehman Brothers rendered a fairness opinion to the special committee stating that the consideration paid by the company in the stock repurchase transaction is fair to the company from a financial point of view.

The company financed the share repurchase with borrowings under a new five year $160 million senior bank facility that was established in connection with this transaction.

The newly established senior bank facility provides for $70 million in term loan borrowings and $90 million of borrowing availability under a revolving credit facility.

Borrowings under the new facility are assessed interest at a rate of LIBOR plus a spread that is determined based upon the company’s ratio of debt to EBITDA. That current spread is 1.5%.

Under terms of the new bank agreement the assessed interest can be reduced to a rate as low as 1% over LIBOR upon reaching a debt to EBITDA ratio of 1.5 times.

The company has fixed the rate on $10 million of its borrowing through interest rate swaps and anticipates that it will enter into additional swap agreements to fix the interest rate for a significant portion of the remaining unhedged debt.

As of December 23, 2004, after giving effect to the borrowings incurred to fund the share repurchase the company had $123.3 million of total outstanding debt. And the company expects to fund an additional $8 million of estimated costs related to the transaction.

For financial reporting purposes the company expects to record a pre-tax charge in the range of $13 to $16 million in the fourth quarter of 2004. The anticipated fourth quarter charge will include $8 million associated with the repurchase of the 271,000 stock options from the Whitmans that will be reflected as compensation expense for financial reporting purpose; $1.2 million associated with the write off of deferred financing costs related to the company’s previous bank facility that was refinanced as a result of the transaction; an estimated $3 million of expense associated with the pension settlement for Bill Whitman; an estimated $2.5 million of investment banking and legal fees and various other costs associated with the transaction that will be expensed during the fourth quarter.

The fourth quarter charges are anticipated to be deductible for tax purposes and the company does not anticipate it will incur any further earnings charges associated with the transaction subsequent to its fourth quarter.

(Lawanna) that’s all for our prepared commentary. Can you please open the call to questions and answers at this time.

Operator: At this time I would like to remind everyone in order to ask a question please press star then the number 1 on your telephone key pad. We’ll pause for just a moment to compile the Q&A roster.

Operator: Your first question comes from (Trey Snow).

(Trey Snow): The $8 million that’s part of the larger $13 to $16 million charge, could you provide a little more detail as to what’s in that $8 million number?

Tim Fitzgerald: Well the $8 million is simply the repurchase value for the 271,000 stock option. So for - the accounting rules out there requires that if a company repurchases stock options from an officer within a six month period prior to their exercise you treat that as compensation expense rather than as an equity repurchase.

So the $8 million is simply - if you take the $42 less than the price on the 271,000 shares that equates to $8 million.

(Trey Snow): Okay. So it’s all stock option related?

Tim Fitzgerald: Yes. It’s all stock option related.

(Trey Snow): And am I right in assuming that of the $13 to $16 million about $5 million might be in cash - $5 or $6 million?

Tim Fitzgerald: Well I think the $8 million - if you think about the $8 million itself that’s all going to be cash paid out…So you start with $8 million and then there’s the pension cost is going to be a cash cost and that’s going to be a number somewhere in the $3 million range - or estimated to be $3 million. And then there’s costs related with the transaction such as the investment banking and legal fees. That’s going to be cash as well.

So really the only non-cash portion of that is the write off of the first financing cost which we had paid back when we initially put together our financing.

(Trey Snow): Okay so most of it is cash?

Tim Fitzgerald: Most of it is cash.

(Trey Snow): Okay. Great. That’s all I had. Thanks.

Operator: As a reminder to ask a question please press star then the number 1 on your telephone key pad. We’re now pausing to compile the Q&A roster. Your next question comes from (Jordan Janis).

(Jordan Janis): Hello gentlemen this is (Jordan Janis) of (Cog Hill).

(Jordan Janis): Quick question for you. You guys had an employment agreement that was in place and I think due to expire - I’m going to say the first week in January for Whitman and I think it encompassed a change in control.

I can’t remember the exact details. However it was something to the tune of about $500,000. Can you elaborate on that agreement a little bit and does this transaction I guess trigger the additional payment for Mr. Whitman?

Tim Fitzgerald: No it does not. That contract was put back in place, you know, prior to this transaction being considered. And it was centrally, you know, a trigger for the company to re-enter into a new employment agreement with him.

But with this transaction, you know, his employment agreement in its entirety including that amendment which you’re referring to was all cancelled and terminated.

(Jordan Janis): So what type of transaction then would’ve facilitated the additional $500,000 payment I mean if this isn’t considered a change in control?

Tim Fitzgerald: Well that was essentially a payment that was triggered if his employment contract wasn’t renewed. But, you know, this transaction trumped everything that was out there.

So, I mean, it’s an agreement between the board and Bill for the repurchase of the shares and along with that was, you know, an agreement that his existing employment contracts would be terminated.

(Jordan Janis): And then was any future compensation pulled into - I think last year you had - or I should say I think it’s maybe the current year you pulled forward years compensation from Mr. Whitman into the current year and I can’t remember if that was 2003. It might have been. I’m not sure.

Is there a similar type of arrangement in this buy out for pulling forward any future compensation contracts?

Tim Fitzgerald: I’m not sure what you’re referring to in terms of pulling forward. Initially, you know, there is no future compensation associated with Bill. So, you know, there’s been the repurchase of his shares.

There’s a pension which he had in his existing - previously existing pension contract and the company is working with Bill either to settle that or annuitize that obligation.

And then there’s some continued medical benefits which are relatively minor in the scheme of things.

He is eligible for - I’m sorry - for his bonus that was earned this year. So since the year has been completed Bill, you know, has earned the bonus for 2004 and that will be paid out as well.

(Jordan Janis): And is there a specific amount tied to that that’s sort of public information or no?

Tim Fitzgerald: Well, you know, the maximum payable under the bonus program is $2.4 million.

(Jordan Janis): And then when do you plan on - or you do have a time frame for planning your - or for filing your statement for the additional shares? I mean, how soon do you look to offer those shares up?

Tim Fitzgerald: I think, you know, the board will work with Bill Whitman to determine what the appropriate time is. I would anticipate that it wouldn’t incur until after the company has released its audited results for 2004.

(Jordan Janis): Okay. Fantastic. And Selim if you’re on the call congratulations.

Selim Bassoul: Thank you (Jordan). Thank you very much. And to everybody I want to wish everybody sincere - to say happy holidays and Happy New Year for everybody on the call.

Tim Fitzgerald: (Lawanna) I think since there’s no more questions we’ll just make a closing comment that, you know, we’d like to reiterate that we believe this is a good transaction for the company and shareholders for a number of reasons.

The company was able to repurchase the shares at a substantial discount to the current market value. The transaction will be accretive to earnings per share. The level of debt associated with repurchases is very manageable and financed at a time when interest costs are favorable.

And we believe that the plan to sell Bill’s remaining shares through an underwritten public offering should improve the liquidity of the stock.

But for all those reasons, you know, we’re very excited about this transaction and believe it’s good for the company and the shareholders.

Selim Bassoul: I would like to add two more things that makes this transaction good. It does not alter our strategy of going after - continue growing our business which is going after some strategic acquisitions that we said we would like to go over whether it’s in automation or baking equipment.

It also retains our key members of the management team in their existing positions. And they are very excited about moving forward.

Tim Fitzgerald: Thank you very much and we appreciate everybody for attending the call.

Operator: Thank you. This concludes today’s Middleby Corporation conference call. You may now disconnect.

END