Memorandum Offering

Red Lobster Representative Photo 4670 Hardy Street Hattiesburg, Mississippi 39402

OFFERING MEMORANDUMPrepared For: Lynn Mitchell Marcus & Millichap hereby advises all prospective purchasers be set based on a tenant’s projected sales with little or no asbestos, the compliance with State and Federal regulations, of Net Leased property as follows: record of actual performance, or comparable rents for the the physical condition of the improvements thereon, or the area. Returns are not guaranteed; the tenant and any financial condition or business prospects of any tenant, or any The information contained in this Marketing Brochure has guarantors may fail to pay the lease rent or property taxes, or tenant’s plans or intentions to continue its occupancy of the been obtained from sources we believe to be reliable. may fail to comply with other material terms of the lease; cash subject property. The information contained in this Marketing However, Marcus & Millichap has not and will not verify any of flow may be interrupted in part or in whole due to market, Brochure has been obtained from sources we believe to be this information, nor has Marcus & Millichap conducted any economic, environmental or other conditions. Regardless of reliable; however, Marcus & Millichap has not verified, and investigation regarding these matters. Marcus & Millichap tenant history and lease guarantees, Buyer is responsible for will not verify, any of the information contained herein, nor makes no guarantee, warranty or representation whatsoever conducting his/her own investigation of all matters affecting has Marcus & Millichap conducted any investigation regarding about the accuracy or completeness of any information the intrinsic value of the property and the value of any long- these matters and makes no warranty or representation provided. term lease, including the likelihood of locating a replacement whatsoever regarding the accuracy or completeness of the tenant if the current tenant should default or abandon the information provided. All potential buyers must take As the Buyer of a net leased property, it is the Buyer’s property, and the lease terms that Buyer may be able to appropriate measures to verify all of the information set forth responsibility to independently confirm the accuracy and negotiate with a potential replacement tenant considering the herein. completeness of all material information before completing location of the property, and Buyer’s legal ability to make any purchase. This Marketing Brochure is not a substitute for alternate use of the property. NON-ENDORSEMENT NOTICE your thorough due diligence investigation of this investment opportunity. Marcus & Millichap expressly denies any By accepting this Marketing Brochure you agree to release Marcus & Millichap Real Estate Investment Services, Inc. obligation to conduct a due diligence examination of this Marcus & Millichap Real Estate Investment Services and hold it (“M&M”) is not affiliated with, sponsored by, or endorsed by Property for Buyer. harmless from any kind of claim, cost, expense, or liability any commercial tenant or lessee identified in this marketing arising out of your investigation and/or purchase of this net package. The presence of any corporation’s logo or name is Any projections, opinions, assumptions or estimates used in leased property. not intended to indicate or imply affiliation with, or this Marketing Brochure are for example only and do not sponsorship or endorsement by, said corporation of M&M, its represent the current or future performance of this property. CONFIDENTIALITY AND DISCLAIMER affiliates or subsidiaries, or any agent, product, service, or The value of a net leased property to you depends on factors commercial listing of M&M, and is solely included for the that should be evaluated by you and your tax, financial and The information contained in the following Marketing purpose of providing tenant lessee information about this legal advisors. Brochure is proprietary and strictly confidential. It is intended listing to prospective customers. to be reviewed only by the party receiving it from Marcus & Buyer and Buyer’s tax, financial, legal, and construction Millichap and should not be made available to any other ALL PROPERTY SHOWINGS ARE BY APPOINTMENT ONLY. advisors should conduct a careful, independent investigation person or entity without the written consent of Marcus & PLEASE CONSULT YOUR MARCUS & MILLICHAP AGENT FOR of any net leased property to determine to your satisfaction Millichap. This Marketing Brochure has been prepared to MORE DETAILS. ACTIVITY ID: Z0331514. with the suitability of the property for your needs. provide summary, unverified information to prospective purchasers, and to establish only a preliminary level of interest Like all real estate investments, this investment carries in the subject property. The information contained herein is significant risks. Buyer and Buyer’s legal and financial advisors not a substitute for a thorough due diligence investigation. must request and carefully review all legal and financial Marcus & Millichap has not made any investigation, and documents related to the property and tenant. While the makes no warranty or representation, with respect to the tenant’s past performance at this or other locations is an income or expenses for the subject property, the future important consideration, it is not a guarantee of future projected financial performance of the property, the size and success. Similarly, the lease rate for some properties, including square footage of the property and improvements, the newly-constructed facilities or newly-acquired locations, may presence or absence of contaminating substances, PCB’s or Table of Contents

Investment Overview Investment Highlights Financial Overview Lease Summary Tenant Overview Private Equity Sponsor Property Overview Location Overview Surrounding Area Map Local Map Regional Map Property Photos Surrounding Area Photos

Demographics Population Income Employment FINANCIAL OVERVIEW PRICE: $2,598,548 | 5.65%CAP | RENT: $146,818

PROPERTY DESCRIPTION HIGHLIGHTS Property Red Lobster Property Address 4670 Hardy St ➢ Property is Subject to a 25 Year Triple-Net (NNN) Lease City, State, ZIP Hattiesburg, MS 39402 With 20 Years Remaining Building Size (SF) 5,694 ➢ Lot Size (Acres) +/- 0.81 Corporate Guaranty | 704 Locations in the US & Canada THE OFFERING ➢ Strong Inflation Hedge | Attractive 2.0 Percent Annual Net Operating Income $146,818 Increases CAP Rate 5.65% ➢ Has Four, Five-Year Tenant Renewal Options Purchase Price $2,598,548 LEASE SUMMARY ➢ World’s Largest Seafood Restaurant | Serving Customers Property Name Red Lobster in 11 Countries Property Type Net Leased Casual Dining Ownership Private Tenant Red Lobster Restaurants, LLC Guarantor Red Lobster Intermediate Holdings, LLC Lease Term 25 Years Lease Expiration July 31, 2039 Lease Term Remaining 20 Years Lease Type Triple-Net (NNN) Lease Roof & Structure Tenant Responsible Rental Increases 2.00% Annually Options to Renew Four (4), Five (5) Year Option Periods Rental Increases in Options 2.00% Annually

Marcus & Millichap is pleased to present the exclusive listing for a Red ANNUALIZED OPERATING DATA Lobster property located in Hattiesburg, Mississippi. The property consists Current Annual Rent $146,818 of 5,694 square feet of building space and is situated on approximately 0.81 acres of land. The property is subject to a 25-year Triple-Net (NNN) lease Base Term Rental Escalations 2.00% Annually with 20 years remaining on the base term. The current rent is $146,818 and RENT SCHEDULE will continue to increase by 2.00% annually. The increases will continue Lease Year Annual Rent Monthly Rent through the four, five-year tenant renewal options. Year 5 $146,818 $12,235 Year 6 $149,754 $12,480 TENANT SUMMARY Year 7 $152,749 $12,729 Red Lobster is the largest seafood restaurant concept in the world and is an Year 8 $155,804 $12,984 iconic full service brand with broad demographic appeal and significant Year 9 $158,921 $13,243 advertising budget. Red Lobster is led by an experienced management team Year 10 $162,099 $13,508 with a history of success leading the brand(average 27+ years experience Year 11 $165,341 $13,778 across executive team). The company generates $2.5 billion in revenue and Year 12 $168,648 $14,054 th is the 5 largest casual dining concept in North America. Red Lobster was Year 13 $172,021 $14,335 recently acquired by Golden Gate Capital. Year 14 $175,461 $14,622 Year 15 $178,970 $14,914 Year 16 $182,550 $15,212 Year 17 $186,201 $15,517 Year 18 $189,925 $15,827 Year 19 $193,723 $16,144 Year 20 $197,598 $16,466 Year 21 $201,550 $16,796 Year 22 $205,581 $17,132 Year 23 $209,692 $17,474 Year 24 $213,886 $17,824 Year 25 $218,164 $18,180 CAP Rate 5.65% Purchase Price $2,598,548

This information has been securedThisfrominformationsources wehasbelievebeentosecuredbe reliable,frombutsourceswe makeweno representationsbelieve to be reliable,or warranties,but weexpressedmake noorrepresentationsimplied, as to the accuracyor warranties,of the informationexpressed. Referencesor implied,to squareas to thefootageaccuracyor ageofaretheapproximateinformation. Buyer. Referencesmust verifytothesquareinformationfootage or and bears all risk for any inaccuraciesage are. Anyapproximateprojections,. Buyeropinions,mustassumptionsverify theorinformationestimates usedandhereinbearsareallforriskexamplefor anypurposesinaccuraciesonly and. Anydo notprojections,represent opinions,the currentassumptionsor future performanceor estimatesof theusedpropertyherein. Marcusare for& MillichapexampleRealpurposesEstate Investmentonly and doServicesnot representis a 5 service mark of Marcus & Millichapthe currentReal Estateor Investmentfuture performanceServices, Incof. ©the2013propertyMarcus. &MarcusMillichap& Millichap Real Estate Investment Services is a service mark of Marcus & Millichap Real Estate Investment Services, Inc. © 2017 Marcus & Millichap 5 EXECUTIVE SUMMARY Tenant Overview • Red Lobster is the largest seafood restaurant concept in the world and is an iconic full service brand with broad demographic appeal and a significant advertising budget (2nd largest in casual dining). • The Company was founded in 1968 and currently operates 704 restaurants throughout the United States and Canada and has 43 franchised restaurants in international markets. • Red Lobster is led by an experienced management team with a history of success leading the brand (average 27+ years experience across executive team). • The company generates $2.5B in revenue and is the 6th largest casual dining concept in North America. The Transaction

• On July 28th, 2014, Golden Gate Capital (“GGC”) acquired Red Lobster from Darden Restaurants. • Red Lobster is now an independently owned company, completely separate from Darden Restaurants. • Red Lobster is well capitalized with >$200M of liquidity. • Golden Gate Capital has a long, successful track record and significant experience with multi-unit restaurant and retail businesses.

Strong Market Position Significant Scale With Broad Geographic Reach

• Red Lobster is the largest seafood restaurant concept in the world and the 6th largest casual dining concept in the United States with over $2.5 billion in annual sales and 704 restaurants. • The Company is the category killer in the seafood casual dining space, holding almost 50% market share. • Largest share of any restaurant concept in any segment. • Is the 6th largest overall casual dining concept in the US.

6th Largest Casual Dining Concept in the US ~50% Share in Seafood Casual Dining

• Golden Gate Capital (GGC) is a San Francisco-based Private Equity firm with over $15 billion of capital under management. • GGC has been one of the most active acquirers of multi-unit restaurant and retail companies. • Over the past 10 years, GGC has invested in restaurant and retail companies with annual revenues in excess of $15 billion. • GGC’s investors include leading educational endowments, non-profit foundations, and selected entrepreneurs and managers. • Investment approach is to partner with strong management teams to acquire strong, established brands with an opportunity to grow earnings through better execution, productivity improvements and unit growth. • Excellent track record with acquiring and growing divisions of corporations.

Select Restaurant Investments

Restaurant Private Equity Investments

9 LOCATION OVERVIEW

HIGHLIGHTS ADTC 44,000 ➢ Major National Tenants In Surrounding Area: Walmart, Walgreens, Target, Lowe’s. Kohl’s, Best Buy, T.J. Maxx, The Home Depot, CVS, Hilton Garden Inn, and Several Others ➢ Hattiesburg is Home to The University of Southern Mississippi and William Carey University ADTC | Over 18,000 Students Combined 62,000 ➢ Strong Traffic Counts in the Area: Hardy Street and U.S. Interstate- 59| Average Traffic Counts of 62,000 and 44,000 Vehicles Daily ➢ Dense Population: 39,118 People Within Three Miles and Over 68,000 Within Five Miles

MAJOR EMPLOYERS

EMPLOYER # OF EMPLOYEES * Pine Grove Recovery 4,030 University Southern Miss 3,500 University of Southern Miss 2,603 Hattiesburg Clinic Prof Assn 1,077 Windham House of Hattiesburg 1,035 Wesley Medical Center 990 Usm Communication Resources 850 Walmart 800 Marshall Durbin Poultry 758 Merchants Foodservice 500 Wesley Health System LLC 470 Hattiesburg, MS Chain Electric Company 400

This information has been secured from sources we believe to be reliable, but we make no representations or warranties, expressed or implied, as to the accuracy of the information. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Any projections, opinions, assumptions or estimates used herein are for example purposes only and do not represent the current or future performance of the property. Marcus & Millichap Real Estate Investment Services is a service mark of Marcus & Millichap Real Estate Investment Services, Inc. © 2017 Marcus & Millichap 10 LOCATION OVERVIEW This Red Lobster property is located at 4670 Hardy St. in Hattiesburg, Mississippi. Hattiesburg is a city in Mississippi, bisected by the county line between Forrest and Lamar counties. It is the principal city of the Hattiesburg, Mississippi, Metropolitan Statistical Area which encompasses Forrest, Lamar and Perry counties.

Surrounding Retail and Points of Interest The subject property is well-positioned in a strong retail corridor benefitting from its proximity to the Turtle Creek Mall. The Turtle Creek Mall is anchored by Belk, Dillard's, Garden Ridge, JCPenney, Sears, and Stein Mart. The mall contains over 75 stores and services including American Eagle, Finish Line, Foot Locker, Journey’s, Victoria’s Secret, Kay Jewelers, Verizon, Game Stop and Charlotte Russe, which is a strong driver of traffic to this Red Lobster site. Walgreens, TJ Maxx, Michael’s, Hobby Lobby, Walmart, Kohl’s, Sam’s Club and Lowe’s are among the nationally recognized retailers in the immediate area. Additional restaurants include Chick-fil-A, Wendy’s, Golden Corral, Waffle House, Hooters, Olive Garden and Outback Steakhouse amongst many others.

Traffic Counts and Demographics There are approximately 39,118 people within a three-mile radius of this property and more than 68,000 within a five-mile radius. The property is situated between BancorpSouth Bank and Regions Bank. It is opposite a First Presbyterian Church. The property is located on Hardy Street, which experiences daily traffic counts of over 62,000 vehicles. U.S. Interstate 59 is also in close proximity and has over 59,000 vehicles pass through daily.

Hattiesburg, Mississippi Hattiesburg is home to The University of Southern Mississippi and William Carey University. Their populations are 15,325 and 3,626 respectively. Both have campuses in other locations; USM has a campus in Long Beach, Mississippi, and William Carey has campuses in Gulfport, and New Orleans, Louisiana. The Forrest County Center of Pearl River Community College, a public institution, is located in Hattiesburg, with the main campus located in Poplarville, Mississippi. South of Hattiesburg is Camp Shelby, the largest National Guard training base, east of the Mississippi River and the largest state-owned training site in the nation. Hattiesburg is home to several national business branches that hold thousands of jobs across the Pine Belt. It currently hosts branches of Kohler Engines and BAE Systems Inc., as well as Berry Plastics and the Coca-Cola Bottling Co., Pepsi Cola Bottling Co., and Budweiser Distribution Co. Companies.

ThisThisinformationinformationhashasbeenbeensecuredsecuredfromfromsourcessourceswewebelievebelievetotobebereliable,reliable,butbutwewemakemakenonorepresentationsrepresentationsororwarranties,warranties,expressedexpressedororimplied,implied,asastotothetheaccuracyaccuracyofofthetheinformationinformation. References. Referencestotosquaresquarefootagefootageoror ageageareareapproximateapproximate. Buyer. Buyermustmustverifyverifythetheinformationinformationandandbearsbearsallallriskriskforforanyanyinaccuraciesinaccuracies. Any. Anyprojections,projections,opinions,opinions,assumptionsassumptionsororestimatesestimatesusedusedhereinhereinareareforforexampleexamplepurposespurposesonlyonlyandanddodonotnotrepresentrepresent 13 thethecurrentcurrentororfuturefutureperformanceperformanceofofthethepropertyproperty. Marcus. Marcus&&MillichapMillichapRealRealEstateEstateInvestmentInvestmentServicesServicesisisa aserviceservicemarkmarkofofMarcusMarcus&&MillichapMillichapRealRealEstateEstateInvestmentInvestmentServices,Services,IncInc. ©. ©20172017MarcusMarcus&&MillichapMillichap Demographics

1 Mile 3 Miles 5 Miles 5 Miles POPULATION 2022 Projection 8,491 38,583 67,573 2017 Estimate 8,629 39,118 68,349 2010 Census 8,123 37,868 66,241 2000 Census 5,956 34,804 59,937 3 Miles INCOME Average $60,960 $59,115 $60,997 Median $39,891 $39,535 $40,011 Per Capita $27,981 $25,833 $25,065 1 Mile HOUSEHOLDS 2022 Projection 3,949 16,763 27,712 2017 Estimate 3,956 16,780 27,642 2010 Census 3,735 16,100 26,549 2000 Census 2,614 14,120 22,983

HOUSING 2017 $153,959 $142,903 $142,899

EMPLOYMENT 2017 Daytime Population 9,661 62,554 100,757 2017 Unemployment 5.18% 5.34% 6.30% 2017 Median Time 20 19 20 Traveled

RACE & ETHNICITY White 47.57% 52.89% 48.64% Native American 0.09% 0.09% 0.08% African American 44.74% 40.98% 45.76% Asian/Pacific Islander 2.82% 2.22% 1.73%

This information has been secured from sources we believe to be reliable, but we make no representations or warranties, expressed or implied, as to the accuracy of the information. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Any projections, opinions, assumptions or estimates used herein are for example purposes only and do not represent the current or future performance of the property. Marcus & Millichap Real Estate Investment Services is a service mark of Marcus & Millichap Real Estate Investment Services, Inc. © 2017 Marcus & Millichap 14 Steven Chaben Marcus & Millichap Two Towne Square, Suite 450 Southfield, MI 48076 Tel: (248) 415-2600 Fax: (248) 352-3813 License: 6502387903