FRANCHISEE REPORT CONTENTS

3 WHAT IS MIAMI GRILL®?

4 HOW IS MIAMI GRILL® DIFFERENT FROM ITS COMPETITORS?

5 THE MIAMI GRILL® BRAND HISTORY

8 WHAT ARE MY START-UP COSTS?

12 HOW DO I FINANCE MY MIAMI GRILL®?

15 A DAY IN THE LIFE OF A MIAMI GRILL® FRANCHISEE

19 HOW MUCH CAN I MAKE? HOW PROFITABLE IS THIS?

22 HOW BIG IS THE FAST CASUAL INDUSTRY?

23 DO I NEED RESTAURANT EXPERIENCE?

24 WHAT ATTRIBUTES MAKE A GOOD MIAMI GRILL® FRANCHISEE?

26 WHAT ARE OUR OWNERS SAYING ABOUT US?

27 WHAT OPPORTUNITIES ARE AVAILABLE?

28 HOW ABOUT REAL ESTATE- WHAT’S AN IDEAL LOCATION?

29 MEET THE MIAMI GRILL® LEADERSHIP

31 WHAT’S NEXT? WHAT IS MIAMI GRILL 3

THE FRANCHISE It’s all about the experience…top quality food, a South Beach/Miami vibe OPPORTUNITY THAT’S and unparalleled service!

AS HOT AS MIAMI You get a mini vacation in a restaurant that radiates with excitement. Pitbull, Mr. Worldwide, can be seen looping on the screen. He also sits on our Board of Directors as an equity partner. You enjoy your meal in an upscale setting. It’s your personal get-away from your everyday routine.

Tired of arguing about where to go because everyone wants something different to eat? Fight no more! With our menu, Everything Goes! We have something to whet everyone’s appetite, served made to order with authentic products brimming with freshness. If it’s on your mind, it’s on our menu.

What makes Miami Grill® so special is that everything on our menu is authentic and the best in category. We source our cheesesteak from the heart of Philadelphia. The gyro meat, pita bread and tzatziki sauce come from a Greek supplier in Chicago. Our fresh Angus burger has never been frozen, is hormone, antibiotic and steroid free. Every item on our menu is made fresh to order just for you.

All day the restaurant is filled with the irresistible aroma of fresh baked bread, brioche and multi-grain rolls made with our special dough to make each meal stand out. Nothing beats fresh like our mouthwatering Fresh Angus Burger and All White Meat Char-Grilled Chicken Breast cooked to order sandwiches. DIFFERENTIATION 4

HOW IS MIAMI GRILL® Most Fast Casual concepts focus on a vertical product (one type). Five Guys® is ® ® ® DIFFERENT FROM OTHER burgers, Chipotle is Mexican, Panera is sandwiches, Firehouse Subs is subs, Marco’s Pizza® is pizza etc. However, with Miami Grill® it’s all about the FAST CASUAL CONCEPTS? horizontal (wide choices). We bring in the BEST of categories. Everything Goes! The BEST cheesesteak, the BEST gyros, the BEST wings, the BEST burgers, the BEST house-made salads and more. Everything Goes!

For the first time ever, according to the chart above, consumer spending on dining out has taken over grocery store purchases. Today, Americans eat out 4.5 times per week. Couples disagree about what to eat 1.7 times per week. They want a place to go where everyone is happy. Our brand offers choices for all, so go to a Miami Grill® and the entire family is happy. BRAND HISTORY 5

CELEBRATING NEARLY 30 2000s Nathan’s acquires 2010 2012 YEARS OF GREAT FOOD 1980s the franchise brand; New management Pitbull equity 2013-2016 AND SERVICE Mr. Submarine, growth for the brand team takes over, partnership announced Expansion plans include an upscale slows and brand bringing over 62 years Hawaii, Texas, the sandwich shop, marketing efforts of proven experience Rollout of new Fresh Middle East, Malaysia, opened in Key were significantly to the iconic franchise Angus Steak Burgers and Myanmar, Panama and West, Florida. reduced brand healthy dining options South Florida 1990s Worldwide franchising 2007 2011 efforts, national and Miami Subs® grew Miami Subs® Positive sales trend, viral media outreach to 190+ locations Capital Partners new advertising supporting Miami Grill® and expands it’s acquires the agency, new TV investment franchise menu to include franchise brand spots released opportunity grilled items such as burgers, chicken and our now famous Philly cheesesteaks.

THE BEGINNINGS Miami Subs® opened under the name Mr. Submarine in 1988 and soon changed its name to Miami Subs® which grew to become Florida’s largest regional sub and grill chain. It was started by Konstantinos “Gus” Boulis of Greek decent. Boulis started off as a fisherman before taking a job as a dishwasher at a Mr. Submarine sandwich shop. The original owners of Mr. Submarine, now known as Mr. Sub, were Jack Levinson and Earl Linzon who opened their first shop in Toronto Canada in 1968. It was Gus Boulis who showed Levinson and Linzon how to franchise. He soon was offered control of one of the stores, and shares in the corporation. In his five years with the company Boulis developed a chain of over 200 stores. The sale of the Boulis’s shares in the company in the mid-1970s made Boulis a multimillionaire at 25.

In 1979, Boulis moved to Florida with the intent to retire, however he soon began building the popular Miami Subs® (Grill). He continued his success in the food business, expanding the Miami Subs® chain throughout Florida and beyond. Miami Subs® built the concept and expanded rapidly in the 90’s, starting in Florida and spreading quickly nationwide. Many were “A” locations, free standing buildings with drive-thru, as well as stores in non- traditional locations such as; schools, highway rest areas (particularly along Florida’s Turnpike) and airports. The restaurants featured distinctive exterior designs with Miami-inspired pastels trimmed with pink and blue, neon lights and interiors decorated in a tropical motif. However, in 1994 Boulis started “SunCruz” Casinos and took his eyes off Miami Subs®. He decided to sell the company in 1999 to Nathan’s Famous®. BRAND HISTORY 6

THE NATHAN’S Nathan’s Famous® purchased the chain bringing Nathan’s, Miami Subs®, ACQUISITION and Arthur Treacher’s brands under a common corporate umbrella. The chain had approximately 175 outlets at acquisition. This was more of a real estate transaction for Nathan’s as real estate values increased exponentially from 2000-2006. Miami Subs® owned very valuable hard corner proper- ties which Nathan’s sold off piece by piece to drug store chains and banks. Post-acquisition the chain struggled, due in part to instability in the manage- ment ranks and the sales of prime locations.

In 2007, Nathan’s Famous announced the sale of Miami Subs® to a private investment group under the name of Miami Subs® Capital Partner 1 Inc. At the time of the sale, the chain had 59 locations. Management still struggled and finally a fresh vision was announced by bringing in a new CEO.

In 2010 Richard Chwatt took over and began to revitalize the Miami Subs® brand. He wanted the excitement back in this aging brand that everyone had spoken about. His motto was to renovate, relocate or terminate to start the turn-around. The excitement came back and the vision and reality of Miami Grill® emerged. BRAND HISTORY 7

PITBULL JOINS In 2012, Armando Christian Perez, a.k.a. Pitbull joined the team as an AS EQUITY PARTNER equity partner bringing his star power to help our brand flourish.

“I’m no longer just an artist. I’m a business partner. Daleeeeee!" – PITBULL

The true legend and staying power of the brand is our food. It’s all about fresh food and choices. We feature, Philly cheesesteaks, wings, gyros, grilled seafood, handmade fresh Angus steak burgers, pitas, platters, garden fresh salads, hot and cold subs, chicken, breakfast and more. We also carry a great selection of craft beers, wines and legendary Dom Pérignon champagne.

Dom Pérignon you ask? We sell Dom Pérignon because the founder “Gus” of Miami Subs® felt the best name in champagne was Dom Pérignon, and the best quality food was at Miami Subs®. So he put together a combination for $109.99—a bottle of Dom Pérignon and a dozen wings.

A famous story has it that Madonna used to come after all of her shows. She would order the combo, and our drive-thru staff would hand it to her through the top of her limo. She’d be drinking “Dom” and enjoying her wings after her performances!

It’s a fast casual concept that has a modern, fresh approach with a South Florida tropical flare. A look that is inspired by the Miami lifestyle. Every meal is prepared fresh before your eyes. It has something on the menu for everyone. As mentioned, research shows that couples argue 1.7 times per week where to eat. Our menu makes families happy! It is a strong Miami iconic brand that has been serving great food over its 25 years’ history. YOUR FRANCHISE 8

WHAT DOES IT COST TO OUR MINIMUM CRITERIA FOR A NEW FRANCHISEE FOR A SINGLE UNIT: OPEN A MIAMI GRILL®? 1. $150,000 in liquid assets. This includes anything besides home equity that can be converted to cash within 30 days 2. Net worth of $350,000 3. Strong credit history

ESTIMATED INITIAL INVESTMENT:

PLEASE REVIEW THESE CHARTS TOGETHER WITH THE NOTES THAT FOLLOW.

TO WHOM TYPE OF AMOUNT METHOD OF WHEN DUE PAYMENT IS EXPENDITURE PAYMENT MADE Initial Franchise Fee $30,000 Lump Sum Upon Signing Us (Note 2)

Real Estate (Note 3) $8,000 to $15,000 Lump Sum Prior to Lease Landlord

Leasehold Improvements and $100,000 to Architect, As Incurred As Incurred Construction $195,000 Contractor (Note 4)

Furnishings, Fixtures $75,000 to and Equipment As Incurred As Ordered Suppliers $128,000 (Note 5)

Signage $5,000 to $15,000 As Incurred As Ordered Suppliers

Training During Airlines, Hotels Expenses $3,000 to $5,000 As Incurred Training and Restaurants (Note 6) Initial Inventory Before and Supplies $10,000 As Incurred Suppliers Opening (Note 7) Misc. Opening Costs Before Suppliers, $5,000 to $15,000 As Incurred (Note 8) Opening Utilities, etc. Liquor License Governmental Before (Beer & Wine) $1,000 to $10,000 Lump Sum Authority or Existing Opening (Note 9) License Holder YOUR FRANCHISE 9

WHAT DOES IT COST TO 1. Since none of these costs except the Initial Franchise Fee and the OPEN A MIAMI GRILL®? additional fees for co-branded operations (which are not refundable) are paid to us, whether any of these costs are refundable will vary based on the practice in the area where your franchised restaurant is located and upon the arrangements you make with vendors and suppliers.

2. The Initial Franchise Fee for a traditional Miami Grill® Restaurant is $30,000 and is paid when you sign the Franchise Agreement. If you have signed a Deposit Agreement, we will credit any Deposit you paid us under a Deposit Agreement against your Initial Franchise Fee. Otherwise, as described in Item 5, the Deposit is non-refundable. If you are signing an Area Developer Agreement, the Area Developer Fee will be based on the population of the Territory granted to you under the Area Developer Agreement. See Item 5 for details. In addition, Area Developers may incur certain costs in connection with complying with the franchise laws that may apply in their Territory.

3. The costs of acquiring or leasing a location for your franchised restaurant will vary significantly depending on the geographic location. The cost of purchasing the real estate is not included in this estimated investment range. If leased, the base rent, exclusive of percentage rent, common area maintenance charges, taxes and insurance likely will range from $4,000 to $10,000 a month, plus deposits as shown above. These estimates are based on a restaurant of 2,500-3,000 square feet with 85 seats and parking for 45 cars.

4. Your election either to construct a new building or convert an existing building will significantly affect the cost of leasehold improvements, including construction. In addition, the geographic area, the location of the building, its size, its character (i.e., free- standing versus in-line), the condition of the premises and the amount of parking area provided will all affect the required investment. Therefore, we offer no estimation on new building construction. We estimate that the leasehold improvement cost for the conversion of an existing building will range from approximately $100,000 to $195,000. Our new look designed by Kobi Karp will be required for all new restaurants unless otherwise waived, in writing, and the said new look will add to the estimated total investment. YOUR FRANCHISE 10

WHAT DOES IT COST TO 5. The amount of furnishings, fixtures and equipment will depend, to OPEN A MIAMI GRILL®? some extent, on the size of the building. The total cost of furnishings, fixtures and equipment will depend on the suppliers, your location, distance from the suppliers, transportation costs and similar variables. If you do not qualify for or elect to purchase a co-branded operation(s), you will not incur the associated costs for furnishings or fixtures listed in the co-branded table(s).

6. For our initial training program, you must pay the costs associated with transportation, lodging, food, uniforms, and salaries for you and any of your restaurant managers that attend our initial training program. The cost will depend upon the distance you and your managers must travel and the type of accommodations you choose.

7. The total cost of the initial inventory and supplies will depend on individual suppliers, your location, transportation costs, season, available supplies and similar variables. If you do not qualify for or elect to purchase a co-branded operation(s), you will not incur the associated costs for opening inventory listed in the table.

8. These costs include professional fees (such as legal, accounting and architectural fees), security deposits, utility deposits, governmental license fees and insurance premiums for one year for the insurance required by the Franchise Agreement. This amount also includes grand opening advertising expenses. This includes a $3,000 design fee.

9. You must offer beer and wine at your Restaurant, and you must have the appropriate license related to offering beer and wine, unless the cost of acquiring the license is prohibitive in our judgment. These are general estimates for “beer & wine” licenses, not full liquor licenses, which can vary widely. You should determine the cost and availability of a beer & wine license and/or a liquor license before you sign the Franchise Agreement. YOUR FRANCHISE 11

WHAT DOES IT COST TO 10. This estimates your initial opening expenses for the first 90 days. OPEN A MIAMI GRILL®? These expenses include payroll costs for management and other employees. These figures are estimates and we cannot guarantee that you will not have additional expenses starting the business. Your costs will depend on factors such as: how closely you follow our methods and procedures; your management skill, experience and business acumen; financing costs; local economic conditions; the local market for restaurants; the prevailing wage rate; competition; and the sales level reached during the initial period.

11. We relied on our experience (and that of our predecessors) in the restaurant business to compile these estimates. You should review these figures carefully with a business advisor before making any decision to purchase a franchise. FINANCING 12

SMALL BUSINESS Miami Grill ® is an approved franchise on the SBA National Registry. ADMINISTRATION Franchise Registry Approved Brands means that the franchisor’s agreement governing the relationship and any related documents must be reviewed. The GUARANTEE SBA requires this review to insure the applicant and franchise are eligible LOAN PROGRAM for SBA financing. This does not guarantee that a loan will be approved. It is only a part of the requirements necessary to apply.

The SBA guarantees small business loans for banks, making it more attractive to lend to entrepreneurs. SBA loans can provide borrowers with attractive terms and lower interest rates, and are ideal when buying an existing business or a new franchise. The approval process can be 5-7 business days. The disbursement of funds can occur as soon as 60-90 days. SBA loans can also be used in conjunction with other financing options, such as Rollovers for Business Start-ups.

SBA – loans are government-backed loans available through commercial lenders who follow SBA guidelines. SBA works with lenders to provide a partial guarantee for loans, reducing lenders’ risk, increasing small business lending, and helping expand small business economic activity. For information, see: www.sba.gov/category/navigation-structure/loans-grants .The SBA does not make direct loans to small businesses.

401K ROLLOVERS For over a decade, our 401(k) business financing service has helped entrepreneurs fund small businesses and franchises. Through an arrangement called Rollovers for Business Start-ups (ROBS), you can invest your funds from an eligible retirement account into a small business or franchise without taking a taxable distribution or getting a loan. Whether you want to buy an existing business, start one from scratch or grow one you currently have, ROBS could provide a significant part of your capital injection. FINANCING 13

TYPES OF LOANS UNSECURED LOANS: Can be a fast funding option for your new business or franchise. You won’t need any collateral to qualify and you can be funded in 45 days.

Unsecured loans can be thought of as a small business credit card. They consist of multiple, revolving lines of credit, available from $25,000 – $150,000. The funds can be used for working capital, marketing, payroll, franchise fees, equipment, or for that extra cushion should the need ever arise. There is no use of proceeds requirement.

Rather than relying on collateral to secure the loan, lenders look at the borrower’s creditworthiness to determine eligibility, making those with high credit scores and a solid credit history the best candidates for these small business lines of credit. Because no collateral is required, interest rates for unsecured loans are usually higher compared to SBA loans or other forms of small business financing.

PORTFOLIO LOANS: Allow securities owners to leverage instead of liquidate. If you hold publicly traded stocks or other eligible securities and can borrow against them, this may be a great option for business funding.

Portfolio loans can be a fast, low-cost approach to small business financing. If you have at least $85,000 in brokerage accounts, you can qualify for a stock loan at a minimum of $55,000. The higher the value of your securities, the more money you can borrow. Here are a few of the other perks of portfolio loans:

Quick turnaround: Stock loans close in an average of 10 days.

No out-of-pocket costs.

Low interest rates: Portfolio loans have interest rates as low as 3 – 4 percent (even lower for jumbo credit lines over $800k). Plus, you don’t pay interest unless you use the funds.

Combine with other forms of small business financing: You can use this form of financing with SBA loans, unsecured loans, equipment leasing, Rollovers for Business Start-ups and more. FINANCING 14

OTHER OPTIONS EQUIPMENT LEASING: A great way to grow your business without significant out-of-pocket expenses is to lease your equipment instead of buying it. Equipment leasing usually offers two-to five-year terms with fixed payments. Interest rates range between 8.5 percent – 20 percent, based on business industry, the borrower’s credit history, experience, and equipment type.

To see a comparison chart for these four options, go to: https://www.guidantfinancial.com/financing-solutions/comparison-chart/

BUYOUT OF EXISTING FRANCHISEE: This deal can be structured to both parties’ satisfaction.

EQUITY PARTNER: An equity partner is a part-owner of the business, and is entitled to a proportion of the distributable profits of the partnership. The equity partner can have a passive role in the business as well; it all depends on the way it is structured.

1031 EXCHANGE: (Also called a like-kind exchange or a Starker) is a swap of one business or investment asset for another. Although most swaps are taxable as sales, if you come within 1031, you’ll either have no tax or limited tax due at the time of the exchange.

Using some of the income from the sale of your business to start a new company will lower the amount you pay in capital gains tax. Because the IRS allows you to use business startup expenses to offset income, including capital gains, it makes sense to start a new business during the same year that you sell your old one. From the time of closing on the relinquished property, the investor has 45 days to nominate potential replacement properties and a total of 180 days from closing to acquire the replacement property. Check with your accountant to see if you have a qualifying asset.

CASH: The King Of All Deals A TYPICAL DAY 15

WHAT’S A DAY LIKE JOHN NAKIS, A MULTI-UNIT OWNER, WAS KIND ENOUGH TO SHARE: FOR A MIAMI GRILL® SO HOW DOES YOUR DAY START? FRANCHISEE? I usually arrive at one of the restaurants by 7 a.m. and determine the maintenance project for the day. It may be touch-up paint on a door or wall, power washing the sidewalks, or anything else that is on the list. I then assign it to an employee and check on the progress.

Around 9 a. m. my manager arrives and I will then start to do the daily banking, pay bills or place a food order. At 9 a.m. the rest of the morning crew starts to arrive and start doing prep work such as baking bread, slicing vegetables, making bases for our salads, mixing tuna, etc. Since we make everything fresh daily we have to get ready each day.

Our doors open at 10 a. m. (store hours vary), so I make sure our front of the house people are in proper uniform with their name tags on and we have a small team meeting to remind them to always smile, be respectful, and use the customer’s name as much as possible. I want my restaurant to be a place where our customers feel special.

WHAT DO YOU DO BETWEEN 10 A.M. AND NOON?

Once I know that everything is moving in the right direction, I may take deposits to the bank or do some local marketing in my trade area. I divide the area in quadrants and try to hit one quadrant a week, handing out flyers, menus or just give out information about the restaurant, like we have a drive-thru.

I try to work out special deals with area schools. Like at the local high school, I have a Miami Grill® banner up that they wanted $500.00 for the school year but instead, I offered to cater a function that would equal the same value but it only cost me the food. So, I always try to use my food rather than my money because it saves me money and it gets people to try my food. A TYPICAL DAY 16

WHAT’S A DAY LIKE DO YOU THEN WORK LUNCH? FOR A MIAMI GRILL® I never schedule myself in any of my restaurants. I am a hands on owner/ FRANCHISEE? operator so I have no problem helping out wherever I’m needed. That way I can expedite wherever a bottleneck occurs. It may be the drive-thru, or the kitchen or the register, wherever there is a holdup is where I go.

Sometimes I work in my office, but I have a full camera system that lets me see every area of the restaurant. I can tell when things are backing up and then I go and help.

HOW DO YOU STAFF YOUR RESTAURANT?

I am always looking for the right person to work here. I start with happy, respectful, polite individuals. Then I tell them to take our menu home and learn it. When they have learned it, I tell them to call me and we do a trial to see if the business is right for them. Some love it, some don’t but I learn that fast. I start them off part-time and they can grow based on performance. A TYPICAL DAY 17

WHAT’S A DAY LIKE WHAT ABOUT AFTER LUNCH? FOR A MIAMI GRILL® After 2 p.m. I start giving employees a paid 15-minute break that includes a FRANCHISEE? meal of their choice for free. I know they are hungry so I feed them so they are not tempted to go in the walk-in and grab something to eat. They work hard and it is a perk I offer. I hang around in case we get busy and pitch in until everyone has eaten.

WHAT HAPPENS NEXT?

We do prep work if needed for the dinner rush. We bake more bread so everything is fresh. I go over the expectations of the night crew then I go and spend time with my family.

I typically work 6 days a week some days it might be only 5 hours; some days it might be 15 hours. When you’re an owner operator you stay until things get done. But, I love what I do. It’s all about setting your priorities, for me it’s my family, my business, and my hockey. (John has played hockey since the age of 5 and still plays competitive hockey today.)

HOW DO YOU HANDLE CUSTOMER COMPLAINTS?

When you’re serving 200-300 customers a day something may go wrong. We are only human. So you take the human aspect and treat the customer in a polite, nice manner. You want them to leave with a positive story. The old adage “the customer is always right” needs to apply in almost every situation. We want our customers to be satisfied when they leave. So we fix the problem.

WHAT KPIS (KEY PERFORMANCE INDEXES) DO YOU MONITOR?

First is a smooth running restaurant; if it’s not smooth there is a problem. It’s all about the customer experience. Cleanliness is also a huge aspect. If the restaurant is clean, people come back. I look at speed of service as well. People don’t want to spend time. They want to have their meal. The way my staff treats each customer is very important as well. I want each customer to be special. (continued on next page) A TYPICAL DAY 18

WHAT’S A DAY LIKE From the back end of the house, I look, of course at sales. For example, last FOR A MIAMI GRILL® Monday we had our best Monday ever. I celebrate those accomplishments. Of course I also look at my controllable costs, my labor costs, my food costs. FRANCHISEE? Just recently, I installed an oil tank where the company delivers fresh oil, then buys back from me the used oil, saving me money. So, I am always looking at increasing my sales and lowering my costs. It’s all about the numbers.

WHY ARE YOU A MIAMI GRILL® FRANCHISEE?

I love what I do! I love Miami Grill® I love the people at the corporate offices and I have a great relationship with them. I feel that we work well together.

WHAT’S NEXT FOR YOU?

I don’t settle for average. I want to be a top performing owner/operator. I want to continue to grow my business and look for additional locations to expand into. I feel if I do the right things…. I will be rewarded. GUAGING INCOME 19

HOW MUCH MONEY The FTC’s Franchise Rule permits a franchisor to disclose information about CAN I MAKE? the actual or potential financial performance of its franchised and/or franchisor-owned outlets, if there is a reasonable basis for the information, and the information is included in the disclosure document. Financial performance information that differs from that included in Item 19 may be given only if: (1) a franchisor provides the actual records of an existing outlet you are considering buying; or (2) a franchisor supplements the information provided in this Item 19, for example, by providing information about performance at a particular location or under particular circumstances.

Comparative year over year sales for traditional franchisee owned Miami (Subs) Grill restaurants that were open for the entire 2013, 2014 and 2015 calendar years.

Comparative YOY sales +5.67% for all Miami (Subs) Grill restaurants open during calendar years 2013, 2014 and 2015.

Average sales for 28 traditional franchise owned Miami (Subs) Grill restaurants that were open for the entire 2015 calendar year.

1. High sales quartile (7 Miami (Subs) Grill Restaurants) $1,376,058 $1,581,925 $1,845,355

Low Average High

2. Medium High sales quartile (7 Miami (Subs) Grill Restaurants) $1,127,187 $1,235,602 $1,340,893

Low Average High 3. Medium Low sales quartile (7 Miami (Subs) Grill Restaurants) $832,626 $957,618 $1,063,202

Low Average High 4. Low sales quartile (7 Miami (Subs) Grill Restaurants) $506, 237 $600,724 $667,998

Low Average High GUAGING INCOME 20

HOW MUCH MONEY We do not furnish or authorize our salespersons to furnish any oral or CAN I MAKE? written information concerning the actual or potential sales, costs, income or profits of a Restaurant, except as stated above. Actual results vary from Restaurant to Restaurant and we cannot estimate the results of any particular franchisee. We are not representing that you can expect to achieve these sales in your first year of operation, or at any time during the term of your Franchise Agreement. Your revenues may vary significantly depending on a number of factors, including the location of your Restaurant and how you operate your business.

Some outlets have earned this amount. Your individual results may differ. There is no assurance that you’ll earn as much. Net income will vary from Restaurant to Restaurant depending upon factors such as rental or real estate costs, costs of goods sold, labor costs and other costs relating to the operation of the Restaurant.

We offered substantially the same services to the Restaurants described in this Statement. These Restaurants offered substantially the same products and services to the public as you will. The Restaurants report gross receipts information to us based upon a uniform reporting system.

We strongly urge you to consult with your financial advisor or personal accountant concerning the financial analysis that you should make in determining whether or not to purchase a Miami Grill franchise.

Written substantiation of the data used in preparing these sales figures will be made available to you upon reasonable request. The information presented above has not been audited.

Except as provided above, we do not make any representations about a franchisee’s future financial performance or the past financial performance of company-owned or franchised outlets. We also do not authorize our employees or representatives to make any such representations either orally or in writing. If you are purchasing an existing outlet, however, we may provide you with the actual records of that outlet. If you receive any other financial performance information or projections of your future income, you should report it to the franchisor’s management by contacting Robert Haar at 6300 NW 31st Avenue, Ft. Lauderdale, Florida 33309, telephone (954) 973-0350, the Federal Trade Commission, and the appropriate state regulatory agencies. THE INDUSTRY 21

WHAT’S OUR NICHE? Miami Grill® can offer the convenience of drive-thru and delivery while offering a comfortable environment for dine-in customers. Every meal is cooked to order offering the highest quality and level of freshness.

QUICK SERVICE: CASUAL DINING: FAST CASUAL: McDonald’s Applebee’s Miami Grill® & Burger King & Chili’s

HOW BIG IS THE FAST Fast Casual is one of the hottest segments in the restaurant business for the last CASUAL INDUSTRY? 10 years. It is a smaller part of the overall market but it is far less saturated and provides growth for the person interested in the food industry. Fast Casual is a hybrid between quick service restaurants and casual dining. This is all done in an upscale and inviting atmosphere.

The Fast Casual concept merges the need to eat in short order with the customer’s desire for a variety of options. So Fast Casual solves the question of; Where can I get something quick, yet eat a higher quality meal? The customer orders at the counter then has their meal delivered on plates with cutlery to their table. Beer and wine is also available to consume on premises in our Miami Grill® restaurants.

Our customizable menu options are geared to appeal to the Millennial base. Since Fast Casual combines quick service with quality food, the prices reflect the higher standards. Prices will range between $8 and $14. However, the consumers are willing to pay slightly higher prices for a quality meal, as you can see by the following chart.

The American Fast Casual Food Craze (Sales Growth Since 1999) 600%

Fast Casual Food

400%

200%

Fast Food 0%

‘00 ‘01 ‘02 ‘03 ‘04 ‘05 ‘06 ‘07 ‘08 ‘09 ‘10 ‘11 ‘12 ‘13 ‘14

https://www.washingtonpost.com/news/wonk/wp/2015/02/02/the-chipotle-effect-why-america-is-obsessed-with-fast-casual-food/ THE INDUSTRY 22

HOW BIG IS THE FAST Fast Casual, according to a recent 2016 analysis by Franchisehelp.com CASUAL INDUSTRY? is one of the fastest growing segments of the restaurant industry over the past decade. The Fast Casual concept is also growing faster than the rest of the restaurant industry now. Another recent study by food service industry research firm Technomic Inc. Fast Casual restaurants posted 11.4% growth (year-over-year) which is prior to nearly double the growth of full-service and fast-food QSR restaurants among the Top 500 Chains in the U.S.

DEMOGRAPHIC

Exhibit 2: Percent of each generation who said they ate at a restaurant at least once in the last 3 months... Millennials lead in all three of these categories, but especially in fast casuals.

BABY TOTAL MILLENNIAL GEN X BOOMERS

QSR 93% 96% 95% 90%

CDR 71% 80% 74% 64%

FCR 56% 69% 62% 43%

Source: AlphaWise, Morgan Stanley Research.

Millennials make up 51% of Fast Casual customers, although they represented only 31% of the people surveyed by Morgan Stanley. EXPERIENCE 23

DO I NEED RESTAURANT Miami Grill® ’s training and support is an immersion program designed to allow EXPERIENCE? individuals that don’t have restaurant experience to learn the business. We seek individuals with multi-unit experience. If you have restaurant experience the ramp up time will be quicker. That experience can be a true asset. However, we have franchisees in our system that are successful with no prior experience. It’s all about passion for the brand and a drive to succeed.

Miami Grill® has all the systems, tools and procedures to give you the blueprint for success. It is up to the individual franchisee to utilize these. At the end of training you will know every aspect of the business model. The restaurant business is a fast paced fun environment but it is not for everyone. It’s a business where you must have leadership and coaching skills to train your staff to help run the operation. After all, no owner can be at their business 24/7.

In addition, we teach bookkeeping methodology and administration of Human Resources. Also, how to monitor your key performance indicators such as food cost and labor costs. You can’t manage what you don’t measure. New franchisees spend between 4-6 weeks in a Miami Grill® operation learning how to make each product and understand each piece of equipment. The trainee learns the requirements of each station and learns how each individual creates the magic of the Miami Grill® experience.

The key to our Miami Grill® experience is consistency. A Gyro eaten in South Beach should be the same proprietary product as a Gyro eaten in Fort Wayne, Indiana. It’s the excellent systems that insure this happens. Each product has specific instructions to build to Miami Grill® specifications.

According to the SBA less than 25% of all businesses survive over 15 years, Miami Grill® has been in business for over 28 years. For more information about small business go to: https://www.sba.gov/sites/default/files/advocacy /FAQ_March_2014_0.pdf

We can teach you how to make a cheesesteak. We can teach you how to read your profit and loss statements. How to find a great location. We will show you how to train and treat your staff. We can show you how to market your business in your neighborhood. We can show you how to be a vital part of the community.

What we can’t do, is do it for you. You have to have the passion to run your own business. You have to supply the drive to make this business thrive. Your success is our success and our success is yours. If you have that must win attitude, it will make all the difference in the world. It all comes down to serving a great product in a clean inviting restaurant with a team that makes you feel welcome. BE THE BEST 24

WHAT ATTRIBUTES MAKE PASSION A GOOD MIAMI GRILL® The passion to build a new business from nothing to something. To put your heart and soul into making this a thriving business. It all FRANCHISEE? comes down to the heart.

If you are interested in becoming AVERSION TO RISK an Area Developer or a Multi-Unit Most people believe that in order to be a successful franchisee you owner call us to discuss what need to be a risk taker. However, an ideal candidate wants to follow attributes you will need. the systems, tools and processes that the franchisor has developed to provide the greatest opportunity for their success. An entrepreneur on the other hand wants to come up with new ways of doing things and create their own systems and are less likely to follow the estab- lished methods.

ABILITY TO FOLLOW THE RULES You are not opening your own business. You are part of the Miami Grill® system. The strength of our brand is having each franchise doing tasks in a consistent manner. Customers walk into a Miami Grill® business to experience the brand, not a franchisees interpretation of it. We are only as strong as our weakest franchise restaurant.

OPTIMISTIC A strong franchise candidate has a great attitude. Instead of complaining about problems they look for effective solutions. They look at failure as a way of not doing something. They make mistakes a learning tool not a burden.

A PEOPLE PERSON They have strong interpersonal skills. They are able to communicate well with the franchisor, the customer and their employees. They truly enjoy networking, being involved in the community, and working to coach their employees, build customer loyalty, and contribute to the community that supports their business.

COOL, CALM AND COLLECTED In order to run a successful operation, they have to be the voice of reason. In the heat of battle, they keep their composure and calm others down. The more hectic things get the calmer they become. They rarely show any frustration or anger. BE THE BEST 25

WHAT ATTRIBUTES MAKE GOAL ORIENTED A GOOD MIAMI GRILL® They are willing to do what it takes to make the business successful. They understand that the systems, tools and procedures of the FRANCHISEE? franchise only work if they take an active role in implementing them. They put in the long hours, do any task, pitch in and help where needed. They set the goals and work to achieve the results to meet those goals. Once the goal is achieved they set a new goal and figure out how to reach new heights.

FLEXIBLE AND RESILIENT They are able to adjust to difficult situations and they figure a way to work around the issue. They are able to rebound from an obstacle. They remain positive that the future will improve. Any problem is a temporary setback.

THEY KEEP THE END IN MIND They realize all the work of today is to achieve their future goals. They understand that if they follow the proper steps they will reach the goals they desire. They never take their eye off the target.

ASK FOR HELP They understand they don’t know everything. As the old saying goes, they are working for themselves but not by themselves. They must be willing to call and ask for help. The only stupid question is the one that isn’t asked. Our teams’ support validates that they made the right choice with Miami Grill®. Their success will be our success and they will be our best sales force for new franchisees.

MULTI-TASK AND TIME MANAGEMENT Effective franchisees keep the main thing the main thing. They have to be able to juggle multiple tasks that are both urgent and important. Time management is a key skill set to understand the priorities to ensure a productive day. TESTIMONIALS 26

WHAT ARE OUR OWNER’S “I love what I do! I love Miami Grill® I love the people SAYING ABOUT US? at the corporate offices and I have a great relationship with them. I feel that we work well together. “

John Nakis, Multi-unit Owner

“Since my childhood, Miami Subs® has been one of my favorite Miami spots, it’s an incredible feeling to take ownership in a brand that’s so close to home!”

Armando Christian Perez aka PITBULL, Equity Partner

“I am absolutely thrilled to be part of the fresh and new direction Miami Grill® is taking” Dan Finlayson, Franchisee

“Miami Grill® is the hottest brand out there. We are excited to launch our new South Beach location.” Vito Reznik, Franchisee

“With all the franchise concepts to choose from I’m happy I selected Miami Grill®. Fresh food and new look shows me their vision for the future. J.C. Rivera, Franchisee OPPORTUNITIES 27

WHAT OPPORTUNITIES We have territories available throughout the United States and worldwide! ARE AVAILABLE? Many great regions for multi-unit owners are available. We offer exclusive territories with a 3-5 restaurant deal. We are also seeking Area Developers to assist us in growing larger territories.

AREA DEVELOPERS – We are looking for area developers throughout the country to help grow the Miami Grill brand. A minimum territory would hold 10 restaurants that could be less depending on size of market. An Area Developer is an agent of the franchisor and receives a commission on each franchise sold and a percentage of the weekly royalty fee to provide continued support to the franchisees in the Area Developers Territory

MULTI-UNIT OWNERS – We have prime exclusive territories we can offer an individual who wants to develop multi-units in an area.

SINGLE UNIT OPERATORS – We always have locations for that individual who wants to be in business for themselves but not by themselves. REAL ESTATE 28

THE IDEAL LOCATION? SITE SELECTION: Location, location, location is the beginning of a good business. We work hard with you to find the best locations in your area. We have a long list of criteria we use to determine the viability of the proposed location (link to site info). Our first preference is a stand-alone building with a drive-thru. Ideal- ly these would be 2nd generation sites where a restaurant already existed thereby providing some potential cost savings. Second, is an end cap with a drive-thru, again 2nd generation is ideal. Third is an end cap or an in line with a strong anchor such as a supermarket or a large retail chain operator.

BASIC NEEDS FOR A GOOD LOCATION:

1. Free standing building with drive-thru

2. Good Visibility – you have to see the building or the sign from a distance

3. Ease of Ingress and Egress – the easier to get in and out the more likely customers will visit

4. Ample Parking – a minimum of 1 space for every 2 seats in the restaurant plus spaces for staff or off site or adjacent parking for them. Ideal is 78 seats, 45 spaces

5. Good Tenant Mix – does the current tenant mix draw a similar customer profile?

6. Strong Traffic Count – 20-30 thousand cars per day

7. Population and Income Levels of Area Population – what is the daytime, nighttime and workplace population within 1,2, and 3 miles?

8. Size of location – 2500-3000 square ft. ADJACENT TENANT SPACE (N.I.C.) ACCESSIBLE 24 BATHROOM MEN'S 25B 25A 25 26A 26 ACCESSIBLE BATHROOM WOMEN'S 26B F1 F1 27 27 42 52 24 38 51 47 49 46 36 37 05 (REAR OF BUILDING) 59 EXISTING EXTERIOR C 57A 44 41 35 F2 57 38 3 10 FRONT KITCHEN/ 02 03 SERVICE AREA 22A 48 39 COVERED WALKWAY EXISTING EXTERIOR (FRONT ENTRANCE)

06 3 DINING AREA DINING 37 21 45B F4 38 32A 22 23 32 45 39 32 29 30A 32 33 07 28 56A 30 34 F4 56 F4 43 BACK KITCHEN AREA F3 45A 01 15 21 15A 2 3 EXISTING EXTERIOR (SIDE OF BUILDING) 18 2 09 11 16 17 12 14 12A 19 20 08 LEADERSHIP 29

WHO IS THE MIAMI GRILL® CO-PRESIDENT AND CHAIRMAN OF THE BOARD OF DIRECTORS: LEADERSHIP? BERNARD H. VOGEL Mr. Vogel has served as a Member of the Board of Directors for MSCPI and MSUSA since May 2007. In June 2010, he became President and Chairman of the Board of Directors. He is also currently, and has been since January 1967, self-employed as an attorney in New York State.

CEO, CO-PRESIDENT AND MEMBER OF THE BOARD OF DIRECTORS: RICHARD CHWATT Mr. Chwatt has been our CEO since January 2011. Mr. Chwatt has served as our Vice President and now Co-President as well as a Member of our Board of Directors since June 2010. Since 1979, Mr. Chwatt has been Chairman and Chief Executive Officer for Jericho State Capital Corp. headquartered in Boca Raton, Florida. Since May 2007, he has been President and Chief Executive Officer for RC Food Services, LLC headquartered in Boca Raton, Florida.

EQUITY OWNER AND AREA DEVELOPER: ARMANDO CHRISTIAN PEREZ AKA PITBULL Mr. Perez is an equity owner since July 2012, with development rights in Latin America. He is known worldwide as a global superstar, as a recording artist and performing artist. He or his assignee has a seat on the Board of Directors.

VICE PRESIDENT: FRANK BARAN Mr. Baran has served as our Vice President of Operations since June 2010 and from January 2009 to June 2010 he was our Chief Compliance Officer. He previously served with us in several capacities between 1991 and June 2003, including as Vice President of Operations, Vice President of Non- Traditional Operations, and Director of Franchise Operations. Mr. Baran is currently the owner of Jupiter Academy of Music, Inc., in Jupiter, Florida, a position he has held since the Jupiter Academy of Music opened in August 2002.

DIRECTOR OF TRAINING: AMBROSE WHYMS Mr. Whyms has served as our Director of Training since our inception in October 2007. Before that, from March 1993 to October 2007, he served us and MSUSA in several capacities, including Store Manager, Area Representative and Director. LEADERSHIP 30

WHO IS THE MIAMI GRILL® VICE PRESIDENT OF FRANCHISE DEVELOPMENT: ROBERT HAAR LEADERSHIP? Mr. Haar has served as our Vice President of Franchise Development since May 2011.

EXECUTIVE VICE PRESIDENT OF OPERATIONS AND MARKETING: STEVEN H. KLASS Mr. Klass joined the organization in August, 2013. From April, 2010 through August, 2013 he was President and CEO of Klass & Associates Consulting, Inc., a full service restaurant consulting firm. From September, 2007 through April, 2010 he was Senior Vice President of Operations for Boston Market Corporation overseeing operations of 530 corporate restaurants nationwide, all catering operations, training, operations services, restaurant technology and risk management. Mr. Klass was previously with Miami Subs in 1989 – 1993 as Senior Vice President of Operations, Director of Research and Development and became a Miami Subs franchisee.

EXECUTIVE VICE PRESIDENT: EVAN B. FRIEDMAN Mr. Friedman has served as our Executive Vice President since March 2013 and is currently involved with business development and sales, as well as assisting in growth of the expansion of Miami Grill. From 2009 to July 2011, Mr. Friedman was President and Co-owner of Promo Media Concepts, Inc., an advertising and marketing company located in NYC, NY. Prior to joining the Miami Subs family, Mr. Friedman then served as the Vice President Director of Marketing for Pico Manufacturing Sales Corp., a family underwear and sleepwear business also located in NYC, NY from August 2001 through February 2013.

CHIEF FINANCIAL OFFICER: MELANIE SATISKY Ms. Satisky has been involved with the organization since September 2010 and is now servings as our CFO. Prior to this, Ms. Satisky worked for VISA and Ernst and Young. NEXT STEPS 31

WHAT NEXT? A franchise is all about relationships. This is a long-term commitment. We will start to explore if we are suited for each other. It’s a mutual due diligence process. Are we right for you and are you right for us? During this time, we get to find this out.

It starts with you filling out our initial application, then our Franchise Application and NDA, so you can learn about us and then get the Federal Disclosure Document. Then, please follow our steps as outlined on our website (MyMiamiGrill.com). This allows us to share some proprietary information with you about Miami Grill® (which does not obligate you or us in any way).

We will then set up a time for discussing this further and answering questions you will have.

OUR PROMISE TO YOU:

We look at every prospect as a long-term relationship. A good Franchise system is always about the relationship. Your success is vital our success. The goal from both sides is to protect the brand and help it grow profitably. We will be honest with you and we expect you to do the same. It’s all about transparency, honesty and integrity. If we have that kind of discussion no matter what the out- come is, we all benefit.