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Exhibit 1 provides the company description for Applebee’s, which includes industry
information and historical financial data.
Exhibit 1
Applebee’s Neighborhood Grill & Bar is the largest casual dining concept in America, both in
terms of number of restaurants and market share. As of Dec. 31, 2006, there were 1,930
Applebee’s Neighborhood Grill & Bar restaurants, of which 1,409 were operated by
franchisees and 521 were operated by the company.
The company’s common stock trades on The NASDAQ Global Select Market® under the
symbol APPB.
For the fiscal year ended December 2006, the company generated revenues of $1,338 milion,
an increase of 9.9% on the previous year. The company saw a net income of $81 million
during fiscal 2006, an decrease of -20.6% on fiscal 2005.
Financial performance
For the fiscal year ended December 31, 2006, total system-wide sales for the Applebee’s
brand, which includes both company and franchise restaurants, climbed 9.9 percent over the
prior year. Total company revenue for the year grew 9.4 percent to $1.3 billion. Net earnings
for fiscal 2006 were $81.0 million or -20.6 percent less than 2005. This is a disappointing
result and is the second time in a row in the company’s history that earnings failed to exceed
the prior year. Through 2006 year-end, Applebee’s has achieved system-wide comparable
sales growth for 30 consecutive quarters. Comparing restaurants open for at least 18 months,
system-wide comparable sales for 2006 increased 1.8 percent, with franchise restaurant
comparable sales growing 2.7 percent for the year and company comparable sales declining
0.9 percent a gap driven both by the timing of sales initiatives and the concentration of
company restaurants in the Midwest and Northeast, which have experienced economic
weakness.
1
Per Applebee’s website www.applebees.com
Exhibit 1
• Applebee's
• Bahama Breeze
• Bennigan's
• Bob Evans
• Buca di Beppo
• Carrabba's Italian Grill
• The Cheesecake Factory
• Chi-Chi's
• Chili's
• Cracker Barrel Old Country Store
• Damon's
• Don Pablo's
• Down Under Steakhouse
• Hops
• Logan's Roadhouse
• Lone Star Steakhouse
• Morton's of Chicago Steakhouse
• O'Charley's
• Olive Garden
• On The Border
• Outback Steakhouse
• P.F. Chang's China Bistro
• Red Lobster
• Romano's Macaroni Grill
• Ruby Tuesday's
• Smokey Bones BBQ
• Stoney River Legendary Steaks
• TGI Friday's
Future Expectations
Market Size
Over the past decade, the rise in the number of double-income families has spurred
commercial restaurant sales, with increases in food eaten on-premise and ordered for
carryout, drive-through or delivery. Despite the recession beginning in 2001, the intensely
competitive restaurant industry maintained steady growth with no down years. The restaurant
Exhibit 1
industry is typically the top performing sector exiting a recession, with the economic
downturn in the early 2000’s being no exception. In 2004, restaurant revenues totaled $470
billion based on growth of 5.4 percent per year in the 1999-2004 period. In the previous five-
year period (1994-1999), annual growth averaged 4.5 percent. In 2004, away-from-home, or
restaurant sales, accounted for 46.8 percent of the food dollar in the US, up from 46.4 percent
in 1999. In addition, over the past decade, growth in consumer food expenditures has
significantly outpaced population growth in part due to a shift in the food product mix toward
higher value products, especially convenience items. In addition, as an outgrowth of
consumer demands for convenience of all types, dining out has become more routine and is
viewed as a social activity and no longer as a special occasion.
Market Environment
A number of factors impact the US restaurant industry, although most are beyond the direct
control of restaurant operators. The health of the overall economy, as well as personal
consumption expenditures and disposable personal income are major factors. These factors
influence how much consumers are willing to spend on commercially prepared meals, the
frequency of dining away from home and the types of restaurants frequented.
Population patterns also have major effects on consumer spending, including restaurant
expenditures. Favorable growth in mature population segments influences the overall
restaurant revenue level and which eating and drinking places will benefit. Older population
segments are more affluent than younger consumers and are willing to pay for the
convenience of restaurant foods. The outlook for restaurants is also affected by changing
dietary patterns and consumer lifestyles (i.e., many people working longer hours and having
busier schedules, which allows for less time to prepare meals).
Establishment Forecasts
Restaurant revenues are forecast to reach $590 billion in 2009 based on growth of 4.7 percent
per year in the 2004-2009 period. Gains will be stimulated by the rising proportion of food
expenditures on food away-from-home as consumers will be willing to pay for convenient,
ready-to-eat offerings that provide different choices than what is typically prepared at home.
In 2009, away-from-home food expenditures are expected to account for 47.2 percent of
consumer food expenditures, which is up 0.2 percent from 2004. Moreover, the availability of
prepared foods from supermarkets and other retail stores, along with increased takeout
offerings from full service restaurants, is a response to consumer demands for increased
Exhibit 1
convenience and will provide further avenues of growth in the away-from-home food
segment.
Full service restaurant revenues are projected to reach $210 billion in 2009 based on annual
increases of 4.9 percent from 2004. These above-average advances will be due to consumers
continuing to view dining out as a social activity that is not limited to special occasions. The
willingness to pay for the convenience of prepared foods featuring flavors, cuisines and
presentations that are more difficult to achieve at home will stimulate business in full service
restaurants, as will rebounds in domestic and international tourism. Growth in the number of
establishments will trail revenue gains, with the number of full service restaurants reaching
209,000 in 2009 based on expansion of 0.9 percent per year from 2004.
• The fastest revenue growth is expected in the casual dining segment based on favorable
gains in disposable personal income and the combination of convenience and value
provided by such establishments. Moreover, the rapid expansion of upscale casual dining
chain restaurants, which have greater economies of scale and marketing clout than
independents, will boost revenues in the segment. The rising popularity of takeout meals
from full service restaurants and the increased promotion of this option will be another
avenue of revenue growth in this segment as time-pressed consumers seek the
convenience of restaurant foods for offsite consumption.
Top Competitors
Industry competition is currently considered medium. Although there are several large
industry participants, no one company dominates the market. The following companies are
the major competitors of Applebee’s:
• BUCA, Inc.
• Shoney’s Restaurants Inc.
• Darden Restaurants, Inc.
• McDonald’s Corporation
• Wendy’s International, Inc.
• Denny’s Corporation
• Brinker International
• CBRL Group
• Jack in the Box Inc.
• OSI Restaurant Partners, Inc.
• CKE Restaurants
• Lone Star Steakhouse & Saloon, Inc.
• Ruby Tuesday, Inc.
• Cheesecake Factory Incorporated, The
• O Charley’s Inc
• RARE Hospitality International, Inc.
• VICORP Restaurants, Inc.
• Benihana Inc.
• Silver Diner, Inc.
• Applebee’s International, Inc.
Exhibit II, Page 1 of 3 Exhibit 1
Deloitte Learning Initiative
Applebees
Business Valuation
Historical Financial Statement
Valuation as of December 31, 2006
($ Million's)
BALANCE SHEETS
Fiscal Years Ended LTM as of
Non-Current Assets
Intangible Assets 130.7 17.3% 153.0 17.4% 152.2 16.3% 145.7 16.3%
Other Non-Current Assets 36.5 4.8% 44.7 5.1% 42.0 4.5% 49.8 5.6%
Total Non-Current Assets 167.2 22.2% 197.7 22.5% 194.2 20.8% 195.5 21.9%
TOTAL ASSETS: $ 754.5 100.0% $ 878.6 100.0% $ 935.5 100.0% $ 894.0 100.0%
Non-Current Liabilities
Long-Term Debt 35.5 4.7% 180.2 20.5% 174.9 18.7% 184.0 20.6%
Other Non Current Liabilities 41.5 5.5% 50.4 5.7% 61.9 6.6% 60.4 6.8%
Deferred Taxes & ITC 29.0 3.8% 37.7 4.3% 25.1 2.7% 27.8 3.1%
Minority Interest - 0.0% - 0.0% - 0.0% - 0.0%
Total Non-Current Liabilities 106.0 14.1% 268.3 30.5% 261.9 28.0% 272.2 30.4%
TOTAL LIABILITIES 257.7 34.2% 466.0 53.0% 448.8 48.0% 414.9 46.4%
Stockholders' Equity
Preferred Stock - 0.0% - 0.0% - 0.0% - 0.0%
Common Equity 496.7 65.8% 412.6 47.0% 486.7 52.0% 479.1 53.6%
Common Stock - 0.0% - 0.0% - 0.0% - 0.0%
Capital Surplus - 0.0% - 0.0% - 0.0% - 0.0%
Retained Earnings - 0.0% - 0.0% - 0.0% - 0.0%
Treasury Stock - 0.0% - 0.0% - 0.0% - 0.0%
TOTAL STOCKHOLDERS' EQUITY 496.7 65.8% 412.6 47.0% 486.7 52.0% 479.1 53.6%
TOTAL LIABILITIES & CAPITAL $ 754.4 100.0% $ 878.6 100.0% $ 935.5 100.0% $ 894.0 100.0%
Source Notes:
[S1] Source
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Exhibit II, Page 2 of 3 Exhibit 1
Deloitte Learning Initiative
Applebees
Business Valuation
Historical Financial Statement
Valuation as of December 31, 2006
($ Million's)
INCOME STATEMENTS [D1]
Fiscal Years Ended LTM as of
Net Sales $ 1,111.6 100.0% $ 1,216.7 100.0% $ 1,337.9 100.0% $ 1,296.1 100.0%
Cost of Goods Sold 833.8 75.0% 937.6 77.1% 1,048.9 78.4% 1,016.0 78.4%
GROSS PROFIT 277.8 25.0% 279.1 22.9% 289.0 21.6% 280.1 21.6%
Operating Expenses
Research & Development - 0.0% - 0.0% - 0.0% - 0.0%
Sales & Marketing - 0.0% - 0.0% - 0.0% - 0.0%
General & Administrative 103.8 9.3% 107.5 8.8% 120.0 9.0% 116.3 9.0%
Other Operating Expenses (42.0) -3.8% (47.6) -3.9% (38.7) -2.9% (43.7) -3.4%
EBITDA [D2] 216.0 19.4% 219.2 18.0% 207.7 15.5% 207.5 16.0%
Depreciation and Amortization 46.7 4.2% 55.5 4.6% 65.5 4.9% 63.7 4.9%
EBIT [D3] 169.3 15.2% 163.7 13.5% 142.2 10.6% 143.8 11.1%
Net Interest Expense/(Income) 0.3 0.0% 2.7 0.2% 8.7 0.7% 8.6 0.7%
Non-Operating Expense/(Income) (1.4) -0.1% (1.8) -0.1% - 0.0% (0.7) -0.1%
Non-Recurring Expense/(Income) 1.9 0.2% 6.0 0.5% 11.4 0.9% 10.4 0.8%
EBT [D4] 168.5 15.2% 156.8 12.9% 122.1 9.1% 125.5 9.7%
Income Taxes 57.6 5.2% 54.7 4.5% 41.2 3.1% 42.3 3.3%
Minority Interest - 0.0% - 0.0% - 0.0% - 0.0%
NET INCOME $ 110.9 10.0% $ 102.1 8.4% $ 80.9 6.0% $ 83.2 6.4%
SUPPLEMENTAL DATA:
MARGIN SUMMARY:
Definitions:
Source Notes:
[S1] Source
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Exhibit II, Page 3 of 3 Exhibit 1
Deloitte Learning Initiative
Applebees
Business Valuation
Historical Financial Statement
Valuation as of December 31, 2006
RATIO ANALYSIS
Fiscal Years Ended LTM as of
LEVERAGE ANALYSIS
Net fixed assets/total capital 0.91 0.98 0.96 0.92
Long term debt/equity 0.07 0.44 0.36 0.38
Long term debt/total capital 0.07 0.30 0.26 0.28
Long term debt/assets 0.05 0.21 0.19 0.21
OPERATING ANALYSIS
Net fixed asset turnover 2.28 2.06 2.10 2.09
Return on average assets 15% 6% 5% 5%
Return on equity [F1] 22% 25% 17% 17%
Net Income/EBT 66% 65% 66% 66%
EBT/EBIT 100% 96% 86% 87%
EBIT/Sales 15% 14% 11% 11%
Sales/Assets 1.5 1.4 1.4 1.5
Assets/Equity 1.5 2.1 1.9 1.9
EBITDA/Sales 0.194 0.18 0.155 0.16
Source Notes:
[S1] Source
Footnotes:
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EXHIBIT 2
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Exhibit 2
Confidential
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Confidential
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Confidential
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Confidential
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Confidential
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Exhibit 2
Confidential
Certain data is the copyrighted (2005) material of Dun & Bradstreet, Inc.,
which reserves all of its rights
Page 11 of 11
EXHIBIT 3
Exhibit 3 documents the steps used and criteria considered in selecting the set of
guideline companies.
Exhibit 3
The following outlines the process utilized to select the public guideline companies.
Each Applebee’s Neighborhood Grill & Bar is designed as an attractive, friendly, neighborhood
establishment featuring moderately priced, high-quality food and beverage items, table service
and a comfortable atmosphere that appeals to all ages. As "America’s Favorite Neighbor®," each
Applebee’s restaurant reflects its local neighborhood. The decor conveys this theme with
photographs and memorabilia highlighting hometown heroes, local schools and area history.
Applebee’s Neighborhood Grill & Bar is the largest casual dining concept in America, both in
terms of number of restaurants and market share. As of Dec. 31, 2006, there were 1,930
Applebee’s Neighborhood Grill & Bar restaurants, of which 1,409 were operated by franchisees
and 521 were operated by the company.
The company’s common stock trades on The NASDAQ Global Select Market® under the symbol
APPB.
For the fiscal year ended December 2006, the company generated revenues of $1,338 million, an
increase of 9.9% on the previous year. The company saw a net income of $81 million during
fiscal 2006, an decrease of -20.6% on fiscal 2005.
Exhibit 3
3. The pool of potential guideline companies was refined based on the following criteria:
Based on the criteria listed above, the following companies were selected:
No. Company Ticker Last FY Sales Brief Description/Major Products & Services
Name ($ millions)
1 Darden Restaurants DRI $5,720.60 Darden Restaurants, Inc. engages in the ownership and
Inc. operation of casual dining restaurants in the United
States and Canada. The company operates restaurants
under the names Red Lobster, Olive Garden, Bahama
Breeze, Smokey Bones, and Seasons 52. As of May 5,
2007, it operated approximately 1,400 Red Lobster,
Olive Garden, Bahama Breeze, Smokey Bones, and
Seasons 52 restaurants. The company was founded in
1968 and is based in Orlando, Florida.
2 Brinker International EAT $4,151.30 Brinker International, Inc. primarily engages in the
Inc. ownership, operation, development, and franchising of
restaurant brands in the United States. It operates
restaurants under the names of Chili's Grill & Bar,
Romano's Macaroni Grill, Maggiano's Little Italy, and
On The Border Mexican Grill & Cantina. As of June 28,
2006, the company operated 1,622 jointly-developed and
franchised restaurants located in 49 states, and
Washington, D.C. Brinker International also has
restaurants in the countries of Australia, Bahrain,
Canada, Egypt, Great Britain, Germany, Guatemala,
Indonesia, Japan, Kuwait, Lebanon, Malaysia, Mexico,
Oman, Peru, the Philippines, Puerto Rico, Qatar, Saudi
Arabia, South Korea, Taiwan, the United Arab Emirates,
and Venezuela. The company was founded in 1977 and
is headquartered in Dallas, Texas.
3 OSI Restaurant OSI $3,941.00 OSI Restaurant Partners, Inc. engages in the
Partners, Inc. development and operation of casual dining restaurant.
As of December 31, 2006, it had 1,408 system-wide
restaurants, including 786 domestic Outback
Steakhouses, 162 international Outback Steakhouses,
Exhibit 3
4 Ruby Tuesday, Inc. RT $1,306.20 Ruby Tuesday, Inc., together with its subsidiaries,
engages in the development, ownership, operation, and
franchising of Ruby Tuesday brand casual dining
restaurants. As of October 23, 2006, it owned, operated,
or franchised 900 casual dining restaurants primarily in
the United States, the Asia Pacific region, India, Kuwait,
Puerto Rico, Canada, Mexico, Iceland, Eastern Europe,
and Central and South America. Ruby Tuesday was
founded in 1920 and is based in Maryville, Tennessee.
5 Rare Hospitality RARE $986.90 RARE Hospitality International, Inc. and its subsidiaries
International Inc. operate and franchise restaurants in the United States. It
operates company-owned restaurants, joint venture
restaurants, and franchised restaurants. As of June 21,
2007, the company owned, operated, and franchised 316
restaurants, including 286 LongHorn Steakhouse
restaurants and 28 Capital Grille restaurants. RARE
Hospitality International also operates Hemenway’s
Seafood Grille & Oyster Bar; and The Old Grist Mill
Tavern restaurant. The company was founded in 1981
and is based in Atlanta, Georgia.
Describe any special criteria for including or excluding certain guideline companies, if
necessary
BALANCE SHEETS
Fiscal Years Ended As of
Non-Current Assets
Intangible Assets 54.5 2.0% 55.7 1.9% 56.0 1.9% - 0.0%
Other Non-Current Assets 128.9 4.6% 123.3 4.2% 130.6 4.3% 184.6 6.0%
Total Non-Current Assets 183.4 6.6% 179.0 6.1% 186.6 6.2% 184.6 6.0%
TOTAL ASSETS: $ 2,780.4 100.0% $ 2,937.8 100.0% $ 3,010.3 100.0% $ 3,060.2 100.0%
Non-Current Liabilities
Long-term Debt 653.3 23.5% 350.3 11.9% 494.7 16.4% 493.9 16.1%
Other Non-Current Liabilities 135.6 4.9% 155.1 5.3% 169.0 5.6% 178.5 5.8%
Deferred Taxes & ITC 132.7 4.8% 114.8 3.9% 90.6 3.0% 86.7 2.8%
Minority Interest - 0.0% - 0.0% - 0.0% - 0.0%
Total Non-Current Liabilities 921.6 33.1% 620.2 21.1% 754.3 25.1% 759.1 24.8%
TOTAL LIABILITIES 1,605.1 57.7% 1,664.8 56.7% 1,780.4 59.1% 1,795.6 58.7%
Stockholders' Equity
Preferred Stock - 0.0% - 0.0% - 0.0% - 0.0%
Common Equity 1,175.3 42.3% 1,273.0 43.3% 1,229.8 40.9% 1,264.6 41.3%
Common Stock - 0.0% - 0.0% - 0.0% - 0.0%
Capital Surplus - 0.0% - 0.0% - 0.0% - 0.0%
Retained Earnings - 0.0% - 0.0% - 0.0% - 0.0%
Treasury Stock - 0.0% - 0.0% - 0.0% - 0.0%
TOTAL STOCKHOLDERS' EQUITY 1,175.3 42.3% 1,273.0 43.3% 1,229.8 40.9% 1,264.6 41.3%
TOTAL LIABILITIES & CAPITAL $ 2,780.4 100.0% $ 2,937.8 100.0% $ 3,010.2 100.0% $ 3,060.2 100.0%
Source Notes:
[S1] Source
C:\Documents and Settings\nscerbo\Desktop\Learning Initiative\Learning Initiative Cap IQ Final Model_unlinked_edited data 2.xls
Exhibit 4
Workpaper vii, Page 2 of 3
Deloitte Learning Initiative
Applebees
Business Valuation
Historical Financial Analysis: Guideline Company 1
Valuation as of December 31, 2006 Darden Restaurants Inc.
($ Millions)
INCOME STATEMENTS [D1]
Fiscal Years ended LTM as of
Net Sales $ 5,003.4 100.0% $ 5,278.1 100.0% $ 5,720.6 100.0% $ 5,767.3 100.0%
Cost of Goods Sold 3,902.9 78.0% 4,095.8 77.6% 4,427.5 77.4% 4,455.8 77.3%
GROSS PROFIT 1,100.5 22.0% 1,182.3 22.4% 1,293.1 22.6% 1,311.5 22.7%
Operating Expenses
Research & Development - 0.0% - 0.0% - 0.0% - 0.0%
Sales & Marketing - 0.0% - 0.0% - 0.0% - 0.0%
General & Administrative - 0.0% - 0.0% - 0.0% - 0.0%
Other Operating Expenses 472.1 9.4% 497.5 9.4% 1,027.3 18.0% 1,036.7 18.0%
EBITDA [D2] 628.4 12.6% 684.8 13.0% 265.8 4.6% 274.8 4.8%
Depreciation and Amortization 210.0 4.2% 213.2 4.0% 221.5 3.9% 224.1 3.9%
EBIT [D3] 418.4 8.4% 471.6 8.9% 44.3 0.8% 50.7 0.9%
Net Interest Expense/(Income) 43.7 0.9% 43.1 0.8% 43.1 0.8% 42.4 0.7%
Non-Operating Expense/(Income) - 0.0% - 0.0% - 0.0% - 0.0%
Non-Recurring Expense/(Income) 41.9 0.8% 4.5 0.1% 18.7 0.3% 23.3 0.4%
EBT [D4] 332.8 6.7% 424.0 8.0% (17.5) -0.3% (15.0) -0.3%
Income Taxes 105.6 2.1% 133.3 2.5% 144.3 2.5% 143.9 2.5%
Minority Interest - 0.0% - 0.0% - 0.0% - 0.0%
NET INCOME $ 227.2 4.5% $ 290.7 5.5% $ (161.8) -2.8% $ (158.9) -2.8%
SUPPLEMENTAL DATA:
MARGIN SUMMARY:
Definitions:
Source Notes:
[S1] Source
C:\Documents and Settings\nscerbo\Desktop\Learning Initiative\Learning Initiative Cap IQ Final Model_unlinked_edited data 2.xls
Exhibit 4
Workpaper vii, Page 3 of 3
Deloitte Learning Initiative
Applebees
Business Valuation
Historical Financial Analysis: Guideline Company 1
Valuation as of December 31, 2006 Darden Restaurants Inc.
RATIO ANALYSIS
Fiscal Years Ended LTM as of
LEVERAGE ANALYSIS
Net fixed assets/total capital 1.22 1.22 1.28 1.23
Long term debt/equity 0.56 0.28 0.40 0.39
Long term debt/total capital 0.36 0.22 0.29 0.28
Long term debt/assets 0.23 0.12 0.16 0.16
OPERATING ANALYSIS
Net fixed asset turnover 2.22 2.24 2.34 2.35
Return on average assets 16% 10% -5% -5%
Return on equity [F1] 19% 23% -13% -13%
Net Income/EBT 68% 69% 925% 1059%
EBT/EBIT 80% 90% -40% -30%
EBIT/Sales 8% 9% 1% 1%
Sales/Assets 1.8 1.8 1.9 1.9
Assets/Equity 2.4 2.3 2.4 2.4
Source Notes:
[S1] Source
Footnotes:
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Workpaper viii, Page 1 of 3 Exhibit 4
Deloitte Learning Initiative
Applebees
Business Valuation
Historical Financial Analysis: Guideline Company 2
Valuation as of December 31, 2006 Brinker International Inc.
($ Millions)
BALANCE SHEETS
Fiscal Years Ended As of
Non-Current Assets
Intangible Assets 158.1 7.0% 124.7 5.8% 145.5 6.5% 145.3 6.5%
Other Non-Current Assets 81.5 3.6% 71.9 3.3% 41.3 1.9% 47.6 2.1%
Total Non-Current Assets 239.6 10.6% 196.6 9.1% 186.8 8.4% 192.9 8.6%
TOTAL ASSETS: $ 2,254.4 100.0% $ 2,156.0 100.0% $ 2,221.8 100.0% $ 2,243.0 100.0%
Non-Current Liabilities
Long-term Debt 639.3 28.4% 406.5 18.9% 500.5 22.5% 504.9 22.5%
Other Non-Current Liabilities 153.0 6.8% 163.1 7.6% 141.0 6.3% 148.2 6.6%
Deferred Taxes & ITC 72.5 3.2% 56.2 2.6% 7.0 0.3% - 0.0%
Minority Interest - 0.0% - 0.0% - 0.0% - 0.0%
Total Non-Current Liabilities 864.8 38.4% 625.8 29.0% 648.5 29.2% 653.1 29.1%
TOTAL LIABILITIES 1,244.0 55.2% 1,055.8 49.0% 1,145.9 51.6% 1,145.8 51.1%
Stockholders' Equity
Preferred Stock - 0.0% - 0.0% - 0.0% - 0.0%
Common Equity 1,010.4 44.8% 1,100.3 51.0% 1,075.8 48.4% 1,097.3 48.9%
Common Stock - 0.0% - 0.0% - 0.0% - 0.0%
Capital Surplus - 0.0% - 0.0% - 0.0% - 0.0%
Retained Earnings - 0.0% - 0.0% - 0.0% - 0.0%
Treasury Stock - 0.0% - 0.0% - 0.0% - 0.0%
TOTAL STOCKHOLDERS' EQUITY 1,010.4 44.8% 1,100.3 51.0% 1,075.8 48.4% 1,097.3 48.9%
TOTAL LIABILITIES & CAPITAL $ 2,254.4 100.0% $ 2,156.1 100.0% $ 2,221.7 100.0% $ 2,243.1 100.0%
Source Notes:
[S1] Source
C:\Documents and Settings\nscerbo\Desktop\Learning Initiative\Learning Initiative Cap IQ Final Model_unlinked_edited data 2.xls
Exhibit 4
Workpaper viii, Page 2 of 3
Deloitte Learning Initiative
Applebees
Business Valuation
Historical Financial Analysis: Guideline Company 2
Valuation as of December 31, 2006 Brinker International Inc.
($ Million's)
INCOME STATEMENTS [D1]
Fiscal Years ended LTM as of
Net Sales $ 3,541.0 100.0% $ 3,749.5 100.0% $ 4,151.3 100.0% $ 4,215.3 100.0%
Cost of Goods Sold 2,905.1 82.0% 3,136.3 83.6% 3,425.5 82.5% 3,473.6 82.4%
GROSS PROFIT 635.9 18.0% 613.2 16.4% 725.8 17.5% 741.7 17.6%
Operating Expenses
Research & Development - 0.0% - 0.0% - 0.0% - 0.0%
Sales & Marketing - 0.0% - 0.0% - 0.0% - 0.0%
General & Administrative 147.9 4.2% 151.0 4.0% 174.9 4.2% 173.8 4.1%
Other Operating Expenses 2.7 0.1% 2.1 0.1% 32.2 0.8% 36.4 0.9%
EBITDA [D2] 485.3 13.7% 460.1 12.3% 518.7 12.5% 531.5 12.6%
Depreciation and Amortization 167.8 4.7% 179.9 4.8% 190.2 4.6% 191.7 4.5%
EBIT [D3] 317.5 9.0% 280.2 7.5% 328.5 7.9% 339.8 8.1%
Net Interest Expense/(Income) 11.5 0.3% 25.3 0.7% 22.9 0.6% 23.7 0.6%
Non-Operating Expense/(Income) 1.7 0.0% 1.5 0.0% (1.7) 0.0% (2.3) -0.1%
Non-Recurring Expense/(Income) 69.2 2.0% 61.9 1.7% 2.0 0.0% 0.8 0.0%
EBT [D4] 235.1 6.6% 191.5 5.1% 305.3 7.4% 317.6 7.5%
Income Taxes 82.9 2.3% 33.1 0.9% 91.4 2.2% 94.5 2.2%
Minority Interest - 0.0% - 0.0% - 0.0% - 0.0%
NET INCOME $ 152.2 4.3% $ 158.4 4.2% $ 213.9 5.2% $ 223.1 5.3%
SUPPLEMENTAL DATA:
MARGIN SUMMARY:
Definitions:
Source Notes:
[S1] Source
C:\Documents and Settings\nscerbo\Desktop\Learning Initiative\Learning Initiative Cap IQ Final Model_unlinked_edited data 2.xls
Exhibit 4
Workpaper viii, Page 3 of 3
Deloitte Learning Initiative
Applebees
Business Valuation
Historical Financial Analysis: Guideline Company 2
Valuation as of December 31, 2006 Brinker International Inc.
RATIO ANALYSIS
Fiscal Years Ended LTM as of
LEVERAGE ANALYSIS
Net fixed assets/total capital 0.97 1.09 1.14 1.13
Long term debt/equity 0.63 0.37 0.47 0.46
Long term debt/total capital 0.39 0.27 0.32 0.32
Long term debt/assets 0.28 0.19 0.23 0.23
OPERATING ANALYSIS
Net fixed asset turnover 2.19 2.28 2.32 2.32
Return on average assets 7% 4% 5% 5%
Return on equity [F1] 15% 14% 20% 20%
Net Income/EBT 65% 83% 70% 70%
EBT/EBIT 74% 68% 93% 94%
EBIT/Sales 9% 8% 8% 8%
Sales/Assets 1.6 1.7 1.9 1.9
Assets/Equity 2.2 2.0 2.1 2.0
Source Notes:
[S1] Source
Footnotes:
C:\Documents and Settings\nscerbo\Desktop\Learning Initiative\Learning Initiative Cap IQ Final Model_unlinked_edited data 2.xls
Workpaper ix, Page 1 of 3 Exhibit 4
Deloitte Learning Initiative
Applebees
Business Valuation
Historical Financial Analysis: Guideline Company 3
Valuation as of December 31, 2006 OSI Restaurant Partners, Inc.
($ Millions)
BALANCE SHEETS
Fiscal Years Ended As of
Non-Current Assets
Intangible Assets 144.4 8.3% 139.9 7.0% 191.9 8.5% 141.4 6.8%
Other Non-Current Assets 112.9 6.5% 202.3 10.1% 202.6 9.0% 248.5 12.0%
Total Non-Current Assets 257.3 14.8% 342.2 17.0% 394.5 17.5% 389.9 18.8%
TOTAL ASSETS: $ 1,733.4 100.0% $ 2,009.5 100.0% $ 2,258.6 100.0% $ 2,076.6 100.0%
Non-Current Liabilities
Long-term Debt 90.2 5.2% 121.9 6.1% 209.6 9.3% 219.2 10.6%
Other Non-Current Liabilities 120.0 6.9% 200.0 10.0% 226.7 10.0% 202.6 9.8%
Deferred Taxes & ITC - 0.0% - 0.0% - 0.0% - 0.0%
Minority Interest 48.1 2.8% 44.3 2.2% 36.9 1.6% 43.0 2.1%
Total Non-Current Liabilities 258.3 14.9% 366.2 18.2% 473.2 21.0% 464.8 22.4%
TOTAL LIABILITIES 686.3 39.6% 865.1 43.1% 1,037.4 45.9% 857.8 41.3%
Stockholders' Equity
Preferred Stock - 0.0% - 0.0% - 0.0% - 0.0%
Common Equity 1,047.1 60.4% 1,144.4 56.9% 1,221.2 54.1% 1,218.8 58.7%
Common Stock - 0.0% - 0.0% - 0.0% - 0.0%
Capital Surplus - 0.0% - 0.0% - 0.0% - 0.0%
Retained Earnings - 0.0% - 0.0% - 0.0% - 0.0%
Treasury Stock - 0.0% - 0.0% - 0.0% - 0.0%
TOTAL STOCKHOLDERS' EQUITY 1,047.1 60.4% 1,144.4 56.9% 1,221.2 54.1% 1,218.8 58.7%
TOTAL LIABILITIES & CAPITAL $ 1,733.4 100.0% $ 2,009.5 100.0% $ 2,258.6 100.0% $ 2,076.6 100.0%
Source Notes:
[S1] Source
C:\Documents and Settings\nscerbo\Desktop\Learning Initiative\Learning Initiative Cap IQ Final Model_unlinked_edited data 2.xls
Workpaper ix, Page 2 of 3 Exhibit 4
Deloitte Learning Initiative
Applebees
Business Valuation
Historical Financial Analysis: Guideline Company 3
Valuation as of December 31, 2006 OSI Restaurant Partners, Inc.
($ Million's)
INCOME STATEMENTS [D1]
Fiscal Years ended LTM as of
Net Sales $ 3,216.0 100.0% $ 3,612.7 100.0% $ 4,191.0 100.0% $ 4,019.7 100.0%
Cost of Goods Sold 2,020.3 62.8% 2,245.7 62.2% 2,502.7 59.7% 2,372.1 59.0%
GROSS PROFIT 1,195.7 37.2% 1,367.0 37.8% 1,688.3 40.3% 1,647.6 41.0%
Operating Expenses
Research & Development - 0.0% - 0.0% - 0.0% - 0.0%
Sales & Marketing - 0.0% - 0.0% - 0.0% - 0.0%
General & Administrative 174.0 5.4% 197.1 5.5% 222.4 5.3% 203.4 5.1%
Other Operating Expenses 667.8 20.8% 783.8 21.7% 894.9 21.4% 853.2 21.2%
EBITDA [D2] 353.9 11.0% 386.1 10.7% 571.0 13.6% 591.0 14.7%
Depreciation and Amortization 104.8 3.3% 127.8 3.5% 151.6 3.6% 139.0 3.5%
EBIT [D3] 249.1 7.7% 258.3 7.1% 419.4 10.0% 452.0 11.2%
Net Interest Expense/(Income) 2.3 0.1% 4.8 0.1% 11.5 0.3% 7.1 0.2%
Non-Operating Expense/(Income) 0.4 0.0% 5.8 0.2% (5.2) -0.1% (0.7) 0.0%
Non-Recurring Expense/(Income) 7.0 0.2% 26.1 0.7% 14.3 0.3% 20.5 0.5%
EBT [D4] 239.4 7.4% 221.6 6.1% 398.8 9.5% 425.1 10.6%
Income Taxes 78.6 2.4% 73.8 2.0% 41.8 1.0% 53.9 1.3%
Minority Interest 9.2 0.3% 1.2 0.0% 6.8 0.2% 0.4 0.0%
NET INCOME $ 151.6 4.7% $ 146.6 4.1% $ 350.2 8.4% $ 370.8 9.2%
SUPPLEMENTAL DATA:
MARGIN SUMMARY:
Definitions:
Source Notes:
[S1] Source
C:\Documents and Settings\nscerbo\Desktop\Learning Initiative\Learning Initiative Cap IQ Final Model_unlinked_edited data 2.xls
Workpaper ix, Page 3 of 3 Exhibit 4
Deloitte Learning Initiative
Applebees
Business Valuation
Historical Financial Analysis: Guideline Company 3
Valuation as of December 31, 2006 OSI Restaurant Partners, Inc.
RATIO ANALYSIS
Fiscal Years Ended LTM as of
LEVERAGE ANALYSIS
Net fixed assets/total capital 1.04 1.04 1.04 0.97
Long term debt/equity 0.09 0.11 0.17 0.18
Long term debt/total capital 0.08 0.10 0.15 0.15
Long term debt/assets 0.05 0.06 0.09 0.11
OPERATING ANALYSIS
Net fixed asset turnover 2.61 2.60 2.71 2.72
Return on average assets 9% 4% 8% 9%
Return on equity [F1] 15% 13% 29% 30%
Net Income/EBT 63% 66% 88% 87%
EBT/EBIT 96% 86% 95% 94%
EBIT/Sales 8% 7% 10% 11%
Sales/Assets 1.9 1.8 1.9 1.9
Assets/Equity 1.7 1.8 1.8 1.7
Source Notes:
[S1] Source
Footnotes:
C:\Documents and Settings\nscerbo\Desktop\Learning Initiative\Learning Initiative Cap IQ Final Model_unlinked_edited data 2.xls
Workpaper x, Page 1 of 3 Exhibit 4
Deloitte Learning Initiative
Applebees
Business Valuation
Historical Financial Analysis: Guideline Company 4
Valuation as of December 31, 2006 Ruby Tuesday, Inc.
($ Millions)
BALANCE SHEETS
Fiscal Years Ended As of
Non-Current Assets
Intangible Assets 11.8 6.8% 21.6 12.3% 20.9 11.0% 17.0 1.4%
Other Non-Current Assets 96.4 55.9% 88.5 50.3% 88.3 46.4% 90.2 7.5%
Total Non-Current Assets 108.2 62.7% 110.1 62.6% 109.2 57.4% 107.2 8.9%
TOTAL ASSETS: $ 172.5 100.0% $ 175.9 100.0% $ 190.2 100.0% $ 1,198.1 100.0%
Non-Current Liabilities
Long-term Debt 168.1 18.0% 247.2 23.0% 375.6 32.1% 383.5 32.0%
Other Non-Current Liabilities 110.9 11.8% 112.4 10.5% 111.1 9.5% 112.7 9.4%
Deferred Taxes & ITC 46.2 4.9% 50.8 4.7% 49.7 4.2% 47.3 3.9%
Minority Interest - 0.0% - 0.0% - 0.0% - 0.0%
Total Non-Current Liabilities 325.2 34.7% 410.4 38.2% 536.4 45.8% 543.5 45.4%
TOTAL LIABILITIES 419.9 44.8% 510.8 47.6% 644.4 55.0% 661.2 55.2%
Stockholders' Equity
Preferred Stock - 0.0% - 0.0% - 0.0% - 0.0%
Common Equity 516.5 55.2% 563.2 52.4% 527.2 45.0% 536.9 44.8%
Common Stock - 0.0% - 0.0% - 0.0% - 0.0%
Capital Surplus - 0.0% - 0.0% - 0.0% - 0.0%
Retained Earnings - 0.0% - 0.0% - 0.0% - 0.0%
Treasury Stock - 0.0% - 0.0% - 0.0% - 0.0%
TOTAL STOCKHOLDERS' EQUITY 516.5 55.2% 563.2 52.4% 527.2 45.0% 536.9 44.8%
TOTAL LIABILITIES & CAPITAL $ 936.4 100.0% $ 1,074.0 100.0% $ 1,171.6 100.0% $ 1,198.1 100.0%
Source Notes:
[S1] Source
C:\Documents and Settings\nscerbo\Desktop\Learning Initiative\Learning Initiative Cap IQ Final Model_unlinked_edited data 2.xls
Workpaper x, Page 2 of 3 Exhibit 4
Deloitte Learning Initiative
Applebees
Business Valuation
Historical Financial Analysis: Guideline Company 4
Valuation as of December 31, 2006 Ruby Tuesday, Inc.
($ Million's)
INCOME STATEMENTS [D1]
Fiscal Years ended LTM as of
Net Sales $ 1,041.4 100.0% $ 1,110.3 100.0% $ 1,306.2 100.0% $ 1,336.7 100.0%
Cost of Goods Sold 583.4 56.0% 625.3 56.3% 741.2 56.7% 757.1 56.6%
GROSS PROFIT 458.0 44.0% 485.0 43.7% 565.0 43.3% 579.6 43.4%
Operating Expenses
Research & Development - 0.0% - 0.0% - 0.0% - 0.0%
Sales & Marketing - 0.0% - 0.0% - 0.0% - 0.0%
General & Administrative (8.0) -0.8% 0.4 0.0% (1.5) -0.1% (0.6) 0.0%
Other Operating Expenses - 0.0% - 0.0% - 0.0% - 0.0%
EBITDA [D2] 466.0 44.7% 484.6 43.6% 566.5 43.4% 580.2 43.4%
Depreciation and Amortization 57.9 5.6% 66.9 6.0% 71.4 5.5% 72.7 5.4%
EBIT [D3] 408.1 39.2% 417.7 37.6% 495.1 37.9% 507.5 38.0%
Net Interest Expense/(Income) 3.7 0.4% 4.3 0.4% 12.7 1.0% 15.1 1.1%
Non-Operating Expense/(Income) (5.9) -0.6% (2.7) -0.2% (0.9) -0.1% (1.0) -0.1%
Non-Recurring Expense/(Income) 8.0 0.8% (0.4) 0.0% 1.5 0.1% 0.6 0.0%
EBT [D4] 402.3 38.6% 416.5 37.5% 481.8 36.9% 492.8 36.9%
Income Taxes 60.7 5.8% 52.6 4.7% 50.0 3.8% 49.6 3.7%
Minority Interest - 0.0% - 0.0% - 0.0% - 0.0%
NET INCOME $ 341.6 32.8% $ 363.9 32.8% $ 431.8 33.1% $ 443.2 33.2%
SUPPLEMENTAL DATA:
MARGIN SUMMARY:
Definitions:
Source Notes:
[S1] Source
C:\Documents and Settings\nscerbo\Desktop\Learning Initiative\Learning Initiative Cap IQ Final Model_unlinked_edited data 2.xls
Workpaper x, Page 3 of 3 Exhibit 4
Deloitte Learning Initiative
Applebees
Business Valuation
Historical Financial Analysis: Guideline Company 4
Valuation as of December 31, 2006 Ruby Tuesday, Inc.
RATIO ANALYSIS
Fiscal Years Ended LTM as of
LEVERAGE ANALYSIS
Net fixed assets/total capital - - - 1.11
Long term debt/equity 0.33 0.44 0.71 0.71
Long term debt/total capital 0.25 0.31 0.42 0.42
Long term debt/assets 0.97 1.41 1.97 0.32
OPERATING ANALYSIS
Net fixed asset turnover 359.10 382.86 483.78 1.31
Return on average assets 198% 104% 118% 32%
Return on equity [F1] 66% 65% 82% 83%
Net Income/EBT 85% 87% 90% 90%
EBT/EBIT 99% 100% 97% 97%
EBIT/Sales 39% 38% 38% 38%
Sales/Assets 6.0 6.3 6.9 1.1
Assets/Equity 0.3 0.3 0.4 2.2
Source Notes:
[S1] Source
Footnotes:
C:\Documents and Settings\nscerbo\Desktop\Learning Initiative\Learning Initiative Cap IQ Final Model_unlinked_edited data 2.xls
Workpaper xi, Page 1 of 3 Exhibit 4
Deloitte Learning Initiative
Applebees
Business Valuation
Historical Financial Analysis: Guideline Company 5
Valuation as of December 31, 2006 RARE Hospitality International, Inc.
($ Millions)
BALANCE SHEETS
Fiscal Years Ended As of
Non-Current Assets
Intangible Assets 23.0 13.5% 24.4 16.3% 26.2 15.4% 19.2 3.0%
Other Non-Current Assets 10.4 6.1% 13.1 8.8% 19.0 11.2% 25.8 4.0%
Total Non-Current Assets 33.4 19.7% 37.5 25.1% 45.2 26.6% 45.0 6.9%
TOTAL ASSETS: $ 169.8 100.0% $ 149.3 100.0% $ 170.0 100.0% $ 647.7 100.0%
Non-Current Liabilities
Long-term Debt 37.1 6.6% 39.0 6.5% 166.3 23.9% 40.5 6.3%
Other Non-Current Liabilities 21.7 3.9% 27.4 4.6% 33.1 4.8% 31.3 4.8%
Deferred Taxes & ITC 10.1 1.8% 3.5 0.6% 1.2 0.2% - 0.0%
Minority Interest 1.3 0.2% 1.2 0.2% 1.0 0.1% 1.1 0.2%
Total Non-Current Liabilities 70.2 12.5% 71.1 11.8% 201.6 29.0% 72.9 11.3%
TOTAL LIABILITIES 162.9 29.0% 176.6 29.4% 335.6 48.3% 184.1 28.4%
Stockholders' Equity
Preferred Stock - 0.0% - 0.0% - 0.0% - 0.0%
Common Equity 399.1 71.0% 424.3 70.6% 359.6 51.7% 463.6 71.6%
Common Stock - 0.0% - 0.0% - 0.0% - 0.0%
Capital Surplus - 0.0% - 0.0% - 0.0% - 0.0%
Retained Earnings - 0.0% - 0.0% - 0.0% - 0.0%
Treasury Stock - 0.0% - 0.0% - 0.0% - 0.0%
TOTAL STOCKHOLDERS' EQUITY 399.1 71.0% 424.3 70.6% 359.6 51.7% 463.6 71.6%
TOTAL LIABILITIES & CAPITAL $ 562.0 100.0% $ 600.9 100.0% $ 695.2 100.0% $ 647.7 100.0%
Source Notes:
[S1] Source
C:\Documents and Settings\nscerbo\Desktop\Learning Initiative\Learning Initiative Cap IQ Final Model_unlinked_edited data 2.xls
Workpaper xi, Page 2 of 3 Exhibit 4
Deloitte Learning Initiative
Applebees
Business Valuation
Historical Financial Analysis: Guideline Company 5
Valuation as of December 31, 2006 RARE Hospitality International, Inc.
($ Million's)
INCOME STATEMENTS [D1]
Fiscal Years ended LTM as of
Net Sales $ 717.5 100.0% $ 839.3 100.0% $ 986.9 100.0% $ 1,046.6 100.0%
Cost of Goods Sold 264.3 36.8% 307.7 36.7% 361.9 36.7% 382.8 36.6%
GROSS PROFIT 453.2 63.2% 531.6 63.3% 625.0 63.3% 663.8 63.4%
Operating Expenses
Research & Development - 0.0% - 0.0% - 0.0% - 0.0%
Sales & Marketing 1.2 0.2% (0.8) -0.1% (10.6) -1.1% (8.1) -0.8%
General & Administrative (2.1) -0.3% 0.2 0.0% 5.7 0.6% (0.1) 0.0%
Other Operating Expenses - 0.0% - 0.0% - 0.0% - 0.0%
EBITDA [D2] 454.1 63.3% 532.2 63.4% 629.9 63.8% 672.0 64.2%
Depreciation and Amortization 29.6 4.1% 35.1 4.2% 37.1 3.8% 42.0 4.0%
EBIT [D3] 424.5 59.2% 497.1 59.2% 592.8 60.1% 630.0 60.2%
Net Interest Expense/(Income) 1.3 0.2% 1.9 0.2% 2.6 0.3% 2.5 0.2%
Non-Operating Expense/(Income) - 0.0% - 0.0% - 0.0% - 0.0%
Non-Recurring Expense/(Income) 0.9 0.1% 0.6 0.1% 4.9 0.5% 8.2 0.8%
EBT [D4] 422.3 58.9% 494.6 58.9% 585.3 59.3% 619.3 59.2%
Income Taxes 22.8 3.2% 25.1 3.0% 23.9 2.4% 22.8 2.2%
Minority Interest 0.3 0.0% 0.2 0.0% 0.1 0.0% 0.1 0.0%
NET INCOME $ 399.2 55.6% $ 469.3 55.9% $ 561.3 56.9% $ 596.4 57.0%
SUPPLEMENTAL DATA:
MARGIN SUMMARY:
Definitions:
Source Notes:
[S1] Source
C:\Documents and Settings\nscerbo\Desktop\Learning Initiative\Learning Initiative Cap IQ Final Model_unlinked_edited data 2.xls
Workpaper xi, Page 3 of 3 Exhibit 4
Deloitte Learning Initiative
Applebees
Business Valuation
Historical Financial Analysis: Guideline Company 5
Valuation as of December 31, 2006 RARE Hospitality International, Inc.
RATIO ANALYSIS
Fiscal Years Ended LTM as of
LEVERAGE ANALYSIS
Net fixed assets/total capital - - - 0.98
Long term debt/equity 0.09 0.09 0.46 0.09
Long term debt/total capital 0.09 0.08 0.32 0.08
Long term debt/assets 0.22 0.26 0.98 0.06
OPERATING ANALYSIS
Net fixed asset turnover n.a. n.a. n.a. 2.12
Return on average assets 235% 147% 176% 73%
Return on equity [F1] 100% 111% 156% 129%
Net Income/EBT 95% 95% 96% 96%
EBT/EBIT 100% 100% 99% 98%
EBIT/Sales 59% 59% 60% 60%
Sales/Assets 4.2 5.6 5.8 1.6
Assets/Equity 0.4 0.4 0.5 1.4
Source Notes:
[S1] Source
Footnotes:
C:\Documents and Settings\nscerbo\Desktop\Learning Initiative\Learning Initiative Cap IQ Final Model_unlinked_edited data 2.xls
EXHIBIT 4A
BALANCE SHEETS
Fiscal Years Ended As of
Non-Current Assets
Intangible Assets 54.5 2.0% 55.7 1.9% 56.0 1.9% - 0.0%
Other Non-Current Assets 128.9 4.6%
% 123.3 4.2%
% 130.6 4.3%
% 184.6 6.0%
%
Total Non-Current Assets 183.4 6.6% 179.0 6.1% 186.6 6.2% 184.6 6.0%
TOTAL ASSETS: $ 2,780.4 100.0% $ 2,937.8 100.0% $ 3,010.3 100.0% $ 3,060.2 100.0%
Non-Current Liabilities
Long-term Debt 653.3 23.5% 350.3 11.9% 494.7 16.4% 493.9 16.1%
Other Non-Current Liabilities 135.6 4.9% 155.1 5.3% 169.0 5.6% 178.5 5.8%
Deferred Taxes & ITC 132.7 4.8% 114.8 3.9% 90.6 3.0% 86.7 2.8%
Minority Interest - 0.0%
% - 0.0%
% - 0.0%
% - 0.0%
%
Total Non-Current Liabilities 921.6 33.1% 620.2 21.1% 754.3 25.1% 759.1 24.8%
TOTAL LIABILITIES 1,605.1 57.7% 1,664.8 56.7% 1,780.4 59.1% 1,795.6 58.7%
Stockholders' Equity
Preferred Stock - 0.0% - 0.0% - 0.0% - 0.0%
Common Equity 1,175.3 42.3% 1,273.0 43.3% 1,229.8 40.9% 1,264.6 41.3%
Common Stock - 0.0% - 0.0% - 0.0% - 0.0%
Capital Surplus - 0.0% - 0.0% - 0.0% - 0.0%
Retained Earnings - 0.0% - 0.0% - 0.0% - 0.0%
Treasury Stock - 0.0% - 0.0% - 0.0% - 0.0%
TOTAL STOCKHOLDERS' EQUITY 1,175.3 42.3% 1,273.0 43.3% 1,229.8 40.9% 1,264.6 41.3%
TOTAL LIABILITIES & CAPITAL $ 2,780.4 100.0% $ 2,937.8 100.0% $ 3,010.2 100.0% $ 3,060.2 100.0%
Source Notes:
[S1] Source
Exhibit 4A
, Page 2 of 3
Deloitte Learning Initiative
Applebees
Business Valuation
Historical Financial Analysis: Guideline Company 1
Valuation as of December 31, 2006 Darden Restaurants Inc.
($ Millions) Unadjusted Operating Expense $1,027 Unadjusted Operating Expense $1,037
Less: Normalized Adjustment 500 Less: Normalized Adjustment 500
INCOME STATEMENTS Normalized Operating Expense $ 527 Normalized Operating Expense $ 537 [D1]
Fiscal Years ended LTM as of
Net Sales $ 5,003.4 100.0% $ 5,278.1 100.0% $ 5,720.6 100.0% $ 5,767.3 100.0%
Cost of Goods Sold 3,902.9 78.0% 4,095.8 77.6% 4,427.5 77.4% 4,455.8 77.3%
GROSS PROFIT 1,100.5 22.0% 1,182.3 22.4% 1,293.1 22.6% 1,311.5 22.7%
Operating Expenses
Research & Development - 0.0% - 0.0% - 0.0% - 0.0%
Sales & Marketing - 0.0% - 0.0% - 0.0% - 0.0%
General & Administrative - 0.0% - 0.0% - 0.0% - 0.0%
Other Operating Expenses 472.1 9.4% 497.5 9.4% 527.3 9.2% 536.7 9.3%
EBITDA [D2] 628.4 12.6% 684.8 13.0% 765.8 13.4% 774.8 13.4%
Depreciation and Amortization 210.0 4.2% 213.2 4.0% 221.5 3.9% 224.1 3.9%
EBIT [D3] 418.4 8.4% 471.6 8.9% 544.3 9.5% 550.7 9.5%
Net Interest Expense/(Income) 43.7 0.9% 43.1 0.8% 43.1 0.8% 42.4 0.7%
Non-Operating Expense/(Income) - 0.0% - 0.0% - 0.0% - 0.0%
Non-Recurring Expense/(Income) 41.9 0.8% 4.5 0.1% 18.7 0.3% 23.3 0.4%
EBT [D4] 332.8 6.7% 424.0 8.0% 482.5 8.4% 485.0 8.4%
Income Taxes 105.6 2.1% 133.3 2.5% 144.3 2.5% 143.9 2.5%
Minority Interest - 0.0% - 0.0% - 0.0% - 0.0%
NET INCOME $ 227.2 4.5% $ 290.7 5.5% $ 338.2 5.9% $ 341.1 5.9%
SUPPLEMENTAL DATA:
MARGIN SUMMARY:
Definitions:
Source Notes:
[S1] Source
Exhibit 4A
, Page 3 of 3
Deloitte Learning Initiative
Applebees
Business Valuation
Historical Financial Analysis: Guideline Company 1
Valuation as of December 31, 2006 Darden Restaurants Inc.
RATIO ANALYSIS
Fiscal Years Ended LTM as of
LEVERAGE ANALYSIS
Net fixed assets/total capital 1.22 1.22 1.28 1.23
Long term debt/equity 0.56 0.28 0.40 0.39
Long term debt/total capital 0.36 0.22 0.29 0.28
Long term debt/assets 0.23 0.12 0.16 0.16
OPERATING ANALYSIS
Net fixed asset turnover 2.22 2.24 2.34 2.35
Return on average assets 16% 10% 11% 11%
Return on equity [F1] 19% 23% 28% 27%
Net Income/EBT 68% 69% 70% 70%
EBT/EBIT 80% 90% 89% 88%
EBIT/Sales 8% 9% 10% 10%
Sales/Assets 1.8 1.8 1.9 1.9
Assets/Equity 2.4 2.3 2.4 2.4
Source Notes:
[S1] Source
Footnotes:
BALANCE SHEETS
Fiscal Years Ended As of
Non-Current Assets
Intangible Assets 158.1 7.0% 124.7 5.8% 145.5 6.5% 145.3 6.5%
Other Non-Current Assets 81.5 3.6%
% 71.9 3.3%
% 41.3 1.9%
% 47.6 2.1%
%
Total Non-Current Assets 239.6 10.6% 196.6 9.1% 186.8 8.4% 192.9 8.6%
TOTAL ASSETS: $ 2,254.4 100.0% $ 2,156.0 100.0% $ 2,221.8 100.0% $ 2,243.0 100.0%
Non-Current Liabilities
Long-term Debt 639.3 28.4% 406.5 18.9% 500.5 22.5% 504.9 22.5%
Other Non-Current Liabilities 153.0 6.8% 163.1 7.6% 141.0 6.3% 148.2 6.6%
Deferred Taxes & ITC 72.5 3.2% 56.2 2.6% 7.0 0.3% - 0.0%
Minority Interest - 0.0%
% - 0.0%
% - 0.0%
% - 0.0%
%
Total Non-Current Liabilities 864.8 38.4% 625.8 29.0% 648.5 29.2% 653.1 29.1%
TOTAL LIABILITIES 1,244.0 55.2% 1,055.8 49.0% 1,145.9 51.6% 1,145.8 51.1%
Stockholders' Equity
Preferred Stock - 0.0% - 0.0% - 0.0% - 0.0%
Common Equity 1,010.4 44.8% 1,100.3 51.0% 1,075.8 48.4% 1,097.3 48.9%
Common Stock - 0.0% - 0.0% - 0.0% - 0.0%
Capital Surplus - 0.0% - 0.0% - 0.0% - 0.0%
Retained Earnings - 0.0% - 0.0% - 0.0% - 0.0%
Treasury Stock - 0.0% - 0.0% - 0.0% - 0.0%
TOTAL STOCKHOLDERS' EQUITY 1,010.4 44.8% 1,100.3 51.0% 1,075.8 48.4% 1,097.3 48.9%
TOTAL LIABILITIES & CAPITAL $ 2,254.4 100.0% $ 2,156.1 100.0% $ 2,221.7 100.0% $ 2,243.1 100.0%
Source Notes:
[S1] Source
Exhibit 4A
, Page 2 of 3
Deloitte Learning Initiative
Applebees
Business Valuation
Historical Financial Analysis: Guideline Company 2
Valuation as of December 31, 2006 Brinker International Inc.
($ Millions)
No Adjustment Necessary No Adjustment Necessary
INCOME STATEMENTS [D1]
Fiscal Years ended LTM as of
Net Sales $ 3,541.0 100.0% $ 3,749.5 100.0% $ 4,151.3 100.0% $ 4,215.3 100.0%
Cost of Goods Sold 2,905.1 82.0% 3,136.3 83.6% 3,425.5 82.5% 3,473.6 82.4%
GROSS PROFIT 635.9 18.0% 613.2 16.4% 725.8 17.5% 741.7 17.6%
Operating Expenses
Research & Development - 0.0% - 0.0% - 0.0% - 0.0%
Sales & Marketing - 0.0% - 0.0% - 0.0% - 0.0%
General & Administrative 147.9 4.2% 151.0 4.0% 174.9 4.2% 173.8 4.1%
Other Operating Expenses 2.7 0.1% 2.1 0.1% 32.2 0.8% 36.4 0.9%
EBITDA [D2] 485.3 13.7% 460.1 12.3% 518.7 12.5% 531.5 12.6%
Depreciation and Amortization 167.8 4.7% 179.9 4.8% 190.2 4.6% 191.7 4.5%
EBIT [D3] 317.5 9.0% 280.2 7.5% 328.5 7.9% 339.8 8.1%
Net Interest Expense/(Income) 11.5 0.3% 25.3 0.7% 22.9 0.6% 23.7 0.6%
Non-Operating Expense/(Income) 1.7 0.0% 1.5 0.0% (1.7) 0.0% (2.3) -0.1%
Non-Recurring Expense/(Income) 69.2 2.0% 61.9 1.7% 2.0 0.0% 0.8 0.0%
EBT [D4] 235.1 6.6% 191.5 5.1% 305.3 7.4% 317.6 7.5%
Income Taxes 82.9 2.3% 33.1 0.9% 91.4 2.2% 94.5 2.2%
Minority Interest - 0.0% - 0.0% - 0.0% - 0.0%
NET INCOME $ 152.2 4.3% $ 158.4 4.2% $ 213.9 5.2% $ 223.1 5.3%
SUPPLEMENTAL DATA:
MARGIN SUMMARY:
Definitions:
Source Notes:
[S1] Source
Exhibit 4A
, Page 3 of 3
Deloitte Learning Initiative
Applebees
Business Valuation
Historical Financial Analysis: Guideline Company 2
Valuation as of December 31, 2006 Brinker International Inc.
RATIO ANALYSIS
Fiscal Years Ended LTM as of
LEVERAGE ANALYSIS
Net fixed assets/total capital 0.97 1.09 1.14 1.13
Long term debt/equity 0.63 0.37 0.47 0.46
Long term debt/total capital 0.39 0.27 0.32 0.32
Long term debt/assets 0.28 0.19 0.23 0.23
OPERATING ANALYSIS
Net fixed asset turnover 2.19 2.28 2.32 2.32
Return on average assets 7% 4% 5% 5%
Return on equity [F1] 15% 14% 20% 20%
Net Income/EBT 65% 83% 70% 70%
EBT/EBIT 74% 68% 93% 94%
EBIT/Sales 9% 8% 8% 8%
Sales/Assets 1.6 1.7 1.9 1.9
Assets/Equity 2.2 2.0 2.1 2.0
Source Notes:
[S1] Source
Footnotes:
BALANCE SHEETS
Fiscal Years Ended As of
Non-Current Assets
Intangible Assets 144.4 8.3% 139.9 7.0% 191.9 8.5% 141.4 6.8%
Other Non-Current Assets 112.9 6.5%
% 202.3 10.1%
% 202.6 9.0%
% 248.5 12.0%
%
Total Non-Current Assets 257.3 14.8% 342.2 17.0% 394.5 17.5% 389.9 18.8%
TOTAL ASSETS: $ 1,733.4 100.0% $ 2,009.5 100.0% $ 2,258.6 100.0% $ 2,076.6 100.0%
Non-Current Liabilities
Long-term Debt 90.2 5.2% 121.9 6.1% 209.6 9.3% 219.2 10.6%
Other Non-Current Liabilities 120.0 6.9% 200.0 10.0% 226.7 10.0% 202.6 9.8%
Deferred Taxes & ITC - 0.0% - 0.0% - 0.0% - 0.0%
Minority Interest 48.1 2.8%
% 44.3 2.2%
% 36.9 1.6%
% 43.0 2.1%
%
Total Non-Current Liabilities 258.3 14.9% 366.2 18.2% 473.2 21.0% 464.8 22.4%
TOTAL LIABILITIES 686.3 39.6% 865.1 43.1% 1,037.4 45.9% 857.8 41.3%
Stockholders' Equity
Preferred Stock - 0.0% - 0.0% - 0.0% - 0.0%
Common Equity 1,047.1 60.4% 1,144.4 56.9% 1,221.2 54.1% 1,218.8 58.7%
Common Stock - 0.0% - 0.0% - 0.0% - 0.0%
Capital Surplus - 0.0% - 0.0% - 0.0% - 0.0%
Retained Earnings - 0.0% - 0.0% - 0.0% - 0.0%
Treasury Stock - 0.0% - 0.0% - 0.0% - 0.0%
TOTAL STOCKHOLDERS' EQUITY 1,047.1 60.4% 1,144.4 56.9% 1,221.2 54.1% 1,218.8 58.7%
TOTAL LIABILITIES & CAPITAL $ 1,733.4 100.0% $ 2,009.5 100.0% $ 2,258.6 100.0% $ 2,076.6 100.0%
Source Notes:
[S1] Source
, Page 2 of 3 Exhibit 4A
Deloitte Learning Initiative
Applebees
Business Valuation
Historical Financial Analysis: Guideline Company 3
Valuation as of December 31, 2006 OSI Restaurant Partners, Inc.
($ Millions) Unadjusted Net Sales $4,191 Unadjusted Net Sales $4,020
Less: Normalized Adjustment 250 Less: Normalized Adjustment 250
INCOME STATEMENTS Normalized Net Sales $ 3,941 Normalized Net Sales $ 3,770 [D1]
Fiscal Years ended LTM as of
Net Sales $ 3,216.0 100.0% $ 3,612.7 100.0% $ 3,941.0 100.0% $ 3,769.7 100.0%
Cost of Goods Sold 2,020.3 62.8% 2,245.7 62.2% 2,502.7 63.5% 2,372.1 62.9%
GROSS PROFIT 1,195.7 37.2% 1,367.0 37.8% 1,438.3 36.5% 1,397.6 37.1%
Operating Expenses
Research & Development - 0.0% - 0.0% - 0.0% - 0.0%
Sales & Marketing - 0.0% - 0.0% - 0.0% - 0.0%
General & Administrative 174.0 5.4% 197.1 5.5% 222.4 5.6% 203.4 5.4%
Other Operating Expenses 667.8 20.8% 783.8 21.7% 894.9 22.7% 853.2 22.6%
EBITDA [D2] 353.9 11.0% 386.1 10.7% 321.0 8.1% 341.0 9.0%
Depreciation and Amortization 104.8 3.3% 127.8 3.5% 151.6 3.8% 139.0 3.7%
EBIT [D3] 249.1 7.7% 258.3 7.1% 169.4 4.3% 202.0 5.4%
Net Interest Expense/(Income) 2.3 0.1% 4.8 0.1% 11.5 0.3% 7.1 0.2%
Non-Operating Expense/(Income) 0.4 0.0% 5.8 0.2% (5.2) -0.1% (0.7) 0.0%
Non-Recurring Expense/(Income) 7.0 0.2% 26.1 0.7% 14.3 0.4% 20.5 0.5%
EBT [D4] 239.4 7.4% 221.6 6.1% 148.8 3.8% 175.1 4.6%
Income Taxes 78.6 2.4% 73.8 2.0% 41.8 1.1% 53.9 1.4%
Minority Interest 9.2 0.3% 1.2 0.0% 6.8 0.2% 0.4 0.0%
NET INCOME $ 151.6 4.7% $ 146.6 4.1% $ 100.2 2.5% $ 120.8 3.2%
SUPPLEMENTAL DATA:
MARGIN SUMMARY:
Definitions:
Source Notes:
[S1] Source
, Page 3 of 3 Exhibit 4A
Deloitte Learning Initiative
Applebees
Business Valuation
Historical Financial Analysis: Guideline Company 3
Valuation as of December 31, 2006 OSI Restaurant Partners, Inc.
RATIO ANALYSIS
Fiscal Years Ended LTM as of
LEVERAGE ANALYSIS
Net fixed assets/total capital 1.04 1.04 1.04 0.97
Long term debt/equity 0.09 0.11 0.17 0.18
Long term debt/total capital 0.08 0.10 0.15 0.15
Long term debt/assets 0.05 0.06 0.09 0.11
OPERATING ANALYSIS
Net fixed asset turnover 2.61 2.60 2.54 2.55
Return on average assets 9% 4% 2% 3%
Return on equity [F1] 15% 13% 8% 10%
Net Income/EBT 63% 66% 67% 69%
EBT/EBIT 96% 86% 88% 87%
EBIT/Sales 8% 7% 4% 5%
Sales/Assets 1.9 1.8 1.7 1.8
Assets/Equity 1.7 1.8 1.8 1.7
Source Notes:
[S1] Source
Footnotes:
BALANCE SHEETS
Fiscal Years Ended As of
Non-Current Assets
Intangible Assets 11.8 6.8% 21.6 12.3% 20.9 11.0% 17.0 1.4%
Other Non-Current Assets 96.4 55.9%
% 88.5 50.3%
% 88.3 46.4%
% 90.2 7.5%
%
Total Non-Current Assets 108.2 62.7% 110.1 62.6% 109.2 57.4% 107.2 8.9%
TOTAL ASSETS: $ 172.5 100.0% $ 175.9 100.0% $ 190.2 100.0% $ 1,198.1 100.0%
Non-Current Liabilities
Long-term Debt 168.1 18.0% 247.2 23.0% 375.6 32.1% 383.5 32.0%
Other Non-Current Liabilities 110.9 11.8% 112.4 10.5% 111.1 9.5% 112.7 9.4%
Deferred Taxes & ITC 46.2 4.9% 50.8 4.7% 49.7 4.2% 47.3 3.9%
Minority Interest - 0.0%
% - 0.0%
% - 0.0%
% - 0.0%
%
Total Non-Current Liabilities 325.2 34.7% 410.4 38.2% 536.4 45.8% 543.5 45.4%
TOTAL LIABILITIES 419.9 44.8% 510.8 47.6% 644.4 55.0% 661.2 55.2%
Stockholders' Equity
Preferred Stock - 0.0% - 0.0% - 0.0% - 0.0%
Common Equity 516.5 55.2% 563.2 52.4% 527.2 45.0% 536.9 44.8%
Common Stock - 0.0% - 0.0% - 0.0% - 0.0%
Capital Surplus - 0.0% - 0.0% - 0.0% - 0.0%
Retained Earnings - 0.0% - 0.0% - 0.0% - 0.0%
Treasury Stock - 0.0% - 0.0% - 0.0% - 0.0%
TOTAL STOCKHOLDERS' EQUITY 516.5 55.2% 563.2 52.4% 527.2 45.0% 536.9 44.8%
TOTAL LIABILITIES & CAPITAL $ 936.4 100.0% $ 1,074.0 100.0% $ 1,171.6 100.0% $ 1,198.1 100.0%
Source Notes:
[S1] Source
, Page 2 of 3 Exhibit 4A
Deloitte Learning Initiative
Applebees
Business Valuation
Historical Financial Analysis: Guideline Company 4
Valuation as of December 31, 2006 Ruby Tuesday, Inc.
($ Millions)
INCOME STATEMENTS [D1]
Fiscal Years ended LTM as of
Net Sales $ 1,041.4 100.0% $ 1,110.3 100.0% $ 1,306.2 100.0% $ 1,336.7 100.0%
Cost of Goods Sold 583.4 56.0% 625.3 56.3% 741.2 56.7% 757.1 56.6%
GROSS PROFIT 458.0 44.0% 485.0 43.7% 565.0 43.3% 579.6 43.4%
Operating Expenses
Research & Development - 0.0% - 0.0% - 0.0% - 0.0%
Sales & Marketing - 0.0% - 0.0% - 0.0% - 0.0%
General & Administrative (8.0) -0.8% 0.4 0.0% (1.5) -0.1% (0.6) 0.0%
Other Operating Expenses - 0.0% - 0.0% - 0.0% - 0.0%
EBITDA [D2] 466.0 44.7% 484.6 43.6% 566.5 43.4% 580.2 43.4%
Depreciation and Amortization 57.9 5.6% 66.9 6.0% 71.4 5.5% 72.7 5.4%
EBIT [D3] 408.1 39.2% 417.7 37.6% 495.1 37.9% 507.5 38.0%
Net Interest Expense/(Income) 3.7 0.4% 4.3 0.4% 12.7 1.0% 15.1 1.1%
Non-Operating Expense/(Income) (5.9) -0.6% (2.7) -0.2% (0.9) -0.1% (1.0) -0.1%
Non-Recurring Expense/(Income) 8.0 0.8% (0.4) 0.0% 1.5 0.1% 0.6 0.0%
EBT [D4] 402.3 38.6% 416.5 37.5% 481.8 36.9% 492.8 36.9%
Income Taxes 60.7 5.8% 52.6 4.7% 50.0 3.8% 49.6 3.7%
Minority Interest - 0.0% - 0.0% - 0.0% - 0.0%
NET INCOME $ 341.6 32.8% $ 363.9 32.8% $ 431.8 33.1% $ 443.2 33.2%
SUPPLEMENTAL DATA:
MARGIN SUMMARY:
Definitions:
Source Notes:
[S1] Source
, Page 3 of 3 Exhibit 4A
Deloitte Learning Initiative
Applebees
Business Valuation
Historical Financial Analysis: Guideline Company 4
Valuation as of December 31, 2006 Ruby Tuesday, Inc.
RATIO ANALYSIS
Fiscal Years Ended LTM as of
LEVERAGE ANALYSIS
Net fixed assets/total capital - - - 1.11
Long term debt/equity 0.33 0.44 0.71 0.71
Long term debt/total capital 0.25 0.31 0.42 0.42
Long term debt/assets 0.97 1.41 1.97 0.32
OPERATING ANALYSIS
Net fixed asset turnover 359.10 382.86 483.78 1.31
Return on average assets 198% 104% 118% 32%
Return on equity [F1] 66% 65% 82% 83%
Net Income/EBT 85% 87% 90% 90%
EBT/EBIT 99% 100% 97% 97%
EBIT/Sales 39% 38% 38% 38%
Sales/Assets 6.0 6.3 6.9 1.1
Assets/Equity 0.3 0.3 0.4 2.2
Source Notes:
[S1] Source
Footnotes:
BALANCE SHEETS
Fiscal Years Ended As of
Non-Current Assets
Intangible Assets 23.0 13.5% 24.4 16.3% 26.2 15.4% 19.2 3.0%
Other Non-Current Assets 10.4 6.1%
% 13.1 8.8%
% 19.0 11.2%
% 25.8 4.0%
%
Total Non-Current Assets 33.4 19.7% 37.5 25.1% 45.2 26.6% 45.0 6.9%
TOTAL ASSETS: $ 169.8 100.0% $ 149.3 100.0% $ 170.0 100.0% $ 647.7 100.0%
Non-Current Liabilities
Long-term Debt 37.1 6.6% 39.0 6.5% 166.3 23.9% 40.5 6.3%
Other Non-Current Liabilities 21.7 3.9% 27.4 4.6% 33.1 4.8% 31.3 4.8%
Deferred Taxes & ITC 10.1 1.8% 3.5 0.6% 1.2 0.2% - 0.0%
Minority Interest 1.3 0.2%
% 1.2 0.2%
% 1.0 0.1%
% 1.1 0.2%
%
Total Non-Current Liabilities 70.2 12.5% 71.1 11.8% 201.6 29.0% 72.9 11.3%
TOTAL LIABILITIES 162.9 29.0% 176.6 29.4% 335.6 48.3% 184.1 28.4%
Stockholders' Equity
Preferred Stock - 0.0% - 0.0% - 0.0% - 0.0%
Common Equity 399.1 71.0% 424.3 70.6% 359.6 51.7% 463.6 71.6%
Common Stock - 0.0% - 0.0% - 0.0% - 0.0%
Capital Surplus - 0.0% - 0.0% - 0.0% - 0.0%
Retained Earnings - 0.0% - 0.0% - 0.0% - 0.0%
Treasury Stock - 0.0% - 0.0% - 0.0% - 0.0%
TOTAL STOCKHOLDERS' EQUITY 399.1 71.0% 424.3 70.6% 359.6 51.7% 463.6 71.6%
TOTAL LIABILITIES & CAPITAL $ 562.0 100.0% $ 600.9 100.0% $ 695.2 100.0% $ 647.7 100.0%
Source Notes:
[S1] Source
, Page 2 of 3 Exhibit 4A
Deloitte Learning Initiative
Applebees
Business Valuation
Historical Financial Analysis: Guideline Company 5
Valuation as of December 31, 2006 RARE Hospitality International, Inc.
($ Millions)
INCOME STATEMENTS [D1]
Fiscal Years ended LTM as of
Net Sales $ 717.5 100.0% $ 839.3 100.0% $ 986.9 100.0% $ 1,046.6 100.0%
Cost of Goods Sold 264.3 36.8% 307.7 36.7% 361.9 36.7% 382.8 36.6%
GROSS PROFIT 453.2 63.2% 531.6 63.3% 625.0 63.3% 663.8 63.4%
Operating Expenses
Research & Development - 0.0% - 0.0% - 0.0% - 0.0%
Sales & Marketing 1.2 0.2% (0.8) -0.1% (10.6) -1.1% (8.1) -0.8%
General & Administrative (2.1) -0.3% 0.2 0.0% 5.7 0.6% (0.1) 0.0%
Other Operating Expenses - 0.0% - 0.0% - 0.0% - 0.0%
EBITDA [D2] 454.1 63.3% 532.2 63.4% 629.9 63.8% 672.0 64.2%
Depreciation and Amortization 29.6 4.1% 35.1 4.2% 37.1 3.8% 42.0 4.0%
EBIT [D3] 424.5 59.2% 497.1 59.2% 592.8 60.1% 630.0 60.2%
Net Interest Expense/(Income) 1.3 0.2% 1.9 0.2% 2.6 0.3% 2.5 0.2%
Non-Operating Expense/(Income) - 0.0% - 0.0% - 0.0% - 0.0%
Non-Recurring Expense/(Income) 0.9 0.1% 0.6 0.1% 4.9 0.5% 8.2 0.8%
EBT [D4] 422.3 58.9% 494.6 58.9% 585.3 59.3% 619.3 59.2%
Income Taxes 22.8 3.2% 25.1 3.0% 23.9 2.4% 22.8 2.2%
Minority Interest 0.3 0.0% 0.2 0.0% 0.1 0.0% 0.1 0.0%
NET INCOME $ 399.2 55.6% $ 469.3 55.9% $ 561.3 56.9% $ 596.4 57.0%
SUPPLEMENTAL DATA:
MARGIN SUMMARY:
Definitions:
Source Notes:
[S1] Source
, Page 3 of 3 Exhibit 4A
Deloitte Learning Initiative
Applebees
Business Valuation
Historical Financial Analysis: Guideline Company 5
Valuation as of December 31, 2006 RARE Hospitality International, Inc.
RATIO ANALYSIS
Fiscal Years Ended LTM as of
LEVERAGE ANALYSIS
Net fixed assets/total capital - - - 0.98
Long term debt/equity 0.09 0.09 0.46 0.09
Long term debt/total capital 0.09 0.08 0.32 0.08
Long term debt/assets 0.22 0.26 0.98 0.06
OPERATING ANALYSIS
Net fixed asset turnover - - - 2.12
Return on average assets 235% 147% 176% 73%
Return on equity [F1] 100% 111% 156% 129%
Net Income/EBT 95% 95% 96% 96%
EBT/EBIT 100% 100% 99% 98%
EBIT/Sales 59% 59% 60% 60%
Sales/Assets 4.2 5.6 5.8 1.6
Assets/Equity 0.4 0.4 0.5 1.4
Source Notes:
[S1] Source
Footnotes:
Exhibit 5 provides details on the market capitalization for guideline companies for
Applebee's.
Exhibit 5
Assumptions
• Brinker International’s Balance Sheet includes a jet for CEO’s personal use valued at
$2mm
• Ruby Tuesday’s Balance Sheet includes a rare coin collection in Inventory valued at
$6mm
VALUATION MEASURES 996 997 998 999 1000 2000 996 997 998 999 1000 2000
CASH FLOWS 2002 2003 2004 2005 2006 08/27/06 2002 2003 2004 2005 2006 08/27/06
Common Shares Outstanding (000s) 173.2 168.3 161.0 156.7 148.2 146.8 Depreciation & Amortization $ 166 $ 191 $ 210 $ 213 $ 222 $ 224 3.8% 4.1% 4.2% 4.0% 3.9% 3.9%
Capital Expenditures (318) (423) (354) (329) (338) (353) -7.3% -9.1% -7.1% -6.2% -5.9% -6.1%
MVE to Sales 1.0 0.7 0.7 1.0 0.9 1.0 996 997 998 999 1000 Q 996 997 998 999 1000 Q
MVE to Earnings (Excludes Non Operating 18.5 13.4 14.2 17.4 15.3 16.6 BALANCE SHEET 2002 2003 2004 2005 2006 08/27/06 2002 2003 2004 2005 2006 08/27/06
MVE to Book 3.8 2.7 3.1 4.0 4.4 4.7 ASSETS
Cash & Short-Term Investments $162.80 $48.60 $36.70 $42.80 $42.30 $45.60 6.4% 1.8% 1.3% 1.5% 1.4% 1.5%
Net Receivables 29 29 30 37 37 62 1.2% 1.1% 1.1% 1.2% 1.2% 2.0%
Dividend Payout Ratio Inventories 172 174 199 235 199 209 6.8% 6.5% 7.2% 8.0% 6.6% 6.8%
Dividend per Share 0.1 0.1 0.1 0.4 0.5 0.2 Other Current Assets 79 74 81 93 100 110 3.1% 2.8% 2.9% 3.2% 3.3% 3.6%
Dividend Yield - - - - - - Total Current Assets 443 326 346 407 378 426 17.5% 12.2% 12.5% 13.9% 12.5% 13.9%
FINANCIAL RATIO ANALYSIS Net PP&E 1,927 2,157 2,251 2,352 2,446 2,449 76.2% 81.0% 80.9% 80.0% 81.3% 80.0%
Return on Assets 15% 14% 15% 16% 18% 18% Total Long-Term Investments - - - - - - 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Return on Equity 21% 20% 19% 23% 28% 27% Intangibles 19 55 55 56 56 - 0.8% 2.1% 2.0% 1.9% 1.9% 0.0%
Return on Invested Capital 8% 10% 10% 8% 9% 8% Other Assets 140 127 129 123 131 185 5.5% 4.8% 4.6% 4.2% 4.3% 6.0%
Total Long-Term Assets 2,086 2,339 2,434 2,531 2,633 2,634 82.5% 87.8% 87.5% 86.1% 87.5% 86.1%
Asset Turnover 1.7 1.7 1.8 1.8 1.9 1.9 Total Assets $2,529.70 $2,664.60 $2,780.30 $2,937.80 $3,010.20 $3,060.20 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Receivables Turnover 150.1 160.5 165.1 144.6 154.2 93.3
Inventory Turnover 19.7 21.0 19.6 17.4 22.3 21.4 LIABILITIES & SHAREHOLDERS' EQUITY
Debt in Current Liabilities $0.00 $0.00 $14.50 $299.90 $193.90 $230.00 0.0% 0.0% 0.5% 10.2% 6.4% 7.5%
Average Collection Period 2.4 2.3 2.2 2.5 2.4 3.9 Accounts Payable 160 176 175 191 213 196 6.3% 6.6% 6.3% 6.5% 7.1% 6.4%
Days Inventory 18.5 17.4 18.6 21.0 16.4 17.1 Income Taxes Payable 69 68 49 52 65 97 2.7% 2.6% 1.8% 1.8% 2.2% 3.2%
Days Payable 17.2 17.6 16.3 17.0 17.6 16.0 Other Current Liabilities 372 396 446 501 554 514 14.7% 14.9% 16.0% 17.1% 18.4% 16.8%
Total Current Liabilities 601 640 684 1,045 1,026 1,037 23.8% 24.0% 24.6% 35.6% 34.1% 33.9%
Working Capital $ (158) $ (314) $ (337) $ (637) $ (649) $ (610)
Working Capital as % of Sales -3.6% -6.8% -6.7% -12.1% -11.3% -10.6% Long-Term Debt 663 658 653 350 495 494 26.2% 24.7% 23.5% 11.9% 16.4% 16.1%
Debt-Free Working Capital (158) (314) (323) (337) (455) (380) Deferred Taxes & Invest Tax Credit 118 110 133 115 91 87 4.7% 4.1% 4.8% 3.9% 3.0% 2.8%
Debt-Free Working Capital as % of Sales -3.6% -6.8% -6.4% -6.4% -7.9% -6.6% Minority Interest - - - - - - 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Debt & Cash-Free Working Capital (320) (363) (359) (380) (497) (426) Other Liabilities 20 127 136 155 169 179 0.8% 4.8% 4.9% 5.3% 5.6% 5.8%
Debt & Cash-Free W.C. as % of Sales -7.3% -7.8% -7.2% -7.2% -8.7% -7.4% Total Long-Term Liabilities 800 895 922 620 754 759 31.6% 33.6% 33.1% 21.1% 25.1% 24.8%
Total Liabilities 1,401 1,535 1,605 1,665 1,780 1,796 55.4% 57.6% 57.7% 56.7% 59.1% 58.7%
Current Ratio 0.7 0.5 0.5 0.4 0.4 0.4
Quick Ratio 0.5 0.2 0.2 0.2 0.2 0.2 Preferred Stock - - - - - - 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Interest Coverage Ratio (10.6) (9.0) (9.6) (10.9) (12.6) (13.0) Common Equity 1,129 1,130 1,175 1,273 1,230 1,265 44.6% 42.4% 42.3% 43.3% 40.9% 41.3%
Total Equity 1,129 1,130 1,175 1,273 1,230 1,265 44.6% 42.4% 42.3% 43.3% 40.9% 41.3%
Total Debt to Common Equity 58.7% 58.2% 56.8% 51.1% 56.0% 57.2% Total Liabilities & Equity $ 2,530 $ 2,665 $ 2,780 $ 2,938 $ 3,010 $ 3,060 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Total Debt to Market Cap. 14.9% 21.1% 18.2% 12.6% 12.7% 12.1%
Total Debt to MVIC 13.0% 17.4% 15.4% 11.2% 11.2% 10.8%
Exhibit 6
Brinker International Inc. First Day Traded
Ticker Symbol NYSE:EAT First Fiscal Year Presented 05/28/06 SIC Code Stock Price (Val Date) $30.20 Currency USD
Valuation Date 12/31/06 State of Residency TX Industry Name Restaurants 52 Week High 32.00 Conversion Mode H
Latest Fiscal Year End 6/28/2006 Stock Exchange NYSE S&P Rating 52 Week Low 21.00 Filing Version LFR
Latest Twelve Months / Quarter 3/28/2007 Tax Rate 28.80% Employees (Actual) 110,800.0 Avg. Volume (Actual) 1,700,000 Filings Date Comparison F
1st Fiscal Year A2006
No Adjustment
Brinker International, Inc. primarily engages in the ownership, operation, development, and franchising of restaurant brands in the United States. It operates restaurants under the names of Chili's Grill & Bar, Romano's Macaroni Grill,Necessary
Maggiano's Little Italy, and On The Border Mexican Grill
No Adjustment & Cantina. As of June 28, 2006, the company operated 1,622 jointly-developed and franchis
Necessary
# COMPANY DESCRIPTION 996 997 998 999 1000 2000 996 997 998 999 1000 2000
1 Brinker International, Inc. primarily engages in the ownership, operation, development, and INCOME STATEMENT 2002 2003 2004 2005 2006 9/27/2006 2002 2003 2004 2005 2006 09/27/06
2 franchising of restaurant brands in the United States. It operates restaurants under the names of Chili's Net Sales $2,887 $3,285 $3,541 $3,750 $4,151 $4,215 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
3 Grill & Bar, Romano's Macaroni Grill, Maggiano's Little Italy, and On The Border Mexican Grill & Cost of Goods Sold with D&A 2,513 2,861 3,073 3,316 3,616 3,665 87.0% 87.1% 86.8% 88.4% 87.1% 87.0%
4 Cantina. As of June 28, 2006, the company operated 1,622 jointly-developed and franchised restaurants Depreciation & Amortization 130 161 168 180 190 192 4.5% 4.9% 4.7% 4.8% 4.6% 4.5%
5 located in 49 states, and Washington, D.C. Brinker International also has restaurants in the countries Cost of Goods Sold w/o D&A 2,383 2,700 2,905 3,136 3,426 3,474 82.5% 82.2% 82.0% 83.6% 82.5% 82.4%
6 of Australia, Bahrain, Canada, Egypt, Great Britain, Germany, Guatemala, Indonesia, Japan, Kuwait, Non-operating Asset Gross Income 504 585 636 613 726 742 17.5% 17.8% 18.0% 16.4% 17.5% 17.6%
7 Lebanon, Malaysia, Mexico, Oman, Peru, the Philippines, Puerto Rico, Qatar, Saudi Arabia, South (Jet) of $2mm for Operating Expenses 121 132 151 153 207 210 4.2% 4.0% 4.3% 4.1% 5.0% 5.0%
8 Korea, Taiwan, the United Arab Emirates, and Venezuela. The company was founded in 1977 and is CEO's personal use. EBITDA 383 454 485 460 519 532 13.3% 13.8% 13.7% 12.3% 12.5% 12.6%
Depreciation & Amortization 130 161 168 180 190 192 4.5% 4.9% 4.7% 4.8% 4.6% 4.5%
996 997 998 999 1000 500 EBIT 253 293 318 280 329 340 8.8% 8.9% 9.0% 7.5% 7.9% 8.1%
MARKET CAPITALIZATION 2002 2003 2004 2005 2006 9/27/2006 Interest Expense (13) (12) (12) (25) (23) (24) -0.5% -0.4% -0.3% -0.7% -0.6% -0.6%
Market Capitalization of Equity 6/30/2002 6/25/2003 6/30/2004 6/29/2005 6/28/2006 Nonoperating Income (Expense) (2) (4) (2) (2) 2 2 -0.1% -0.1% 0.0% 0.0% 0.0% 0.1%
Fully Diluted Weighted Average Shares ( 0 151 160 159 141 131 127 Nonrecurring Income (Expense) (9) (26) (69) (62) (2) (1) -0.3% -0.8% -2.0% -1.7% 0.0% 0.0%
x Price Per Share $21.20 $24.00 $22.70 $26.50 $23.61 $30.20 Pretax Income 229 250 235 192 305 318 7.9% 7.6% 6.6% 5.1% 7.4% 7.5%
= Market Capitalization 3,197 3,850 3,600 3,744 3,091 3,826 Total Income Taxes 78 84 83 33 91 95 2.7% 2.5% 2.3% 0.9% 2.2% 2.2%
+ Book Value of Preferred Stock - - - - - - Minority Interest - - - - - - 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
+ Total Debt 444 371 657 408 503 507 Net Income (Loss) Before XO 151 166 152 159 214 223 5.2% 5.1% 4.3% 4.2% 5.2% 5.3%
= MVIC 3,641 4,221 4,258 4,153 3,593 4,333 +/- XO Items (Net of Tax Effects) - - (1) 2 (2) 5 0.0% 0.0% 0.0% 0.0% 0.0% 0.1%
- Cash & Short-Term Investments 10 34 227 42 56 60 Net Income (Loss) $ 151 $ 166 $ 151 $ 160 $ 212 $ 228 5.2% 5.1% 4.3% 4.3% 5.1% 5.4%
- Non- Operating Assets - - - - 2 2
+ Non- Operating Liabilities - - - - - - Net Income (Excluding Non Operat $ 162 $ 197 $ 223 $ 222 $ 214 $ 222
+ Minority Interest - - - - - - Net Income (Excluding after tax No $ 158 $ 186 $ 198 $ 211 $ 214 $ 222
= Business Enterprise Value $ 3,631 $ 4,188 $ 4,031 $ 4,111 $ 3,536 $ 4,272
VALUATION MEASURES 996 997 998 999 1000 2000 996 997 998 999 1000 2000
CASH FLOWS 2002 2003 2004 2005 2006 9/27/2006 2002 2003 2004 2005 2006 9/27/2006
Common Shares Outstanding (000s) 147.0 145.7 144.6 133.1 127.2 122.8 Depreciation & Amortization $ 130 $ 161 $ 168 $ 180 $ 190 $ 192 4.5% 4.9% 4.7% 4.8% 4.6% 4.5%
Capital Expenditures (371) (332) (305) (323) (355) (370) -12.9% -10.1% -8.6% -8.6% -8.5% -8.8%
MVE to Sales 1.1 1.2 1.0 1.0 0.7 0.9 996 997 998 999 1000 Q 996 997 998 999 1000 Q
MVE to Earnings (Excludes Non Operating 20.2 20.5 17.0 17.6 14.2 17.0 BALANCE SHEET 2002 2003 2004 2005 2006 9/27/2006 2002 2003 2004 2005 2006 9/27/2006
MVE to Book 3.3 3.4 3.3 3.4 2.8 3.4 ASSETS
Cash & Short-Term Investments $10.10 $33.50 $226.80 $41.90 $55.60 $59.70 0.6% 1.7% 10.1% 1.9% 2.5% 2.7%
Net Receivables 42 36 38 44 53 45 2.3% 1.9% 1.7% 2.0% 2.4% 2.0%
Dividend Payout Ratio Inventories 22 24 38 49 40 38 1.2% 1.3% 1.7% 2.3% 1.8% 1.7%
Dividend per Share - - - - 0.3 0.1 Other Current Assets 68 74 98 179 94 91 3.8% 3.8% 4.4% 8.3% 4.2% 4.1%
Dividend Yield - - - - - - Total Current Assets 142 168 401 313 242 235 8.0% 8.7% 17.8% 14.5% 10.9% 10.5%
FINANCIAL RATIO ANALYSIS Net PP&E 1,355 1,500 1,614 1,647 1,793 1,816 76.0% 77.3% 71.6% 76.4% 80.7% 80.9%
Return on Assets 14% 15% 14% 13% 15% 15% Total Long-Term Investments - - - - - - 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Return on Equity 15% 15% 15% 14% 20% 20% Intangibles 194 185 158 125 146 145 10.9% 9.5% 7.0% 5.8% 6.5% 6.5%
Return on Invested Capital 7% 7% 7% 7% 9% 8% Other Assets 92 88 82 72 41 48 5.2% 4.5% 3.6% 3.3% 1.9% 2.1%
Total Long-Term Assets 1,641 1,772 1,854 1,843 1,980 2,008 92.0% 91.3% 82.2% 85.5% 89.1% 89.5%
Asset Turnover 1.6 1.7 1.6 1.7 1.9 1.9 Total Assets $1,783.30 $1,940.30 $2,254.40 $2,156.10 $2,221.80 $2,243.00 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Receivables Turnover 69.2 91.3 93.4 86.0 79.1 92.8
Inventory Turnover 109.3 110.7 76.2 64.5 85.0 90.9 LIABILITIES & SHAREHOLDERS' EQUITY
Debt in Current Liabilities $17.30 $17.60 $18.10 $1.80 $2.20 $2.20 1.0% 0.9% 0.8% 0.1% 0.1% 0.1%
Average Collection Period 5.3 4.0 3.9 4.2 4.6 3.9 Accounts Payable 118 108 106 133 151 145 6.6% 5.6% 4.7% 6.2% 6.8% 6.5%
Days Inventory 3.3 3.3 4.8 5.7 4.3 4.0 Income Taxes Payable - 8 37 23 30 52 0.0% 0.4% 1.6% 1.1% 1.3% 2.3%
Days Payable 18.1 14.6 13.3 15.5 16.1 15.2 Other Current Liabilities 167 178 218 272 315 293 9.3% 9.2% 9.7% 12.6% 14.2% 13.1%
Total Current Liabilities 302 312 379 430 497 493 16.9% 16.1% 16.8% 19.9% 22.4% 22.0%
Working Capital $ (160) $ (144) $ 22 $ (117) $ (255) $ (258)
Working Capital as % of Sales -5.5% -4.4% 0.6% -3.1% -6.1% -6.1% Long-Term Debt 427 354 639 407 501 505 23.9% 18.2% 28.4% 18.9% 22.5% 22.5%
Debt-Free Working Capital (143) (126) 40 (115) (253) (256) Deferred Taxes & Invest Tax Credit 17 48 73 56 7 - 1.0% 2.4% 3.2% 2.6% 0.3% 0.0%
Debt-Free Working Capital as % of Sales -4.9% -3.8% 1.1% -3.1% -6.1% -6.1% Minority Interest - - - - - - 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Debt & Cash-Free Working Capital (153) (160) (187) (157) (309) (316) Other Liabilities 60 100 153 163 141 148 3.4% 5.1% 6.8% 7.6% 6.3% 6.6%
Debt & Cash-Free W.C. as % of Sales -5.3% -4.9% -5.3% -4.2% -7.4% -7.5% Total Long-Term Liabilities 504 501 865 626 649 653 28.3% 25.8% 38.4% 29.0% 29.2% 29.1%
Total Liabilities 806 813 1,244 1,056 1,146 1,146 45.2% 41.9% 55.2% 49.0% 51.6% 51.1%
Current Ratio 0.5 0.5 1.1 0.7 0.5 0.5
Quick Ratio 0.4 0.5 1.0 0.6 0.4 0.4 Preferred Stock - - - - - - 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Interest Coverage Ratio (19.0) (23.6) (27.6) (11.1) (14.3) (14.3) Common Equity 977 1,128 1,010 1,100 1,076 1,097 54.8% 58.1% 44.8% 51.0% 48.4% 48.9%
Total Equity 977 1,128 1,010 1,100 1,076 1,097 54.8% 58.1% 44.8% 51.0% 48.4% 48.9%
Total Debt to Common Equity 45.4% 32.9% 65.1% 37.1% 46.7% 46.2% Total Liabilities & Equity $ 1,783 $ 1,940 $ 2,254 $ 2,156 $ 2,222 $ 2,243 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Total Debt to Market Cap. 13.9% 9.6% 18.3% 10.9% 16.3% 13.3%
Total Debt to MVIC 12.2% 8.8% 15.4% 9.8% 14.0% 11.7%
Exhibit 6
OSI Restaurant Partners, Inc. First Day Traded
Ticker Symbol IQ32561 First Fiscal Year Presented 05/28/06 SIC Code Stock Price (Val Date) $39.20 Currency USD
Valuation Date 12/31/06 State of Residency FL Industry Name Restaurants 52 Week High 48.30 Conversion Mode H
Latest Fiscal Year End 12/31/2006 Stock Exchange NYSE S&P Rating Unadjusted Net Sales $4,191 52 Week Low Unadjusted Net Sales $4,020
27.30 Filing Version LFR
Less: Normalized Adjustment 250
Latest Twelve Months / Quarter 3/31/2007 Tax Rate 28.00% Employees (Actual) 116,000.0 Avg. Volume (Actual)Less: Normalized Adjustment 250
- Filings Date Comparison F
Normalized Net Sales 3,941 Normalized Net Sales 3,770
1st Fiscal Year A2006
#NA
# COMPANY DESCRIPTION 996 997 998 999 1000 2000 996 997 998 999 1000 2000
1 INCOME STATEMENT 2002 2003 2004 2005 2006 6/30/2006 2002 2003 2004 2005 2006 06/30/06
OSI Restaurant Partners, Inc. engages in the development and operation of casual dining restaurant. As of December 31,
2 Net Sales $2,295 $2,672 $3,216 $3,613 $3,941 $3,770 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
2006, it had 1,408 system-wide restaurants, including 786 domestic Outback Steakhouses, 162 international Outback
3 Cost of Goods Sold with D&A 1,468 1,744 2,125 2,374 2,654 2,511 64.0% 65.3% 66.1% 65.7% 67.4% 66.6%
4
Steakhouses, 229 Carrabba’s Italian Grills, 119 Bonefish Grills, 45 Fleming’s Prime Steakhouse and Wine Bars, 23 Roy’s, Depreciation & Amortization 73 85 105 128 152 139 3.2% 3.2% 3.3% 3.5% 3.8% 3.7%
5 5 Lee Roy Selmon’s, 1 Blue Coral Seafood and Spirits, and 38 Cheeseburger in Paradise restaurants in the United States Cost of Goods Sold w/o D&A 1,394 1,659 2,020 2,246 2,503 2,372 60.8% 62.1% 62.8% 62.2% 63.5% 62.9%
6 and 20 countries internationally. The company was founded in 1987 as Multi-Venture Partners, Inc. and changed its name Gross Income 900 1,014 1,196 1,367 1,438 1,398 39.2% 37.9% 37.2% 37.8% 36.5% 37.1%
7 to Outback Steakhouse, Inc. in 1990. Further, the company changed its name to OSI Restaurant Partners, Inc. in 2006. OSI Operating Expenses 600 676 842 981 1,117 1,057 26.2% 25.3% 26.2% 27.2% 28.4% 28.0%
8 Restaurant Partners is headquartered in Tampa, Florida. EBITDA 300 338 354 386 321 341 13.1% 12.6% 11.0% 10.7% 8.1% 9.0%
Depreciation & Amortization 73 85 105 128 152 139 3.2% 3.2% 3.3% 3.5% 3.8% 3.7%
996 997 998 999 1000 500 EBIT 227 253 249 258 169 202 9.9% 9.5% 7.7% 7.1% 4.3% 5.4%
MARKET CAPITALIZATION 2002 2003 2004 2005 2006 6/30/2006 Interest Expense 1 (0) (2) (5) (12) (7) 0.1% 0.0% -0.1% -0.1% -0.3% -0.2%
Market Capitalization of Equity 12/31/2002 12/31/2003 12/31/2004 12/31/2005 12/31/2006 Nonoperating Income (Expense) 4 5 (0) (6) 5 1 0.2% 0.2% 0.0% -0.2% 0.1% 0.0%
Fully Diluted Weighted Average Shares ( 0 79 78 78 77 76 76 Nonrecurring Income (Expense) (7) (5) (7) (26) (14) (21) -0.3% -0.2% -0.2% -0.7% -0.4% -0.5%
x Price Per Share $34.40 $44.20 $45.80 $41.60 $39.20 $39.20 Pretax Income 225 252 239 222 149 175 9.8% 9.4% 7.4% 6.1% 3.8% 4.6%
= Market Capitalization 2,728 3,465 3,550 3,182 2,987 2,987 Total Income Taxes 79 85 79 74 42 54 3.4% 3.2% 2.4% 2.0% 1.1% 1.4%
+ Book Value of Preferred Stock - - - - - - Minority Interest (2) 3 9 1 7 0 -0.1% 0.1% 0.3% 0.0% 0.2% 0.0%
+ Total Debt 32 59 145 185 270 296 Net Income (Loss) Before XO 148 164 152 147 100 121 6.5% 6.1% 4.7% 4.1% 2.5% 3.2%
= MVIC 2,760 3,524 3,694 3,368 3,257 3,283 +/- XO Items (Net of Tax Effects) (1) - - - - - 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
- Cash & Short-Term Investments 213 126 92 89 98 62 Net Income (Loss) $ 147 $ 164 $ 152 $ 147 $ 100 $ 121 6.4% 6.1% 4.7% 4.1% 2.5% 3.2%
- Non- Operating Assets - - - - - -
+ Non- Operating Liabilities - - - - - - Net Income (Excluding Non Operat $ 151 $ 165 $ 159 $ 179 $ 109 $ 141
+ Minority Interest 43 58 48 44 37 43 Net Income (Excluding after tax No $ 148 $ 167 $ 166 $ 169 $ 113 $ 135
= Business Enterprise Value $ 2,590 $ 3,456 $ 3,651 $ 3,323 $ 3,196 $ 3,264
VALUATION MEASURES 996 997 998 999 1000 2000 996 997 998 999 1000 2000
CASH FLOWS 2002 2003 2004 2005 2006 06/30/06 2002 2003 2004 2005 2006 06/30/06
Common Shares Outstanding (000s) 75.8 74.8 73.8 74.7 73.4 73.4 Depreciation & Amortization $ 73 $ 85 $ 105 $ 128 $ 152 $ 139 3.2% 3.2% 3.3% 3.5% 3.8% 3.7%
Capital Expenditures (182) (194) (255) (328) (315) (350) -7.9% -7.3% -7.9% -9.1% -8.0% -9.3%
MVE to Sales 1.1 1.3 1.1 0.9 0.7 0.8 996 997 998 999 1000 Q 996 997 998 999 1000 Q
MVE to Earnings (Excludes Non Operating 17.3 20.3 21.1 18.5 25.8 22.0 BALANCE SHEET 2002 2003 2004 2005 2006 06/30/06 2002 2003 2004 2005 2006 06/30/06
MVE to Book 2.6 3.4 3.3 2.7 2.4 2.4 ASSETS
Cash & Short-Term Investments $213.10 $125.90 $91.90 $89.40 $97.60 $62.00 15.8% 8.5% 5.3% 4.4% 4.3% 3.0%
Net Receivables 12 16 21 31 50 39 0.9% 1.1% 1.2% 1.5% 2.2% 1.9%
Dividend Payout Ratio Inventories 35 60 63 69 87 67 2.6% 4.0% 3.7% 3.4% 3.9% 3.2%
Dividend per Share 0.1 0.5 0.5 0.5 0.5 0.1 Other Current Assets 27 32 66 91 80 43 2.0% 2.1% 3.8% 4.5% 3.6% 2.1%
Dividend Yield - - - - - - Total Current Assets 286 233 242 280 315 210 21.2% 15.8% 14.0% 13.9% 14.0% 10.1%
FINANCIAL RATIO ANALYSIS Net PP&E 915 1,050 1,234 1,388 1,549 1,476 67.6% 71.2% 71.2% 69.1% 68.6% 71.1%
Return on Assets 17% 17% 14% 13% 8% 10% Total Long-Term Investments 38 31 16 21 26 25 2.8% 2.1% 0.9% 1.1% 1.2% 1.2%
Return on Equity 15% 16% 14% 13% 8% 10% Intangibles 46 96 144 140 192 141 3.4% 6.5% 8.3% 7.0% 8.5% 6.8%
Return on Invested Capital 8% 7% 7% 8% 5% 6% Other Assets 67 65 97 181 176 223 5.0% 4.4% 5.6% 9.0% 7.8% 10.8%
Total Long-Term Assets 1,067 1,242 1,491 1,730 1,943 1,866 78.8% 84.2% 86.0% 86.1% 86.0% 89.9%
Asset Turnover 1.7 1.8 1.9 1.8 1.7 1.8 Total Assets $1,352.80 $1,474.10 $1,733.40 $2,009.50 $2,258.60 $2,076.60 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Receivables Turnover 199.5 172.4 153.9 116.5 78.3 97.9
Inventory Turnover 40.3 27.8 31.9 32.8 28.7 35.3 LIABILITIES & SHAREHOLDERS' EQUITY
Debt in Current Liabilities $17.50 $48.90 $54.60 $63.40 $60.40 $77.20 1.3% 3.3% 3.1% 3.2% 2.7% 3.7%
Average Collection Period 1.8 2.1 2.4 3.1 4.7 3.7 Accounts Payable 55 59 74 117 166 93 4.0% 4.0% 4.3% 5.8% 7.3% 4.5%
Days Inventory 9.1 13.1 11.5 11.1 12.7 10.3 Income Taxes Payable 16 2 0 18 16 17 1.2% 0.2% 0.0% 0.9% 0.7% 0.8%
Days Payable 14.3 12.9 13.4 19.1 24.2 14.4 Other Current Liabilities 155 205 299 300 323 206 11.5% 13.9% 17.3% 14.9% 14.3% 9.9%
Total Current Liabilities 243 315 428 499 564 393 18.0% 21.3% 24.7% 24.8% 25.0% 18.9%
Working Capital $ 43 $ (82) $ (186) $ (219) $ (249) $ (183)
Working Capital as % of Sales 1.9% -3.1% -5.8% -6.1% -6.3% -4.8% Long-Term Debt 14 10 90 122 210 219 1.1% 0.7% 5.2% 6.1% 9.3% 10.6%
Debt-Free Working Capital 61 (33) (131) (156) (189) (105) Deferred Taxes & Invest Tax Credit 16 1 - - - - 1.2% 0.1% 0.0% 0.0% 0.0% 0.0%
Debt-Free Working Capital as % of Sales 2.7% -1.2% -4.1% -4.3% -4.8% -2.8% Minority Interest 43 58 48 44 37 43 3.2% 3.9% 2.8% 2.2% 1.6% 2.1%
Debt & Cash-Free Working Capital (152) (159) (223) (245) (286) (167) Other Liabilities 62 85 120 200 227 203 4.6% 5.8% 6.9% 10.0% 10.0% 9.8%
Debt & Cash-Free W.C. as % of Sales -6.6% -5.9% -6.9% -6.8% -7.3% -4.4% Total Long-Term Liabilities 136 154 258 366 473 465 10.0% 10.5% 14.9% 18.2% 21.0% 22.4%
Total Liabilities 379 469 686 865 1,037 858 28.0% 31.8% 39.6% 43.1% 45.9% 41.3%
Current Ratio 1.2 0.7 0.6 0.6 0.6 0.5
Quick Ratio 1.0 0.6 0.4 0.4 0.4 0.4 Preferred Stock - - - - - - 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Interest Coverage Ratio 188.9 (842.0) (108.3) (53.8) (14.7) (28.5) Common Equity 974 1,005 1,047 1,144 1,221 1,219 72.0% 68.2% 60.4% 56.9% 54.1% 58.7%
Total Equity 974 1,005 1,047 1,144 1,221 1,219 72.0% 68.2% 60.4% 56.9% 54.1% 58.7%
Total Debt to Common Equity 3.3% 5.8% 13.8% 16.2% 22.1% 24.3% Total Liabilities & Equity $ 1,353 $ 1,474 $ 1,733 $ 2,010 $ 2,259 $ 2,077 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Total Debt to Market Cap. 1.2% 1.7% 4.1% 5.8% 9.0% 9.9%
Total Debt to MVIC 1.2% 1.7% 3.9% 5.5% 8.3% 9.0%
Exhibit 6
Ruby Tuesday, Inc. First Day Traded
Ticker Symbol IQ346489 First Fiscal Year Presented 05/28/06 SIC Code Stock Price (Val Date) $27.40 Currency USD
Valuation Date 12/31/06 State of Residency TN Industry Name Restaurants 52 Week High 33.00 Conversion Mode H
Latest Fiscal Year End 6/5/2007 Stock Exchange NYSE S&P Rating 52 Week Low 21.00 Filing Version LFR
Latest Twelve Months / Quarter 6/5/2007 Tax Rate 30.80% Employees (Actual) 27,700.0 Avg. Volume (Actual) 1,300,000 Filings Date Comparison F
1st Fiscal Year A2006
Ruby Tuesday, Inc., together with its subsidiaries, engages in the development, ownership, operation, and franchising of Ruby Tuesday brand casual dining restaurants. As of October 23, 2006, it owned, operated, or franchised 900 casual dining restaurants primarily in the United States, the Asia Pacific region, India, Kuwait, Puerto Rico, Canada, Mexico, Iceland, Eastern Europe, and
# COMPANY DESCRIPTION 996 997 998 999 1000 2000 996 997 998 999 1000 2000
1 Ruby Tuesday, Inc., together with its subsidiaries, engages in the development, ownership, INCOME STATEMENT 2002 2003 2004 2005 2006 9/5/2006 2002 2003 2004 2005 2006 09/05/06
2 operation, and franchising of Ruby Tuesday brand casual dining restaurants. As of October 23, 2006, it owned, Net Sales $833 $914 $1,041 $1,110 $1,306 $1,337 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
3 operated, or franchised 900 casual dining restaurants primarily in the United States, the Asia Cost of Goods Sold with D&A 526 586 641 692 813 830 63.1% 64.1% 61.6% 62.3% 62.2% 62.1%
4 Pacific region, India, Kuwait, Puerto Rico, Canada, Mexico, Iceland, Eastern Europe, and Central and Depreciation & Amortization 37 49 58 67 71 73 4.4% 5.4% 5.6% 6.0% 5.5% 5.4%
5 South America. Ruby Tuesday was founded in 1920 and is based in Maryville, Tennessee. Cost of Goods Sold w/o D&A 489 536 583 625 741 757 58.7% 58.7% 56.0% 56.3% 56.7% 56.6%
Non-operating Asset (Rare
6 Gross Income 344 377 458 485 565 580 41.3% 41.3% 44.0% 43.7% 43.3% 43.4%
coin collection in
7 inventory) of $6mm Operating Expenses 196 193 224 262 329 342 23.5% 21.1% 21.5% 23.6% 25.2% 25.6%
8 EBITDA 148 185 234 223 236 238 17.8% 20.2% 22.5% 20.1% 18.0% 17.8%
Depreciation & Amortization 37 49 58 67 71 73 4.4% 5.4% 5.6% 6.0% 5.5% 5.4%
996 997 998 999 1000 500 EBIT 111 135 176 156 164 165 13.3% 14.8% 16.9% 14.1% 12.6% 12.4%
MARKET CAPITALIZATION 2002 2003 2004 2005 2006 9/5/2006 Interest Expense 6 (2) (4) (4) (13) (15) 0.7% -0.3% -0.4% -0.4% -1.0% -1.1%
Market Capitalization of Equity 6/4/2002 6/3/2003 6/1/2004 5/31/2005 6/6/2006 Nonoperating Income (Expense) 1 3 6 3 1 1 0.1% 0.4% 0.6% 0.2% 0.1% 0.1%
Fully Diluted Weighted Average Shares ( 0 65 67 66 61 58 58 Nonrecurring Income (Expense) (30) (0) (8) 0 (2) (1) -3.6% 0.0% -0.8% 0.0% -0.1% 0.0%
x Price Per Share $22.70 $24.00 $28.80 $25.30 $27.18 $27.40 Pretax Income 88 136 171 155 151 151 10.6% 14.9% 16.4% 14.0% 11.6% 11.3%
= Market Capitalization 1,478 1,610 1,886 1,551 1,566 1,578 Total Income Taxes 30 47 61 53 50 50 3.6% 5.2% 5.8% 4.7% 3.8% 3.7%
+ Book Value of Preferred Stock - - - - - - Minority Interest - - - - - - 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
+ Total Debt 8 208 169 250 377 386 Net Income (Loss) Before XO 58 89 110 102 101 101 7.0% 9.7% 10.5% 9.2% 7.7% 7.5%
= MVIC 1,486 1,818 2,055 1,800 1,943 1,964 +/- XO Items (Net of Tax Effects) (0) - - - - - 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
- Cash & Short-Term Investments 33 9 20 20 22 17 Net Income (Loss) $ 58 $ 89 $ 110 $ 102 $ 101 $ 101 7.0% 9.7% 10.5% 9.2% 7.7% 7.5%
- Non- Operating Assets - - - - 6 6
+ Non- Operating Liabilities - - - - - - Net Income (Excluding Non Operat $ 87 $ 86 $ 112 $ 99 $ 102 $ 101
+ Minority Interest - - - - - - Net Income (Excluding after tax No $ 77 $ 87 $ 111 $ 100 $ 101 $ 101
= Business Enterprise Value $ 1,453 $ 1,809 $ 2,036 $ 1,781 $ 1,914 $ 1,941
VALUATION MEASURES 996 997 998 999 1000 2000 996 997 998 999 1000 2000
CASH FLOWS 2002 2003 2004 2005 2006 09/05/06 2002 2003 2004 2005 2006 09/05/06
Common Shares Outstanding (000s) 65.2 64.0 66.6 64.5 59.0 58.6 Depreciation & Amortization $ 37 $ 49 $ 58 $ 67 $ 71 $ 73 4.4% 5.4% 5.6% 6.0% 5.5% 5.4%
Capital Expenditures (111) (154) (152) (162) (172) (167) -13.4% -16.8% -14.5% -14.6% -13.1% -12.5%
MVE to Sales 1.7 1.8 1.8 1.4 1.2 1.2 996 997 998 999 1000 Q 996 997 998 999 1000 Q
MVE to Earnings (Excludes Non Operating 18.7 18.5 16.8 15.3 15.2 15.5 BALANCE SHEET 2002 2003 2004 2005 2006 09/05/06 2002 2003 2004 2005 2006 09/05/06
MVE to Book 4.3 4.0 3.6 2.7 2.9 2.9 ASSETS
Cash & Short-Term Investments $32.70 $8.70 $19.50 $19.80 $22.40 $16.50 6.3% 1.1% 2.1% 1.8% 1.9% 1.4%
Net Receivables 31 13 13 8 12 12 5.9% 1.6% 1.4% 0.8% 1.1% 1.0%
Dividend Payout Ratio Inventories 10 12 14 17 17 19 2.0% 1.5% 1.5% 1.6% 1.5% 1.6%
Dividend per Share - - - - 0.5 - Other Current Assets 15 18 15 18 26 24 2.9% 2.2% 1.6% 1.7% 2.2% 2.0%
Dividend Yield - - - - - - Total Current Assets 89 52 61 63 78 71 17.1% 6.3% 6.6% 5.9% 6.7% 5.9%
FINANCIAL RATIO ANALYSIS Net PP&E 352 678 767 901 984 1,020 67.6% 82.0% 81.9% 83.9% 84.0% 85.2%
Return on Assets 21% 16% 19% 15% 14% 14% Total Long-Term Investments - - - - - - 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Return on Equity 17% 22% 21% 18% 19% 19% Intangibles 8 8 12 22 21 17 1.5% 0.9% 1.3% 2.0% 1.8% 1.4%
Return on Invested Capital 7% 7% 9% 9% 8% 8% Other Assets 72 88 96 88 88 90 13.8% 10.7% 10.3% 8.2% 7.5% 7.5%
Total Long-Term Assets 431 774 875 1,011 1,093 1,128 82.9% 93.7% 93.4% 94.1% 93.3% 94.1%
Asset Turnover 1.6 1.1 1.1 1.0 1.1 1.1 Total Assets $520.30 $825.90 $936.40 $1,074.10 $1,171.60 $1,198.10 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Receivables Turnover 27.1 69.8 80.1 137.1 105.3 115.2
Inventory Turnover 47.5 44.0 42.9 36.8 42.6 40.7 LIABILITIES & SHAREHOLDERS' EQUITY
Debt in Current Liabilities $0.60 $0.60 $0.50 $2.30 $1.50 $2.20 0.1% 0.1% 0.1% 0.2% 0.1% 0.2%
Average Collection Period 13.4 5.2 4.6 2.7 3.5 3.2 Accounts Payable 36 23 37 47 40 43 7.0% 2.8% 4.0% 4.3% 3.4% 3.6%
Days Inventory 7.7 8.3 8.5 9.9 8.6 9.0 Income Taxes Payable - - - 0 - 8 0.0% 0.0% 0.0% 0.0% 0.0% 0.7%
Days Payable 27.2 15.6 23.4 27.2 19.5 20.7 Other Current Liabilities 54 63 57 51 67 64 10.3% 7.6% 6.1% 4.8% 5.7% 5.4%
Total Current Liabilities 91 86 95 100 108 118 17.4% 10.4% 10.1% 9.3% 9.2% 9.8%
Working Capital $ (2) $ (34) $ (33) $ (38) $ (30) $ (47)
Working Capital as % of Sales -0.2% -3.7% -3.2% -3.4% -2.3% -3.5% Long-Term Debt 8 207 168 247 376 384 1.5% 25.1% 18.0% 23.0% 32.1% 32.0%
Debt-Free Working Capital (1) (33) (33) (35) (28) (45) Deferred Taxes & Invest Tax Credit 21 28 46 51 50 47 4.0% 3.4% 4.9% 4.7% 4.2% 3.9%
Debt-Free Working Capital as % of Sales -0.1% -3.6% -3.1% -3.2% -2.2% -3.4% Minority Interest - - - - - - 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Debt & Cash-Free Working Capital (34) (42) (52) (55) (51) (62) Other Liabilities 67 101 111 112 111 113 12.8% 12.2% 11.8% 10.5% 9.5% 9.4%
Debt & Cash-Free W.C. as % of Sales -4.1% -4.6% -5.0% -5.0% -3.9% -4.6% Total Long-Term Liabilities 95 335 325 410 536 544 18.3% 40.6% 34.7% 38.2% 45.8% 45.4%
Total Liabilities 186 422 420 511 644 661 35.7% 51.0% 44.8% 47.6% 55.0% 55.2%
Current Ratio 1.0 0.6 0.6 0.6 0.7 0.6
Quick Ratio 0.9 0.5 0.5 0.5 0.6 0.4 Preferred Stock - - - - - - 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Interest Coverage Ratio 19.2 (58.8) (47.7) (36.3) (12.9) (10.9) Common Equity 334 404 517 563 527 537 64.3% 49.0% 55.2% 52.4% 45.0% 44.8%
Total Equity 334 404 517 563 527 537 64.3% 49.0% 55.2% 52.4% 45.0% 44.8%
Total Debt to Common Equity 2.5% 51.4% 32.6% 44.3% 71.5% 71.8% Total Liabilities & Equity $ 520 $ 826 $ 936 $ 1,074 $ 1,172 $ 1,198 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Total Debt to Market Cap. 0.6% 12.9% 8.9% 16.1% 24.1% 24.4%
Total Debt to MVIC 0.6% 11.4% 8.2% 13.9% 19.4% 19.6%
Exhibit 6
RARE Hospitality International Inc. First Day Traded
Ticker Symbol NASDAQNM:RARE First Fiscal Year Presented 05/28/06 SIC Code Stock Price (Val Date) $32.90 Currency USD
Valuation Date 12/31/06 State of Residency GA Industry Name Restaurants 52 Week High 34.90 Conversion Mode H
Latest Fiscal Year End 12/31/2006 Stock Exchange NasdaqNM S&P Rating 52 Week Low 25.00 Filing Version LFR
Latest Twelve Months / Quarter 4/1/2007 Tax Rate 32.30% Employees (Actual) 19,773.0 Avg. Volume (Actual) 600,000 Filings Date Comparison F
1st Fiscal Year A2006
RARE Hospitality International, Inc. and its subsidiaries operate and franchise restaurants in the United States. It operates company-owned restaurants, joint venture restaurants, and franchised restaurants. As of June 21, 2007, the company owned, operated, and franchised 316 restaurants, including 286 LongHorn Steakhouse restaurants and 28 Capital Grille restaurants. RARE Hospita
# COMPANY DESCRIPTION 996 997 998 999 1000 2000 996 997 998 999 1000 2000
1 RARE Hospitality International, Inc. and its subsidiaries operate and franchise restaurants in the INCOME STATEMENT 2002 2003 2004 2005 2006 10/1/2006 2002 2003 2004 2005 2006 10/01/06
2 United States. It operates company-owned restaurants, joint venture restaurants, and franchised Net Sales $585 $598 $718 $839 $987 $1,047 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
3 restaurants. As of June 21, 2007, the company owned, operated, and franchised 316 restaurants, including Cost of Goods Sold with D&A 237 240 294 343 399 425 40.5% 40.1% 41.0% 40.8% 40.4% 40.6%
4 286 LongHorn Steakhouse restaurants and 28 Capital Grille restaurants. RARE Hospitality Depreciation & Amortization 26 25 30 35 37 42 4.4% 4.1% 4.1% 4.2% 3.8% 4.0%
5 International also operates Hemenway’s Seafood Grille & Oyster Bar; and The Old Grist Mill Tavern restaurant. Cost of Goods Sold w/o D&A 211 215 264 308 362 383 36.1% 35.9% 36.8% 36.7% 36.7% 36.6%
6 The company was founded in 1981 and is based in Atlanta, Georgia. Gross Income 374 383 453 532 625 664 63.9% 64.1% 63.2% 63.3% 63.3% 63.4%
7 Operating Expenses 294 299 353 416 506 539 50.4% 50.0% 49.1% 49.6% 51.3% 51.5%
8 EBITDA 79 84 101 115 119 124 13.6% 14.1% 14.0% 13.7% 12.0% 11.9%
Depreciation & Amortization 26 25 30 35 37 42 4.4% 4.1% 4.1% 4.2% 3.8% 4.0%
996 997 998 999 1000 500 EBIT 54 59 71 80 82 82 9.2% 9.9% 9.9% 9.6% 8.3% 7.9%
MARKET CAPITALIZATION 2002 2003 2004 2005 2006 10/1/2006 Interest Expense (2) (1) (1) (2) (3) (3) -0.3% -0.2% -0.2% -0.2% -0.3% -0.2%
Market Capitalization of Equity 12/29/2002 12/28/2003 12/26/2004 12/25/2005 12/31/2006 Nonoperating Income (Expense) - - - - - - 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Fully Diluted Weighted Average Shares ( 0 34 35 35 35 34 34 Nonrecurring Income (Expense) (2) - (1) (1) (5) (8) -0.3% 0.0% -0.1% -0.1% -0.5% -0.8%
x Price Per Share $18.50 $24.00 $31.00 $30.60 $32.93 $32.90 Pretax Income 50 58 69 78 74 72 8.5% 9.8% 9.6% 9.3% 7.5% 6.8%
= Market Capitalization 635 835 1,097 1,065 1,133 1,102 Total Income Taxes 16 19 23 25 24 23 2.7% 3.2% 3.2% 3.0% 2.4% 2.2%
+ Book Value of Preferred Stock - - - - - - Minority Interest 0 0 0 0 0 0 0.1% 0.1% 0.0% 0.0% 0.0% 0.0%
+ Total Debt 23 28 37 39 167 41 Net Income (Loss) Before XO 33 39 46 52 50 49 5.7% 6.6% 6.4% 6.2% 5.1% 4.7%
= MVIC 657 863 1,135 1,104 1,299 1,143 +/- XO Items (Net of Tax Effects) - 3 1 (1) (11) (8) 0.0% 0.5% 0.2% -0.1% -1.1% -0.8%
- Cash & Short-Term Investments 32 45 54 18 37 9 Net Income (Loss) $ 33 $ 42 $ 47 $ 52 $ 39 $ 41 5.7% 7.0% 6.5% 6.1% 4.0% 3.9%
- Non- Operating Assets - - - - - -
+ Non- Operating Liabilities - - - - - - Net Income (Excluding Non Operat $ 35 $ 39 $ 47 $ 53 $ 55 $ 57
+ Minority Interest 1 1 1 1 1 1 Net Income (Excluding after tax No $ 35 $ 40 $ 47 $ 53 $ 53 $ 54
= Business Enterprise Value $ 627 $ 820 $ 1,082 $ 1,087 $ 1,263 $ 1,135
VALUATION MEASURES 996 997 998 999 1000 2000 996 997 998 999 1000 2000
CASH FLOWS 2002 2003 2004 2005 2006 10/01/06 2002 2003 2004 2005 2006 10/01/06
Common Shares Outstanding (000s) 33.0 33.7 34.0 33.4 34.1 34.1 Depreciation & Amortization $ 26 $ 25 $ 30 $ 35 $ 37 $ 42 4.4% 4.1% 4.1% 4.2% 3.8% 4.0%
Capital Expenditures (55) (78) (97) (104) (121) (115) -9.4% -13.0% -13.5% -12.4% -12.2% -11.0%
MVE to Sales 1.0 1.3 1.5 1.2 1.1 1.0 996 997 998 999 1000 Q 996 997 998 999 1000 Q
MVE to Earnings (Excludes Non Operating 17.2 20.1 22.4 19.8 20.5 20.1 BALANCE SHEET 2002 2003 2004 2005 2006 10/01/06 2002 2003 2004 2005 2006 10/01/06
MVE to Book 2.0 2.2 2.6 2.5 3.0 2.4 ASSETS
Cash & Short-Term Investments $31.50 $44.50 $54.40 $18.30 $37.40 $9.20 8.1% 9.5% 9.7% 3.0% 5.4% 1.4%
Net Receivables 11 11 13 16 16 15 2.7% 2.3% 2.2% 2.6% 2.3% 2.3%
Dividend Payout Ratio Inventories 14 10 12 15 16 16 3.7% 2.1% 2.1% 2.4% 2.3% 2.4%
Dividend per Share - - - - - - Other Current Assets 8 13 58 63 55 68 2.0% 2.7% 10.3% 10.5% 8.0% 10.5%
Dividend Yield - - - - - - Total Current Assets 64 78 136 112 125 108 16.5% 16.6% 24.3% 18.6% 18.0% 16.7%
FINANCIAL RATIO ANALYSIS Net PP&E 300 361 392 452 525 494 77.0% 77.3% 69.8% 75.2% 75.5% 76.3%
Return on Assets 14% 13% 13% 13% 12% 13% Total Long-Term Investments - - - - - - 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Return on Equity 11% 11% 11% 12% 14% 11% Intangibles 19 23 23 24 26 19 4.9% 4.9% 4.1% 4.1% 3.8% 3.0%
Return on Invested Capital 8% 7% 6% 7% 6% 7% Other Assets 6 5 10 13 19 26 1.5% 1.2% 1.9% 2.2% 2.7% 4.0%
Total Long-Term Assets 325 389 426 489 570 539 83.5% 83.4% 75.7% 81.4% 82.0% 83.3%
Asset Turnover 1.5 1.3 1.3 1.4 1.4 1.6 Total Assets $389.30 $467.00 $562.00 $600.90 $695.20 $647.70 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Receivables Turnover 54.6 54.8 57.4 53.1 62.9 69.3
Inventory Turnover 14.8 21.9 22.4 21.2 22.2 24.4 LIABILITIES & SHAREHOLDERS' EQUITY
Debt in Current Liabilities $0.10 $0.10 $0.20 $0.30 $0.30 $0.30 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Average Collection Period 6.7 6.7 6.4 6.9 5.8 5.3 Accounts Payable 18 19 33 30 34 29 4.5% 4.0% 5.9% 5.0% 4.9% 4.5%
Days Inventory 24.7 16.7 16.3 17.2 16.4 15.0 Income Taxes Payable - - - 1 3 5 0.0% 0.0% 0.0% 0.2% 0.4% 0.7%
Days Payable 30.6 31.8 45.7 35.6 34.2 27.8 Other Current Liabilities 44 55 59 74 97 77 11.3% 11.8% 10.6% 12.3% 13.9% 11.9%
Total Current Liabilities 62 74 93 106 134 111 15.9% 15.9% 16.5% 17.6% 19.3% 17.2%
Working Capital $ 3 $ 4 $ 44 $ 6 $ (9) $ (3)
Working Capital as % of Sales 0.4% 0.6% 6.1% 0.8% -0.9% -0.3% Long-Term Debt 22 28 37 39 166 41 5.8% 5.9% 6.6% 6.5% 23.9% 6.3%
Debt-Free Working Capital 3 4 44 7 (9) (3) Deferred Taxes & Invest Tax Credit 1 8 10 4 1 - 0.3% 1.7% 1.8% 0.6% 0.2% 0.0%
Debt-Free Working Capital as % of Sales 0.5% 0.6% 6.1% 0.8% -0.9% -0.2% Minority Interest 1 1 1 1 1 1 0.4% 0.3% 0.2% 0.2% 0.1% 0.2%
Debt & Cash-Free Working Capital (29) (41) (11) (12) (46) (12) Other Liabilities 3 4 22 27 33 31 0.6% 0.9% 3.9% 4.6% 4.8% 4.8%
Debt & Cash-Free W.C. as % of Sales -4.9% -6.8% -1.5% -1.4% -4.7% -1.1% Total Long-Term Liabilities 27 41 70 71 202 73 7.0% 8.8% 12.5% 11.8% 29.0% 11.3%
Total Liabilities 89 115 163 177 336 184 22.9% 24.6% 29.0% 29.4% 48.3% 28.4%
Current Ratio 1.0 1.0 1.5 1.1 0.9 1.0
Quick Ratio 0.8 0.9 1.3 0.9 0.8 0.8 Preferred Stock - - - - - - 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Interest Coverage Ratio (31.5) (59.4) (54.7) (42.2) (31.4) (33.0) Common Equity 300 352 399 424 360 464 77.1% 75.4% 71.0% 70.6% 51.7% 71.6%
Total Equity 300 352 399 424 360 464 77.1% 75.4% 71.0% 70.6% 51.7% 71.6%
Total Debt to Common Equity 7.5% 7.8% 9.3% 9.3% 46.3% 8.8% Total Liabilities & Equity $ 389 $ 467 $ 562 $ 601 $ 695 $ 648 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Total Debt to Market Cap. 3.5% 3.3% 3.4% 3.7% 14.7% 3.7%
Total Debt to MVIC 3.4% 3.2% 3.3% 3.6% 12.8% 3.6%
EXHIBIT 7
CURRENT RATIO
QUICK RATIO
1.5%
Mean of positive #s 1.5% 1.6% 1.6% 1.7% 1.4% 1.3% 1.6% 1.6%
Mean 1.5% 1.6% 1.6% 1.7% 1.4% 1.0% 1.6% 1.6% 1.0%
Median 1.2% 1.6% 1.6% 1.5% 1.3% 1.1% 1.5% 1.6%
High 2.4% 2.3% 3.0% 3.5% 2.3% 1.9% 2.9% 2.7% 0.5%
Low 0.8% 0.5% 0.0% 0.7% 0.3% -0.3% 0.3% 0.4%
0.0%
Low Quartile 0.8% 1.3% 1.3% 1.4% 1.3% 0.8% 1.4% 1.3%
2002 2003 2004 2005 2006 LTM
Upper Quartile 2.4% 2.1% 2.0% 1.6% 1.8% 1.3% 1.7% 1.7%
Mean of positive #s 1.5% 1.6% 1.6% 1.7% 1.4% 1.3% 1.6% 1.6% 80.0%
Mean 1.5% 1.6% 1.6% 1.7% 1.4% 1.0% 1.6% 1.6% 60.0%
Median 1.2% 1.6% 1.6% 1.5% 1.3% 1.1% 1.5% 1.6% 40.0%
High 2.4% 2.3% 3.0% 3.5% 2.3% 1.9% 2.9% 2.7% 20.0%
Low 0.8% 0.5% 0.0% 0.7% 0.3% -0.3% 0.3% 0.4%
0.0%
Low Quartile 0.8% 1.3% 1.3% 1.4% 1.3% 0.8% 1.4% 1.3%
2002 2003 2004 2005 2006 LTM
Upper Quartile 2.4% 2.1% 2.0% 1.6% 1.8% 1.3% 1.7% 1.7%
DAYS OF INVENTORY
15000.0
Mean of positive #s N/A N/A N/A N/A N/A N/A N/A N/A
Mean #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0! N/A #DIV/0! #DIV/0! 10000.0
Median N/A N/A N/A N/A N/A N/A N/A N/A
High - - - - - - - - 5000.0
Low - - - - - - - -
0.0
Low Quartile #NUM! #NUM! #NUM! #NUM! #NUM! N/A #NUM! #NUM!
2002 2003 2004 2005 2006 LTM
Upper Quartile #NUM! #NUM! #NUM! #NUM! #NUM! N/A #NUM! #NUM!
Historical Margins
GROSS MARGIN
EBITDA MARGIN
13.0%
Mean of positive #s 14.1% 14.6% 14.8% 14.0% 12.8% 13.0% 13.8% 14.0%
Mean 14.1% 14.6% 14.8% 14.0% 12.8% 13.0% 13.8% 14.0% 12.5%
Median 13.3% 13.8% 13.7% 13.0% 12.5% 12.6% 13.0% 13.1%
High 17.8% 20.2% 22.5% 20.1% 18.0% 17.8% 20.2% 19.7% 12.0%
Low 12.7% 12.4% 11.0% 10.7% 8.1% 9.0% 9.9% 11.1%
11.5%
Low Quartile 13.1% 12.6% 12.6% 12.3% 12.0% 11.9% 12.8% 12.8%
2002 2003 2004 2005 2006 LTM
Upper Quartile 13.6% 14.1% 14.0% 13.7% 13.4% 13.4% 13.3% 13.5%
EBIT MARGIN
Historical Margins
Mean of positive #s 5.9% 6.5% 6.1% 5.9% 5.3% 5.3% 5.7% 5.9% 4.0%
Mean 5.9% 6.5% 6.1% 5.9% 5.3% 5.3% 5.7% 5.9% 3.0%
Median 5.7% 6.1% 4.7% 5.5% 5.2% 5.3% 5.3% 5.2% 2.0%
High 7.0% 9.7% 10.5% 9.2% 7.7% 7.5% 9.2% 8.8% 1.0%
Low 5.2% 4.9% 4.3% 4.1% 2.5% 3.2% 3.8% 4.8%
0.0%
Low Quartile 5.3% 5.1% 4.5% 4.2% 5.1% 4.7% 4.6% 4.8%
2002 2003 2004 2005 2006 LTM
Upper Quartile 6.5% 6.6% 6.4% 6.2% 5.9% 5.9% 5.9% 6.0%
RETURN ON ASSETS
RETURN ON EQUITY
SG&A / SALES
Mean of positive #s 2.5% 2.7% 2.8% 3.0% 2.4% 3.0% 2.7% 2.7% 2.0%
Mean 2.5% 2.7% 2.8% 3.0% 2.4% 3.0% 2.7% 2.7% 1.5%
Median 2.9% 2.7% 2.3% 2.2% 1.9% 3.2% 2.3% 2.2% 1.0%
High 4.3% 5.3% 6.0% 5.8% 5.2% 5.3% 5.7% 5.3% 0.5%
Low 0.9% 0.9% 1.4% 1.6% 1.0% 1.0% 1.6% 1.4%
0.0%
Low Quartile 1.0% 1.9% 1.5% 1.9% 1.8% 2.1% 1.7% 2.1%
2002 2003 2004 2005 2006 LTM
Upper Quartile 3.2% 2.7% 2.6% 3.4% 2.1% 3.4% 2.3% 2.3%
Mean of positive #s 0.4% N/A N/A N/A N/A N/A N/A N/A -0.3%
Mean -0.2% -0.3% -0.4% -0.4% -0.6% -0.6% -0.5% -0.4% -0.4%
Median -0.3% -0.3% -0.3% -0.4% -0.6% -0.6% -0.5% -0.3% -0.5%
High 0.7% 0.0% -0.1% -0.1% -0.3% -0.2% -0.2% -0.1% -0.6%
Low -0.8% -0.9% -0.9% -0.8% -1.0% -1.1% -0.8% -0.8%
-0.7%
Low Quartile -0.5% -0.4% -0.4% -0.7% -0.8% -0.7% -0.6% -0.5%
2002 2003 2004 2005 2006 LTM
Upper Quartile 0.1% -0.2% -0.2% -0.2% -0.3% -0.2% -0.2% -0.2%
Historical Growth
EBITDA GROWTH
Mean of positive #s 13.1% 13.5% 10.9% 8.3% 3.1% 9.1% 8.6% 10.0%
Mean 13.1% 13.5% 4.5% 3.3% 3.1% 7.1% 8.6% 5.0%
Median 12.6% 9.2% 9.0% 5.6% 2.5% 9.3% 8.4% 0.0%
High 24.6% 27.0% 14.5% 12.7% 6.2% 12.4% 13.1% -5.0%
Low 3.6% 4.8% -5.2% -16.9% 1.0% -1.0% 2.4%
-10.0%
Low Quartile 6.2% 7.0% -4.8% 3.0% 1.2% 4.8% 8.2%
2002 2003 2004 2005 2006 LTM
Upper Quartile 18.4% 19.7% 9.1% 11.8% 4.7% 10.0% 10.9%
Mean of positive #s 22.7% 13.6% 15.6% 25.7% 8.6% 9.8% 12.2% 6.0%
Mean 17.6% 4.9% 7.3% 2.8% 4.6% 5.0% 8.1% 4.0%
Median 10.9% 0.5% 4.1% -1.3% 0.9% 8.9% 10.5% 2.0%
High 52.1% 23.6% 27.9% 35.0% 20.7% 14.9% 16.9% 0.0%
Low -2.9% -8.4% -6.8% -31.8% -2.6% -14.2% -7.9%
-2.0%
Low Quartile 10.4% -7.7% -3.2% -4.6% -0.1% 5.2% 10.3%
2002 2003 2004 2005 2006 LTM
Upper Quartile 17.4% 16.6% 14.7% 16.4% 4.3% 10.2% 11.0%
Historical Growth
ASSET GROWTH
EMPLOYEE GROWTH
SALES / EMPLOYEE
ASSETS / EMPLOYEE
SALES / PP&E
Rare
Darden Brinker Osi Hospitality
Restaurants International Restaurant Ruby International
Inc. Inc. Partners, Inc. Tuesday, Inc. Inc.
BEV/Revenue
BEV/EBITDA
BEV/EBIT
MVE/Earnings
MVE/Book Value
Profitability Adjustments
Growth Adjustments
WACC 11%
Applebees Darden Restaurants Inc. Brinker International Inc. Osi Restaurant Partners, Inc. Ruby Tuesday, Inc. Rare Hospitality International Inc.
Present Value Present Value Present Value Present Value Present Value Present Value
Year Value of $1 Growth 11.0% Value of $1 Growth 11.0% Value of $1 Growth 11.0% Value of $1 Growth 11.0% Value of $1 Growth 11.0% Value of $1 Growth 11.0%
0 1.00 1.00 1.00 1.00 $1.00 1.00 $1.00 1.00 $1.00 1.00 $1.00 1.00
1 1.10 10.0% 0.99 1.07 7.0% 0.96 1.08 8.0% 0.97 1.10 10.0% 0.99 1.09 9.0% 0.98 1.09 9.0% 0.98
2 1.27 15.6% 1.03 1.14 7.0% 0.93 1.17 8.0% 0.95 1.21 10.0% 0.98 1.19 9.0% 0.96 1.19 9.0% 0.96
3 1.37 7.8% 1.00 1.23 7.0% 0.90 1.26 8.0% 0.92 1.33 10.0% 0.97 1.30 9.0% 0.95 1.30 9.0% 0.95
4 1.44 5.0% 0.95 1.31 7.0% 0.86 1.36 8.0% 0.90 1.46 10.0% 0.96 1.41 9.0% 0.93 1.41 9.0% 0.93
5 1.48 3.0% 0.88 1.40 7.0% 0.83 1.47 8.0% 0.87 1.61 10.0% 0.96 1.54 9.0% 0.91 1.54 9.0% 0.91
6 1.53 3.0% 0.82 1.44 3.0% 0.77 1.51 3.0% 0.81 1.66 3.0% 0.89 1.58 3.0% 0.85 1.58 3.0% 0.85
7 1.57 3.0% 0.76 1.49 3.0% 0.72 1.56 3.0% 0.75 1.71 3.0% 0.82 1.63 3.0% 0.79 1.63 3.0% 0.79
8 1.62 3.0% 0.70 1.53 3.0% 0.67 1.61 3.0% 0.70 1.76 3.0% 0.76 1.68 3.0% 0.73 1.68 3.0% 0.73
9 1.67 3.0% 0.65 1.58 3.0% 0.62 1.65 3.0% 0.65 1.81 3.0% 0.71 1.73 3.0% 0.68 1.73 3.0% 0.68
10 1.72 3.0% 0.61 1.63 3.0% 0.57 1.70 3.0% 0.60 1.87 3.0% 0.66 1.78 3.0% 0.63 1.78 3.0% 0.63
11 1.77 3.0% 0.56 1.67 3.0% 0.53 1.75 3.0% 0.56 1.92 3.0% 0.61 1.84 3.0% 0.58 1.84 3.0% 0.58
12 1.82 3.0% 0.52 1.72 3.0% 0.49 1.81 3.0% 0.52 1.98 3.0% 0.57 1.89 3.0% 0.54 1.89 3.0% 0.54
13 1.88 3.0% 0.48 1.78 3.0% 0.46 1.86 3.0% 0.48 2.04 3.0% 0.53 1.95 3.0% 0.50 1.95 3.0% 0.50
14 1.94 3.0% 0.45 1.83 3.0% 0.42 1.92 3.0% 0.44 2.10 3.0% 0.49 2.01 3.0% 0.47 2.01 3.0% 0.47
15 1.99 3.0% 0.42 1.88 3.0% 0.39 1.97 3.0% 0.41 2.16 3.0% 0.45 2.07 3.0% 0.43 2.07 3.0% 0.43
16 2.05 3.0% 0.39 1.94 3.0% 0.37 2.03 3.0% 0.38 2.23 3.0% 0.42 2.13 3.0% 0.40 2.13 3.0% 0.40
17 2.11 3.0% 0.36 2.00 3.0% 0.34 2.09 3.0% 0.36 2.30 3.0% 0.39 2.19 3.0% 0.37 2.19 3.0% 0.37
18 2.18 3.0% 0.33 2.06 3.0% 0.31 2.16 3.0% 0.33 2.37 3.0% 0.36 2.26 3.0% 0.35 2.26 3.0% 0.35
19 2.24 3.0% 0.31 2.12 3.0% 0.29 2.22 3.0% 0.31 2.44 3.0% 0.34 2.33 3.0% 0.32 2.33 3.0% 0.32
20 2.31 3.0% 0.29 2.19 3.0% 0.27 2.29 3.0% 0.28 2.51 3.0% 0.31 2.40 3.0% 0.30 2.40 3.0% 0.30
Total (rounded) $13.50 $12.71 $13.18 $14.16 $13.66 $13.66
Total (rounded)
Adjustment Calculation
Selected Adjustment
Multiples Analyses Exhibit 8
Applebees
Fair Market Value of Equity
As of December 31, 2006
Risk Adjustments
Cost Of Equity
LT Growth
Cap Rate 10.1% 10.1% 9.8% 10.0% 10.0% 11.1%
Screening Criteria
1) Industry Classification (Target/Issuer):Restaurants
2) Closed/Registration Effective Date: [1/1/2004-12/31/2006]
3) Total Transaction Value ($mm):is greater than 100
4) Transaction Type: Merger/Acquisition
5) Geographic Location (Target/Issuer):United States and Canada
Target LTM
Financials - Target LTM Target LTM
Total Financials - Financials -
Announced/Registrati Revenue EBITDA EBIT ($mm) Implied
on Filed Date Total Implied ($mm) (at ($mm) (at (at Implied Enterprise Implied
(Including Bids and Closed/Registrati Transaction Enterprise AnnouncemenAnnouncemenAnnouncemen Enterprise Value/Revenu Enterprise
Letters of Intent) on Effective Date Buyers/Investors Target/Issuer Value ($mm) Business Description [Target/Issuer]Transaction Comments Value/EBIT t) t) t) Value ($mm) es Value/EBITDA
12/27/2006 12/27/2006 GSO Capital Partners Heartland Food Corp. 155.0 Heartland Food Corp. engages in the ownership an GSO Capital Partners LP acquired a majority stake in Heartland - - - - 155.0 - -
operation of franchised BURGER KING restaurants Food Corp. for a consideration of $155 million in cash on
in the Midwest and Southeast United States. Its December 27, 2006. Sperry, Mitchell & Co. was the financial
restaurants offer burgers, sandwiches, fries, and advisor and Chadbourne & Parke LLP was the legal advisor for
soft drinks. Heartland Food Corp. was founded in Heartland.
2003 and is headquartered in Downers Grove,
Illinois.
08/18/2006 12/13/2006 Lone Star Funds Lone Star Steakhouse & 619.88 Lone Star Steakhouse & Saloon, Inc. engages in th Lone Star Funds entered into a definitive agreement to acquire 26.56 310.2 44.85 21.23 563.82 1.82 12.57
Saloon Inc. ownership and operation of mid-priced, full service, Lone Star Steakhouse & Saloon Inc. (Nasdaq: STAR) on
casual dining restaurant concepts in the United August 18, 2006 for $615.02 million. Lone Star Steakhouse &
States. The company operates restaurants under Saloon, Inc. will be acquired by affiliates of Lone Star Funds for
Lone Star, Texas Land & Cattle, Sullivan's, and Del $27.10 per share in cash, a 15% premium to its closing price on
Frisco's brand names. As of March 6, 2006, the August 17, 2006. Lone Star Funds also agreed to acquire the
company owned and operated 250 restaurants. It 3.815 million outstanding options for $37.35 million. The Board
also operated a mid-priced restaurant operating as of Directors of Lone Star Steakhouse & Saloon approved the
Frankie's Italian Grille, as well as licensed 4 Lone agreement in a special meeting and the transaction is subject to
Star restaurants in California, 1 Del Frisco’s stockholder approval and other customary conditions. In case o
restaurant in Florida, 12 Lone Star Steakhouse & termination, the termination fees is $18 million.
Saloon restaurants in Australia, and 1 in Guam, as
of the above date. The company was founded in On November 30, 2006, Lone Star Steakhouse & Saloon Inc.
1991 and is headquartered in Wichita, Kansas. As amended the merger agreement and increased the offer price t
of December 13, 2006, Lone Star Steakhouse & $27.35 per share in cash from $27.10. As a result the new
Saloon Inc. was taken private. consideration is $623.12 million. Lone Star Funds will acquire
3.721 million outstanding options for $36.88 million. The
amended merger agreement has been unanimously approved
by Lone Star Steakhouse & Saloon's Board of Directors. The
acquisition is expected to be completed during the fourth quarte
North Point Advisors LLC and Thomas Weisel Partners LLC are
Exhibit 9
Target LTM
Financials - Target LTM Target LTM
Total Financials - Financials -
Announced/Registrati Revenue EBITDA EBIT ($mm) Implied
on Filed Date Total Implied ($mm) (at ($mm) (at (at Implied Enterprise Implied
(Including Bids and Closed/Registrati Transaction Enterprise AnnouncemenAnnouncemenAnnouncemen Enterprise Value/Revenu Enterprise
Letters of Intent) on Effective Date Buyers/Investors Target/Issuer Value ($mm) Business Description [Target/Issuer]Transaction Comments Value/EBIT t) t) t) Value ($mm) es Value/EBITDA
10/30/2006 12/06/2006 Black Canyon Capital LLC, Logan's Roadhouse, Inc. 656.32 Logan’s Roadhouse, Inc. engages in the ownership Bruckmann, Rosser, Sherrill & Co., Inc., Canyon Capital 19.47 320.5 47.84 33.55 653.42 2.04 13.66
Bruckmann, Rosser, Sherrill & Co. and operation of full-services restaurant chains in Advisors LLC, Black Canyon Capital LLC agreed to acquire
L.L.C., Canyon Capital Advisors, LLC the United States. It offers various ribs, chicken, Logan's Roadhouse from CBRL Group, Inc. (NASDAQ: CBRL)
seafood, and vegetable dishes, steak burgers, for a reported consideration of $486 million on October 30,
salads, sandwiches, and scratch yeast rolls. As of 2006. The consideration includes the anticipated proceeds from
April 30, 2006, it operated 134 company-owned a real estate sale-leaseback transaction to be undertaken by
restaurants and 25 franchisees in 20 states. The Logan's and closed simultaneously with the sale of Logan's to
company was founded in 1991 and is LRI. The completion of the deal is subject to customary post-
headquartered in Nashville, Tennessee. Logan’s closing adjustments, if any, for working capital, indebtedness
Roadhouse, Inc. was formerly a subsidiary of CBRLand capital expenditures. The transaction is expected to close o
Group, Inc. before on November 30, 2006.
02/01/2006 12/05/2006 ADF Companies 165 Pizza Hut 115.0 As of December 5, 2006, 165 Pizza Hut restaurants ADF Companies acquired 165 Pizza Hut restaurants in the US - - - - 115.0 - -
Restaurants in US in US were acquired by ADF Companies. 165 Pizzain a series of transactions for a total of about $115 million. The
Hut Restaurants in US offer catering services. The acquisitions occurred from February-November 2006. With
restaurants are based in The United States. these acquisitions, the ADF Companies are now the second
largest Pizza Hut franchisee in the United States. Capital
Growth Advisors LLC, provided financial advisory services to
ADF Companies for this transaction. Ares Capital Corporation
provided the senior debt and a line of credit. Spirit Finance
Corporation provided initial bridge financing and certain other
financing.
03/10/2006 11/29/2006 Jamba, Inc. (NasdaqNM:JMBA) Jamba Juice Company 264.98 Services Acquisition Corp. International (AMEX: SVI, SVI-U, - - - - 264.98 - -
SVI-WS) entered into an agreement and plan of merger to
acquire Jamba Juice Company for approximately $265 million
on March 10, 2006, from Benchmark Capital, Global Retail
Partners (GRP), Invesco Private Capital, Oak Investment
Partners, Phillips-Smith-Machens Venture Partners, Trinity
Ventures, Ltd. As reported under the terms of the agreement,
SVI will acquire all of the outstanding capital stock of Jamba
Juice for approximately $249 million, and assumed certain
indebtedness for approximately $16 million. Simultaneously with
the closing of the merger, approximately 30.9 million shares of
SVI common stock will be issued, at $7.50 per share, resulting
in aggregate gross proceeds to SVI of approximately $231.6
million, which funds will be used with the approximately $127
million of cash currently held in trust by SVI to fund the merger
consideration and provide additional working and expansion
capital. Paul Clayton will continue in his role as CEO and
President in the new company, supported by the current Jamba
Target LTM
Financials - Target LTM Target LTM
Total Financials - Financials -
Announced/Registrati Revenue EBITDA EBIT ($mm) Implied
on Filed Date Total Implied ($mm) (at ($mm) (at (at Implied Enterprise Implied
(Including Bids and Closed/Registrati Transaction Enterprise AnnouncemenAnnouncemenAnnouncemen Enterprise Value/Revenu Enterprise
Letters of Intent) on Effective Date Buyers/Investors Target/Issuer Value ($mm) Business Description [Target/Issuer]Transaction Comments Value/EBIT t) t) t) Value ($mm) es Value/EBITDA
06/30/2006 11/03/2006 Live Nation, Inc. (NYSE:LYV) HOB Entertainment, Inc. 350.0 HOB Entertainment, Inc., an entertainment Live Nation (NYSE: LYV) entered into a definitive merger - - - - 350.0 - -
company, operates club venues and concert agreement to acquire HOB Entertainment, Inc. from Ares
amphitheaters for promoting music in the United Management LLC, Ares Corporate Opportunities Fund, J.P.
States. Its venues provide various genres of music, Morgan Partners and J.H. Whitney & Co., LLC for a
including rock, hip hop, country, rock en español, consideration of $350 million in cash on June 30, 2006. Under
blues, jazz, reggae, and pop. The company the terms of the agreement, $10 million will be held in escrow.
operates venues in venues located in New Orleans, The deal provides for a termination fee of $15 million. The deal
Los Angeles, Chicago, Myrtle Beach, Denver, is subject to regulatory and shareholders approval. The closing
Dallas, Seattle, Orlando, Las Vegas, Anaheim, of the transaction, which is expected by the end of 2006, will be
Cleveland, San Diego, Toronto, Vancouver, and subject to customary closing conditions.
Atlantic City. Its venues also offer southern-style
cuisine. HOB Entertainment, Inc. was founded in Live Nation anticipates the transaction to be accretive to
1992 and is based in Los Angeles, California. As of earnings and free cash flow per share within the first year.
November 3, 2006, HOB Entertainment, Inc. is a Navid Mahmoodzadegan, Markus Pressdee and Andrew Mun o
subsidiary of Live Nation, Inc. UBS were the financial advisors for HOB and Robert L. Adler of
Munger, Tolles & Olson LLP was the legal advisor for HOB.
Dewey Ballantine LLP provided legal counsel to UBS. Andy
Gordon and Guy Nachtomi of Goldman, Sachs & Co. were the
financial advisors for Live Nation and Steve Rowles, Taylor
Stevens, Matt Steiner and Neeta Toprani of Morrison & Foerste
09/05/2006 11/01/2006 Realty Income Corp. (NYSE:O) Ryan's Restaurant 348.0 As of November 1, 2006, 144 Restaurant PropertiesRealty Income Corporation signed a definitive agreement to - - - - 348.0 - -
Group Inc., 144 of Ryan's Restaurant Group Inc. was acquired by acquire 144 restaurant properties from Ryan's Restaurant
Restaurant Properties Realty Income Corp. 144 Restaurant Properties of Group Inc. for a reported consideration of approximately $350
Ryan's Restaurant Group Inc. offer food and dining million in a sale/leaseback transaction on September 5, 2006.
services. The restaurant's are located in Alabama, Realty Income will acquire the Buffets/Ryan's restaurant
Georgia, Illinois, Indiana, Iowa, Kansas, Kentucky, properties subject to 20-year, triple-net lease agreements. The
Louisiana, Michigan, Mississippi, Missouri, North exact locations and number of properties to be acquired is the
Carolina, Ohio, Oklahoma, Pennsylvania, South subject of continuing discussion between the parties involved in
Carolina, Tennessee, Texas, Virginia and West the transaction. The acquisition is subject to a number of
Virginia. Ryan’s Restaurant Group Inc. is conditions and is anticipated to close in the fourth quarter of
headquartered in Greer, South Carolina. 2006.
07/24/2006 11/01/2006 Buffets Inc. Ryan's Restaurant 874.35 Ryan’s Restaurant Group, Inc., together with its Buffets Inc. entered into an agreement to acquire Ryan's 14.69 480.0 94.0 58.59 860.77 1.79 9.16
Group Inc. subsidiaries, engages in the ownership and Restaurant Group, Inc. (Nasdaq: RYAN) for a consideration of
operation of restaurants principally in the southern $706.24 million in cash on July 24, 2006. Under the terms of
and midwestern United States. As of December 28, the agreement, Buffets Inc. will pay $16.25 per share for the
2005, the company owned and operated 338 outstanding shares of Ryan. The consideration also includes
restaurants under the Ryan’s and the Fire Mountain assumption of 3.215 million options valued at $18.45 million
brand names. Ryan’s Restaurant Group was being the difference between exercise price of $10.51 million
founded in 1977 and is headquartered in Greer, and offer price of $16.25. Buffets will also assume debt of Ryan
South Carolina. As of November 1, 2006, Ryan's In the event of termination, Ryan's Restaurant Group, Inc. will
Restaurant Group Inc. is a subsidiary of Buffets Inc. pay a termination fee of $25 million, including up to $10 million
for expenses incurred by Buffets, where as Buffet will pay a
termination fee of $7.5 million. The combined company will
continue to be called Buffets, Inc. and will continue to be
headquartered in Eagan, Minnesota. Ryan's will operate as a
separate division of Buffets and will continue to be based in
Greer, South Carolina. R. Michael Andrews, Chief Executive
Officer of Buffets, will continue to serve in this capacity for the
combined company. Ryan’s generated sales of $825 million an
Target LTM
Financials - Target LTM Target LTM
Total Financials - Financials -
Announced/Registrati Revenue EBITDA EBIT ($mm) Implied
on Filed Date Total Implied ($mm) (at ($mm) (at (at Implied Enterprise Implied
(Including Bids and Closed/Registrati Transaction Enterprise AnnouncemenAnnouncemenAnnouncemen Enterprise Value/Revenu Enterprise
Letters of Intent) on Effective Date Buyers/Investors Target/Issuer Value ($mm) Business Description [Target/Issuer]Transaction Comments Value/EBIT t) t) t) Value ($mm) es Value/EBITDA
04/20/2006 09/27/2006 Sun Capital Partners IV, L.P., Sun Marsh Supermarkets 324.73 Marsh Supermarkets, Inc. operates supermarkets, Sun Capital Partners, Inc. signed a letter of intent on April 20, 42.8 1,683.79 33.33 6.91 295.73 0.176 8.87
Capital Partners, Inc. Inc. convenience stores, and florist shops primarily in 2006, to acquire Marsh Supermarkets Inc. for a reported
central Indiana and western Ohio. Its supermarkets consideration of approximately $88.15 million including $0.09 fo
offer delicatessens, bakeries, prepared foods, primeClass B options. Under the terms of the proposed deal, Sun
cut meats, fresh seafood, and floral items. The Capital will pay $11.125 for each outstanding share of Marsh's
company’s supermarkets also operate various Class A and Class B common stock. A termination fee of $10
service and specialty departments, including million will be payable if the transaction is terminated under
delicatessens, hot prepared foods, bakeries, prime certain circumstances. In case the shareholders do not approve
cut service meat, fresh seafood, sushi shops, floral the merger agreement and the merger at a meeting held for
shops, imported cheese shops, wines and beer, such purpose, March would be required to pay Sun capital the
salad bars, video rental, fuel kiosks, and amount of Sun capital’s transaction expenses up to $5 million.
Ticketmaster outlets. Its supermarkets include
pharmacies, banks or savings institutions branches The Special Committee approved entering into the letter of
and automated teller machines. The company’s intent. The Board of Directors approved the entering into the
convenience stores offer various grocery, bakery, letter of intent, and entered into an exclusivity agreement with
dairy, and delicatessen items, including fountain Sun Capital. The Marsh Supermarkets has agreed not to
drinks, store-prepared pizza and/or chicken, fresh negotiate with other persons or solicit alternative transactions
pastry products, and sandwiches, as well as sells prior to May 11, 2006. If it breaches its obligations regarding
money orders, lottery tickets, and petroleum exclusivity, it will be required to reimburse Sun Capital for its ex
products. Its floral shops offer plants and cut
flowers and provide event floral arrangements for Sun Capital Partners, Inc. entered into a definitive merger agre
individuals and corporate clients. In addition, the
company provides food management services unde
07/05/2006 09/05/2006 Strategic Hotels & Resorts, Inc. The Fairmont Scottsdale 345.0 The Fairmont Scottsdale Princess offers guest Strategic Hotels & Resorts Inc. agreed to acquire Fairmont - - - - 345.0 - -
(NYSE:BEE) Princess rooms, meeting space, restaurants, and recreationafroScottsdale Princess from Fairmont Raffles Holdings
facilities. It offers south pool, meeting and wedding International for $345.0 million on July 5, 2006. Fairmont will
spaces, and other hospitality amenities. The continue to manage the property after the deal is completed.
Fairmont Scottsdale Princess also offers hotel The transaction is subject to contractual closing conditions. The
packages, such as spa and golf courses. The acquisition is expected to close during the third quarter of 2006.
company was founded in 1987 and is based in
Scottsdale, Arizona. The Fairmont Scottsdale
Princess is a former subsidiary of Fairmont Raffles
Holdings.
08/17/2006 08/21/2006 Sun Capital Partners, Inc. Real Mex Restaurants 667.79 Real Mex Restaurants, Inc. operates full service, Sun Capital Partners, Inc. agreed to acquire Real Mex 16.69 298.6 56.63 38.74 646.44 2.16 11.41
Inc. Mexican casual dining restaurant chain in the Unite Restaurants Inc. for a consideration of $359 million in cash on
States. It operates restaurants primarily under El August 17, 2006. Under the terms of the agreement $11 will be
Torito, Acapulco Mexican Restaurant Y Cantina, held in escrow. Bruckmann, Rosser, Sherrill & Co., Jefferies
and Chevys Fresh Mex brand names. These Capital Partners, J.W. Childs Associates, L.P., Canterbury
restaurants offer various Mexican dishes and Capital Partners and Blackstone Mezzanine Partners sold their
alcoholic beverages. The company, through its stakes in the transaction. Murray Huneke, John Twichell and
subsidiary, Real Mex Foods, Inc. manufactures Damon Chandik from Piper Jaffray & Co., Mike Jones, Jim
specialty products for outside customers, including Walsh, Rob Engel and Chris Nobili from Wachovia Securities,
fast food and casual restaurants, amusement parks LLC and Deutsche Bank Securities Inc. were the financial
and club stores, as well as food service, retail, advisors to Real Mex Restaurants Inc. Michael Weinberg and
vending, and institutional customers. As of Stuart Chasanoff of Jones Day acted as the legal advisors to
December 31, 2006, the company owned and Piper Jaffray Companies. David A. Gerson of Morgan, Lewis &
operated 195 restaurants principally located in Bockius LLP was the legal advisor for Sun Capital Partners.
California. Real Mex Restaurants was founded in Carmen J. Romano of Dechert LLP was the legal advisor for
1998. It was formerly known as Acapulco Real Mex Restaurants.
Acquisition Corp. and changed its name to Real
Mex Restaurants, Inc. in 2004. The company is
headquartered in Cypress, California. Real Mex
Restaurants, Inc. is a subsidiary of RM Restaurant
Holding Corp.
Exhibit 9
Target LTM
Financials - Target LTM Target LTM
Total Financials - Financials -
Announced/Registrati Revenue EBITDA EBIT ($mm) Implied
on Filed Date Total Implied ($mm) (at ($mm) (at (at Implied Enterprise Implied
(Including Bids and Closed/Registrati Transaction Enterprise AnnouncemenAnnouncemenAnnouncemen Enterprise Value/Revenu Enterprise
Letters of Intent) on Effective Date Buyers/Investors Target/Issuer Value ($mm) Business Description [Target/Issuer]Transaction Comments Value/EBIT t) t) t) Value ($mm) es Value/EBITDA
05/19/2006 06/28/2006 Briad Main Street, Inc. Main Street Restaurant 160.12 Main Street Restaurant Group, Inc. operates as a Briad Main Street, Inc., a wholly owned subsidiary of The Briad 18.04 243.57 18.04 8.07 145.57 0.598 8.07
Group Inc. franchisee of TGI Friday’s restaurants in the United Group entered into a definitive agreement to acquire Main Stree
States. The company also engages in the ownershi Restaurant Group, Inc. (NASDAQ: MAIN) from CIC Partners
and operation of the Bamboo Club ‘Asian Bistro’ LP on May 19, 2006 for a reported consideration of
restaurants and Redfish Seafood Grill and Bar approximately $122.69 million. Under the terms of the
restaurants, as well as in the operation of Alice agreement, Briad Main Street, Inc. will pay $6.40 per share in
Cooper’stown restaurants. As of December 31, cash for all issued and outstanding shares of Main Street
2005, it operated 55 TGI Friday's, 10 Bamboo Club Restaurant Group’s common stock. Mr. Bradford Honigfeld,
‘Asian Bistro’, and 4 Redfish Seafood Grill and Bar sole shareholder and CEO of The Briad Group controls
restaurants in 13 states, as well as 1 Alice approximately 2.2 million shares of Main Street Restaurant
Cooper'stown restaurant in Cleveland, Ohio. Main Group common stock. As of May 12, 2006, the Main Street
Street Restaurant Group was incorporated in 1988 Restaurant Group had 17,230,176 shares of its common stock,
and is headquartered in Phoenix, Arizona. As of 3370835 options and 581,395 warrants outstanding. Main
June 30, 2006, Main Street Restaurant Group, Inc. Street Restaurant Group is obligated to pay a termination fee of
is a subsidiary of Briad Main Street, Inc. $5.0 million to The Briad Group and to pay The Briad Group up
to $2.0 million as reimbursement of fees and expenses incurred
by The Briad Group relating to the merger agreement and the
transactions contemplated by the merger agreement.
05/03/2006 05/03/2006 Perkins & Marie Callender’s Inc. Marie Callender Pie 440.0 Marie Callender Pie Shops, Inc. operates a chain of Perkins & Marie Callender’s Inc., formerly known as The - - - - 440.0 - -
Shops, Inc. restaurants in the United States and Mexico. The Restaurant Company, announced the acquisition of Marie
company offers soups, starters, crisp and chicken Callender Pie Shops, Inc. in a transaction valued at $440 million
sesame salads, pasta, sandwiches and burgers, on May 3, 2006. Castle Harlan, Inc. divested its stake in the
muffins, and wine products, as well as pie products company. Under the terms of transaction, The Restaurant
in various flavors. Marie Callender Pie Shops, Inc. Company acquired all the outstanding stock, options and
was founded in 1948 and is headquartered in Aliso warrants of Marie Callender Pie Shops, Inc. The Restaurant
Viejo, California. Marie Callender Pie Shops, Inc. is Company also assumed debt of approximately $101 million, an
a subsidiary of Perkins & Marie Callender’s, Inc. lease obligation of $7 million. Marie Callender Pie Shops, Inc.
will operate as wholly owned subsidiary of The Restaurant
Company.
Target LTM
Financials - Target LTM Target LTM
Total Financials - Financials -
Announced/Registrati Revenue EBITDA EBIT ($mm) Implied
on Filed Date Total Implied ($mm) (at ($mm) (at (at Implied Enterprise Implied
(Including Bids and Closed/Registrati Transaction Enterprise AnnouncemenAnnouncemenAnnouncemen Enterprise Value/Revenu Enterprise
Letters of Intent) on Effective Date Buyers/Investors Target/Issuer Value ($mm) Business Description [Target/Issuer]Transaction Comments Value/EBIT t) t) t) Value ($mm) es Value/EBITDA
01/13/2006 04/18/2006 Compass Group plc (LSE:CPG) Levy Restaurants 250.0 Levy Restaurants operates as a restaurant and Compass Group PLC entered into an agreement to acquire the - - - - 490.2 - -
foodservice organization in the United States and remaining 51% stake in Levy Restaurants for approximately
internationally. The company operates in two $250 million in cash on January 13, 2006. The transaction is
groups, Restaurant, and Sports and Entertainment. expected to close on April 17, 2006. Stan Meadows, Scott
The Restaurant group includes locations that range Williams, Gary Karch and Richard Dees of McDermott Will &
from fine dining to casual dining, as well as Emery LLP gave legal advise to Levy Restaurants.
manages foodservice operations for retailers. The
Sports and Entertainment group represents a
foodservice specialty providing restaurant quality
dining experiences at sports facilities, entertainment
venues, and convention centers that include
stadiums, arenas, convention facilities, and
music/performance venues in the United States.
Levy Restaurants portfolio includes restaurants,
such as Spiaggia, Bistro 110, and Fulton's on the
river in Chicago; and Fulton's Crab House,
Portobello Yacht Club, and Wolfgang Puck's at
Walt Disney World Resort; as well as sports venues
and events, such as Wrigley Field in Chicago,
Lambeau Field in Green Bay, STAPLES Center in
Los Angeles, and AmericanAirlines Arena in Miami.
The comapny was founded in 1978 and is based in
Chicago, Illinois. As of April 18, 2006, Levy Restaur
12/08/2005 03/08/2006 Wellspring Capital Management, L.L.C.Dave & Buster's Inc. 372.66 Dave & Buster’s, Inc. engages in the ownership andWellspring Capital Management LLC entered into a definitive 17.39 123.8 63.07 21.32 370.8 3.0 5.88
operation of restaurant/entertainment complexes in agreement to acquire Dave & Buster's, Inc. (NYSE: DAB) from
North America. The company’s complexes combine HBK Investments, LP on December 8, 2005, in a transaction
casual dining with an array of entertainment reportedly valued at approximately $282.29 million. Under the
attractions, including simulators, high-tech video terms of the agreement, Wellspring will acquire all of Dave &
games, traditional pocket billiards, and shuffleboard Buster's outstanding shares for $18.05 per share, all the
as well as various redemption games that comprise outstanding 1.07 million options at 9.2 per share, 0.57 million
basic games of skill, such as skee-ball and outstanding warrants at $4.59 per share, and 2.32 million of
basketball. Its locations also have multiple special convertible corporate debt at $5.13 per share. A termination fee
event facilities that are used for hosting private of $10.175 million has been agreed in the transaction. All the
parties, business functions, and other corporate securities except common stock have been valued at the
sponsored events. The company was founded in difference between offer price and their respective exercise
1982 and is headquartered in Dallas, Texas. prices. The merger agreement has been unanimously approved
by the Dave & Buster's board of directors. Completion of the
transaction is subject to customary conditions and regulatory
approvals, and the approval of Dave & Buster's shareholders.
The parties expect that the merger will be consummated in the
second quarter of 2006. Wellspring has furnished Dave & Buste
12/12/2005 03/01/2006 Bain Capital, LLC, The Carlyle Group, Dunkin' Brands, Inc. 2,425.0 Dunkin' Brands, Inc. operates as a quick service Bain Capital Partners, The Carlyle Group and Thomas H. Lee - 4,800.0 188.0 - 2,425.0 - -
Thomas H. Lee Partners, L.P. restaurant franchisor in the coffee, bakery, and ice Partners entered into a definitive agreement to acquire Dunkin’
cream segments. It operates a chain of coffee and Brands, Inc. from Allied Domecq Plc on December 12, 2005.
baked goods restaurants, ice cream specialty The transaction is reportedly valued at approximately $2.425
stores, and sandwich restaurants. The company billion in cash. Dunkin’ Brands, Inc. had sales of $4.8 billion for
serves the food and beverage industry. Dunkin' the fiscal year ending August 31, 2004. The private equity firms
Brands, Inc. was founded as Allied Domecq Quick are going to raise approximately $1.4 billion out of the entire
Service Restaurants in 1999 and changed its name consideration through debt financing from a lending group that
to Dunkin' Brands, Inc. in 2004. The company is would be lead by J.P. Morgan Chase & Co. The management o
headquartered in Canton, Massachusetts. Dunkin' Dunkin’ Brands, Inc. is going to participate in the transaction as
Brands, Inc. is a prior subsidiary of Allied Domecq investors.
plc.
The closing of the transaction is subject to regulatory approvals
The existing Dunkin’ Brands management team, led by Chief
Executive Officer, Jon L. Luther, will continue in their current
positions. The transaction is expected to close in the first
quarter of 2006. J.P. Morgan Securities Inc. acted as financial
advisor and Mr. Paul S. Bird, Mr. Gary M. Friedman and Ms.
Elizabeth Pagel Serebransky of Debevoise & Plimpton LLP
acted as legal advisor to Pernod Ricard on the transaction. Citig
Exhibit 9
Target LTM
Financials - Target LTM Target LTM
Total Financials - Financials -
Announced/Registrati Revenue EBITDA EBIT ($mm) Implied
on Filed Date Total Implied ($mm) (at ($mm) (at (at Implied Enterprise Implied
(Including Bids and Closed/Registrati Transaction Enterprise AnnouncemenAnnouncemenAnnouncemen Enterprise Value/Revenu Enterprise
Letters of Intent) on Effective Date Buyers/Investors Target/Issuer Value ($mm) Business Description [Target/Issuer]Transaction Comments Value/EBIT t) t) t) Value ($mm) es Value/EBITDA
12/12/2005 02/24/2006 Newcastle Partners, LP, Steel PartnersFox & Hound Restaurant 157.75 Fox & Hound Restaurant Group engages in the Newcastle Partners, L.P. and Steel Partners II, L.P. proposed a 13.73 164.65 22.08 12.41 170.31 1.03 7.71
LLC, Steel Partners, II L.P. Group development and operation of entertainment cash tender offer on December 12, 2005, to purchase all of the
restaurants under the Fox and Hound, and Bailey’s outstanding shares of common stock of Fox & Hound
brand names in the United States. Its entertainment Restaurant Group (NASDAQ: FOXX) not already owned for
restaurants combine a social gathering place, full $14.75 per share. Newcastle and Steel would also cash out
menu and full service bar, audio and video systems outstanding in the money options and warrants at this price.
for sports entertainment; games, such as pocket The transaction is reportedly valued at $145.36 million. The
billiards; and a late-night dining. The company’s tender offer will be subject to customary conditions, including a
restaurant features full-service bars, which offer a majority of Fox & Hound's shares on a fully diluted basis being
selection of domestic, imported, and specialty tendered and not withdrawn, expiration of the applicable waiting
beers. As of March 22, 2005, it owned and operatedperiod under the Hart-Scott-Rodino Antitrust Improvements Act
59 Fox and Hound restaurants; and 18 Bailey’s of 1976, Fox & Hound's stockholder approval, the obtaining of
restaurants located in Alabama, Arizona, Arkansas, all consents, approvals or authorizations required by all state,
Colorado, Georgia, Illinois, Indiana, Kansas, city or local liquor licensing boards, agencies or other similar
Louisiana, Michigan, Missouri, Nebraska, New entities and Newcastle and Steel being satisfied that Section
Jersey, New Mexico, North Carolina, Ohio, 203 of the Delaware General Corporation Law is inapplicable to
Oklahoma, Pennsylvania, South Carolina, the offer to purchase and the potential merger thereafter. The
Tennessee, Texas, and Virginia. The company was offer will not be subject to or conditioned upon any financing arr
formerly known as Total Entertainment Restaurant
Corp. and changed its name to Fox & Hound
Restaurant Group in May 2005. Fox & Hound
Restaurant is based in Wichita, Kansas.
09/27/2005 11/18/2005 Trimaran Capital Partners, Trimaran EPL Intermediate, Inc. 415.0 EPL Intermediate, Inc. owns, operates, and Trimaran Capital Partners entered into a definitive agreement - - - - 415.0 - -
Fund II franchises quick service restaurants specializing in with American Securities Capital Partners L.P., to acquire EPL
marinated and flame-grilled chicken. The company Intermediate Inc. on September 27, 2005. The transaction is
is based in Irvine, California. valued at approximately $415 million on a debt-free basis,
subject to adjustment as provided in the purchase agreement
for debt and debt related costs, transaction expenses, working
capital and management retained equity. The closing of the
transaction is subject to the satisfaction of waiver of customary
conditions as set forth in the stock purchase agreement. The
purchase agreement also contains a number of customary
representations, warranties and covenants. In connection with
the closing of the Acquisition, directors Glenn B. Kaufman,
David L. Horing, and Stephen E. Carley were replaced by
Steven A. Flyer and David L. Benyaminy on the board of EPL
Intermediate. The purchase agreement may be terminated by
mutual agreement by both parties if certain conditions containe
in the purchase agreement have not been satisfied or waived b
December 31, 2005. Bank of America Securities LLC advised E
10/18/2005 10/18/2005 Sun Capital Partners, Inc. Garden Fresh 198.0 Garden Fresh Restaurant Corp. engages in the Sun Capital Partners Inc. acquired Garden Fresh Restaurant - - - - 198.0 0.81 6.6
Restaurant Corp. ownership and operation of salad buffet restaurants Corp. from Fairmont Capital Inc., Centre Partners Management
under the names, Souplantation and Sweet LLC, Northwestern Mutual Insurance Co. and management of
Tomatoes. As of September 30, 2003, the companythe company for $198 million on October 18, 2005. Sun Capital
operated 97 restaurants in Arizona, California, will provide a bridge loan in this transaction. Garden Fresh has
Colorado, Florida, Georgia, Illinois, Kansas, annual revenue of $245 million and EBIDTA of about $30
Missouri, Nevada, New Mexico, North Carolina, million.
Oregon, Texas, Utah, and Washington. Garden
Fresh was founded in 1983 and is headquartered in Murray Huneke, John Twichell and Damon Chandik of Piper
San Diego, California. Jaffray & Co. advised Fairmont Capital Inc., Northwestern
Mutual Life Insurance Co., Investment Arm and Centre Partners
Management LLC while Steven Rubin and Jeffrey Hopkins of
Weil Gotshal & Manges LLP acted as their legal advisers. Doug
Gessner, Jeremy Liss, Mike Wright, Rob Kiburz, Lacey Bundy
and Jon Glassglow of Kirkland & Ellis LLP provided counsel to
Sun Capital.
Exhibit 9
Target LTM
Financials - Target LTM Target LTM
Total Financials - Financials -
Announced/Registrati Revenue EBITDA EBIT ($mm) Implied
on Filed Date Total Implied ($mm) (at ($mm) (at (at Implied Enterprise Implied
(Including Bids and Closed/Registrati Transaction Enterprise AnnouncemenAnnouncemenAnnouncemen Enterprise Value/Revenu Enterprise
Letters of Intent) on Effective Date Buyers/Investors Target/Issuer Value ($mm) Business Description [Target/Issuer]Transaction Comments Value/EBIT t) t) t) Value ($mm) es Value/EBITDA
09/19/2005 10/10/2005 Black Canyon Capital LLC, Leonard Claim Jumper 250.0 Claim Jumper Restaurants, LLC offers a selection Leonard Green & Partners, L.P. announced that it has entered - 226.0 - - - - -
Green & Partners, L.P. Restaurants, LLC of prepared items for lunch and dinner. It provides into a letter of intent to acquire a majority stake in Claim Jumpe
steaks, fish and seafood, rotisserie chicken, baby Restaurants, LLC on September 19, 2005. As part of the
back pork ribs, baked pot pies, wood-fired pizzas, acquisition, Black Canyon Capital LLC will make an equity
pasta, sandwiches, burgers, baked goods, investment of $5 million and an additional $15 million in senior
desserts, sweets, and soups and salads. The subordinated notes. The company has received Hart-Scott-
company’s saloons offer signature cocktails, chilled Rodino antitrust clearance to sell itself to Leonard Green &
martinis, spirits, specialty nonalcoholic beverages, Partners, L.P. For the year ended on December 31, 2004,
wines, and imported and American craft beers. It Claim Jumper Restaurants, LLC reported revenues of $226
also offers banquet facilities. The company serves million. Piper Jaffray Companies was the financial advisor to
families, children, seniors, and business Claim Jumper Restaurants, LLC on the deal. Michael Weinberg
professionals. It has locations in Arizona, California,of Jones Day advised Piper Jaffray Companies.
Colorado, Illinois, Nevada, Oregon, and
Washington. Claim Jumper Restaurants, LLC was
founded in 1977 and is based in Irvine, California.
11/03/2004 10/03/2005 Penn National Gaming Inc. Argosy Gaming Co. 2,253.64 Argosy Gaming Company engages in the ownershipPenn National Gaming, Inc. (Nasdaq: PENN) entered in to an 10.67 1,017.03 268.79 205.19 2,189.81 2.15 8.15
(NasdaqNM:PENN) and operation of riverboat casinos, and related agreement on November 3, 2004, to acquire Argosy Gaming
entertainment and hotel facilities in the midwestern Company (NYSE: AGY) for approximately $2.22 billion,
and southern United States. The company owned including approximately $805.28 million of long-term debt of
and operated six riverboat casinos, including the Argosy and its subsidiaries. As reported under the terms of the
Argosy Casino Alton in Alton, Illinois, serving the St agreement, Penn National will acquire all of the outstanding
Louis metropolitan market; Argosy Casino-Riversideshares of Argosy for a cash price of $47.00 per share and each
in Missouri, serving the greater Kansas City outstanding option to purchase Argosy’s common stock will also
metropolitan market; Argosy Casino-Baton Rouge inbe converted into the right to receive a cash amount equal to
Louisiana; Argosy Casino-Sioux City in Iowa; $47, less the exercise price for such option. Argosy Gaming ha
Argosy Casino-Lawrenceburg in Indiana, serving 29.5 million shares of common stock and 1.4 million outstandin
the Cincinnati and Dayton metropolitan markets; stock options exercisable at a price of $29.20 per share
and Empress Casino Joliet in Illinois serving the outstanding as on November 3, 2004. Argosy Gaming shall pay
greater Chicagoland market. The company’s hotels to Penn National Gaming a termination fee in an amount equal
offers land-based entertainment pavilions, to $49.50 million. The transaction is subject to approval by the
recreational vehicle parks, entertainment lounges, Argosy Gaming stockholders and by each company's
and support facilities featuring buffet restaurant and respective state regulatory bodies, and to certain other
specialty restaurants. Argosy Gaming Company necessary regulatory approvals and other customary closing
was organized in 1992 and is based in Alton, Illinoisconditions contained in the merger agreement. The transaction
As of October 3, 2005, Argosy Gaming Co.
operates as a subsidiary of Penn National Gaming
Inc.
09/06/2005 09/22/2005 Castle Harlan Partners IV, L.P., Castle Perkins & Marie 245.0 Perkins & Marie Callender’s, Inc., together with its Castle Harlan, Inc. and the managment of Perkins & Marie - 341.34 42.23 25.51 - - -
Harlan, Inc. Callender’s Inc. subsidiaries, operates and franchises full-service Callender’s Inc., formerly known as Restaurant Co., The,
family dining restaurants primarily in the Midwest, announced that they have agreed to acquire a stake in the
Florida, and Pennsylvania under the brand name company from Don Smith and BancBoston Ventures, Inc. for
Perkins Restaurant and Bakery. The company also $245 million on September 6, 2005. The transaction will buy out
operates casual-dining restaurants and sells pie andBancBoston Ventures Inc.'s 30% interest of the company's
other bakery items primarily located in the western common stock, as well as preferred stock that will be redeemed
United States under the name Marie Callender’s prior to the deal's closing. Castle Harlan will invest $65 million o
Restaurant and Bakery. In addition, it manufactures equity from its Castle Harlan Partners IV LP fund. Donald Smith
and sells pies, pancake mixes, cookie doughs, will continue to own a minority position in the company.
muffin batters, and other bakery products for third- Restaurant Co., The’s other senior managers are expected to
party customers. As of December 31, 2006, the participate in the purchase. David Pittaway, a Castle Harlan
company’s network consisted of 155 operated and Senior Managing Director, led the negotiating team. As a result
322 franchised Perkins’ restaurants in 33 states of the transaction, William Pruellage, Castle Harlan, Inc.'s
and in 5 Canadian provinces, as well as 92 operate Managing Director, will join the board of directors of the
and 46 franchised Marie Callender’s restaurants in company. The transaction is expected to close by September
four states and Mexico. It also operated 11 Marie 2005.
Callender’s restaurants under partnership
agreements. The company, formerly known as The Marc Weingarten, Robert Goldstein, Christian Mittweg, and
Restaurant Company, was founded in 1958 and is David Levine of Schulte Roth & Zabel, LLP provided legal advic
based in Memphis, Tennessee. Perkins & Marie
Callender’s, Inc. is a subsidiary of Perkins & Marie C
Exhibit 9
Target LTM
Financials - Target LTM Target LTM
Total Financials - Financials -
Announced/Registrati Revenue EBITDA EBIT ($mm) Implied
on Filed Date Total Implied ($mm) (at ($mm) (at (at Implied Enterprise Implied
(Including Bids and Closed/Registrati Transaction Enterprise AnnouncemenAnnouncemenAnnouncemen Enterprise Value/Revenu Enterprise
Letters of Intent) on Effective Date Buyers/Investors Target/Issuer Value ($mm) Business Description [Target/Issuer]Transaction Comments Value/EBIT t) t) t) Value ($mm) es Value/EBITDA
04/28/2005 09/22/2005 Pacific Equity Partners Worldwide Restaurant 268.38 Worldwide Restaurant Concepts, Inc. and its Pacific Equity Partners entered into a definitive merger 17.16 359.53 26.38 14.0 240.2 0.668 9.11
Concepts Inc. subsidiaries engage in the operation, development, agreement to acquire Worldwide Restaurant Concepts Inc.
and franchising of the Sizzler restaurants; the (WRC) on April 28, 2005. As reported, the consideration was
operation and development of the Pat & Oscar's valued at approximately $218.26 million, excluding debt. Pacific
restaurants; and the operation of KFC franchises. would pay $7.25 per share, based on the merger consideration
As of April 30, 2005, the company operated and formula in the merger agreement using the exchange rate of US
franchised 310 Sizzler restaurants in the United dollar to Australian dollar of 0.7806 on April 28, 2005. The term
States, Australia, New Zealand, Latin America, and of the deal are subject to fluctuations in the Australian dollar
Asia; 21 Pat & Oscar's restaurants in southern exchange rate. According to the terms of the merger
California; and 111 KFC restaurants in Australia. agreement, per share consideration would vary from a floor of
The company was founded in 1958 and is $6.65 if the US dollar to Australian dollar exchange rate is
headquartered in Sherman Oaks, California. 0.7339 or below to a high of $7.25 if the exchange rate is
Worldwide Restaurant Concepts, Inc. was acquired 0.8140 or above. The transaction is subject to the approval of
as a wholly owned subsidiary by an affiliate of WRC's stockholders, as well as customary closing conditions,
Pacific Equity Partners Pty Limited in September including receipt of regulatory approvals and certain third party
2005. consents, including, but not limited to, the approval by YUM!
Brands, Inc. of the transfer of franchise agreements for WCR's
KFC(R) stores in Australia, and receipt by Pacific Equity Partne
05/27/2005 07/25/2005 Triarc Companies Inc. (NYSE:TRY) RTM Restaurant Group 724.13 As of July 25, 2005, RTM Restaurant Group was Triarc Companies, Inc. (NYSE: TRY; TRY.B) entered into a - - - - 724.13 - -
acquired by Triarc Companies Inc. RTM Restaurant definitive agreement to acquire RTM Restaurant Group (RTM)
Group operates as a quick service food company in for approximately $738 million on May 27, 2005. As reported
the United States. It operates a portfolio of under the terms of the deal, Triarc Companies, Inc. will pay
restaurants concepts, which include Arby's Roast $175 million in cash, subject to adjustment under certain
Beef Restaurants and Mrs. Winner's Chicken & circumstances, plus either 10 million shares of Triarc's existing
Biscuits. The company was founded by Russ Class B common stock, Series 1 (Series B-1 Stock) or 10
Umphenour in 1973 and is based in Atlanta, million shares of a newly created, non-voting Triarc Class B
Georgia. common stock, Series 2 (Series B-2 Stock) that are converted
into shares of Series B-1 Stock. All RTMRG stock options
either will be exercised or terminated and cancelled prior to the
closing of the acquisition of RTM, except for specified rollover
stock options, which will be converted into replacement stock
options to acquire shares of Triarc Class B-1 Common Stock or
Triarc Class B-2 Common Stock, as applicable. The "in-the-
money" value of these replacement stock options at the time of
grant will reduce the number of shares included in the
aggregate merger consideration. In connection with the RTM ac
04/06/2005 06/01/2005 DB Real Estate, Gaylord Entertainmen ResortQuest Waikiki 107.0 ResortQuest Waikiki Beach Hotel provides boardingGaylord Entertainment Co. (NYSE: GET) entered into an - - - - 107.0 - -
Co. (NYSE:GET) Beach Hotel lodging services. The hotel offers valet parking, agreement to purchase the Aston Waikiki Beach Hotel from WB
Internet access, swimming, surfing, hiking, and 2507 Kalakaua, LLC, a subsidiary of Leucadia National
canoeing services. Additionally, it owns and Corporation for $107 million on April 6, 2005. This purchase
operates restaurants and ice cream parlors. agreement is subject to due diligence and approval by Gaylord'
ResortQuest Waikiki, formerly known as Aston board of directors. Gaylord plans to bring in a partner that will
Waikiki Beach Hotel, is headquartered in Honolulu, own the majority of the equity in the property and that partner
Hawaii. As of June 1, 2007, ResortQuest Hawaii will fund the majority of the equity required for the purchase,
LLC is a subsidiary of IAC/InterActiveCorp. which will be an important factor in the board's consideration.
On May 2, 2005, Gaylord Entertainment agreed to sell 80.1%
interest in the Aston Waikiki Beach Hotel to DB Real Estate.
11/10/2004 04/13/2005 - Quality Dining Inc. 114.54 Quality Dining, Inc. and its subsidiaries engage in Quality Dining, Inc. (Nasdaq: QDIN) announced that it has 8.96 232.1 24.97 14.46 129.57 0.558 5.19
the development and operation of both quick servic entered into a definitive merger agreement with QDI Merger
and full service restaurants in the United States. Corp. pursuant to which a group of five shareholders led by
The company owns the Grady's American Grill, company Chief Executive Officer Mr. Daniel B. Fitzpatrick will
Papa Vino's Italian Kitchen, and Spageddies Italian purchase all the outstanding shares of common stock owned by
Kitchen concepts, as well as operates Burger King the public shareholders on November 9, 2004. Under the terms
restaurants and Chili's Grill & Bar restaurants as a of the proposed transaction, the public holders of the
franchisee. It operated 123 Burger King restaurants outstanding shares of Quality Dining would each receive $3.20
39 Chili's Grill & Bar restaurants, 2 Grady's per share in cash in exchange for their shares. The purchase
American Grill restaurants, 6 Papa Vino's Italian would take the form of a merger in which Quality Dining would
Kitchen restaurants, 3 Spageddies Italian Kitchen survive as a privately held corporation. Mr. Fitzpatrick's group
restaurants, and 1 Porterhouse Steaks and Seafoodalready owns 44.7% of the company's outstanding shares, and
restaurant, as of February 9, 2005. Quality Dining 45.7% giving effect to their stock options. The board had
was founded in 1981 by Daniel B. Fitzpatrick. The appointed a special committee of independent directors to
company is headquartered in Mishawaka, Indiana. evaluate the transaction. Houlihan, Lokey, Howard & Zukin
Financial Advisers, Inc. and Houlihan, Lokey, Howard & Zukin
Capital, which acted as the special committee's financial
advisors. Banc of America Securities LLC advised the investor
group. The transaction, which is expected to be completed in e
Exhibit 9
Target LTM
Financials - Target LTM Target LTM
Total Financials - Financials -
Announced/Registrati Revenue EBITDA EBIT ($mm) Implied
on Filed Date Total Implied ($mm) (at ($mm) (at (at Implied Enterprise Implied
(Including Bids and Closed/Registrati Transaction Enterprise AnnouncemenAnnouncemenAnnouncemen Enterprise Value/Revenu Enterprise
Letters of Intent) on Effective Date Buyers/Investors Target/Issuer Value ($mm) Business Description [Target/Issuer]Transaction Comments Value/EBIT t) t) t) Value ($mm) es Value/EBITDA
01/20/2005 03/07/2005 Trimaran Capital Partners Charlie Browns, Inc. 140.0 Charlie Browns, Inc. operates a steakhouse chain inTrimaran Capital Partners LLC announced that it has backed - - - - 140.0 - -
New Jersey. Its menu includes seafood, chicken, the management buy-out of Charlie Brown's Inc. from Castle
appetizers, soups and salads, steaks and chops, Harlan Inc. in a transaction valued at $140 million on January
burgers, sandwiches and wraps, cheese, cheese 20, 2005. Banc of America Securities LLC is providing $85
sticks, pizzas, coffee, desserts, wines, and beers. million in financing for the buyout, a $15 million revolver and $7
The company also has locations in New York and million term. Charlie Brown's senior management team, headed
Pennsylvania. Charlie Browns, Inc. was founded in by Russell D'Anton, will continue in their current positions and
1966 and is headquartered in Mountainside, New will be investors in the transaction. D'Anton will assume the role
Jersey. of Chairman of the Board of Directors. Closing is expected in
the first quarter.
11/01/2004 12/29/2004 Arcapita Inc. Church's Chicken 390.0 Church's Chicken, also known as Cajun Operating Arcapita Inc. announced that it has signed an agreement to - - - - 390.0 - -
Company is a quick service chicken concept. The acquire the Church's Chicken Brand from AFC Enterprises, Inc
Company operates a chain of restaurants in the for as reported value of approximately $390 million on Novemb
United States, Canada, Costa Rica, Honduras, 1, 2004. The deal is comprised of $383 million in cash and a
Indonesia, Kuwait, Mexico, Nigeria, Puerto Rico, subordinated note from an affiliate of the buyer for $7 million. A
Saipan, South Africa, St. Maarten, Tobago, part of the transaction, if the agreement is terminated by
Trinidad, and Venezuela. It serves specialties, Church's Chicken or AFC under certain conditions, it shall be
including fried okra, coleslaw, mashed potatoes, liable to pay Arcapita a sum of $15 million as the termination
corn on the cob, and honey butter biscuits. The fee. AFC Enterprises expects net proceeds from the sale, after
company also offers catering services. The tax considerations, to be approximately $275 million. Further
company was founded in 1952 and is based in terms of the agreement were not disclosed. The transaction is
Atlanta, Georgia. Church's Chicken is a former expected to close by the end of the year 2004. Sun Trust Bank
subsidiary of AFC Enterprises Inc. of Atlanta is providing a senior bridge loan. Drawbridge Special
Opportunities Fund II LP is providing real estate financing. The
rest is equity financed by the First Islamic Investment Bank
through a holding company managed by Arcapita. Bear, Stearn
& Co. Inc. acted as the financial advisor to AFC Enterprises in
this transaction. King & Spalding's Mr. C. William Baxley and M
11/24/2004 12/27/2004 Charlesbank Capital Partners, LLC, Captain D’s, LLC 150.0 Captain D’s, LLC owns, operates, and franchises Charlesbank Capital Partners and Grotech Capital Group - - - - 150.0 - -
Charlesbank Equity Fund V, Limited restaurants in the United States and the Caribbean. announced the acquisition of Captain D's Inc. from Lone Star
Partnership, Grotech Capital Group, Its restaurants serve seafood menu that includes Funds. Charlesbank Capital Partners is investing through its
Inc. entrees, pasta dishes, and the signature fried fish. Charlesbank Equity V fund. The sponsors are arranging $100
The company’s restaurants also offer baked or million in senior bank debt for the buyout. Wachovia Securities
broiled fish, as well as shrimp, chicken, salads, is syndicating the $100 million of bank debt. The deal is
home-style side dishes, sandwiches, starters and expected to close by the end of 2004. Goodwin Proctor advised
desserts, and sweet tea. It offers side items, Charlesbank Capital Partners. Wachovia Securities Inc advised
including corn, baked potato, tossed salads, the acquirors.
hushpuppies, and southern style green beans.
Captain D’s also operates restaurants in various
military bases internationally. The company was
founded in 1969 as Mr. D's. It changed its name to
Captain D's Seafood, Inc. Captain D's Seafood
further changed its name to Captain D’s, LLC in
2002. The company is based in Nashville,
Tennessee. As of December 27, 2004, Captain D’s,
LLC is a subsidiary of Sagittarius Brands, Inc.
Exhibit 9
Target LTM
Financials - Target LTM Target LTM
Total Financials - Financials -
Announced/Registrati Revenue EBITDA EBIT ($mm) Implied
on Filed Date Total Implied ($mm) (at ($mm) (at (at Implied Enterprise Implied
(Including Bids and Closed/Registrati Transaction Enterprise AnnouncemenAnnouncemenAnnouncemen Enterprise Value/Revenu Enterprise
Letters of Intent) on Effective Date Buyers/Investors Target/Issuer Value ($mm) Business Description [Target/Issuer]Transaction Comments Value/EBIT t) t) t) Value ($mm) es Value/EBITDA
07/28/2004 07/28/2004 CBL & Associates Properties Inc. Monroeville Mall 231.2 Monroeville Mall is a shopping complex that CBL & Associates Properties, Inc. (NYSE:CBL) has acquired - - - - 231.2 - -
(NYSE:CBL) operates department stores, an athletic facility, the Monroeville Mall in Monroeville, PA from Turnberry
luxury apartments, and a food market. The mall is Associates. The acquisition included the mall, an associated
based in Monroeville, Pennsylvania. As of center known as the Annex, and an open-air expansion known
07/28/2004, Monroeville Mall is a subsidiary of CBLas the Village all of which are situated on leasehold land. The
& Associates Properties Inc. consideration for this acquisition is $231.2 million and is
expected to generate an initial yield for the mall and associated
center of 7.37% based upon current income. An additional
$20.7 million will be invested for the open-air expansion, which
is expected to yield 8.18% when it opens in mid-2005. The
combined return for the entire project is expected to be 7.45%.
The purchase price is comprised of the assumption of a $134.0
million fixed-rate, non-recourse loan that matures in 2013 and
bears interest at a rate of 5.732%; $36.25 million in cash,
including closing costs; and the issuance of 780,470 SCUs
(special common units) of CBL's Operating Partnership with a
par value of $60.95 million, or $78.10 per unit. The SCUs will b
entitled to receive an initial annual dividend of 6.5% and will be
06/14/2004 07/07/2004 Bob Evans Farms Inc. Mimi’s Cafe Inc. 179.6 Mimi’s Cafe, Inc. offers various food products in Bob Evans Farms, Inc. (Nasdaq: BOBE) announced that it has 17.82 102.3 17.64 9.79 174.47 1.71 9.89
(NasdaqNM:BOBE) New Orleans cafes and European bistros. As of signed a definitive agreement to acquire SWH Corporation
December 31, 2003, the company owned and (d/b/a Mimi's Cafe). The deal was valued at $182 million in
operated 78 restaurants including 47 in California, 9cash, including the assumption of approximately $79 million of
in Arizona, 6 in Colorado, 4 in Texas, 3 in Nevada, 3outstanding indebtedness. Mimi's total revenues for calendar
in Utah, 2 in Florida, 2 in Kansas, 1 in New Mexico, year 2003 were $240.5 million. Mimi's Cafe will operate as a
and 1 in Oklahoma. Mimi’s Café was founded by separate subsidiary of Bob Evans Farms. The acquisition will b
Thomas M. Simms in 1978 and is headquartered in financed initially through a committed credit facility, which is
Tustin, California. As of 07/07/2004, Mimi’s Cafe expected to be refinanced through a private placement of
Inc. is a subsidiary of Bob Evans Farms Inc. approximately $190 million in debt securities. Proceeds from
this transaction will also be used to repay Mimi's existing debt.
CIBC World Markets acted as the financial advisor to Mimi’s
Cafe Incorporated.
05/03/2004 07/01/2004 Castle Harlan Partners IV, L.P., Castle Caribbean Restaurants 340.0 Caribbean Restaurants LLC engages in restaurant Castle Harlan, Inc. announced that it has signed a definitive - - - - - - -
Harlan, Inc. LLC business. It operates BURGER KING restaurants in agreement to acquire a majority stake in Caribbean Restaurant
Puerto Rico. Caribbean Restaurants is based in LLC from Oak Hill Capital Partners and American Securities
Cataño, Puerto Rico. Capital Partners in a transaction valued at $340 million on May
3, 2004. Castle Harlan, Inc. will invest through its fund Castle
Harlan Partners IV, L.P. in the transaction. Following the
transaction, Caribbean's management, led by Luis Arenas
Pérez, Chief Executive Officer, will retain a minority stake in the
company. Oak Hill sold its 73% stake while American Securities
sold its 10% stake in the transaction. Credit Suisse First Boston
and Wachovia are providing senior debt and mezzanine
financing in the transaction.
01/20/2004 05/19/2004 Boyd Gaming Corp. (NYSE:BYD) Red River Entertainment 190.0 Harrah’s Entertainment, Inc. (NYSE:HET) and Boyd Gaming - - - - 190.0 - -
of Shreveport Corporation (NYSE:BYD) jointly announced that they have
Partnership in signed a definitive agreement for Harrah’s to sell its Shreveport
Commendam hotel-casino to Boyd Gaming for $190 million, subject to
regulatory approval. Harrah’s Entertainment, Inc. will pay a
termination fee of $10.0 million to Boyd Gaming Corporation, in
the event of the termination of the agreement. On May 17,
2004, Boyd Gaming Corporation (NYSE: BYD) announced that
it has received unanimous approval from the Louisiana Gaming
Control Board for its $190 million acquisition of Harrah's
Shreveport. Latham & Watkins LLP, under the lead of Mr.
Charles Ruck, was legal advisor to Harrah's Entertainment Inc
while CIBC World Markets Corp advised Boyd Gaming Corp on
the deal. Morrison & Foerster, LLP was the legal advisor to
Boyd Gaming Corp.
Exhibit 9
Target LTM
Financials - Target LTM Target LTM
Total Financials - Financials -
Announced/Registrati Revenue EBITDA EBIT ($mm) Implied
on Filed Date Total Implied ($mm) (at ($mm) (at (at Implied Enterprise Implied
(Including Bids and Closed/Registrati Transaction Enterprise AnnouncemenAnnouncemenAnnouncemen Enterprise Value/Revenu Enterprise
Letters of Intent) on Effective Date Buyers/Investors Target/Issuer Value ($mm) Business Description [Target/Issuer]Transaction Comments Value/EBIT t) t) t) Value ($mm) es Value/EBITDA
04/05/2004 05/14/2004 Quinlan Private Capital Ltd. Maybourne Hotel Group 1,372.05 Maybourne Hotel Group owns and runs internationaQuinlan Private agreed to purchase Savoy Hotel plc for £750 - - - - 1,372.05 - -
hotels and restaurants. The company comprises of million ($1,372.05 million) from Colony Capital, LLC and
The Berkeley, The Claridge’s, and The Connaught. Blackstone Real Estate Advisors on April 5, 2005. Deutsche
The company was founded in 1889 as The Savoy Bank AG London was financial advisor to Savoy Hotel plc,
Group and changed its name to Maybourne Hotel Colony Capital, LLC and Blackstone Real Estate Advisors. The
Group in January 2005. Maybourne Hotel Group is conversion was made through oanda.com on April 5, 2004.
based in London, United Kingdom. Maybourne Hote
Group operates as a subsidiary of Coroin Limited.
05/04/2004 05/04/2004 Simon Property Group Inc. Plaza Carolina 309.0 Plaza Carolina is a shopping mall that includes Simon Property Group, Inc. (NYSE: SPG) announced that it - - - - 309.0 - -
(NYSE:SPG) specialty stores, ATM machines, department stores has completed the purchase of a 100% interest in Plaza
cinemas, and a food court. The mall's specialty and Carolina for $309 million from a partnership owned 50% by the
departmental stores include Limited Too, PacSun, California Public Employees' Retirement System ("CalPERS")
Claire's Boutique, GAP, Rave, Zales Jewelers, and 50% by the State of Michigan Treasury ("Michigan").
JCPenney, Sears, and Champs Sports. Plaza Credit Suisse First Boston principled the private placement of a
Carolina was founded in 1978 and is based in five-year, $260 million loan in connection with the acquisition.
Carolina, Puerto Rico. As of 05/04/2004, Plaza The financing is comprised of a fixed and floating component at
Carolina is a subsidiary of Simon Property Group an initial approximate all-in blended rate of 3.1%.
Incorporation.
09/29/2003 03/10/2004 Capital Investors IV, L.P., Centre Garden Fresh 143.03 Garden Fresh Restaurant Corp. engages in the Fairmont Capital Inc. announced the acquisition of Garden 10.86 217.52 26.8 12.39 134.57 0.619 5.02
Partners Management LLC, Fairmont Restaurant Corp. ownership and operation of salad buffet restaurants Fresh Restaurant Corp. (Nasdaq: LTUS) on September 30,
Capital Inc under the names, Souplantation and Sweet 2003. Fairmont Capital Inc. The merger agreement provides
Tomatoes. As of September 30, 2003, the companythat the stockholders of Garden Fresh will receive $16.35 per
operated 97 restaurants in Arizona, California, share in cash for their shares of common stock. Under
Colorado, Florida, Georgia, Illinois, Kansas, occurrence of certain circumstances, a termination fee of
Missouri, Nevada, New Mexico, North Carolina, approximately $4.1 million would be payable. Fairmont Capital,
Oregon, Texas, Utah, and Washington. Garden and its partners, will be providing the equity portion of the
Fresh was founded in 1983 and is headquartered in financing and will finance the balance of the purchase price.
San Diego, California. Fleet National Bank and Fleet Securities Inc. are providing
senior debt financing and will assist with raising more debt
financing for the deal.
08/29/2003 02/25/2004 - Cara Operations Ltd. 324.0 Cara Operations Ltd. serves as an integrated food Cara Holdings Limited today announced that it has proposed to 7.86 829.31 78.45 41.24 324.0 0.391 4.13
service company with owned and franchised the Board of Directors of Cara Operations Limited a going
operations. The company's foodservice activities ar private transaction to acquire all of the outstanding Common
focused on preparing, serving, and distributing food shares (TSX: CAO) and Class A non-voting shares (TSX:
to guests through its branded restaurants, catering CAO.A) not owned directly or indirectly by it and its principals a
activities, and integrated food distribution a price of $7.50 per share in cash, representing an aggregate
operations. Its wholly owned businesses include value of $324 million. Cara Holdings is controlled Ms. Gail
Swiss Chalet, Harvey's, Second Cup, Kelsey's Regan, Ms. Rosemary Phelan, Ms. Holiday Phelan-Johnson.
Neighbourhood Bar & Grill, and Montana's On December 17, 2003, Cara Operations Limited and Cara
Cookhouse. As a franchisee, the company operatesHoldings Limited announced today that they have reached an
Outback Steakhouse Restaurants in eastern agreement in respect of Cara Holdings’ proposal to effect a
Canada; Cara Air Terminal Restaurant Division; going private transaction, pursuant to which Cara Holdings and
Cara Airport Services Division; and Summit Food other participating parties (Acquisition Group) will acquire
Service Distributors, Inc. In addition, Cara owns indirectly all of the outstanding Common shares (TSX: CAO)
74% of Milestones Restaurants, Inc., an up-scale and Class A non-voting shares (TSX: CAO.A) of Cara
casual restaurant chain. As of March 31, 2003, the Operations not owned directly or indirectly by the Acquisition
company had approximately 1,200 locations Group at a price of $7.625 per share in cash. The Acquisition
operating in 10 provinces across Canada. Cara Group currently owns approximately 79% of the Common
Operations Ltd. was founded in 1883 as The shares and 31% of the Class A shares, which in the aggregate
Canada Railway News Company and changed its
name to Cara Operations Ltd. in 1961. Cara
Operations Ltd. is based in Mississauga, Canada.
Target LTM
Financials - Target LTM Target LTM
Total Financials - Financials -
Announced/Registrati Revenue EBITDA EBIT ($mm) Implied
on Filed Date Total Implied ($mm) (at ($mm) (at (at Implied Enterprise Implied
(Including Bids and Closed/Registrati Transaction Enterprise AnnouncemenAnnouncemenAnnouncemen Enterprise Value/Revenu Enterprise
Letters of Intent) on Effective Date Buyers/Investors Target/Issuer Value ($mm) Business Description [Target/Issuer]Transaction Comments Value/EBIT t) t) t) Value ($mm) es Value/EBITDA
Historical Equity
Pricing Data supplied
by
Certain data is the
copyrighted (2007)
material of Dun &
Bradstreet, Inc., which
reserves all of its rights
Target
SIC Eating and Drinking Places;
Deal Terms
Announce Date 01/01/04-12/31/06
Enterprise Value Minimum 100 (millions)
Deal Status Closed
5/1/2006 1/26/2007 ARAMARK Corp. /Neubauer/ ARAMARK Corp. Provides food management 8,086 21.0 16.0 A group of investors led by ARAMARK Corp's 9,933 0.9 10.7 16.6 11,329 600 929
and uniform rental services CEO, Joseph Neubauer, has acquired all
outstanding shares in ARAMARK Corp, the
world's third-largest food service provider, for
approximately US$6.1 billion in cash plus the
assumption of US$2.0 billion in debt.
8/18/2006 12/14/2006 Lone Star Management Co. Lone Star Steakhouse & Owns and operates steak 586 17.0 8.0 Lone Star Steakhouse & Saloon Inc was 561 0.8 12.1 24.0 678 23 47
Ltd. Saloon, Inc. house restaurants acquired by affiliates of Lone Star Funds for
US$586.2 million in cash. Lone Star Funds
increased its offer from US$27.10 to US$27.35
in cash.
10/31/2006 12/6/2006 LRI Holdings, Inc. CBRL Group, Inc. Operates restaurants 486 LRI Holdings Inc has acquired Logan's 486 7.3 35.1 47.9 90 13 18
Roadhouse Inc from CBRL Group Inc for
US$486 million. Logan's Roadhouse Inc
operates 143 restaurants and franchises 25
restaurants in 20 states. LRI Holdings Inc is
doing this deal together with the following privat
3/13/2006 11/29/2006 Services Acquisition Corp. Jamba Jucie Co. Manufactures juice and 265 Services Acquisition Corp International acquired 265 0.8 345
International operates fruit drink outlets Jamba Juice Co for $265 million in cash. The
price of the transaction, as well as capital for
growth, will be provided by cash currently held
in trust by Services Acquisition Corp
International and the sale
10/10/2006 11/17/2006 JCS Holdings LLC Landry's Restaurants, Operates restaurants 192 JCS Holdings LLC has acquired 120 Joe's Crab 192
Inc. Shack restaurants from Landry's Restaurants
Inc for approximately US$192 million. The Joe's
Crab Shack restaurant chain no longer fits in
with Landry's Restaurants Inc's future plans.
JCS Holdings LLC is an acq
7/5/2006 11/6/2006 Live Nation, Inc. House of Blues Owns and operates House 350 Live Nation Inc acquired HOB Entertainment Inc 350
Entertainment, Inc. of Blues night club and for $350 million in cash. HOB operates 10
restaurants venues under the House of Blues brand and
eight amphitheaters. The acquisition will allow
Live Nation to expand its presence in the
growing mid-size venue business an
7/25/2006 11/1/2006 Buffets Holdings, Inc. Ryan's Restaurant Owns and operates 688 48.0 36.0 Buffets Inc, a subsidiary of Buffets Holdings 814 1.0 9.1 15.1 822 54 89
Group, Inc. restaurants Inc, acquired Ryans Restaurant Group Inc for
approximately US$687.7 million in cash. Under
the terms of the agreement, Ryans Restaurant
Group Inc will receive US$16.25 per share in
cash from Buffets Inc. Buffe
8/8/2006 8/22/2006 Sun Capital Partners, Inc. Bruckmann, Rosser, Operates full service 350 Sun Capital Partners Inc acquired Real Mex 350
Sherrill & Co. LLC restaurants Restaurants Inc from Bruckmann Rosser
Sherrill & Co LLC for $350 million. Real Mex
Restaurants Inc manages casual-dining,
Mexican-style restaurants in more than a dozen
states under the El Torito, Chevy's Fresh-M
5/22/2006 6/30/2006 The Briad Group Main Street Restaurant Franchises and operates 110 23.0 32.0 Briad Main Street Inc, a subsidiary of Briad 133 0.6 8.0 20.0 244 7 17
Group, Inc. restaurants Group acquired Main Street Restaurant Group
Inc for approximately $110.3 million in cash.
Under the terms of the agreement, Main Street
Restaurant Group Inc shareholders will receive
$6.40 in cash for each Main
2/17/2006 6/20/2006 Taxi Holdings Corp. Checkers Drive-In Owns and operates quick- 172 (3.0) Taxi Holdings Corp, a portfolio company of 177 1.0 6.7 10.3 187 17 26
Restaurants, Inc. service restaurants Wellspring Capital Management LLC, acquired
Checkers Drive-In Restaurants Inc for $171.9
million in cash, plus the assumption of debt.
Checkers Drive-In Restaurants Inc develops,
owns, operates, and franchises qu
4/10/2006 5/3/2006 TRC Holding LLC Castle Harlan, Inc. Owns and operates 440 The Restaurant Co (TRC), operator and 440
restaurants franchisor of a national chain of family
restaurants under the Perkins Restaurant &
Bakery name, acquired Marie Callender's, a
chain of dining restaurants best known for
baked pies for approximately $440 million in a
Exhibit 9
12/12/2005 2/27/2006 F&H Acquisition Corp. Fox & Hound Restaurant Owns and operates 163 24.0 25.0 F&H Acquisition Corp, an acquisition vehicle led 167 1.1 8.3 14.4 149 12 20
Group entertainment restaurants by Newcastle Partners LP and Steel Partners II
LP, entered into an agreement after
commencing a tender offer to acquire Fox &
Hound Restaurant Group for approximately
US$163.5 million in cash. Fox & Hound R
10/18/2005 10/18/2005 Sun Capital Partners, Inc. GF Holdings, Inc. Owns and operates salad 198 Sun Capital Partners Inc acquired Garden 198 0.9 221
buffet style restaurants Fresh Restaurant Corp from GF Holdings Inc
for approximately US$198 million. The sellers
included Fairmont Capital Inc, Centre Partners
Management LLC and Northwestern Mutual
Insurance Co. Garden Fresh Restaurant C
9/6/2005 9/22/2005 Castle Harlan, Inc. The Restaurant Co. Operates and franchises 245 New York-based private-equity investment firm, 245 0.7 341
mid-scale full service Castle Harlan Inc acquired The Restaurant Co
restaurants for approximately $245 million. Under the
Perkins Restaurant & Bakery name, TRC is the
operator and franchiser of 483 family
restaurants in 33 U.S. states and five
4/29/2005 9/22/2005 Pacific Equity Partners Pty Worldwide Restaurant Operates, develops and 193 40.0 38.0 Pacific Equity Partners Pty Ltd has acquired 175 0.5 6.0 10.6 359 17 29
Ltd. Concepts, Inc. franchises restaurants Worldwide Restaurant Concepts Inc through
Pacific's newly established financial affiliate,
Aus Bidco Pty Ltd, for approximately US$193
million in cash. The deal's merger consideration
formula had Pacific pay Wo
5/31/2005 7/25/2005 Triarc Cos., Inc. RTM Restaurant Group Operates a chain of fast 327 Triarc Cos Inc acquired RTM Restaurant Group 736
food restaurants for $326.5 million in cash and stock, plus the
assumption of $420 million in liabilities. Through
its subsidiaries, Triarc is the franchisor of the
Arby's restaurant system and owner and
operator of 233 restaur
6/16/2004 4/13/2005 Quality Dining, Inc. Quality Dining, Inc. Operates restaurants 21 40.0 35.0 A private group led by management of Quality 118 0.5 7.4 23.2 229 5 16
/Management/ Dining Inc acquired the remaining 55.3% stake
in the company that it does not already own for
US$20.5 million in cash. The private group
consists of Daniel Fitzpatrick, CEO and
shareholder of Quality Dining, an
1/20/2005 3/7/2005 Trimaran Capital Partners LLCCharlie Brown's, Inc. Owns and operates 140 Trimaran Capital Partners acquired Charlie 140
restaurants Browns Inc from Castle Harlan Inc for $140
million. Castle Harlan Inc originally acquired the
business in 1997. Charlie Browns Inc owns 45
neightborhood restaurants.
11/1/2004 12/29/2004 First Islamic Investment Bank AFC Enterprises, Inc. Owns and operates fast 390 Crescent Capital Investment Inc, a unit of First 390
Ec food restaurants Islamic Investment Bank EC, entered into an
agreement to acquire Church's Chicken from
AFC Enterprises Inc for approximately US$390
million in cash. Crescent Capital Investments,
Inc. is an Atlanta-based pr
12/27/2004 12/27/2004 Captain D's LLC /Private Lone Star Management Operates a restaurant 150 A private group led by Grotech Capital Group 150
Equity Group/ Co. Ltd. seafood Inc and Charlesbank Capital Partners LLC
acquired Captain D's LLC from Lone Star
Funds for approximately US$150 million.
Captain D's LLC is a high quality quick-service
seafood restaurant. Captain D's LLC has g
10/6/2004 12/1/2004 TravelCenters of America, Inc. Rip Griffin Truck Service Provides services and 120 TravelCenters of America Inc acquired 11 Rip 129
Center, Inc. goods to professional Griffin interstate travel centers from Rip Griffin
drivers and personal Truck Service Center Inc for $120 million in
travelers cash plus $1.1 million in assumed
environmental liabilities. In addition,
TravelCenters paid an amount for site ca
5/3/2004 7/1/2004 Castle Harlan, Inc. Oak Hill Capital Operates restaurants 340 Castle Harlan Inc acquired Caribbean 340
Management, Inc. Restaurants LLC, operator of 165 Burger King
restaurants in Puerto Rico, from Oak Hill Capita
Partners LP, which is a unit of Oak Hill Capital
Management Inc for US$340 million. Castle
Harlan also holds interests in o
2/13/2004 3/28/2004 Yucaipa Cos. LLC Piccadilly Cafeterias, Inc. Operates a chain of 80 Piccadilly Investments LLC, a subsidiary of The 114 0.4 573.6 (9.0) 315 (13) 0
cafeterias and seafood Yucaipa Cos, acquired Piccadilly Cafeterias Inc
restaurants for $80 million in cash. For the purpose of this
transaction, Diversified Investment Managemen
Group LLC co-founded Piccadilly Investments
with The Yucaipa Co
December 13, 2006 Lone Star Steakhouse & Saloon Inc. Lone Star Funds $ 310.2 100% 42.0% 15.0% 23.9% 563.8 1.82 12.57 26.56
December 6, 2006 Logan's Roadhouse, Inc. Black Canyon Capital LLC, 320.5 100% 10.7% 25.0% 31.0% 653.4 2.04 13.66 19.48
November 1, 2006 Ryan's Restaurant Group Inc. Buffets Inc. 480.0 100% 12.4% 19.0% 22.5% 860.8 1.79 9.16 14.69
August 21, 2006 Real Mex Restaurants Inc. Sun Capital Partners, Inc. 298.6 100% 18.5% 27.0% 48.3% 646.4 2.16 11.42 16.69
March 8, 2006 Dave & Buster's Inc. Wellspring Capital Management, L.L.C. 123.8 100% 30.0% NA 2.1% 370.8 3.00 5.88 17.39
July 7, 2004 Mimi’s Cafe Inc. Bob Evans Farms Inc. (NasdaqNM:BOBE) 102.3 100% 25.0% NA 10.7% 174.5 1.71 9.89 17.82
Notes:
(1) Sellers' primary SIC Codes in 5411 (Grocery Stores) or 5141 (Groceries Wholesale).
Weightings
Concluded Fair Value of Operating Equity - Non-Marketable, Minority Basis $ 858 $ 406 $ 438 1,702
Preliminary Indication of Fair Value of Business Enterprise - Marketable Controlling Basis 2,579 2,181 2,775
Less: Total Debt 194 194 194
Less: Preferred Stock
Equals: Fair Value of Operating Equity - Marketable, Control Basis 2,385 1,986 2,581
Concluded Fair Value of Operating Equity - Marketable, Control Basis $ 715 $ 596 $ 1,032 2,344
Exhibit 11A details the results of applied discounts and premiums to the concluded
value. Note that the Mergerstat data for the subject industry indicates a 20%
transaction premium, which includes a 5% premium regarding buyer-specific
synergies. The Discount for Lack of Marketability is 20%. When using the Guideline
Transaction Method, a discount for lack of control of 13% is applied using the
formula 1-(1/1.15).
, Page 1 of 3 Exhibit 11A
Deloitte Learning Initiative
Applebees
Business Valuation
Market Approach: Guideline Company Method
Valuation as of December 31, 2006
Weightings
Concluded Fair Value of Operating Equity - Non-Marketable, Minority Basis $ 686 $ 325 $ 350 1,361
Preliminary Indication of Fair Value of Business Enterprise - Marketable Controlling Basis 2,579 2,181 2,775
Less: Total Debt 194 194 194
Less: Preferred Stock
Equals: Fair Value of Operating Equity - Marketable, Control Basis 2,385 1,986 2,581
Concluded Fair Value of Operating Equity - Marketable, Control Basis $ 498 $ 415 $ 718 1,630
Exhibit 12 provides preliminary conclusions on using the Market Approach and the
weighting of the Guideline Public Company Method and Guideline Transaction
Method.
Exhibit 12
Deloitte Learning Initiative
Applebees
Business Valuation
Fair Value Summary
Valuation as of December 31, 2006
Equity Weighted
Summary Value Weighting Value Exhibit
Market Approach: Guideline Company Method $ 1,361 80% $ 1,089
Market Approach: Guideline Transaction Method $ 1,630 20% $ 326
Exhibit 12A provides the conclusion to the case study which indicates fair market
value of 100% of the shareholders’ equity on a non-marketable, minority interest
basis.
Note that the following non-operating assets are added and liabilities subtracted to
arrive at final estimate of value.
Assets:
Excess cash on books = $150mm
Vacation home for CEO use = value of $10mm
Loan Receivable from Chairman of Board = $3mm
Liabilities:
Mortgage on vacation home for CEO use = $2mm
Exhibit 12A
Deloitte Learning Initiative
Applebees
Business Valuation
Fair Value Summary
Valuation as of December 31, 2006
Equity Weighted
Summary Value Weighting Value Exhibit
Market Approach: Guideline Company Method $ 1,361 80% $ 1,089
Market Approach: Guideline Transaction Method $ 1,630 20% $ 326