Investment Opportunity
YUM! Brands is the world’s largest restaurant company based on system units with over 34,000 stores in over 100 countries.  Taco Bell is one of five concepts held by YUM! Brands and is the fifth largest QSR chain in the U.S.  With a 65% market share, Taco Bell is the clear leader in the Mexican QSR segment.  Taco Bell has a strong brand identity and operates in the stable, non-faddish segment of the restaurant business, and is regarded as one of the top 3 QSR chains with regard to brand strength (along with McDonald’s and Sonic), and # 1 in “value for your money.”  The concept’s brand strength has been supported primarily by its Big Bell Value Menu, which offers large quantities of food at very reasonable prices, which has served both to secure its core market of 18- to 35-year old males as well as attract customers to its more premium products.  Additionally, Taco Bell invests heavily in their brand, spending over $250 million per annum in network advertising and product promotion in support of the Taco Bell brand.

Business Description
Southeast QSR Holdings, LLC is a YUM! Brands franchisee and owns and operates 56 Taco Bell restaurants and 1 Pizza Hut Express restaurant concentrated in the Jacksonville, Mobile/Pensacola, and Augusta markets.  Southeast QSR has experienced strong revenue growth over the past few years with a compound annual growth rate of 7.6% from 2002 through 2005, driven primarily by both daily customer count increases at a CAGR of 4.6% and average customer check increases at a CAGR of 3.6% over the same period.  These increases have been driven by strong senior management leadership and continued population growth in the Company’s primary areas of operations, which include three of the fastest growing markets in the U.S.  In all three of its primary markets, the Company is the dominant Taco Bell franchisee, with no corporate stores and no competition in the Mexican QSR segment.

Transaction Description
In November 2006, Southeast QSR Holdings, LLC acquired 56 Taco Bell restaurants and 1 Pizza Hut Express restaurant from a group of five YUM! franchisees.

Prometheus arranged a senior term loan from Merrill Lynch Capital and Bank of America with an additional credit facility to finance future acquisitions and new store growth.  In addition, Norwest Mezzanine Partners provided the majority of the subordinated debt.

Immediately following closing, the Company is focused on implementing a growth strategy focused on new store development and on reinvesting capital in the existing physical plant. Additionally, the Company will concentrate its efforts on remodeling, scrape-and-rebuilding and offsetting older existing units, which will allow the stores to gain operational efficiency.