Investment Company Executes $69M Sale/Leaseback Transaction For Lone Star Funds

PRINCETON, N.J., March 18, 2008

Sovereign Investment Company, one of the largest and fastest growing private equity investors providing sale-leaseback capital, today announced that it recently completed a $69 million transaction for Lone Star Funds.

Sovereign completed a multi-unit sale-leaseback transaction to enable Lone Star Funds to recapitalize its investment in Lone Star Steakhouse & Saloon restaurants. The properties were purchased by Sovereign and will be leased back for at least 15 years on a triple-net (NNN) lease basis.

Lone Star Funds took private Lone Star Steakhouse & Saloon, a casual dining steakhouse, in December 2006. Lone Star Steakhouse & Saloon currently operates 180 Lone Star Steakhouses and Texas Land & Cattle restaurants in 30 states.

"We are pleased to provide Lone Star with a sale-leaseback solution to help fund the 'take private' acquisition," said Barry Bain, vice president of acquisitions for Sovereign Investment Company. "Providing sale-leaseback solutions to the private equity community is an important area of focus for Sovereign. In addition to executing this major venture with Lone Star; Sovereign has recently completed sale-leaseback transactions with private equity firms J. S. Chapman and Sun Capital Partners, Inc., and is in negotiations with several others."

This was a complicated transaction involving multiple tenants and assets in 19 different states. Sovereign was able to close the transaction quickly and reliably in one of the tightest credit environments. This execution is a testament to the strength of Sovereign's team and its capital relationships," commented Peter M. Mavoides, CEO and president of Sovereign Investment Company. "As companies look to access capital in the current market environment many CFO's are finding alternative capital strategies, like sale-leasebacks as more attractive then they have been in the past. We are very excited about the recent pick up in activity and look forward to creating new partnerships in the coming year," Mavoides added.

About Lone Star Funds

Lone Star is a leading U.S. private equity firm. Since 1995, the principals of Lone Star have organized private equity funds totaling more than $13.3 billion to invest globally in corporate secured and unsecured debt instruments, real estate related assets and select corporate opportunities. Additional information may be found at

About Sovereign Investment Company

Sovereign Investment Company empowers owners, operators and developers to capitalize on the value of their real estate through net lease sale-leaseback portfolio transactions. Leveraging the experience of a 30-year investment history, Sovereign invests capital to offer a variety of terms and structures, while providing unparalleled service, pricing and execution for its transaction partners. As one of the largest and fastest-growing private equity investment firms focused on real estate structured finance, Sovereign has provided more than $1 billion in sale-leaseback capital to long-term, net-leased properties nationwide.

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