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Section 1: 8-K (8-K)


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549 



FORM 8-K



CURRENT REPORT

Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934

February 21, 2019
Date of Report (Date of earliest event reported)



STORE Capital Corporation
(Exact name of registrant as specified in its charter)



Maryland
001-36739
45-2280254
(State or other jurisdiction of incorporation)
(Commission File Number)
(IRS Employer Identification No.)

8377 East Hartford Drive, Suite 100
Scottsdale, AZ
85255
(Address of Principal Executive Offices)
(Zip Code)

Registrant’s telephone number, including area code: (480) 256-1100



Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions:

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.



Item 2.02
Results of Operations and Financial Condition.

On February 21, 2019, STORE Capital Corporation (the “Company”) issued a press release announcing its financial results for the fourth fiscal quarter and full year ended December 31, 2018. The press release is furnished hereto as Exhibit 99.1 and incorporated herein by reference.  Additionally, on February 21, 2019, the Company issued its 2018 fourth quarter investor presentation containing operating and financial data of the Company.  The investor presentation is furnished hereto as Exhibit 99.2 and incorporated herein by reference.  The press release and the investor presentation are also available on the Company’s website.

The information set forth in this Item 2.02 and in the attached Exhibit 99.1 and Exhibit 99.2 is deemed to be “furnished” and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and is not incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

Item 7.01
Regulation FD Disclosure.

On February 21, 2019, the Company issued its 2018 fourth quarter investor presentation containing operating and financial data of the Company.  The investor presentation is furnished hereto as Exhibit 99.2 and incorporated herein by reference.

The information set forth in this Item 7.01 and in the attached Exhibit 99.2 is deemed to be “furnished” and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and is not incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

Item 9.01
Financial Statements and Exhibits.

(d) Exhibits.

Exhibit
 
Description
 
Earnings Press Release dated February 21, 2019.
 
2018 Fourth Quarter Investor Presentation.

The press release and investor presentation furnished as Exhibits 99.1 and 99.2 hereto include non-GAAP financial measures as defined in Regulation G, along with the most directly comparable financial measures calculated and presented in accordance with accounting principles generally accepted in the United States (“GAAP”), information reconciling the non-GAAP financial measures to the GAAP financial measures, and a discussion of the reasons why the Company believes that presentation of the non-GAAP financial measures provides useful information to investors regarding the Company’s financial condition and results of operations. The non-GAAP financial measures presented therein should be considered in addition to, and not in lieu of or alternatives to, GAAP financial measures.


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 
STORE Capital Corporation
   
Dated: February 21, 2019
 
 
By:
/s/ Michael T. Bennett
   
Michael T. Bennett
   
Executive Vice President-General Counsel



(Back To Top)

Section 2: EX-99.1 (EXHIBIT 99.1)


Exhibit 99.1


STORE Capital Announces Fourth Quarter
and Full Year 2018 Operating Results

Affirms 2019 Guidance

SCOTTSDALE, Ariz., February 21, 2019 – STORE Capital Corporation (NYSE: STOR, “STORE Capital” or the “Company”), an internally managed net-lease real estate investment trust (REIT) that invests in Single Tenant Operational Real Estate, today announced operating results for the fourth quarter and full year ended December 31, 2018.

Highlights

For the quarter ended December 31, 2018:

§
Total revenues of $146.7 million

§
Net income of $56.6 million, or $0.26 per basic and diluted share, including an aggregate net gain of $14.7 million on dispositions of real estate

§
AFFO of $103.4 million, or $0.48 per basic and diluted share

§
Declared a regular quarterly cash dividend per common share of $0.33

§
Invested $460.0 million in 75 properties at a weighted average initial cap rate of 8.0%

§
Raised net proceeds of $268.1 million from the sale of an aggregate of 9.2 million common shares under the Company’s at-the-market equity program

§
Issued $592.0 million of long-term fixed-rate notes, which included the inaugural issuance of $378 million of AAA rated notes, under STORE’s Master Funding debt program in October 2018

For the year ended December 31, 2018:

§
Total revenues of $540.8 million

§
Net income of $217.0 million, or $1.06 per basic and diluted share, including an aggregate net gain of $45.5 million on dispositions of real estate

§
AFFO of $377.9 million, or $1.85 per basic share and $1.84 per diluted share

§
Declared regular cash dividends per common share aggregating $1.28 which included a 6.5% increase in the third quarter

§
Invested $1.63 billion in 418 properties at a weighted average initial cap rate of 7.9%

§
Raised net proceeds of $741.7 million from the sale of an aggregate of 27.1 million common shares under the Company’s at-the-market equity program

§
Expanded the unsecured revolving credit facility to $600 million and the accordion feature to $800 million, raising maximum borrowing capacity to $1.4 billion in February 2018

§
Closed inaugural public debt offering, issuing $350 million in aggregate principal amount of investment-grade senior unsecured notes in March 2018


STORE Capital Corporation
Page 2 of 15
Management Commentary

“STORE posted new records in all key performance metrics in 2018, including real estate investment activity, AFFO and AFFO per share. We also delivered our fourth consecutive year of double-digit returns to our stockholders, in part due to our fourth dividend increase in as many years,” said Christopher Volk, Chief Executive Officer of STORE Capital.  “During the year, we acquired 418 properties for a total of $1.63 billion at sector leading average investment yields of 7.9%, further diversifying our tenant base to 434 customers across the United States. From a capital markets perspective, we strengthened our financing flexibility and reduced our cost of capital with the successful completion of our inaugural public unsecured note offering, together with the first-ever AAA rated real estate master funding issuance. In 2019, we look forward to building on these accomplishments to achieve another year of record financial performance that contributes to continued success for all of our stakeholders.”

Financial Results

Total Revenues

Total revenues were $146.7 million for the fourth quarter of 2018, an increase of 22.1% from $120.1 million for the fourth quarter of 2017.

Total revenues for 2018 were $540.8 million, an increase of 19.4% from $452.8 million for 2017. The increase was driven primarily by the growth in the size of STORE Capital’s real estate investment portfolio, which grew from $6.2 billion in gross investment amount representing 1,921 property locations and 397 customers at December 31, 2017 to $7.6 billion in gross investment amount representing 2,255 property locations and 434 customers at December 31, 2018.

Net Income

Net income was $56.6 million, or $0.26 per basic and diluted share, for the fourth quarter of 2018, an increase from $41.0 million, or $0.21 per basic and diluted share, for the fourth quarter of 2017.  Net income for the fourth quarter of 2018 includes an aggregate net gain on dispositions of real estate of $14.7 million as compared to $3.8 million for the same period in 2017.

Net income includes such items as gain or loss on dispositions of real estate and provisions for impairment, which can vary from quarter to quarter and impact net income and period-to-period comparisons.

Net income for the year ended December 31, 2018 was $217.0 million, or $1.06 per basic and diluted share, an increase of 33.9% from $162.0 million, or $0.90 per basic and diluted share, for 2017.  Net income for 2018 includes an aggregate net gain on dispositions of real estate of $45.5 million as compared to $39.6 million for 2017.  Net income for 2018 included $9.9 million of non-cash charges consisting of a $2.1 million charge to interest expense for the accelerated amortization of deferred financing costs primarily related to the $233.3 million prepayment of STORE Master Funding notes in the fourth quarter and an aggregate $7.8 million of provisions for impairment. Net income for 2017 included $20.0 million of non-cash charges consisting of a $4.6 million charge to revenue related to the accelerated amortization of lease incentives, a $2.0 million charge to interest expense related to the accelerated amortization of deferred financing costs associated with STORE Master Funding prepayments in 2017 and an aggregate $13.4 million of provisions for impairment.


STORE Capital Corporation
Page 3 of 15
Adjusted Funds from Operations (AFFO)

AFFO increased 25.8% to $103.4 million, or $0.48 per basic and diluted share, for the fourth quarter of 2018, compared to AFFO of $82.2 million, or $0.43 per basic and diluted share, for the fourth quarter of 2017.

AFFO for 2018 was $377.9 million, or $1.85 per basic share and $1.84 per diluted share, an increase of 23.5% from $306.1 million, or $1.71 per basic and diluted share, for 2017. The year-over-year increase in AFFO was primarily driven by additional rental revenues and interest income generated by the growth in the Company’s real estate investment portfolio.

Dividend Information
As previously announced, STORE Capital declared a regular quarterly cash dividend per common share of $0.33 for the fourth quarter of 2018. This dividend, totaling $73.0 million, was paid on January 15, 2019 to stockholders of record on December 31, 2018. For the year ended December 31, 2018, the Company declared regular cash dividends per common share aggregating $1.28 which included a 6.5% increase in the third quarter.

Real Estate Portfolio Highlights

Investment Activity

The Company originated $460.0 million of gross investments representing 75 property locations during the fourth quarter of 2018, adding 13 net new customers. These investments had a weighted average initial cap rate of 8.0%. Total investment activity for the year was $1.63 billion representing 418 property locations with a weighted average initial cap rate of 7.9%. The Company defines “initial cap rate” for property acquisitions as the initial annual cash rent divided by the purchase price of the property. STORE’s leases customarily have lease escalations, most of which are tied to the consumer price index and subject to a cap.  For acquisitions made in 2018, the weighted average annual lease escalation was 1.8%.

Disposition Activity

During the year ended December 31, 2018, the Company sold 80 properties and recognized an aggregate net gain of $45.5 million on the dispositions; 25 of these 80 properties were sold in the fourth quarter for an aggregate net gain of $14.7 million. For the year ended December 31, 2018, proceeds from the dispositions of real estate aggregated $251.4 million as compared to an aggregate original investment amount of $227.8 million for the properties sold.

Portfolio

At December 31, 2018, STORE Capital’s real estate portfolio totaled $7.6 billion representing 2,255 property locations. Approximately 95% of the portfolio represents commercial real estate properties subject to long-term leases, 5% represents mortgage loans and direct financing receivables primarily on commercial real estate buildings (located on land the Company owns and leases to its customers) and a nominal amount represents loans receivable secured by the tenants’ other assets. As of December 31, 2018, the portfolio’s annualized base rent and interest (based on rates in effect on December 31, 2018 for all lease and loan contracts) totaled $614.5 million as compared to $501.0 million a year ago. The weighted average non-cancelable remaining term of the leases at December 31, 2018 was approximately 14 years.


STORE Capital Corporation
Page 4 of 15
The Company’s portfolio of real estate investments is highly diversified across customers, brand names or business concepts, industries and geography. The following table presents a summary of the portfolio.

 
Portfolio At A Glance - As of December 31, 2018
       
 
Investment property locations
   
2,255
   
 
States
   
49
   
 
Customers
   
434
   
 
Industries in which customers operate
   
106
   
 
Proportion of portfolio from direct origination
 
~80
%
 
 
Contracts with STORE-preferred terms*(1)
   
94
%
 
 
Weighted average annual lease escalation(2)
   
1.8
%
 
 
Weighted average remaining lease contract term
 
~14 years
   
 
Occupancy(3)
   
99.6
%
 
 
Properties not operating but subject to a lease(4)
   
23
   
 
Investment locations subject to a ground lease
   
21
   
 
Investment portfolio subject to NNN leases*
   
98
%
 
 
Investment portfolio subject to Master Leases*(5)
   
91
%
 
 
Average investment amount/replacement cost (new)(6)
   
81
%
 
 
Locations subject to unit-level financial reporting
   
98
%
 
 
Median unit fixed charge coverage ratio (FCCR)/4-Wall coverage ratio(7)
   
2.1x/2.5
x
 
 
Contracts rated investment grade(8)
 
~75
%
 
* Based on annualized base rent and interest.


(1)
Represents the percentage of our lease contracts that were created by STORE or contain preferred contract terms such as unit-level financial reporting, triple-net lease provisions and, when applicable, master lease provisions.

(2)
Represents the weighted average annual escalation rate of the entire portfolio as if all escalations occurred annually.  For escalations based on a formula including CPI, assumes the stated fixed percentage in the contract or assumes 1.5% if no fixed percentage is in the contract.  For contracts with no escalations remaining in the current lease term, assumes the escalation in the extension term.  Calculation excludes contracts representing less than 0.2% of annualized base rent and interest where there are no further escalations remaining in the current lease term and there are no extension options.

(3)
The Company defines occupancy as a property being subject to a lease or loan contract.  As of December 31, 2018, eight of the Company’s properties were vacant and not subject to a contract.

(4)
Represents the number of the Company’s investment locations that have been closed by the tenant but remain subject to a lease.

(5)
Percentage of investment portfolio in multiple properties with a single customer subject to master leases. Approximately 84% of the investment portfolio involves multiple properties with a single customer, whether or not subject to a master lease.

(6)
Represents the ratio of purchase price to replacement cost (new) at acquisition.

(7)
STORE Capital calculates a unit’s FCCR generally as the ratio of (i) the unit’s EBITDAR, less a standardized corporate overhead expense based on estimated industry standards, to (ii) the unit’s total fixed charges, which are its lease expense, interest expense and scheduled principal payments on indebtedness. The 4-Wall coverage ratio refers to a unit’s FCCR before taking into account standardized corporate overhead expense. The weighted average unit FCCR and 4-Wall coverage ratios were 2.6x and 3.2x, respectively.

(8)
Represents the percentage of the Company’s contracts that have a STORE Score that is investment grade. The Company measures the credit quality of its portfolio on a contract-by-contract basis using the STORE Score, which is a proprietary risk measure reflective of both the credit risk of the Company’s tenants and the profitability of the operations at the properties.  As of December 31, 2018, STORE Capital’s tenants had a median tenant credit profile of approximately ‘Ba2’ as measured by Moody’s Analytics RiskCalc rating scale.  Considering the profitability of the operations at each of its properties and STORE’s assessment of the likelihood that each of the tenants will choose to continue to operate at the properties in the event of their insolvency, the credit quality of its contracts, or STORE Score, is enhanced to a median of ‘Baa2’.


STORE Capital Corporation
Page 5 of 15
Capital Transactions

The Company established a $750 million “at the market” equity distribution program, or ATM Program, in November 2018, and terminated its previous program. During the fourth quarter of 2018, the Company sold an aggregate of approximately 9.2 million common shares at a weighted average share price of $29.57 and raised approximately $268.1 million in net proceeds after the payment of sales agents’ commissions and offering expenses.  For the year ended December 31, 2018, the Company sold approximately 27.1 million common shares at a weighted average share price of $27.79 and raised approximately $741.7 million in net proceeds after the payment of sales agents’ commissions and offering expenses.

In October 2018, certain of the Company’s consolidated special purpose entities issued the eighth series, Series 2018-1, of net-lease mortgage notes under the Company’s STORE Master Funding debt program, separated into four tranches as summarized below.

Class
 
Rating
 
Amount
(in millions)
 
Coupon Rate
 
 
Maturity Date
Class A-1
 
AAA
 
$
150.0
 
3.96
%
Oct. 2024
Class A-2
 
AAA
   
228.0
 
4.29
%
Oct. 2027
Class A-3
 
   A+
   
50.0
 
4.40
%
Oct. 2024
Class A-4
 
   A+
   
164.0
 
4.74
%
Oct. 2027
Total
     
$
592.0
        

The Series 2018-1 transaction marked the Company’s inaugural issuance of AAA rated notes.  The net proceeds from the issuance were primarily used to pay down outstanding balances on the Company’s credit facility and to prepay, without penalty, the STORE Master Funding Series 2013-1 Class A-1 notes and the Series 2013-2 Class A-1 notes; these notes had an aggregate outstanding principal balance of $233.3 million at the time of prepayment, were scheduled to mature in 2020 and bore interest rates of 4.16% and 4.37%, respectively.

In March 2018, the Company completed its first public debt offering, issuing $350 million in aggregate principal amount of its unsecured, investment-grade rated 4.50% Senior Notes, due March 2028. The net proceeds from the issuance were primarily used to pay down amounts outstanding under the Company’s credit facility.

In February 2018, the Company expanded its unsecured revolving credit facility from $500 million to $600 million and the accordion feature from $300 million to $800 million for a total maximum borrowing capacity of $1.4 billion. The amended credit facility matures in February 2022 and includes two six-month extension options, subject to certain conditions.

2019 Guidance

Affirming its 2019 guidance initially presented in November 2018, the Company currently expects 2019 AFFO per share to be within a range of $1.90 to $1.96, based on projected 2019 annual real estate acquisition volume, net of projected property sales, of approximately $1.1 billion. This AFFO per share guidance equates to anticipated net income, excluding gains or losses on sales of property, of $0.88 to $0.91 per share, plus $0.96 to $0.98 per share of expected real estate depreciation and amortization, plus approximately $0.06 to $0.07 per share related to noncash items. The midpoint of our AFFO per share guidance is based on a weighted average initial cap rate on new acquisitions of 7.85% and target leverage in the range of 5½ to 6 times run-rate net debt to EBITDA.  AFFO per share is sensitive to the timing and amount of real estate acquisitions, property dispositions and capital markets activities during the year, as well as to the spread achieved between the lease rates on new acquisitions and the interest rates on borrowings used to finance those acquisitions.


STORE Capital Corporation
Page 6 of 15
Conference Call and Webcast

A conference call and audio webcast with analysts and investors will be held later today at 12:00 p.m. Eastern Time / 10:00 a.m. Scottsdale, Arizona Time, to discuss fourth quarter and full year ended December 31, 2018 operating results and answer questions.


·
Live conference call: 855-656-0920 (domestic) or 412-542-4168 (international)

·
Conference call replay available through March 7, 2019: 877-344-7529 (domestic) or 412-317-0088 (international)

·
Replay access code: 10128322

·
Live and archived webcast: http://ir.storecapital.com/webcasts

About STORE Capital

STORE Capital Corporation is an internally managed net-lease real estate investment trust, or REIT, that is the leader in the acquisition, investment and management of Single Tenant Operational Real Estate, which is its target market and the inspiration for its name. STORE Capital is one of the largest and fastest growing net-lease REITs and owns a large, well-diversified portfolio that consists of investments in 2,255 property locations, substantially all of which are profit centers, in 49 states. Additional information about STORE Capital can be found on its website at www.storecapital.com.

Forward-Looking Statements

Certain statements contained in this press release that are not historical facts contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, that are subject to the “safe harbor” created by those sections. Forward-looking statements can be identified by the use of words such as “estimate,” “anticipate,” “expect,” “believe,” “intend,” “may,” “will,” “should,” “seek,” “approximate” or “plan,” or the negative of these words and phrases or similar words or phrases. Forward-looking statements, by their nature, involve estimates, projections, goals, forecasts and assumptions and are subject to risks and uncertainties that could cause actual results or outcomes to differ materially from those expressed in the forward-looking statements. For more information on risk factors for STORE Capital’s business, please refer to the periodic reports the Company files with the Securities and Exchange Commission from time to time. These forward-looking statements herein speak only as of the date of this press release and should not be relied upon as predictions of future events. STORE Capital expressly disclaims any obligation or undertaking to update or revise any forward-looking statements contained herein, to reflect any change in STORE Capital’s expectations with regard thereto, or any other change in events, conditions or circumstances on which any such statement is based, except as required by law.


STORE Capital Corporation
Page 7 of 15
Non-GAAP Financial Measures

FFO and AFFO

STORE Capital’s reported results are presented in accordance with U.S. generally accepted accounting principles, or GAAP. The Company also discloses Funds from Operations, or FFO, and Adjusted Funds from Operations, or AFFO, both of which are non‑GAAP measures. Management believes these two non‑GAAP financial measures are useful to investors because they are widely accepted industry measures used by analysts and investors to compare the operating performance of REITs. FFO and AFFO do not represent cash generated from operating activities and are not necessarily indicative of cash available to fund cash requirements; accordingly, they should not be considered alternatives to net income as a performance measure or to cash flows from operations as reported on a statement of cash flows as a liquidity measure and should be considered in addition to, and not in lieu of, GAAP financial measures.

The Company computes FFO in accordance with the definition adopted by the Board of Governors of the National Association of Real Estate Investment Trusts, or NAREIT. NAREIT defines FFO as GAAP net income, excluding gains (or losses) from extraordinary items and sales of depreciable property, real estate impairment losses, and depreciation and amortization expense from real estate assets, including the pro rata share of such adjustments of unconsolidated subsidiaries.

To derive AFFO, the Company modifies the NAREIT computation of FFO to include other adjustments to GAAP net income related to certain non-cash revenues and expenses that have no impact on the Company’s long-term operating performance, such as straight-line rents, amortization of deferred financing costs and stock-based compensation. In addition, in deriving AFFO, the Company excludes certain other costs not related to its ongoing operations, such as the amortization of lease-related intangibles.

FFO is used by management, investors and analysts to facilitate meaningful comparisons of operating performance between periods and among the Company’s peers primarily because it excludes the effect of real estate depreciation and amortization and net gains on sales, which are based on historical costs and implicitly assume that the value of real estate diminishes predictably over time, rather than fluctuating based on existing market conditions. Management believes that AFFO provides more useful information to investors and analysts because it modifies FFO to exclude certain additional non-cash revenues and expenses such as straight-line rents, including construction period rent deferrals, and the amortization of deferred financing costs, stock-based compensation and lease-related intangibles as such items may cause short-term fluctuations in net income but have no impact on long-term operating performance. The Company believes that these costs are not an ongoing cost of the portfolio in place at the end of each reporting period and, for these reasons, the portion expensed is added back when computing AFFO. As a result, the Company believes AFFO to be a more meaningful measurement of ongoing performance that allows for greater performance comparability.  Therefore, the Company discloses both FFO and AFFO and reconciles them to the most appropriate GAAP performance metric, which is net income.  STORE Capital’s FFO and AFFO may not be comparable to similarly titled measures employed by other companies.

Investor and Media Contacts:

Financial Profiles, Inc.
Moira Conlon, 310-622-8220
Tricia Ross, 310-622-8226
[email protected]


STORE Capital Corporation
Page 8 of 15
STORE Capital Corporation
Condensed Consolidated Statements of Income
(In thousands, except share and per share data)

   
Three months ended
December 31,
   
Year ended
December 31,
 
   
2018
   
2017
   
2018
   
2017
 
    (unaudited)     (unaudited)     (audited)  
Revenues:
                       
Rental revenues
 
$
139,211
   
$
113,850
   
$
513,302
   
$
427,943
 
Interest income on loans and direct financing receivables
   
7,074
     
5,836
     
25,741
     
22,565
 
Other income
   
419
     
438
     
1,713
     
2,339
 
Total revenues
   
146,704
     
120,124
     
540,756
     
452,847
 
                                 
Expenses:
                               
Interest
   
35,964
     
28,540
     
129,061
     
120,478
 
Property costs
   
1,413
     
1,501
     
4,250
     
4,773
 
General and administrative
   
12,513
     
11,203
     
45,725
     
40,990
 
Depreciation and amortization
   
49,519
     
40,079
     
181,826
     
150,279
 
Provisions for impairment
   
5,202
     
1,500
     
7,810
     
13,440
 
Total expenses
   
104,611
     
82,823
     
368,672
     
329,960
 
                                 
Gain on dispositions of real estate
   
14,676
     
3,826
     
45,528
     
39,609
 
Income from operations before income taxes
   
56,769
     
41,127
     
217,612
     
162,496
 
Income tax expense
   
185
     
119
     
642
     
458
 
Net income
 
$
56,584
   
$
41,008
   
$
216,970
   
$
162,038
 
                                 
Net income per share of common stock - basic and diluted:
 
$
0.26
   
$
0.21
   
$
1.06
   
$
0.90
 
                                 
                                 
Weighted average common shares outstanding:  Basic
   
215,660,467
     
190,765,946
     
204,322,298
     
178,586,266
 
Diluted
   
216,477,667
     
191,302,717
     
204,933,292
     
178,656,676
 
                                 
Dividends declared per common share
 
$
0.33
   
$
0.31
   
$
1.28
   
$
1.20
 


STORE Capital Corporation
Page 9 of 15
STORE Capital Corporation
Condensed Consolidated Balance Sheets
(In thousands, except share and per share data)

   
December 31,
 
   
2018
   
2017
 
   
(unaudited)
   
(audited)
 
Assets
           
Investments:
           
Real estate investments:
           
Land and improvements
 
$
2,280,280
   
$
1,898,342
 
Buildings and improvements
   
4,888,440
     
3,958,003
 
Intangible lease assets
   
85,148
     
87,402
 
Total real estate investments
   
7,253,868
     
5,943,747
 
Less accumulated depreciation and amortization
   
(585,913
)
   
(426,931
)
     
6,667,955
     
5,516,816
 
Real estate investments held for sale, net
   
     
16,741
 
Loans and direct financing receivables
   
351,202
     
271,453
 
Net investments
   
7,019,157
     
5,805,010
 
Cash and cash equivalents
   
27,511
     
42,937
 
Other assets, net
   
67,303
     
51,830
 
Total assets
 
$
7,113,971
   
$
5,899,777
 
                 
Liabilities and stockholders’ equity
               
Liabilities:
               
Credit facility
 
$
135,000
   
$
290,000
 
Unsecured notes and term loans payable, net
   
916,720
     
570,595
 
Non-recourse debt obligations of consolidated special purpose entities, net
   
2,008,592
     
1,736,306
 
Dividends payable
   
72,954
     
60,068
 
Accrued expenses, deferred revenue and other liabilities
   
117,204
     
71,866
 
Total liabilities
   
3,250,470
     
2,728,835
 
                 
Stockholders’ equity:
               
Common stock, $0.01 par value per share, 375,000,000 shares
               
authorized, 221,071,838 and 193,766,854 shares issued and
               
outstanding, respectively
   
2,211
     
1,938
 
Capital in excess of par value
   
4,129,082
     
3,381,090
 
Distributions in excess of retained earnings
   
(267,651
)
   
(214,845
)
Accumulated other comprehensive (loss) income
   
(141
)
   
2,759
 
Total stockholders’ equity
   
3,863,501
     
3,170,942
 
Total liabilities and stockholders’ equity
 
$
7,113,971
   
$
5,899,777
 


STORE Capital Corporation
Page 10 of 15
STORE Capital Corporation
Reconciliations of Non-GAAP Financial Measures
(In thousands, except per share data)

Funds from Operations and Adjusted Funds from Operations

   
Three months ended
December 31,
   
Year ended
December 31,
 
   
2018
   
2017
   
2018
   
2017
 
   
(unaudited)
   
(unaudited)
 
                         
Net income
 
$
56,584
   
$
41,008
   
$
216,970
   
$
162,038
 
Depreciation and amortization of real estate assets
   
49,295
     
39,858
     
180,851
     
149,556
 
Provision for impairment of real estate
   
5,202
     
     
5,202
     
11,940
 
Gain on dispositions of real estate, net of tax (1)
   
(14,666
)
   
(3,826
)
   
(45,398
)
   
(39,604
)
Funds from Operations
   
96,415
     
77,040
     
357,625
     
283,930
 
                                 
Adjustments:
                               
Straight-line rental revenue, net:
                               
Fixed rent escalations accrued
   
(1,296
)
   
(1,361
)
   
(6,121
)
   
(6,414
)
Construction period rent deferrals
   
2,116
     
965
     
6,622
     
3,056
 
Amortization of:
                               
Equity-based compensation
   
2,659
     
2,051
     
8,608
     
7,931
 
Deferred financing costs and other (2)
   
3,578
     
1,851
     
9,549
     
9,978
 
Lease-related intangibles and costs (3)
   
601
     
573
     
2,433
     
7,043
 
Provision for loan losses
   
     
1,500
     
2,608
     
1,500
 
Capitalized interest
   
(681
)
   
(415
)
   
(2,641
)
   
(1,243
)
Gain on extinguishment of debt
   
     
     
(814
)
   
 
Accrued severance costs
   
     
     
     
296
 
Adjusted Funds from Operations
 
$
103,392
   
$
82,204
   
$
377,869
   
$
306,077
 
                                 
Dividends declared to common stockholders
 
$
72,954
   
$
60,068
   
$
267,873
   
$
223,776
 
                                 
Net income per share of common stock: (4)
                               
Basic and Diluted
 
$
0.26
   
$
0.21
   
$
1.06
   
$
0.90
 
FFO per share of common stock: (4)
                               
Basic
 
$
0.45
   
$
0.40
   
$
1.75
   
$
1.59
 
Diluted
 
$
0.44
   
$
0.40
   
$
1.74
   
$
1.59
 
AFFO per share of common stock: (4)
                               
Basic
 
$
0.48
   
$
0.43
   
$
1.85
   
$
1.71
 
Diluted
 
$
0.48
   
$
0.43
   
$
1.84
   
$
1.71
 


(1)
For the three months ended December 31, 2018, includes $10,000 and for the years ended December 31, 2018 and 2017, includes $130,000 and $5,000, respectively, of income tax expense associated with gains recognized on the dispositions of certain properties.

(2)
For the three months ended December 31, 2018, includes $1.7 million and for the years ended December 31, 2018 and 2017, includes $2.1 million and $2.0 million, respectively, of accelerated amortization of deferred financing costs primarily related to the prepayment of debt.

(3)
For the year ended December 31, 2017, includes a $4.6 million charge related to accelerated amortization of lease incentives associated with terminated lease contracts.

(4)
Under the two-class method, earnings attributable to unvested restricted stock are deducted from earnings in the computation of per share amounts where applicable.


STORE Capital Corporation
Page 11 of 15
STORE Capital Corporation
Investment Portfolio
December 31, 2018

Real Estate Portfolio Information

As of December 31, 2018, STORE Capital’s total investment in real estate and loans approximated $7.6 billion, representing investments in 2,255 property locations, substantially all of which are profit centers for its customers.  The Company’s real estate portfolio is highly diversified.  The following tables summarize the diversification of the real estate portfolio based on the percentage of base rent and interest, annualized based on rates in effect on December 31, 2018, for all leases, loans and direct financing receivables in place as of that date.

Diversification by Customer

STORE Capital has a diverse customer base. At December 31, 2018, the Company’s property locations were operated by 434 customers. The largest single customer represented 2.7% of annualized base rent and interest and the top ten customers totaled 18.1% of annualized base rent and interest. The following table identifies STORE Capital’s ten largest customers as of December 31, 2018:

Customer
 
% of
Annualized
Base Rent and
Interest
   
Number of
Properties
 
AVF Parent, LLC (Art Van Furniture)
   
2.7
%
   
23
 
Mills Fleet Farm Group LLC
   
2.4
     
8
 
Bass Pro Group, LLC (Cabela’s)
   
2.2
     
9
 
American Multi-Cinema, Inc. (AMC/Carmike/Starplex)
   
1.7
     
14
 
Stratford School, Inc. (Elementary and middle schools)
   
1.6
     
17
 
Cadence Education, Inc. (Early childhood/elementary education)
   
1.6
     
32
 
Zips Holdings, LLC
   
1.6
     
42
 
US LBM Holdings, LLC (Building materials distribution)
   
1.5
     
46
 
CWGS Group, LLC (Camping World/Gander Outdoors)
   
1.5
     
19
 
Dufresne Spencer Group Holdings, LLC (Ashley Furniture HomeStore)
   
1.3
     
16
 
All other (424 customers)
   
81.9
     
2,029
 
Total
   
100.0
%
   
2,255
 

STORE Capital Corporation
Page 12 of 15
STORE Capital Corporation
Investment Portfolio
December 31, 2018

Diversification by Concept

STORE Capital’s customers operate their businesses under a wide range of brand names or business concepts. Of the more than 600 concepts represented in the Company’s investment portfolio as of December 31, 2018, the largest single concept represented 2.4% of annualized base rent and interest and the top ten concepts totaled 16.0% of annualized base rent and interest. The following table identifies the top ten customer business concepts as of December 31, 2018:

Customer Business Concept
 
% of
Annualized
Base Rent and
Interest
   
Number of
Properties
 
Fleet Farm
   
2.4
%
   
8
 
Ashley Furniture HomeStore
   
2.2
     
25
 
Cabela’s
   
2.0
     
8
 
Art Van Furniture
   
1.9
     
16
 
Zips Car Wash
   
1.6
     
42
 
Big R Stores
   
1.5
     
24
 
Stratford School
   
1.2
     
4
 
AMC Theaters
   
1.1
     
10
 
Popeyes Louisiana Kitchen
   
1.1
     
63
 
Applebee’s
   
1.0
     
35
 
All other (600 concepts)
   
84.0
     
2,020
 
Total
   
100.0
%
   
2,255
 

STORE Capital Corporation
Page 13 of 15
STORE Capital Corporation
Investment Portfolio
December 31, 2018

Diversification by Industry

The business concepts of STORE Capital’s customers are diversified across more than 100 industries within the service, retail and manufacturing sectors of the U.S. economy.  The following table summarizes these industries, by sector, into 74 industry groups as of December 31, 2018:

Customer Industry Group
 
% of
Annualized
Base Rent and
Interest
   
Number of
Properties
   
Building
Square
Footage
(in thousands)
 
Service:
                 
Restaurants – full service
   
11.2
%
   
403
     
2,719
 
Restaurants – limited service
   
5.8
     
395
     
1,040
 
Early childhood education
   
5.9
     
185
     
2,082
 
Health clubs
   
5.3
     
76
     
2,267
 
Movie theaters
   
4.8
     
38
     
1,879
 
Family entertainment
   
4.0
     
38
     
1,290
 
Automotive repair and maintenance
   
3.8
     
139
     
643
 
Pet care
   
3.5
     
157
     
1,539
 
Lumber and construction materials wholesalers
   
2.9
     
105
     
4,375
 
Medical and dental
   
2.2
     
59
     
618
 
Behavioral health
   
1.7
     
38
     
603
 
Career education
   
1.6
     
7
     
584
 
Elementary and secondary schools
   
1.4
     
6
     
278
 
Equipment sales and leasing
   
1.2
     
19
     
619
 
Metal and mineral merchant wholesalers
   
1.0
     
20
     
1,698
 
Wholesale automobile auction
   
1.0
     
6
     
224
 
All other service (19 industry groups)
   
7.5
     
149
     
6,008
 
Total service
   
64.8
     
1,840
     
28,466
 
Retail:
                       
Furniture
   
5.5
     
54
     
3,224
 
Farm and ranch supply
   
4.3
     
41
     
3,914
 
Hunting and fishing
   
2.2
     
9
     
758
 
Recreational vehicle dealers
   
1.6
     
21
     
954
 
Used car dealers
   
1.2
     
19
     
229
 
Home furnishings
   
0.7
     
5
     
691
 
New car dealers
   
0.7
     
8
     
236
 
All other retail (9 industry groups)
   
2.2
     
51
     
2,102
 
Total retail
   
18.4
     
208
     
12,108
 
Manufacturing:
                       
Metal fabrication
   
3.9
     
57
     
6,894
 
Plastic and rubber products
   
2.5
     
30
     
3,855
 
Furniture manufacturing
   
2.0
     
12
     
3,688
 
Electronics equipment
   
1.4
     
10
     
1,060
 
Aerospace product and parts
   
0.8
     
11
     
992
 
Chemical products
   
0.8
     
9
     
820
 
Automotive parts and accessories
   
0.8
     
12
     
1,533
 
All other manufacturing (16 industry groups)
   
4.6
     
66
     
5,849
 
Total manufacturing
   
16.8
     
207
     
24,691
 
Total
   
100.0
%
   
2,255
     
65,265
 


STORE Capital Corporation
Page 14 of 15
STORE Capital Corporation
Investment Portfolio
December 31, 2018

Diversification by Geography

STORE Capital’s portfolio is also highly diversified by geography, as the Company’s property locations can be found in every state except Delaware. The following table details the top ten geographical locations of the properties as of December 31, 2018:

State
 
% of
Annualized
Base Rent and
Interest
   
Number of
Properties
 
Texas
   
11.6
%
   
232
 
Florida
   
6.2
     
137
 
Illinois
   
6.2
     
140
 
Ohio
   
5.5
     
134
 
Georgia
   
5.3
     
140
 
Michigan
   
4.4
     
79
 
California
   
4.3
     
40
 
Tennessee
   
4.2
     
100
 
Arizona
   
4.0
     
71
 
Minnesota
   
3.7
     
75
 
All other (39 states) (1)
   
44.6
     
1,107
 
Total
   
100.0
%
   
2,255
 

(1)
Includes one property in Ontario, Canada which represents 0.3% of annualized base rent and interest.


STORE Capital Corporation
Page 15 of 15
STORE Capital Corporation
Investment Portfolio
December 31, 2018

Contracts and Expirations

The Company focuses on long-term, triple-net leases with built-in lease escalators and uses master leases, where appropriate. As of December 31, 2018, 98% of the Company’s investment portfolio was subject to triple-net leases. Where the Company owns multiple properties leased to a single customer, 91% of this portion of the investment portfolio was subject to master leases. Leases and loans representing approximately 16.1% of the annualized base rent and interest will expire in the next ten years (before 2029). The following table sets forth the schedule of lease, loan and direct financing receivable expirations as of December 31, 2018:

Year of Lease Expiration or Loan Maturity (1)
 
% of
Annualized
Base Rent and
Interest
   
Number of
Properties (2)
 
2019
   
0.8
%    
18
 
2020
   
0.7
     
13
 
2021
   
0.6
     
7
 
2022
   
0.4
     
7
 
2023
   
1.0
     
26
 
2024
   
0.7
     
15
 
2025
   
1.5
     
23
 
2026
   
2.1
     
54
 
2027
   
3.5
     
64
 
2028
   
4.8
     
79
 
Thereafter
   
83.9
     
1,941
 
Total
   
100.0
%
   
2,247
 

(1)
Expiration year of contracts in place as of December 31, 2018, excluding any tenant renewal option periods.
(2)
Excludes eight properties which were vacant and not subject to a lease as of December 31, 2018.



(Back To Top)

Section 3: EX-99.2 (EXHIBIT 99.2)


Exhibit 99.2

 

 Disclaimer  This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act. Such forward-looking statements include, without limitation, statements concerning our business and growth strategies, investment, financing and leasing activities and trends in our business, including trends in the market for long-term, triple-net leases of freestanding, single-tenant properties. Words such as “expects,” “anticipates,” “intends,” “plans,” “likely,” “will,” “believes,” “seeks,” “estimates,” and variations of such words and similar expressions are intended to identify such forward-looking statements. Such statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from the results of operations or plans expressed or implied by such forward-looking statements. Although we believe that the assumptions underlying the forward-looking statements contained herein are reasonable, any of the assumptions could be inaccurate, and therefore such statements included in this presentation may not prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by us or any other person that the results or conditions described in such statements or our objectives and plans will be achieved. Furthermore, actual results may differ materially from those described in the forward-looking statements and may be affected by a variety of risks and factors including, without limitation, the risks described in our Annual Reports on Form 10-K and quarterly reports on form 10-Q.Forward-looking statements set forth herein speak only as of the date hereof, and we expressly disclaim any obligation or undertaking to update or revise any forward-looking statement contained herein, to reflect any change in our expectations with regard thereto, or any other change in events, conditions or circumstances on which any such statement is based, except to the extent otherwise required by law.THIS PRESENTATION CONTAINS HISTORICAL PERFORMANCE INFORMATION REGARDING STORE CAPITAL, AS WELL AS OTHER COMPANIES PREVIOUSLY MANAGED BY OUR SENIOR EXECUTIVE TEAM. SUCH PAST PERFORMANCE IS NOT A GUARANTEE OF FUTURE RESULTS.This presentation contains references to our copyrights, trademarks and service marks and to those belonging to other entities. Solely for convenience, copyrights, trademarks, trade names and service marks referred to in this presentation may appear without the “© “ or “TM” OR “sm” Symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights or the rights of the applicable licensor to these copyrights, trademarks, trade names and service marks. We do not intend our use or display of other companies’ trade names, copyrights, trademarks or service marks to imply a relationship with, or endorsement or sponsorship of us by, any other companies.Definitions and footnotes for data provided herein are provided in the appendix section of this presentation. Unless otherwise indicated, data provided herein is as of December 31, 2018.  2   
 

 3  STORE CAPITAL SNAPSHOT  4      DESIGNED TO PERFORM (How We Uniquely Built S|T|O|R|E)  5   Our Market. Our Approach to Real Estate Investing.      Our Investment Strategy and Customers. Our Capital Structure.      Our Internal Growth. Our Leadership. Our Governance.    PERFORMANCE (How We Have Performed)  17   Our Many Key Achievements. Our Portfolio at a Glance.      Our High Investment Diversity. Our Contract Quality.      Our Investment Pipeline Activity. Our Growth and Performance.     Our Comparative Stock Return Profile. Proof of our Design.    APPENDIX (Important Supporting Information)  29   Prior Leadership Investment Performance. Market Value Added Performance.      Peer Group Comparisons. Contract Quality Trends.      Contract Seniority Importance. Portfolio Management Approach. Our Growth.    FINANCIAL INFORMATION   43      DEFINITIONS AND FOOTNOTES  52    Table of Contents 
 

 STORE Capital Snapshot  NYSE: STOR; U.S. PROFIT-CENTER REAL ESTATE ~30-YEAR SUCCESSFUL LEADERSHIP TRACK RECORD $6.3B EQUITY MARKET CAP; 4.7% DIVIDEND YIELD32% DIVIDEND INCREASE FROM 2014 TO 2018FOUR CONSECUTIVE YEARS OF DOUBLE-DIGIT INVESTOR RETURNS2,255 PROPERTIES LEASED TO 434 CUSTOMERS ~75% OF LEASE CONTRACTS INVESTMENT-GRADE QUALITY1 UNIQUE DIRECT ORIGINATION PLATFORM    4  “We often use a real estate term – “brick by brick” – to explain how we have been building S|T|O|R|E and our durable business model. The result is a substantial, nearly irreplaceable, trophy investment portfolio designed to deliver consistent and dependable performance.” -- Christopher Volk, CEO 
 

 S|T|O|R|E addresses a large market    S|T|O|R|E has many broad based market opportunities.  >$3 trillionSTORE market opportunity  Dedicated to net-leased profit-center real estateFocused on the service sector of the U.S. economyMarket leader in profit-center net-lease solutionsNearly 200,000 companies in S|T|O|R|E’s target marketApproximately same size as world’s fourth largest economyOver 20,000 contacts in proprietary prospecting database  | designed to perform |  5    Cumulative Counts  ($MM)    S|T|O|R|E’sTarget Market(U.S. Middle Market) 
 

   S|T|O|R|E is Single Tenant Operational Real Estate  defining our investment asset class shapes everything we do.  Why is that so important?Tenants need their profit-center real estate in order to conduct business, making our rent contracts senior to other financial obligations  Which is the unique payment source?Profitability from the operations of each investment  How do STORE Properties differ from other real estate?Three sources of payment support instead of two  PROPERTY VALUE  CORPORATE CREDIT  UNIT-LEVEL PROFITABILITY  STORE Properties uniquely offer the ability to create contracts that are superior to the credit quality of the tenant.  6  | designed to perform | 
 

 Filling A Broad-Based Market Need  Rated  S|T|O|R|E’s tenants choose to rent because….Long term real estate funding solutions are lackingLeasing real estate replaces both debt and equityLower cost of capitalUnparalleled product flexibility  S|T|O|R|E is landlord of choice because….Customer-centric and solutions-orientedAdministrative ease through responsive servicing Development and renovation opportunitiesA focus on corporate flexibility and wealth creation       our customers choose to have a landlord rather than a banker.  7  S|T|O|R|E is important and fundamental to creating opportunities for our clients,their employees and other stakeholders  What we do is impactful….Year-over-year tenant revenue growth of 15.1%1S|T|O|R|E customers added ~325,000 employees in 20172Exclusive educational event: Inside Track Forum Online educational opportunities: STORE UniversityIntegrated real estate capital: Master Funding Solutions  | designed to perform | 
 

    Internal OwnershipDirect calling efforts on thousands of companies and financial sponsors  ~80%    ~20%  B2B Benefits  + Higher Lease Rates+ Lower Real Estate Prices+ Longer Lease Terms+ Smaller Transaction Sizes + Greater Investment Diversity+ Stronger Contracts  Our unique platform has multiple origination channels enabling us to efficiently cover a very large market opportunity.All channels result in a B2B approach.    our origination platform is key to greater investment returns and lower risk.  “B2B” Origination Platform  Virtual SalesforceTenant introductions through intermediary relationships  = Value for Stockholders  8  | designed to perform | 
 

 S|T|O|R|E’s Diverse Customer Profile  UNPRECEDENTED GRANULARITY    customer revenue distribution1  % Of Total Rent & Interest    434 customers operating across more than 100 industries~ 15 net new customers quarterly 2,255 properties | ~ 75 net new properties quarterly ~ 680 contracts | ~ 32 transactions closed quarterlyAverage transaction size below $9 millionRepeat customers about one-third of new business  <$5MM  $5 -$20MM  $20 -$50MM  $50 -$200MM  $200 -$500MM  $500MM -$1B  >$1B  ~ 73% of customers have revenues over $50 millionMedian tenant revenues ~ $54 millionWeighted average tenant revenues ~$862 millionEmploy ~2.2 million workers2Operate ~25,000 locations in all 50 states3  S|T|O|R|E TENANT PROFILES  9  both our customers and their employees benefit from a S|T|O|R|E relationship.     | designed to perform | 
 


 10  Profit-Center Investing Table Stakes S|T|O|R|E’s entry-level guideposts  Demand unit-level financial reporting.This provides the best picture of real estate quality and essentiality.  Always request master leases on multi-unit transactions.This is the most effective way for landlords to achieve risk diversity.  Invest in properties at or below replacement cost.This is proven to lessen defaults and raise recoveries.  Invest at yields and gross returns in excess of the brokered market.This is proven to enhance returns and increase margins of safety.    Evidence-Based Real Estate Investing    the result: investment-grade portfolio performance.  10  Focus on The Big PictureCriteria that stand the test of time  Appreciate the industry.Seek industries likely to have sustained long-term relevance.   Understand the tenant business model.Evaluate unlevered equity returns and market share.   Evaluate the tenant business defensive moat.Understand features that make tenants viable and competitive.   Know the players.Understand background of leadership and equity investors.   Numbers and Analysis Know the deal  Evaluate the real estate.Look to local market rents and estimates.  Evaluate the corporate credit.Assess corporate credit and know where we stand in capital stack priority.   Evaluate unit-level financial performance.Look to long-term unit-level rent coverage reliability.  Understand the corporate structure and recourse.Look for parent and affiliate company recourse and potential guarantors.  | designed to perform | 
 

 Portfolio Diversity   2,255 Properties  > 400 Tenants  >100 Industries  49 States  ~80% of tenants < 1%  Top Tenant <3%  Non-Correlated Risk  Stable Portfolio Tenant Credit Profile  The Essence of S|T|O|R|E’s Investing Strategy  11  A Value Investing Portfolio Approach, Driven ByEstablished AAA/A+ Securitization Principles    11  the result: exceptional returns and investment-grade portfolio performance.  Together with Active Portfolio and Property Management  Contract Seniority  Virtually All Profit Center Investments  Virtually All Provide Financial Statements  91% Master Lease Penetration  Median Unit Coverage: 2.1:1  Median 4-Wall Coverage: 2.5:1  Wtd. Avg. Tolerable Sales Fall-off: ~40%1  Investment/Replacement Cost: 81%  Investments Made at Discounts to NAV  &  | designed to perform | 
 

 Capital Structure Leadership    our liability structure is designed to withstand interest rate volatility.  12  Virtually all borrowings are long-term and fixed rate  strategic liability management ($MM)  S|T|O|R|E’s annual free cash flow generally exceeds current debt maturities, making us effectively asset/liability neutral.  Median debt maturities  2   2.7% 4.2% 3.5% 4.4% 5.1% 4.7% 4.2% 4.4% 4.4% 4.5% N/A  Avg Rate 1  AAA/A+ asset-backed and Baa2/BBB unsecured borrowing options  $600 million unsecured multi-year revolving credit facility  | designed to perform | 
 

 Complementary Investment-Grade Debt Options  growing unencumbered asset pool ($MM)  AAA & A+ STORE Master Funding   Dedicated asset-backed securities conduit$1.9 billion outstanding  Baa2/BBB Unsecured Term Borrowings    Rated by Moody’s, S&P and Fitch Ratings, stable outlook$925 million outstanding   Q3 2011   2018  13  Non-recourse with minimal covenantsComplete portfolio management flexibilityEfficient leverage of 70% at time of issuanceBBB rated notes retained for flexibilityEnables superior unsecured debt ratiosProvides leading term borrowing diversity    A-/BBB+   STOREUnencumbered  Select Ratios  Net Lease Avg1  Assets2  Debt/EBITDA  ~5x  3.2x  Unencumbered assets/unsecured debt  ~3x  4.4x  Debt service coverage  ~5x  7.5x  Cash flow support from encumbered assets  NO  YES  Investment-grade borrowing diversity with resultant improved unsecured credit metrics.  $4.6B  $2.7B  $0.3B   2016   2017  ~61%  ~35%  ~4%  $3.3B  $2.5B  $0.4B  $2.2B  $2.5B  $0.4B  | designed to perform |  liability efficiencies enhanced through multiple borrowing options. 
 

 Internal Growth Strategy  Lease Escalation Frequency  % Base Rent and Interest1  Weighted Average Annual Escalation Rate2  Annually  73%  1.8%  Every 5 years  23%  1.8%  Other escalation frequencies  2%  1.7%  Flat  2%  N/A  Total / Weighted Average  100%  1.8%  lease escalations  dividends  Market-leading dividend increases 8.0% in 2015 7.4% in 2016 6.9% in 2017 6.5% in 2018 Market-leading dividend protection3 70% payout ratio in 2015 68% payout ratio in 2016 70% payout ratio in 2017 70% payout ratio in 2018  Annual Lease Escalations  AFFO Per Share Growth  1.00%  1.55%  1.25%  1.93%  1.50%  2.32%  1.80%  2.79%  2.00%  3.09%  +  ReinvestedCash Flows                        65.0%  70.0%  75.0%  80.0%  2.93%  2.47%  2.01%  1.56%          =  EstimatedInternal Growth                                                > 5%    internal growth is driven by retained and reinvested cash flows.  14  estimated gross internal growth4    AFFO Payout Ratio    AFFO Per Share Growth  32% INCREASE SINCE IPO  | designed to perform | 
 

 Unrivaled Leadership Over Decades  Experienced….Built & managed three net-lease real estate investment companiesInvested over $17 billion in profit-center real estate (9,600+ properties)Consistently outperformed broader REIT market returns over multiple decades1Navigated platforms through multiple economic cycles & interest rate environmentsThought leadership through primary and published research  Groundbreaking….Investment-grade corporate net-lease rating (1995)Net-lease real estate master trust conduit (2005)NYSE-listed public company sales (2001 & 2007)Private institutional investor sponsorship (1999 & 2011)Inaugural issuance of AAA rated net-lease notes (2018)    a progression of innovation and thought leadership over three decades.  15  1980  Q4 2018  > $17 B  We have successfully invested and managed more in STORE Properties and over a longer period of time than anyone.  90 employees in one office, ~40% of which drive our origination activity.  | designed to perform | 
 

   Best in Class Corporate Governance  Independent Board, Board Chairman and Key Committees?  Yes  Board Refreshment?  Yes, 50% directors new since 2016  Board Diversity?  33%  Regular Board Evaluations?  Yes  Regular Stockholder Engagement?  Yes  Opt-out of State Anti-Takeover Provisions1?  Yes  Poison Pill?  No  Staggered Board?  No  leading board governance  leading stockholder disclosure  Full tenant credit quality distributionFull contract quality distributionFull tenant size distributionLease contract escalationsProperty appraised replacement costsPortfolio master leasesLeading unit-level performance disclosureProperty sales gain over costsGround lease investmentsNN v. NNN leases   With our leading stockholder disclosure and governance practices, we provide corporate governance that is “best in class” in the net-lease sector.    16  our best in class corporate governance is key to creating shareholder value.   | designed to perform | 
 

 Key Achievements As A Public Company  EXCEPTIONAL PERFORMANCEMore than doubled our pipeline of investment opportunities1 to $13 Billion since IPORealized average monthly investment activity in excess of $100 million since 2015Raised our dividends to shareholders 32% (6.5% in 2018)Delivered AFFO per share growth of ~37%2 (7.6% in 2018)Realized compound annual shareholder returns greater than 16% vs. just under 3.8% for Equity REITsCreated exceptional Market Value Added with our equity valuation exceeding equity cost by 37%3 Delivered four consecutive years of double digit stockholder returnsINVESTMENT SAFETYHave been amongst the industry leaders in dividend protection4Have realized approximate A-rated portfolio performance since inception Maintained a consistent real estate occupancy5 level of 99% or betterMARKET RECOGNITIONGarnered investor interest from well-known investors, including Berkshire Hathaway, an 8.4% shareholderInstituted programmatic ability to uniquely issue AAA rated structured finance notesAmongst the highest corporate net-lease credit ratings from all three agencies (BBB, BBB, Baa2)    | performance |  17 
 

 18  Portfolio at a Glance    As of December 31,        2018  2017  2016  Investment property locations  2,255  1,921  1,660  States  49  48  48  Customers  434  397  360  Industries in which our customers operate  106  104  106  Proportion of portfolio from direct origination  ~80%  ~80%  ~80%  Contracts with STORE-preferred terms*1  94%  93%  91%  Weighted average annual lease escalation2  1.8%  1.8%  1.8%  Weighted average remaining lease contract term  ~14 years  ~14 years  ~14 years  Occupancy3  99.6%  99.6%  99.5%  Properties not operating but subject to a lease4  23  16  9  Investment locations subject to a ground lease  21  20  17  Investment portfolio subject to NNN leases*  98%  98%  97%  Investment portfolio subject to Master Leases*5  91%  87%  82%  Average investment amount / replacement cost (new)6  81%  82%  82%  Locations subject to unit-level financial reporting7   98%  97%  97%  Median unit FCCR / 4-wall FCCR8  2.1x / 2.5x  2.1x / 2.6x  2.1x / 2.6x  Contracts rated investment grade9  ~75%  ~75%  ~75%    | performance |  industry leading growth and portfolio consistency. 
 

   Diversification Across Industry Groups  SERVICE  (~65%)  Located near target customers Not readily available onlineBroad array of everyday services  As of December 31, 2018, our portfolio is diversified across 106 different industries in the service, retail and manufacturing sectors of the U.S. economy. We group these industries into 74 different industry groups as shown in the following tables.  19  | performance |  service industries account for more than half of the u.s. employment and gdp.      Building  % Base Rent and Interest1        # ofProperties  Sq. Ft. (in thousands)  As of December 31,      Customer Industry Groups      2018  2017  2016  Restaurants – Full Service  403  2,719  11.2%  13.1%  13.8%  Restaurants – Limited Service  395  1,040   5.8%  7.2%  8.4%  Early Childhood Education  185  2,082   5.9%  6.6%  7.4%  Health Clubs  76  2,267   5.3%  5.9%  6.2%  Movie Theaters  38  1,879   4.8%  6.0%  6.9%  Family Entertainment  38  1,290  4.0%  4.2%  3.8%  Automotive Repair and Maintenance  139  643  3.8%  3.1%  2.9%  Pet Care  157  1,539   3.5%  3.0%  2.8%  Lumber & Construction Materials Wholesalers  105  4,375  2.9%  2.0%  1.0%  Medical and Dental  59  618  2.2%  1.4%  0.9%  Behavioral Health  38  603  1.7%  1.8%  1.9%  Career Education  7  584   1.6%  1.9%  2.2%  Elementary and Secondary Schools  6  278   1.4%  1.4%  1.5%  Equipment Sales and Leasing  19  619   1.2%  1.5%  1.2%  Metal and Mineral Merchant Wholesalers  20  1,698   1.0%  0.8%  1.0%  Wholesale Automobile Auction  6  224  1.0%  1.1%  0.9%  All Other Service (19 industry groups)  149  6,008  7.5%  7.7%  8.0%  Total Service  1,840  28,466  64.8%  68.7%  70.8% 
 

   Diversification Across Industry Groups (continued)  20  RETAIL  MANUFACTURING   Primarily located in industrial parksStrategically near customersBroad array of industriesMaking everyday necessities  (~17%)  Located in retail corridorsInternet resistantHigh experiential componentSelling merchandise   (~18%)  | performance |  S|T|O|R|E’s retail exposure has high experiential component.      Building  % Base Rent and Interest1        # ofProperties  Sq. Ft. (in thousands)  As of December 31,      Customer Industry Groups      2018  2017  2016  Furniture  54  3,224  5.5%  6.7%  3.8%  Farm and Ranch Supply  41  3,914  4.3%  3.1%  3.2%  Hunting and Fishing  9  758  2.2%  2.6%  2.2%  Recreational Vehicle Dealers  21  954  1.6%  1.0%  1.1%  Used Car Dealers  19  229  1.2%  0.9%  0.6%  Home Furnishings  5  691  0.7%  0.9%  1.1%  New Car Dealers  8  236  0.7%  0.0%  0.2%  All Other Retail (9 industry groups)  51  2,102  2.2%  2.7%  3.4%  Total Retail  208  12,108  18.4%  17.9%  15.6%  Metal Fabrication  57  6,894  3.9%  3.2%  2.9%  Plastic and Rubber Products  30  3,855  2.5%  2.4%  2.9%  Furniture Manufacturing  12  3,688  2.0%  0.6%  0.0%  Electronics Equipment  10  1,060  1.4%  0.7%  0.6%  Aerospace Product and Parts  11  992  0.8%  0.6%  0.2%  Chemical Products  9  820  0.8%  0.4%  0.6%  Automotive Parts and Accessories  12  1,533  0.8%  0.5%  0.1%  All Other Manufacturing (16 industry groups)  66  5,849  4.6%  5.0%  6.3%  Total Manufacturing  207  24,691  16.8%  13.4%  13.6%              Total Portfolio  2,255  65,265  100.0%  100.0%  100.0% 
 

   Retail Portfolio Vitality in the Age of E-Commerce  21  VITAL COMPONENTS COMBINE TO CREATE AN ESSENTIAL RETAIL BUSINESS MOAT.  S|T|O|R|E’s Retail Tenants are Thriving in the Age of E-CommerceVital Experiential Components Distinguish Our Largest Consumer Goods Industry Segments  S|T|O|R|E invests in retail businesses having experiential components combined with strong online presence.      The 8 Components of Retail Vitality in the Age of E-Commerce                    Treasure Hunt  Price Match  Vertical Integration  Private Label  Loyalty Programs  Immediacy  Project Based  Consumer Financing   Customer Industry Groups  # of Props.  In-store experience; Expert sales consultation; Buyer interactionwith products  Affirms online value proposition; Buyers confirm online selection; Product interaction  In-store returns, Ship-to-store for assembly; local delivery and installation  Differentiated products: Exclusive Products only available in branded store  Strong Loyalty programs: Top retailers have 90% sales via loyalties programs.   Immediate product delivery to consumers: “Owning the last mile"  Project-based; Buyer requires both expert consultation and physical confirmation   Consumerfinancing program available on location   Furniture  54                     Farm/Ranch Supply  41                       Hunting and Fishing  9                       RV Dealers  21                     Used Car Dealers  19                     Home Furnishings  5                       New Car Dealers  8                      | performance | 
 

 22  Top 10 Customers1  AMC Entertainment (NYSE:AMC), is the largest movie exhibition company in the world with over 1,000 theatres and 11,000 screens across the globe, AMC operates among the most productive theatres in the United States’ top markets, having the #1 or #2 market share positions in 22 of the 25 largest metropolitan areas of the United States, including the top three markets (NY, LA, Chicago).   Cadence Education is a Morgan Stanley Global private equity owned company and is one of the premier early childhood educators in the U.S. The Company’s national platform of more than 170 schools has the capacity to serve more than 20,000 students across 21 states.   Mills Fleet Farm dba Fleet Farm is a full-service merchant with more than 40 locations in four mid-western states, offering a broad assortment of goods from hunting gear to lawn, garden and farm supplies. In 2016 Mills was purchased by the private equity firm KKR & Co.  Zips Holdings is the second largest car wash operator in the US with over 135 locations in operation. In 2015, founder Brett Overman partnered with Equity Investment Group and Britton Hill Partners to help identify acquisition opportunities and provide management support for onboarding operations at new units.   % Base Rent and Interest2  2.7%  2.4%  1.7%  2.2%  1.6%  1.6%  1.6%  1.5%  1.5%  1.3%    18.1%  Total Top 10 Customers  Art Van Furniture is the Midwest’s largest furniture retailer and a top ten national furniture retailer based on sales. Founded in 1959, the company operates approximately 190 stores throughout nine states with expected annual sales of $1.3 billion. Art Van Furniture is majority owned by Boston based private equity firm Thomas H. Lee Partners.  CWGS Group, dba Camping World, is the nation’s largest retailer of recreational vehicles and related accessories, operating over 220 locations. In 2017, Camping World won a bankruptcy auction to acquire sporting goods retailer Gander Mountain, planning to build on its existing outdoor and camping brand. The Gander Mountain moniker was rebranded to Gander Outdoors.  # ofProperties  23  8  14  9  17  42  32  19  16  46  226  Bass Pro Group operates retail locations under the Bass Pro Shops and Cabela’s monikers, offering outdoor gear and apparel in an immersive setting. These two iconic brands, combined, operate more than 170 retail and marine centers. Both concepts are market leaders and highly respected within their respective niche of outdoor products.  U.S. LBM Holdings, founded in 2009, is a collection of leading building material distributors across 29 states with more than 230 locations. The company serves as a critical link in the building materials supply chain, supplying more than 60,000 stock keeping units (“SKUs”) for custom homebuilders and specialty contractors. US LBM has filed an S-1 with the SEC as it intends to raise additional equity from an IPO. Proceeds from the IPO are expected to payoff outstanding indebtedness under its Second Lien Term Loan.  Dufresne Spencer Group is the largest Ashley’s Furniture HomeStore licensee. DSG entered our top 10 with their ownership of Hill Country Holdings, another existing STORE customer and a top Ashley licensee. DSG is backed by a seasoned management team with a strong operating history and garnered an investment from Ashley Corporate in December 2017.  | performance |  top ten tenants represent less than 19% of annual rent & interest.  Stratford School dba Spring Education is the largest pure play US platform focused on PreK-12 education. Spring’s diversified collection of brands operates 227 schools in 18 states & D.C. The company is owned by Asia-based investment firm, Primavera Capital. STORE’s investment in Stratford increased with their acquisition of Nobel Learning Communities, another existing STORE customer. 
 

 Diversification Across Geographies1    23  OCCUPANCY2  | performance |  geographically dispersed portfolio with consistently high occupancy rates. 
 

 ~75% of Contracts Investment-Grade in Quality  Because we invest in profit-center real estate, our contracts almost always have less investment risk than the credit risk of our tenants. In addition, the STORE Score, being purely quantitative, is a base risk score that often understates contract quality.    Moody’s RiskCalc (EDF) STORE Score 1        24  CONTRACTS RATED INVESTMENT GRADE (3-MO. AVERAGE)  MEDIAN UNIT-LEVEL FIXED CHARGE COVERAGE    Median EDF  MedianSTORE Score  investment-grade contracts mitigate corporate default risk.  | performance | 
 

 25    25  Investment Pipeline Activity  PIPELINE VELOCITY DURING Q4 2018  PIPELINE SECTOR DISTRIBUTION AS OF 12/31/18    PIPELINE SIZE ($B)    Starting Pipeline $12.5 B  Ending Pipeline $13.2 B      New Deals Added $2.0 B  Deals Passed or Closed $1.3 B  Our pipeline continues to mirror STORE’s current portfolio.  Emphasis on Service, Manufacturing and Select Retail sectors having high potential for long-term relevance  | performance |  S|T|O|R|E’s pipeline remains robust and diverse. 
 

 26    NOI, AFFO AND NET INCOME ($MM)2   Growth and Performance    | performance |        PER SHARE ANNUAL GROWTH   NET INCOME:15.9%  DIVIDENDS:7.2%  AFFO:7.3%  Compound Annual Growth Rate  ACQUISITION AND DISPOSITION VOLUME ($MM)1  GROSS RATE OF RETURN 3  5.6%  5.3%  5.4%  5.6%  4.4%  4.1%  8.1%  7.9%  9.8%  9.7%  9.6%  7.8%  3.6%  S|T|O|R|E’S consistent performance has driven stockholder returns.  4.4%  7.9%  9.7% 
 

 Total Return Built on Both Yield & Growth    | performance |  27  500 companies  48 companies(10%)  20 companies(4%)  S|T|O|R|E’s combination of dividend yield and EPS growth offers a superior investment opportunity that has delivered 37% AFFO per share and 32% dividend growth since our IPO.  S|T|O|R|E provides an attractive total return relative to the broader market.  Comparative Annual Return Performance  Rare Earnings and Growth Combination  Comparative Cumulative Return Performance 
 

 Proof of our Design  market-leading direct investment approach in underserved market exceeding $3.4 trillion  1.  market-leading value creation and investment-grade portfolio performance  2.  market-leading diversified investment-grade capital markets strategy  3.  market-leading secure dividends and dividend growth  4.  market-leading investment diversity  5.  leadership team with over 30-year history and a multiple-decade record of outperformance1  8.    | performance |  28  market-leading governance and investor disclosure  6.  7.  four consecutive years of double-digit stockholder returns driven by financial performance 
 

     Appendix 
 

    FFCA (NYSE: FFA) 1994 - 2001  Spirit Finance (NYSE: SFC) 2003 - 2007  STORE Holding (Oaktree) 2011 - 2016  Management Team Performance    | appendix – historical performance |  Management has unparalleled expertise in creating successful STORE Property investment platforms in a variety of market environments.  30  $4.9 billion Invested Average Cap Rate 10.3%Average 10-year US Treasury 6.2%  $3.5 billion InvestedAverage Cap Rate 8.7%Average 10-year US Treasury 4.4%  $4.4 billion InvestedAverage Cap Rate 8.3%Average 10-year US Treasury 2.3%  Excess Return relative to Market Risk1  Annualized total return  S|T|O|R|E leadership has a proven record of risk-adjusted outperformance. 
 

      31  Stable and Attractive Lease Rate Spreads to Treasury Rates  S|T|O|R|E and predecessors’ average Lease Rates vs. 10-Year Treasuries1  1994  2018  3.9%  2.0%  ÷  Δ    =  .51  24-Year Interest Rate Correlation  (Cap Rate)  (Treasury)  net lease sensitivity to interest rates limits interest rate exposure.  Net lease contracts are financial instruments, with yields that move with interest rates. Assuming borrowing costs rise with interest rates and lease rates rise by half of borrowing cost rates, shareholder returns will be little changed.  | appendix – historical performance | 
 

   ¹ Information based on YTD 3Q 2018 reported results. For companies where the year-to-date lease rate on new acquisitions is not disclosed, the formula assumes a lease rate of 7.0%. Same Store NOI growth used as a proxy for contract lease escalator where the latter is not disclosed. For companies where neither is disclosed, the formula assumes a lease escalator of 1.50%. EBITDA margin is based on revenue less reimbursed property expenses and straight-line rent. Marginal interest rate is based on the current spread on unsecured debt outstanding over the 10 year treasury.     | appendix - returns |  Our elevated equity return on new investments is a principle driver of our margins of safety and contributes to superior equity value creation ability.  Marginal Equity Returns on Net Lease Real Estate Investments  32  Marginal Equity RETURNS1  ((lease rate + lease escalators) x EBITDA margin - (marginal interest rate x % funded with debt))  % funded with equity  ROE computed on new investments using the V-Formula   elevated returns contribute to performance and capital access. 
 

     | appendix - returns |  33  ADCONNNEPRSRC  GROSS Cap Rate SPREAD over the cost of debt1  MVA Growth Rate2  CURRENT AFFO Multiple3  S|T|O|R|E  S|T|O|R|E  S|T|O|R|E  Elevated gross cap rates and EBITDA margins have contributed to higher equity rates of return, leading to a higher spread between shareholder historic cost and market valuation, or Market Value Added (MVA).    EPRSRCNNNO ADC  ¹ For the YTD period ended September 30, 2018. Gross cap is Initial cap rate on new acquisitions plus contract bumps. For companies where the year-to-date lease rate on new acquisitions is not disclosed, the formula assumes a lease rate of 7.0%. Same Store NOI growth used as a proxy for contract lease escalator where the latter is not disclosed. For companies where neither is disclosed, the formula assumes a lease escalator of 1.50%. Cost of debt is the current spread on unsecured debt outstanding over the 10 year treasury.2 Calculated using the formula: [market capitalization / computed equity cost]^(1 / weighted average age of equity) 3 Calculated as of September 28, 2018  ADCNNNSRCEPRO  Comparative Value Creation S|T|O|R|E vs. Peers  S|T|O|R|E leads on shareholder value creation. 
 

   Most Diversified Tenant Base  Source: Latest publicly available financial information as of September 30, 2018. ¹ Includes: Agree Realty Corporation; EPR Properties; Lexington Realty Trust; Spirit Realty Capital, Inc.; VEREIT, Inc.; and W. P. Carey Inc.  (weighted average lease term in years)  Longest Lease Term  Lowest Near-Term Renewal Exposure  (% top 5 tenants, based on current annual rent)  (% expirations by period, based on current annual rent)    Our net-lease portfolio has long contract terms and very high tenant diversification.  High Quality Portfolio  34  | appendix – portfolio|  S|T|O|R|E leads on lease term and tenant diversity. 
 

 DIVIDEND PER SHARE growth1    (Since Q1 2015)  affo payout ratio2    Strong Protected Dividend Growth  Our dividend growth is the highest amongst our net-lease peers…..    35  | appendix – portfolio|  …and our dividends are the most protected.    STORE’s dividend growth rate is 37% higher than its nearest peer.  1 Source: Historical dividend data from Nasdaq.com. VEREIT established its quarterly dividend in Q3 2015. Data for Spirit was not included following the spin-off of SMTA.2 Represents consensus 2019 analyst estimate from CapIQ.  S|T|O|R|E has posted strong dividend growth and dividend protection. 
 

 Consistent Contract Quality    36  Investment grade contracts averaging ~75% of S|T|O|R|E’s rent over prior three years.  Tenant Rating vs. Contract Rating (Cumulative)    Strong contracts create a margin of safety relative to corporate credit risk.  Contract Ratings  | appendix – portfolio|  Tenant Ratings  strong contract stability across S|T|O|R|E’s portfolio over time.     
 

   Senior Contract Importance  profit center lease contract seniority greatly lowers investment risk.  WAvg. STORERecovery ~70%3  Avg. Loan Recovery~56%2  Avg. CMBS Recovery~34%1  STORE Capital Normalized Recovery Distribution Vs. Other Credit Sectors  Because we invest in profit-center real estate, our recoveries of underperforming assets have a distribution towards elevated recoveries as a result of lease contract seniority.   37  | appendix – portfolio| 
 

   Asset Sales Impact on Internal Growth  actively managing the portfolio creates accretive internal growth.  Portfolio Management Impact on Growth  Active portfolio management is a strong complement to our property management activity to minimize portfolio investment risk.  Opportunistic Sales(39%)  Property Management(19%)  Net Gains over Cost  StrategicSales(42%)  +20%  +5%  +2%  +10%  Gains/Losses on Dispositions 2018 ($MM)  $228MM (orig. cost), 3.7% of BOY PortfolioOpportunistic Sales 6.81% CapStrategic Sales 7.14% Cap102% Recovery on Property Mgmt.  $0.7  Because STORE is levered at ~40% of our asset cost and we have generated gains on asset sales above our initial cost, we can add to our growth by leveraging those gains.  38  | appendix – portfolio| 
 

 39    Internal Growth in Perspective  Attractive internal growth components based on approximately $8.4 billion of investments over 7.5 years  Avg. Rent Related to Property Sales ~0.9%Avg. Rent Gain on Sales ~8.0%  PORTFOLIO MANAGEMENTAbility to realize gains  AFFO Impact ~0.1%  | appendix – portfolio|  margins of safety, investment-grade performance and built-in growth.          Annual RentIncrease +1.8 %ReinvestedCash Flow1 +1.9 %  INTERNAL GROWTHGrowth by design  Base Int. Growth +3.7 %    +3.7%  (0.3%)  +0.1%  PROPERTY MANAGEMENTWork in Process (WIP)  WIP Drag (0.2)%   WIP (0.2)%(Added drag from unresolved credit events)  3.3%  Internal Growth (Unleveraged) 3.3%   Growth Adjusted for Equity Capitalization (~60% at cost)  Shareholder Internal Growth (Leveraged) >5%   ResolvedCredit Events (1.0)%Recovery (~70%) +0.7%  PROPERTY MANAGEMENTAbility to manage losses  Net Credit Loss (0.3)%    (0.2%)  Shareholder Internal Growth(Leveraged) >5%   Internal Growth(Unleveraged)  
 

 As of December 31, 2018        Unencumbered Asset Pool  Total Portfolio   Investment Property Locations  1,245  2,255  Total Investment Amount  $4,628MM  $7,605MM  Weighted Average Remaining Lease Contract Term  ~15 Years  ~14 Years  % of Portfolio Subject to NNN Leases (by ABR)  98%  98%  % of Portfolio Subject to Master Leases (by ABR)1  90%  91%  Avg. Investment Amount / Replacement Cost (New)2  80%  81%  % of Locations Providing Unit-Level Financial Reporting  98%  98%  Median Expected Default Frequency (Tenant Risk)  1.68% (Ba3)  1.55% (Ba2)  Median STORE Score (Contract Risk)  0.39% (Baa2)  0.41% (Baa2)  Median Unit-Level Fixed Charge Coverage Ratio (FCCR) / 4-Wall Coverage Ratio3  2.35x / 2.82x  2.10x / 2.53x  Top Tenant Exposure (% ABR)  4.7%  2.7%  Top 5 Tenant Exposures (% ABR)  14.9%  10.6%  Industry Diversification (by ABR)  Comparison of Key Metrics: Unencumbered Pool vs. Total Portfolio  Unencumbered and Secured Asset Pools Have Consistent Credit Profiles  Consistent Asset Quality Across Portfolio    granular and diverse assets allow us to create comparable asset pools.   40  Total Portfolio  Unencumbered Asset Pool  | appendix – portfolio| 
 

 41  Executive Management Team    | appendix – S|T|O|R|E leadership|  MARY FEDEWAChief Operating Officer & DirectorCo-Founder; Chief Operating Officer, Assistant Secretary and Assistant Treasurer; Director since August 2016Former Managing Director of Acquisitions at Spirit; former Senior Vice President of GE Franchise Finance (successor company to FFCA)>20 years of experience in a broad range of financial servicesRecognized as a Woman of Influence in 2016 by Real Estate Forum magazine  CHRISTOPHER H. VOLKPresident, CEO & DirectorCo-Founder; CEO and Director since Company’s inception in May 2011Former Co-Founder, CEO and Director of Spirit Finance Corporation (“Spirit”); former President and Director of Franchise Finance Corporation of America (“FFCA”)>30 years of experience in structuring, managing and financing commercial real estate companiesLed largest ever real estate limited partnership roll-up transaction of its time in 1994 in formation of FFCA; oversaw issuance of FFCA's unsecured debt rating in 1995, the first unsecured debt rating ever issued to a net-lease REIT; led creation of first commercial real estate master trust debt conduit in the United States designed to finance net-lease assets in 2005 at Spirit   CATHERINE LONGChief Financial Officer, EVP & TreasurerCo-Founder; Executive Vice President – CFO, Treasurer and Assistant Secretary since Company’s inceptionFormer CFO and Treasurer of Spirit; former Principal Accounting Offer of FFCA>30 years of accounting, operating and financial management expertise Named CFO of the Year in 2008 by Arizona chapter of Financial Executives International  MICHAEL T. BENNETTEVP – General Counsel, Chief Compliance Officer & SecretaryCo-Founder; Executive Vice President—General Counsel, Chief Compliance Officer, Corporate Secretary and Assistant TreasurerFormer Senior Vice President of Spirit; former General Counsel of Farmer Mac (NYSE:AGM)>30 years of legal, transactional and operational experience in real estate and finance industriesNamed best in-house attorney at the Arizona Corporate Counsel Awards in 2017 by Az Business magazine 
 

 42  Board of Directors    MORTON H. FLEISCHERChairmanChairman since inception in May 2011. Former Co-Founder and Chairman of Spirit and FFCA  MARY FEDEWAChief Operating Officer & DirectorCo-Founder of S|T|O|R|E; COO since September 2017 (previously EVP – Acquisitions since inception in May 2011); Director since 2016  William F. HippDirectorDirector since 2016. Former head of real estate for Key Bank, BankBoston and FleetBoston with over 35 years in commercial banking  Einar A. SeadlerDirectorDirector since 2016. Founder and President of EAS Advisors LLC; Former Managing Director of Accenture Strategy  Joseph M. DonovanDirectorDirector since 2014. Chairman of Fly Leasing Limited (NYSE: FLY)  Quentin P. Smith, JrDirectorDirector since 2014. Founder and President of Cadre Business Advisors LLC; Director of Banner Health System  CHRISTOPHER H. VOLKChief Executive Officer & DirectorCo-Founder of S|T|O|R|E; CEO and Director since inception in May 2011. Former Co-Founder, CEO and Director of Spirit and President and Director of FFCA   Catherine D. riceDirectorDirector since October 2017. Lead Independent Director, Colony Northstar Credit Real Estate (NYSE: CLNC); Former Senior Managing Director and CFO of W.P. Carey  | appendix – S|T|O|R|E leadership|  Rajath shourieDirectorDirector since February 2019. Managing Director and co-portfolio manager within Oaktree Capital Management’s Distressed Debt Group 
 

     Financial Information 
 

 44    Condensed Consolidated Statements of Income    Three Months Ended            Year Ended              December 31,            December 31,            $ thousands, except share and per share data    2018      2017    2018      2017       Revenues:    (unaudited)            (unaudited) (audited)           Rental revenues    $ 139,211       $ 113,850       $ 513,302       $ 427,943      Interest income on loans and direct financing receivables    7,074       5,836       25,741       22,565      Other income    419       438       1,713       2,339      Total revenues    146,704       120,124       540,756       452,847      Expenses:                           Interest    35,964       28,540       129,061       120,478      Property costs    1,413       1,501       4,250       4,773      General and administrative    12,513       11,203       45,725       40,990      Depreciation and amortization    49,519       40,079       181,826       150,279      Provisions for impairment    5,202       1,500       7,810       13,440      Total expenses    104,611       82,823       368,672       329,960      Gain on dispositions of real estate    14,676      3,826       45,528      39,609      Income from operations before income taxes    56,769      41,127       217,612       162,496      Income tax expense    185      119      642      458     Net income    $ 56,584       $ 41,008       $ 216,970       $ 162,038                                Net income per share of common stock - basic and diluted    $ 0.26       $ 0.21       $ 1.06       $ 0.90                                Dividends declared per common share    $ 0.33       $ 0.31       $ 1.28       $ 1.20                                Weighted average common shares outstanding – basic    215,660,467      190,765,946       204,322,298      178,586,266      – diluted    216,477,667      191,302,717       204,933,292      178,656,676     | appendix - financial | 
 

   Condensed Consolidated Balance Sheets      December 31,              $ thousands, except share and per share data    2018        2017      Assets      (unaudited)        (audited)    Investments:                   Real estate investments:                   Land and improvements      $ 2,280,280        $ 1,898,342     Buildings and improvements      4,888,440        3,958,003     Intangible lease assets      85,148        87,402     Total real estate investments      7,253,868        5,943,747     Less accumulated depreciation and amortization      (585,913  )      (426,931  )        6,667,955        5,516,816     Real estate investments held for sale, net      -        16,741     Loans and direct financing receivables      351,202        271,453    Net investments      7,019,157        5,805,010    Cash and cash equivalents      27,511        42,937    Other assets, net      67,303        51,830    Total assets      $ 7,113,971        $ 5,899,777    Liabilities and stockholders' equity                  Liabilities:                   Credit facility       $ 135,000          $ 290,000      Unsecured notes and term loans payable, net      916,720        570,595     Non-recourse debt obligations of consolidated special purpose entities, net      2,008,592        1,736,306     Dividends payable      72,954        60,068     Accrued expenses, deferred revenue and other liabilities      117,204        71,866    Total liabilities      3,250,470        2,728,835    Stockholders' equity:                   Common stock, $0.01 par value per share, 375,000,000 shares authorized, 221,071,838                   and 193,766,854 shares issued and outstanding, respectively      2,211        1,938     Capital in excess of par value      4,129,082        3,381,090     Distributions in excess of retained earnings      (267,651  )      (214,845  )   Accumulated other comprehensive (loss) income      (141  )      2,759    Total stockholders' equity      3,863,501        3,170,942    Total liabilities and stockholders' equity      $ 7,113,971        $ 5,899,777    45  | appendix - financial | 
 

   Funds From Operations and Adjusted Funds from Operations1      Three Months Ended                Year Ended                   December 31,                December 31,                $ thousands, except per share data    2018        2017      2018        2017            (unaudited)                (unaudited)               NET INCOME    $ 56,584        $ 41,008        $ 216,970        $ 162,038        Depreciation and amortization of real estate assets    49,295         39,858         180,851         149,556         Provision for impairment of real estate    5,202         -         5,202         11,940         Gain on dispositions of real estate, net of tax2    (14,666  )      (3,826  )      (45,398  )      (39,604  )     FUNDS FROM OPERATIONS (FFO)    $ 96,415        $ 77,040         $ 357,625        $ 283,930         Adjustments:                                    Straight-line rental revenue, net:                                   Fixed rent escalations accrued    (1,296  )      (1,361  )      (6,121  )      (6,414  )     Construction period rent deferrals    2,116        965        6,622        3,056       Amortization of:                                    Equity-based compensation    2,659         2,051         8,608         7,931         Deferred financing costs and other noncash interest expense3    3,578         1,851         9,549         9,978         Lease-related intangibles and costs4    601        573        2,433        7,043        Provision for loan losses    -        1,500        2,608        1,500       Capitalized interest    (681  )      (415  )      (2,641  )      (1,243  )     Gain on extinguishment of debt    -        -        (814  )      -       Accrued severance costs    -         -          -         296         ADJUSTED FUNDS FROM OPERATIONS (AFFO)    $ 103,392        $ 82,204         $ 377,869        $ 306,077                                             Net Income per share of common stock - basic and diluted5    $ 0.26        $ 0.21         $ 1.06        $ 0.90                                             FFO per share of common stock – basic5    $ 0.45        $ 0.40        $ 1.75        $ 1.59        – diluted5    $ 0.44        $ 0.40        $ 1.74        $ 1.59                                           AFFO per share of common stock – basic5    $ 0.48        $ 0.43         $ 1.85        $ 1.71         – diluted5    $ 0.48        $ 0.43         $ 1.84        $ 1.71       46  | appendix - financial | 
 

 GAAP Reconciliations: Net Income to FFO and AFFO1    47   $ millions (unaudited)   Year Ended December 31,          2015  2016  2017  2018   NET INCOME  $ 83.8  $ 123.3  $ 162.0  $ 217.0   Depreciation and amortization of real estate assets  88.3   119.1   149.6   180.9    Provision for impairment of real estate  1.0   1.7   11.9   5.2    Gain on dispositions of real estate, net of tax2  (1.3)   (13.2)  (39.6)  (45.4)   FUNDS FROM OPERATIONS (FFO)  $ 171.7  $ 230.9  $ 283.9  $ 357.6   Adjustments:           Straight-line rental revenue, net:           Fixed rent escalations accrued  (4.8)  (5.5)  (6.4)  (6.1)   Construction period rent deferrals  2.7  3.1  3.1  6.6   Transaction costs  1.2   0.5   -   -    Amortization of:           Equity-based compensation  4.7   7.0   7.9   8.6    Deferred financing costs and other noncash interest expense3  6.5   7.3   10.0   9.5    Lease-related intangibles and costs4  2.1  2.5   7.0  2.4   Provision for loan losses  -   -   1.5  2.6   Capitalized interest  (0.8)  (0.8)  (1.2)  (2.6)   Gain on extinguishment of debt  -  -  -  (0.8)   Accrued severance costs  -   -   0.3  -   Selling stockholder costs  -  0.8  -  -   ADJUSTED FUNDS FROM OPERATIONS (AFFO)  $ 183.5  $ 245.8  $ 306.1  $ 377.9  | appendix - financial | 
 

 GAAP Reconciliations: Net Income to NOI    48   $ millions (unaudited)   Year Ended December 31,           2015  2016  2017  2018   NET INCOME  $83.8  $123.3  $162.0  $217.0   Adjustments:           Interest  81.8   105.2   120.5   129.1    Transaction costs  1.2   0.5   -   -    General and administrative  28.0   34.0   41.0   45.7    Selling stockholder costs  -   0.8   -   -    Depreciation and amortization  88.6   119.6   150.3   181.8    Provisions for impairment  1.0   1.7   13.4   7.8    Gain on dispositions of real estate  (1.3)   (13.3)   (39.6)  (45.5)   Income tax expense  0.3  0.4  0.5  0.6   NET OPERATING INCOME  $283.2  $372.3  $448.1  $536.5  | appendix - financial | 
 

 GAAP Reconciliations: Debt to Adjusted Debt1    49   $ millions (unaudited)  As of        December 31, 2018       Credit facility     $ 135.0     Unsecured notes and term loans payable, net    916.7     Non-recourse debt obligations of consolidated special purpose entities, net    2,008.6     TOTAL DEBT    $ 3,060.3     Adjustments:         Unamortized net debt discount    2.0     Unamortized deferred financing costs    35.5     Cash and cash equivalents    (27.5  )   Restricted cash deposits held for the benefit of lenders    (14.6  )   ADJUSTED DEBT    $ 3,055.7    | appendix - financial | 
 

 GAAP Reconciliations: Net Income to Adjusted EBITDAre1    50   $ millions (unaudited)  Three Months Ended        December 31, 2018       NET INCOME    $ 56.6     Adjustments:         Interest    36.0     Income tax expense    0.2     Depreciation and amortization    49.5     EBITDA    142.3     Adjustments:         Provision for impairment of real estate    5.2     Gain on dispositions of real estate    (14.7  )   EBITDAre    132.8     Adjustments:         Provision for loan losses    -     ADJUSTED EBITDAre    $ 132.8     Estimated adjustment to Adjusted EBITDAre if all real estate acquisitions and dispositions for         the quarter ended December 31, 2018 had occurred as of October 1, 2018    5.9     ADJUSTED EBITDAre – CURRENT ESTIMATED RUN RATE    $ 138.7             ANNUALIZED ADJUSTED EBITDAre    $ 531.1     ANNUALIZED ADJUSTED EBITDAre – CURRENT ESTIMATED RUN RATE    $ 554.8             ADJUSTED DEBT / ANNUALIZED ADJUSTED EBITDAre    5.8x     ADJUSTED DEBT/ ANNUALIZED ADJUSTED EBITDAre – CURRENT ESTIMATED RUN RATE    5.5x    | appendix - financial | 
 

 Long-Term Debt Maturities    51  | appendix - financial |  $ thousands  Total  2019  2020  2021  2022  2023  2024  2025  2026  2027  2028  Thereafter  Unsecured notes  $ 725,000  $ -  $ -  $ -  $ 75,000  $ -  $ 100,000  $ -  $ 200,000  $ -  $ 350,000  $ -  Term loans  200,000  100,0001  -  100,000  -  -  -  -  -  -  -  -  Non-recourse mortgage notes:                           STORE Master Funding2  1,868,466  25,694  93,415  137,853  113,767  262,096  333,322  268,979  169,067  464,273  -  -   Other secured notes  169,405  9,617  4,260  17,580  37,788  24,652  10,263  1,978  54,443  595  622  7,607  Total  $ 2,962,871  $ 135,311  $ 97,675  $ 255,433  $ 226,555  $ 286,748  $ 443,585  $ 270,957  $ 423,510  $ 464,868  $ 350,622  $ 7,607  1 Extendable – three one-year options.2 Prepayable 24 or 36 months prior to maturity. 
 

 52    Supplemental Reporting Measures  Funds from Operations, or FFO, and Adjusted Funds from Operations, or AFFO Our reported results are presented in accordance with U.S. generally accepted accounting principles, or GAAP. We also disclose Funds from Operations, or FFO, and Adjusted Funds from Operations, or AFFO, both of which are non‑GAAP measures. We believe these two non‑GAAP financial measures are useful to investors because they are widely accepted industry measures used by analysts and investors to compare the operating performance of REITs. FFO and AFFO do not represent cash generated from operating activities and are not necessarily indicative of cash available to fund cash requirements; accordingly, they should not be considered alternatives to net income as a performance measure or to cash flows from operations as reported on a statement of cash flows as a liquidity measure and should be considered in addition to, and not in lieu of, GAAP financial measures. We compute FFO in accordance with the definition adopted by the Board of Governors of the National Association of Real Estate Investment Trusts, or NAREIT. NAREIT defines FFO as GAAP net income, excluding gains (or losses) from extraordinary items and sales of depreciable property, real estate impairment losses, and depreciation and amortization expense from real estate assets, including the pro rata share of such adjustments of unconsolidated subsidiaries. To derive AFFO, we modify the NAREIT computation of FFO to include other adjustments to GAAP net income related to certain non‑cash revenues and expenses that have no impact on our long-term operating performance, such as straight‑line rents, amortization of deferred financing costs and stock‑based compensation. In addition, in deriving AFFO, we exclude certain other costs not related to our ongoing operations, such as the amortization of lease-related intangibles.  FFO is used by management, investors and analysts to facilitate meaningful comparisons of operating performance between periods and among our peers primarily because it excludes the effect of real estate depreciation and amortization and net gains on sales, which are based on historical costs and implicitly assume that the value of real estate diminishes predictably over time, rather than fluctuating based on existing market conditions. Management believes that AFFO provides more useful information to investors and analysts because it modifies FFO to exclude certain additional non-cash revenues and expenses such as straight‑line rents, including construction period rent deferrals, and the amortization of deferred financing costs, stock‑based compensation and lease-related intangibles as such items may cause short-term fluctuations in net income but have no impact on long-term operating performance. We believe that these costs are not an ongoing cost of the portfolio in place at the end of each reporting period and, for these reasons, the portion expensed is added back when computing AFFO. As a result, we believe AFFO to be a more meaningful measurement of ongoing performance that allows for greater performance comparability. Therefore, we disclose both FFO and AFFO and reconcile them to the most appropriate GAAP performance metric, which is net income. STORE Capital’s FFO and AFFO may not be comparable to similarly titled measures employed by other companies.   | appendix | 
 

 53    Supplemental Reporting Measures  Note: In 2017, NAREIT issued a white paper recommending that companies that report EBITDA also report EBITDAre for all periods beginning after December 31, 2017. STORE’s presentation of Adjusted EBITDAre matches our previous presentation of Adjusted EBITDA.We believe that presenting supplemental reporting measures, or non-GAAP measures, such as EBITDA, EBITDAre and Adjusted EBITDAre, is useful to investors and analysts because it provides important supplemental information concerning our operating performance exclusive of certain non-cash and other costs. These non-GAAP measures have limitations as they do not include all items of income and expense that affect operations. Accordingly, they should not be considered alternatives to net income as a performance measure and should be considered in addition to, and not in lieu of, GAAP financial measures. Our presentation of such non-GAAP measures may not be comparable to similarly titled measures employed by other companies. EBITDA, EBITDAre and Adjusted EBITDAre EBITDA represents earnings (GAAP net income) plus interest expense, income tax expense, depreciation and amortization.We compute EBITDAre in accordance with the definition adopted by NAREIT. NAREIT defines EBITDAre as EBITDA (as defined above) excluding gains (or losses) from the sales of depreciable property and real estate impairment losses.To derive Adjusted EBITDAre we modify the NAREIT definition of EBITDAre to exclude other items included in GAAP net income, such as provisions for loan losses, as such items are not related to our ongoing performance.Note: The adjustments to derive Adjusted EBITDAre may not exist in every quarter, therefore EBITDAre and Adjusted EBITDAre may be equal.Annualized Adjusted EBITDAre and Adjusted DebtAnnualized Adjusted EBITDAre is calculated by multiplying Adjusted EBITDAre for the most recently completed fiscal quarter by four.   Annualized Adjusted EBITDAre – Current Estimated Run Rate is based on an estimated Adjusted EBITDAre calculated as if all leases and loans in place as of the last date of the most recently completed fiscal quarter had been in place as of the beginning of such quarter; then annualizing that estimated Adjusted EBITDAre for the quarter by multiplying it by four. You should not unduly rely on this metric as it is based on several assumptions and estimates that may prove to be inaccurate. Our actual reported Adjusted EBITDAre for future periods may be significantly less than that implied by our reported Annualized Adjusted EBITDAre – Current Estimated Run Rate for a variety of reasons.Adjusted Debt represents our outstanding debt obligations excluding unamortized deferred financing costs and net debt premium, further reduced for cash and cash equivalents and restricted cash deposits held for the benefit of lenders. We believe excluding unamortized deferred financing costs and net debt premium, cash and cash equivalents and restricted cash deposits held for the benefit of lenders provides an estimate of the net contractual amount of borrowed capital to be repaid, which we believe is a beneficial disclosure to investors and analysts. Adjusted Debt to Annualized Adjusted EBITDAre Adjusted Debt to Annualized Adjusted EBITDAre, or leverage, is a supplemental non-GAAP financial measure we use to evaluate the level of borrowed capital being used to increase the potential return of our real estate investments. We calculate leverage by dividing Adjusted Debt by Annualized Adjusted EBITDAre. Because our portfolio growth level is significant to the overall size of the Company, we believe that presenting this leverage metric on a run rate basis is more meaningful than presenting the metric for the historical quarterly period, and we refer to this metric as Adjusted Debt to Annualized Adjusted EBITDAre—Current Estimated Run Rate. Leverage should be considered as a supplemental measure of the level of risk to which stockholder value may be exposed. Our computation of leverage may differ from the methodology employed by other companies and, therefore, may not be comparable to other measures.   | appendix | 
 

 54  Footnotes  Page 4:1 Reflects the percentage of our contracts (based on annualized base rent and interest) that have a STORE Score that is investment grade. We measure the credit quality of our portfolio on a contract-by-contract basis using the STORE Score, which is a proprietary risk measure reflective of both the credit risk of our tenants and the profitability of the operations at the properties.Page 7:1 Represents the weighted average percentage change (by annualized base rent and interest) in reported corporate revenues for the trailing 12-month (or nine-month if 12-month is not available) period as reported to STORE Capital for the period ended December 31, 2017 as compared to the same period ended December 31, 2016. Excludes customers representing 7.5% of annualized base rent and interest because sufficient comparable data is not available.2 Estimated based on total revenue per employee for all companies in the middle market (based on data reported by the National Center for the Middle Market for 2017) extrapolated to the aggregate total revenue of S|T|O|R|E’s customers and the growth rate as described in footnote 1 above.Page 9:1 Represents reported corporate revenues for financial statements received by STORE Capital through December 31, 2018. Excludes customers, representing approximately 2.0% of annualized base rent and interest, that do not report corporate revenues. 2 Estimated based on total revenue per employee for all companies in the middle market (based on data reported by the National Center for the Middle Market for 2017) extrapolated to the aggregate total revenue of S|T|O|R|E’s customers.3 Represents the number of locations operated by S|T|O|R|E’s customers as reported to STORE Capital through December 31, 2017.  Page 11:1 Represents the tolerable fall-off in unit sales so that EBITDAR after overhead will still cover the unit’s fixed charges (which includes S|T|O|R|E’s rent and interest) weighted by the unit’s fixed charges (based on currently available results for approximately 86% of the properties in our investment portfolio). If the variable profit coefficient for an individual unit was unavailable, we assumed the average long-term variable profit coefficient for the entire portfolio in the calculation of the fall-off amount.Page 12:1 Represents the weighted average interest rate on balloon payments due in the respective years.2 Free cash flow approximates Adjusted Funds from Operations less dividends paid.Page 13:1 Based on average of ratios of Realty Income and National Retail Properties as of September 30, 2018.2 Ratios as of December 31, 2018; Unencumbered EBITDA based on NOI from Unencumbered Assets less an allocation of general and administrative expenses based on assets.Page 14: 1 Shown by percentage of annualized base rent and interest (annualized based on rates in effect on December 31, 2018, for all leases, loans and direct financing receivables in place as of that date). Excludes contracts representing less than 0.2% of annualized base rent and interest where there are no further escalations remaining in the current lease term and there are no extension options. Of our contracts in place as of December 31, 2018, 84% increase based on changes in CPI, 14% increase based on fixed rates in the contract and only 2% do not increase. 2 Represents the weighted average annual escalation rate of the entire portfolio as if all escalations occurred annually.  For escalations based on a formula including CPI, assumes the stated fixed percentage in the contract or assumes 1.5% if no fixed percentage is in the contract.  For contracts with no escalations remaining in the current lease term, assumes the escalation in the extension term.     | appendix |   3 Dividend protection refers to the percentage difference between our AFFO per share and our dividend per share. The wider the relative gap between AFFO per share and dividends per share, the greater the implied dividend protection. All dividends are declared at the discretion of our Board of Directors and future dividends will depend upon our actual funds from operations, financial condition and capital requirements, the annual distribution requirements under the REIT provisions of the Code and other factors.4 S|T|O|R|E defines internal growth as the combination of high average lease escalators and a low AFFO payout ratio, which allows us to reinvest a growing amount of free cash flow back into our business. Page 15:1 See chart, page 30.Page 16:1 Our Board of Directors has opted out of provisions of the Maryland Unsolicited Takeover Act (or “MUTA”), the business combination statute, the control share acquisition statute and provisions otherwise granting us the right to adopt a stockholder rights plan and we may not opt back into any of these statutes or provisions without stockholder approval or, in the case of a stockholder rights plan, stockholder ratification within 12 months of adoption of such a plan.Page 17: 1 S|T|O|R|E’s pipeline from 2014 through December 31, 2018. See slide 25 for more information about S|T|O|R|E's pipeline, including its composition. S|T|O|R|E may never acquire properties in its pipeline for a variety of reasons as described in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2017.2 Growth rate in quarterly AFFO per share since IPO in Q4 2014.3 Data as of September 30, 2018.4 See footnote 3 to page 14.5 S|T|O|R|E defines occupancy as a property being subject to a lease or loan contract.  
 

 Footnotes    | appendix |   55  Page 18: * Based on annualized base rent and interest.1 Represents the percentage of our lease contracts that were created by S|T|O|R|E Capital or contain preferred contract terms such as unit-level financial reporting, triple-net lease provisions and, when applicable, master lease provisions.2 Weighted average annual lease escalation represents the weighted average annual escalation rate of the entire portfolio as if all escalations occurred annually. For escalations based on a formula including CPI, assumes the stated fixed percentage in the contract or assumes 1.5% if no fixed percentage is in the contract. For contracts with no escalations remaining in the current lease term, assumes the escalation in the extension term. Calculation excludes contracts representing less than 0.2% of annualized base rent and interest where there are no further escalations remaining in the current lease term and there are no extension options.3 S|T|O|R|E defines occupancy as a property being subject to a lease or loan contract. 4 The number of properties not currently operating but subject to a lease represents the number of our investment locations that have been closed by the tenant but remain subject to a lease.5 The percentage of investment portfolio subject to master leases represents the percentage of the investment portfolio in multiple properties with a single customer subject to master leases. Based on annualized base rent and interest, 84% of the investment portfolio involves multiple properties with a single customer, whether or not subject to a master lease.6 The average investment amount/replacement cost (new) represents the ratio of purchase price to replacement cost (new) at acquisition.7 Of the 98% of our properties that are required to provide unit-level reporting, 99% have provided current obligated statements as of February 4, 2019.  8 S|T|O|R|E calculates unit fixed charge coverage ratio generally as the ratio of (i) the unit’s EBITDAR, less a standardized corporate overhead expense based on estimated industry standards, to (ii) the unit’s total fixed charges, which are its lease expense, interest expense and scheduled principal payments on indebtedness. The 4-Wall coverage ratio refers to a unit’s FCCR before taking into account standardized corporate overhead expense. The weighted average unit FCCR and 4-Wall coverage ratios were 2.6x and 3.2x, respectively, as of December 31, 2018, 2.4x and 3.1x, respectively, as of December 31, 2017 and 2.9x and 3.5x, respectively, as of December 31, 2016.9 The proportion of investment contracts rated investment grade represents the percentage of our contracts (based on annualized base rent and interest) that have a STORE Score that is investment grade. We measure the credit quality of our portfolio on a contract-by-contract basis using the STORE Score, which is a risk measure reflective of both the credit risk of our tenants and the profitability of the operations at the properties. Pages 19 and 20: 1 Data as of December 31, 2018, 2017 and 2016, by percentage of annualized base rent and interest (annualized based on rates in effect on December 31, 2018, 2017 and 2016, for all leases, loans and direct financing receivables in place as of those dates). The industry group classification for certain customers as of December 31, 2017 and 2016 have been changed to conform to December 31, 2018 presentation.Page 22:1 Data based on information available on customer websites, news releases and/or SEC filings.2 Data as of December 31, 2018, by percentage of annualized base rent and interest (annualized based on rates in effect on December 31, 2018, for all leases, loans and direct financing receivables in place as of that date).  Page 23:1 Based on annualized base rent and interest.2 Represents the percentage of our properties that are occupied. S|T|O|R|E defines occupancy as a property being subject to a lease or loan contract. As of September 30, 2017, the Company owned 19 properties that were vacant and not subject to a contract; subsequent to September 30, 2017, eight of these properties were re-leased, one was sold and the Company’s occupancy rate improved from 99.0% to 99.5%.Page 24:1 We measure the credit quality of our portfolio on a contract-by-contract basis using the STORE Score, which is a proprietary risk measure reflective of both the credit risk of our tenants and the profitability of the operations at our properties.  The STORE Score is a quantitative measurement of contract risk computed by multiplying tenant default probabilities (using Moody’s RiskCalc) and estimated store closure probabilities (using a simple algorithm we developed that has closure probabilities ranging from 100% to 10%, depending on unit-level profitability).  Qualitative features can also impact investment risk, such as low property investment amounts, favorable tenant debt capital stacks, the presence of third party guarantors, or other factors. Such qualitative factors are not included in the STORE Score and may serve to mitigate investment risk even further.Page 26:1 Acquisitions represent the total of acquisitions of real estate and investment in loans and direct financing receivables. Dispositions represent the original acquisition cost of real estate sold and loan repayments received in conjunction with real estate sales.2 Refer to pages 46 through 48 and page 52 for definitions of these non-GAAP financial measures and reconciliation to GAAP net income.3 Gross Rate of Return represents initial cap rate plus weighted average annual lease escalators. Gross returns do not represent the actual returns we may earn on properties. 
 

 Footnotes      | appendix |   56  Page 27:1 Source: CapIQ. Data as of December 31, 2018. Page 28:1 Based on annualized total returns earned by management’s prior investment vehicles while operating as a public company, compared to annualized total returns on the MSCI US REIT Index during the same periods. The past performance of these investment vehicles is not an indicator of S|T|O|R|E’s future performance, and S|T|O|R|E’s performance may be significantly less favorable than the past performance data included in this presentation. Moreover, some of the past performance data covers periods with economic characteristics and cycles and interest rate environments that are significantly different from those S|T|O|R|E faces today and may face in the future.Page 30:1 Source: Green Street Advisors, Company data and, with respect to FFCA and Spirit Finance, publicly available SEC company filings. The Sharpe Ratio measures the ratio of excess returns to risk, using the spread between capitalization or lease rates and the 10-year U.S. Treasury yields to measure excess returns, and using the standard deviation of returns to measure risk. All ratios are calculated using capitalization or lease rate data during which FFCA and Spirit were publicly traded companies and the period since S|T|O|R|E’s inception. The ratio is calculated based on historical data from January 1994 to December 2018, and future returns and risk may not be consistent with this historical data. Page 31:1 Source: U.S. Treasury, Company data and, with respect to FFCA and Spirit Finance, publicly available SEC company filings.  Page 37:1 Converted to Recovery on Original Value. Average CMBS recovery 49.6% and Average LTV is 69.2% (1995-2018) Source: Kroll.2 Converted to Recovery on Original Value. Average Loan recovery is 80.4% and Average LTV is 70% (1987-2017) Sources: Moody’s & Loans.com.3 Weighted Average STORE recovery based on rents. Recovery to Original Value will tend to be higher.Page 39:Note: Data through December 31, 2018.¹ Growth from reinvested cash flow is equal to (i) the incremental cash flow added from reinvesting retained cash assuming a prior period payout ratio of 70%, leveraged at 45% with a borrowing cost of 4.50% and amortization of 45 years, reinvested at 7.85% less incremental operating costs of 0.25% divided by (ii) prior period rents assuming assets were acquired at 7.85%.Page 40:Note: Data as of December 31, 2018. “ABR” is annualized base rent and interest.1 Percentage of investment portfolio in multiple properties with a single customer subject to master leases. Based on annualized base rent & interest of S|T|O|R|E’s total investment portfolio as of December 31, 2018.2 Represents the ratio of purchase price to replacement cost (new) at acquisition.3 S|T|O|R|E calculates a unit’s FCCR generally as the ratio of (i) the unit’s EBITDAR, less a standardized corporate overhead expense based on estimated industry standards, to (ii) the unit’s total fixed charges, which are its lease expense, interest expense and scheduled principal payments on indebtedness. The 4-Wall coverage ratio refers to a unit’s FCCR before taking into account standardized corporate overhead expense.  Page 46:1 See page 52 for discussion regarding use of Funds From Operations and Adjusted Funds from Operations.2 For the three months ended December 31, 2018 includes $10,000 and for the years ended December 31, 2018 and 2017, includes $130,000 and $5,000, respectively, of income tax expense associated with gains recognized on the dispositions of certain properties.3 For the three months ended December 31, 2018 includes $1.7 million and for the years ended December 31, 2018 and 2017, includes $2.1 million and $2.0 million, respectively, of accelerated amortization of deferred financing costs primarily related to the prepayment of debt.4 For the year ended December 31, 2017, includes a $4.6 million charge related to accelerated amortization of lease incentives associated with terminated lease contracts.5 Under the two-class method, earnings attributable to unvested restricted stock are deducted from earnings in the computation of per share amounts where applicable.Page 47:1 See page 52 for discussion regarding use of Funds From Operations and Adjusted Funds from Operations.2 For the years ended December 31, 2016, 2017 and 2018, includes $76,000, $5,000 and $130,000, respectively, of income tax expense associated with gains recognized on the dispositions of certain properties.3 See footnote 3 to page 46.4 See footnote 4 to page 46. Page 49:1 See page 53 for discussion regarding use of EBITDAre, Adjusted EBITDAre and Adjusted Debt.Page 50:1 See page 53 for discussion regarding use of EBITDAre, Adjusted EBITDAre and Adjusted Debt. 
 

   Investor and Media ContactsFinancial Profiles, Inc.Moira Conlon, 310.622.8220Tricia Ross, [email protected]  Corporate Headquarters8377 East Hartford Drive, Suite 100Scottsdale, Arizona 85255480.256.1100www.STOREcapital.com 
 


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