john a. lee, senior managing director jlee@go2griffin 610-205-6106

CONFIDENTIAL

Investment Banking Services

Member FINRA/SIPC

John A. Lee, Senior Managing [email protected]

FEBRUARY 2012 236198v3

Michael J. Sobota, Vice [email protected]

2CONFIDENTIAL

Table of Contents

I.Griffin Overview

II.Comparable Public Company and Comparable Transaction Analysis

III.Preliminary Financial Analysis

IV.Sell-Side Process

V.Potential Purchasers

VI. Summary

Appendix

I.Selected Griffin Team Members

CONFIDENTIAL

I. Griffin Overview

4CONFIDENTIAL

Griffin Overview

Established in 2001, Griffin is the largest middle-market corporate investment banking firm in Pennsylvania with over 40 Investment Banking professionals

Griffin is a FINRA licensed merger and acquisition advisory and institutional private placement investment banking firm serving middle market companies, family-owned businesses, financial institutions and private equity sponsors

Principals include former CEOs, CFOs, CIOs and several other executives who bring a wealth of management experience and ability to assist Griffin in looking at problems from the perspective of senior management

Unlike most investment banks, we have strong technical, financial and tax accountants with Big 4 backgrounds who provide efficient, timely and complete investment banking and placement services

Driven

Focused

Experienced

5CONFIDENTIAL

Investment Banking Services

M&A Advisory Services Private Placement Services

Sale and merger transactions (sell side) Acquisitions (buy side) Recapitalizations Management buyouts Divestitures Going private transactions

Senior debt Subordinated debt Equity capital Bridge loans Units of limited partnership interests on behalf of

financial sponsors Secondary investment and co-investment advisory

Financial Restructuring Services Consulting Services

Chapter 11 – Section 363 asset sales (going concern)

UCC Article 9 – Simultaneous foreclosure and sale Balance sheet restructurings including conversion

of debt to equity conversions and new capital infusions

Creative capital solutions, including bridge loans Disposition of under-performing divisions

Strategic alternatives studies Review of strategic and business plans Outsourced corporate development Capital planning alternatives Capital study and analysis Review of capital plans

CONFIDENTIAL

II. Comparable Public Company and Comparable Transaction Analyses

7CONFIDENTIAL

ABC Financial Services Overview

The Company is a privately held financial services firm that has two primary lines of business, the financial advisory business and the asset management business

Financial Advisory Business The financial advisory business provides advice to corporations related to the issuance of their publicly-

traded debt The financial advisory business charges a fixed fee based on the complexity of the issuance. While some

of these fees are retainer or hourly based, the vast majority are contingent on the underlying debt actually being issued. Once the Company is hired, however, it is rare that the debt issuance doesn’t close

Although the financial advisory business also has repeat clients, the majority of the revenue cannot be deemed recurring because it does not occur in consecutive years (typically the Company will do work for its repeat clients once every three-five years)

Asset Management Business The asset management business manages corporate cash balances. The Company invests these funds

primarily in short and medium–term fixed income securities The asset management business charges a quarterly fee based on the amount of its asset under

management (“AUM”). AUM is currently around $30 billion The asset management business has a strong recurring revenue model because its client retention rate of

close to 100%

8CONFIDENTIAL


The Company has a national platform with 30 offices in the U.S. staffed by approximately 400 professionals. It has grown from a small, local, 4-partner firm 35 years ago

In the early days, the Company relied on client contacts and relationships held by the individual partners. Today, the ABC name carries the same weight among corporate finance and treasury professionals that IBM carries with technology professionals. Indeed, “nobody ever gets fired for hiring ABC”

The feeling amongst the Company’s shareholders, particularly the older ones, is that this institutional value isn’t reflected upon shareholder retirement when the Company purchases the shares at book value

The Company has proven to be strongly recession-resistant Revenue reached a record $100 million in 2011. The Company’s revenue CAGR from 2007-2011 was 8%

and is projected to grow 10% in 2012 In 2011, approximately 55% and 45% of its revenue came from the financial advisory business and the

asset management business, respectively The Company has made several small financial advisory acquisitions in its past, but they have all been

below $5 million in value because equity funding is limited to shareholder contributions and the Company’s lender doesn’t lend much to asset-light services companies. This shortage of acquisition capital has been frustrating, because the Company has several larger Asset Management acquisition opportunities in the $30-50 million range that have significant operating expense synergies with the Company’s asset management business

9CONFIDENTIAL


Like many professional services firms (i.e. law firms and accounting firms), the Company pays virtually all of its profits to its owners each year in the form of compensation (not distributions)

Reported EBITDA is used to fund income taxes and capital expenditures. Therefore, net income and EBITDA in 2011 were $1.0 million and $5.0 million, respectively

Based on a research performed on other financial advisory and asset management firm, the range of compensation expense/revenue ratio is 40-70%, with an average of 55%. The Company’s compensation/revenue ratio is 65%

10CONFIDENTIAL


The Board of Directors of ABC Financial Services Firm has the following objectives for any proposed transaction:

A transaction that would transform the Company from being run for maximum employee compensation to building long term shareholder value

Obtain partial liquidity for all of its 50 Managing Directors (“MD”) Owners, yet keep them incented going forward

A transaction partner(s) must have sufficient capital that can be used for larger acquisitions in the future

All 400 employees are to be retained post-closing

11CONFIDENTIAL

Methodology Introduction

The only true way to know what the Company is worth is to approach the market in a controlled, competitive process

However, prior to approaching the market, it is helpful to develop a preliminary range of value(1) for the Company based on commonly used methodologies, some of which may also be employed by prospective transaction partners

The methodologies Griffin will employ to develop its preliminary view of value include: Comparable public company analysis Comparable transaction analysis Private Equity LBO IRR analysis

The type of partner will also influence value: Strategic partners – Includes partners that are within ABC Financial Services (“ABC”)

industry or related industry and see the acquisition as a long-term strategic growth opportunity

Financial partners – Includes financial investor groups that invest in private companies, with leverage buyout structures, with the intent to grow the business and then sell the company in three to five years in order to realize a return on their investment

(1) Procedures performed do not constitute a formal valuation but rather a range of possible values based on Griffin experience and recent market data. A formal assessment of the valuation of ABC Financial Services is subject to the Fair Market Value and Fairness Opinion Committee of Griffin.

12CONFIDENTIAL

Comparable Public Company Analysis

Based on Griffin’s understanding of ABC’s business, Griffin reviewed and selected public companies in the following categories that perform the same or similar services of ABC, including: Investment Banking Asset Management

♦ Certain similar businesses are private and, therefore, do not have available public information

13CONFIDENTIAL

Comparable Public Company Analysis – Investment Banking

Source: CapitalIQ, data as of 01/16/12

x Company Ticker Short Description Stock Price

Market Cap

($mm)

TEV ($mm)

LTM Total Rev ($mm)

LTM EBITDA ($mm)

EBITDA Margin

(% )

TEV/ LTM EBITDA

J efferies Group, Inc. NYSE:J EF J efferies Group, Inc., together with its subsidiaries, operates as a securities and investment banking company in the Americas, Europe, and Asia.

$ 15.89 $ 3,426 $ 13,184 $ 2,545 $ 1,470 57.7 9.0

Lazard Ltd. NYSE:LAZ Lazard Ltd, together with its subsidiaries, operates as a financial advisory and asset management firm.

$ 26.28 $ 3,160 $ 3,549 $ 1,970 $ 507 25.7 7.0

Greenhill & Co., Inc. NYSE:GHL Greenhill & Co., Inc. operates as an independent investment bank. $ 39.69 $ 1,147 $ 1,171 $ 259 $ 55 21.2 21.3

Evercore Partners Inc. NYSE:EVR Evercore Partners Inc. operates as an independent investment banking advisory firm.

$ 26.18 $ 719 $ 924 $ 517 $ 81 15.7 11.4

KBW Inc. NYSE:KBW KBW, Inc., through its subsidiaries, operates as an investment bank specializing in the financial services industry in the United States, Canada, Europe, and Asia.

$ 16.56 $ 547 $ 367 $ 306 $ (12) NM NM

Piper J affray Companies NYSE:PJ C Piper J affray Companies provides investment banking services, institutional sales, trading and research services, and asset management services worldwide.

$ 22.28 $ 347 $ 794 $ 535 $ 100 18.8 7.9

Cowen Group, Inc. NasdaqGS:COWN Cowen Group, Inc. is a publicly owned asset management holding company. $ 2.69 $ 310 $ 237 $ 286 $ (27) NM NM

Oppenheimer Holdings Inc.

NYSE:OPY Oppenheimer Holdings Inc., through its subsidiaries, operates as a middle-market investment bank and full service broker-dealer.

$ 17.80 $ 243 $ 671 $ 990 $ 100 10.1 6.7

Gleacher & Company, Inc

NasdaqGS:GLCH Gleacher & Company, Inc., an independent investment bank, provides corporate and institutional clients with advice and execution in the areas of advisory services, capital raising and research, sales, and trading.

$ 1.57 $ 190 $ 152 $ 282 $ (6) NM NM

Median 8.4x

Size and Liquidity Discount 20%

6.8x

14CONFIDENTIAL

Comparable Public Company Analysis – Asset Management


x Company Ticker Short Description Stock Price

Total AUM ($mm)

Market Cap ($mm)

TEV ($mm) LTM Total Rev ($mm)

LTM EBITDA ($mm)

EBITDA Margin

(% )

TEV/ LTM EBITDA

Franklin Resources Inc. NYSE:BEN Franklin Resources Inc. is a publicly owned asset management holding company.

$ 96.26 $ 659,900 $ 21,229 $ 16,883 $ 7,145 $ 2,865 40.1 5.9

T. Rowe Price Group, Inc.

NasdaqGS:TROW T. Rowe Price Group, Inc. is a publicly owned asset management holding company.

$ 59.00 $ 520,900 $ 14,906 $ 13,900 $ 2,726 $ 1,305 47.9 10.7

Ameriprise Financial Inc. NYSE:AMP Ameriprise Financial, Inc., through its subsidiaries, provides financial planning, products, and services primarily in the United States.

$ 51.40 $ 559,665 $ 11,630 $ 16,573 $ 10,682 $ 2,759 25.8 6.0

Legg Mason Inc. NYSE:LM Legg Mason, Inc., through its subsidiaries, operates as an asset management company worldwide.

$ 26.36 $ 611,800 $ 3,684 $ 3,809 $ 2,822 $ 553 19.6 6.9

Eaton Vance Corp. NYSE:EV Eaton Vance Corp., through its subsidiaries, engages in the creation, marketing, and management of investment funds in the United States.

$ 24.82 $ 188,204 $ 2,870 $ 3,427 $ 1,260 $ 463 36.7 7.4

Waddell & Reed Financial Inc.

NYSE:WDR Waddell & Reed Financial, Inc., through its subsidiaries, provides investment management, investment product underwriting and distribution, and shareholder services administration to mutual funds, and institutional and separately managed accounts in the United States.

$ 25.74 $ 91,747 $ 2,196 $ 1,946 $ 1,186 $ 316 26.7 6.2

Federated Investors, Inc.

NYSE:FII Federated Investors, Inc. is a publicly owned asset management holding company.

$ 17.26 $ 349,413 $ 1,791 $ 1,859 $ 924 $ 301 32.6 6.2

Cohen & Steers Inc. NYSE:CNS Cohen & Steers, Inc. provides investment management services to individual and institutional investors through a range of investment vehicles.

$ 30.50 $ 44,314 $ 1,316 $ 1,157 $ 230 $ 82 35.8 14.4

J anus Capital Group, Inc.

NYSE:J NS J anus Capital Group, Inc. is a publicly owned asset management holding company with approximately $167.

$ 6.86 $ 169,800 $ 1,280 $ 1,402 $ 1,042 $ 360 34.5 3.9

Epoch Investment Partners, Inc.

NasdaqGS:EPHC Epoch Investment Partners, Inc. is a publicly owned investment manager. $ 22.83 $ 17,087 $ 531 $ 496 $ 75 $ 32 42.8 15.5

Calamos Asset Management Inc.

NasdaqGS:CLMS Calamos Asset Management Inc. is a publicly owned investment manager. $ 12.18 $ 37,352 $ 245 $ 150 $ 356 $ 151 42.6 NM

Diamond Hill Investment Group Inc.

NasdaqGS:DHIL Diamond Hill Investment Group, Inc., through its subsidiaries, sponsors, markets, and provides investment advisory and related services to individual and institutional investors in the United States.

$ 74.04 $ 9,186 $ 222 $ 199 $ 64 $ 23 36.3 8.5

Median 6.9x

Size and Liquidity Discount 20%

5.2x

15CONFIDENTIAL

Comparable Transaction Summary

Griffin searched for comparable transactions announced or closed after January 1, 2009. Transactions were selected based on a review of ABC’s industry classification and key business description terms: Investment Banking Asset Management

The results yielded many transactions from which the most applicable ones were chosen based on their similarity to ABC’s business

16CONFIDENTIAL

Comparable Transaction Analysis – Select M&A TransactionsInvestment Banking


Announced Target/ Issuer Target Business Description Buyer Seller Name

Implied Enterprise

Value ($mm)

Enterprise Value /

Rev

Enterprise Value /

EBIT

Enterprise Value / EBITDA

12/19/11 Pagemill Partners, LLCPagemill Partners, LLC is a boutique investment bank that offers financial advisory services to middle market technology companies.

Duff & Phelps Corporation - - - -

06/30/11 Growth Capital Partners, L.P.Growth Capital Partners, L.P. (GCP) is a boutique investment bank that offers financial advisory and merchant banking services to private and public middle market companies.

Duff & Phelps Corporation 3 - - -

06/07/11 The Lexicon Partnership LlpAs of August 19, 2011, The Lexicon Partnership Llp operates as a subsidiary of Evercore Partners Inc.

Evercore Partners Inc. 151 2.3x - -

04/06/11

Prudential Bache Commodities and Prudential Bache and Bache Commodities and Bache (Hong Kong) Ltd.

Prudential Bache Commodities and Prudential Bache and Bache Commodities and Bache (Hong Kong) Ltd. provides commodities broking services.

J efferies Group, Inc. Prudential Financial, Inc. 420 1.9x - -

02/16/11 LaBranche & Co. Inc. LaBranche & Co Inc., through its subsidiaries, operates as a registered broker-dealer. Cowen Group, Inc. Summit Capital Management LLC - - - -

12/31/10 Adventum Group, Inc.As of 2010, Adventum Group, Inc. was acquired by Consilium Partners, LLC. Adventum Group, Inc. operates as a boutique investment bank that provides transactions and financial advisory services.

Consilium Partners, LLC - - - -

12/31/10 Esae Capital Partners, LLC Esae Capital Partners is an investment bank.Tong Yang Securities Inc. (nka:TONGYANG Securities Inc.)

- - - -

10/13/10 Clearpoint Funding, Inc.Clearpoint Funding, Inc., a wholesale mortgage company, provides loans for customers in the United States.

Gleacher & Company, Inc - - - -

09/14/10 G5 Advisors G5 Advisors is a boutique investment banking firm that offers financial advisory services. Evercore Partners Inc. 40 - - -

05/18/10 Hill Street Capital LLCHill Street Capital LLC (HSC) operates as a boutique investment bank that offers financial advisory services.

BNP Paribas Corporate Finance - - - -

04/07/10 MJ C Associates As of J uly 8, 2010, MJ C Associates was acquired by Evercore Partners Inc. Evercore Partners Inc. 8 - - -

Comparable transactions analysis yielded 22 transactions in this industry, only 1 of which disclosed the deal multiple

17CONFIDENTIAL

Comparable Transaction Analysis – Select M&A TransactionsInvestment Banking


Announced Target/ Issuer Target Business Description Buyer Seller Name

Implied Enterprise

Value ($mm)

Enterprise Value /

Rev

Enterprise Value /

EBIT


03/16/10Caliburn Partnership Pty Ltd. (nka:Greenhill Caliburn Pty Ltd.)

Greenhill Caliburn Pty Limited provides independent corporate advisory services in Australasia.

Greenhill & Co., Inc. 152 2.3x 4.8x 4.8x

10/23/09 Sequence Advisors, LLCSequence Advisors, LLC is a boutique investment bank that provides financial advisory services.

WebsterRogers LLP - - - -

07/29/09 Watch Hill Partners LLCWatch Hill Partners LLC (WHP) is a boutique investment bank that provides senior level merger and acquisition and corporate financial advisory services to financial sponsors and business corporations.

FBR Capital Markets Corporation (nka:FBR & Co.)

6 - - -

06/09/09 Iron Capital Securities, LLCIron Capital Securities, LLC is a boutique investment bank that offers financial consulting services.

Iron Capital Partners - - - -

06/03/09 Cowen Group, Inc.As on November 2, 2009, Cowen Group, Inc was acquired by Ramius, LLC in a reverse merger transaction. Cowen Group provides investment banking, research and alternative investment services.

Ramius LLC, Prior to acquiring Cowen Group, Inc. (nka:Cowen Group, Inc.)

Rodman & Renshaw Capital Group, Inc.; SG Americas Securities Holdings, Inc.

- - - -

04/29/09 I-Many, Inc.I-many, Inc. develops and provides contract management software and services to enterprises.

LLR Partners Inc.; LLR Equity Partners III, L.P.

Clarion Capital Corporation 41 1.1x NM NM

03/31/09 Keane Securities Co., Inc.Keane Securities Co., Inc. is a small-capitalization, investment bank that offers trading, floor execution, syndicate, corporate finance, and market research.

Rafferty Holdings, LLC - - - -

03/02/09 Gleacher & Co.Gleacher & Co. is a private investment firm that provides asset management and investment banking services.

Broadpoint Securities Group, Inc. (nka:Gleacher & Company, Inc)

Bank Of Scotland plc 75 - - -

02/18/09 Corporate Capital Group, LLCCorporate Capital Group, LLC (CCG) is a boutique investment bank that provides financial advisory services.

WorldVest Equity, Inc. - - - -

02/12/09DEPFA First Albany Securities LLC

DEPFA First Albany Securities LLC was acquired by J efferies & Company, Inc. The firm underwrites and trades municipal securities in new issue and secondary markets.

J efferies Group, Inc. DEPFA Bank plc - - - -

01/12/09 Pacific Growth Equities, LLCAs of J anuary 31, 2009, Pacific Growth Equities, LLC was acquired by Wedbush Securities Inc. Pacific Growth Equities, LLC is a boutique investment bank that offers financial advisory services to emerging companies.

Wedbush Securities Inc. - - - -

18CONFIDENTIAL

Comparable Transaction Analysis – Select M&A TransactionsAsset Managers


Announced Target/ Issuer Target Business Description Buyer Seller NameTarget AUM

($mm)

Implied Enterprise

Value ($mm)

Enterprise Value / Rev

Enterprise Value / EBIT


01/11/12 Claymore Investments, Inc. Claymore Investments, Inc is a privately owned investment manager. BlackRock, Inc.Guggenheim Funds Services Group, Inc.

6,878 - - - -

12/16/11 Stone Tower Capital, LLC Stone Tower Capital, LLC (STC) is a privately owned hedge fund sponsor. Apollo Credit Management LLC 17,000 - - - -

11/14/11Gresham Investment Management LLC

As of December 31, 2011, Gresham Investment Management LLC operates as a subsidiary of Nuveen Investments, Inc.

Nuveen Investments, Inc. NA - - - -

10/27/11 PCG Asset Management, LLC PCG Asset Management, LLC is a privately owned investment manager. Mitsubishi Corporation Pacific Corporate Group 20,000 - - - -

09/14/11 Goodwin Capital Advisers, Inc. Goodwin Capital Advisers, Inc. is a privately owned investment manager. Conning & Company Phoenix Companies Inc. 12,846 - - - -

04/26/11 Stadion Money Management Stadion Money Management is an employee owned investment manager. TA Associates, Inc. 6,600 - - - -

02/24/11Emerging Markets Management, L.L.C. (nka:Ashmore EMM, L.L.C.)

Ashmore EMM, L.L.C. is a privately owned investment manager. Ashmore Group PLC Amundi Asset Management 10,400 $ 307 - - -

01/11/11Lloyd George Management (BVI) Ltd

Lloyd George Management (BVI) Limited is a privately owned investment manager. Bank of Montreal Eaton Vance Corp. 490 $ 101 - - -

12/21/10CIFC Investment Management LLC (nka:CIFC Asset Management LLC)

CIFC Asset Management LLC is a privately owned investment manager.Deerfield Capital Corp. (nka:CIFC Corp.)

Charlesbank Capital Partners, LLC; Charlesbank Equity Fund V, L.P.

3,600 $ 648 14.1x 34.9x 34.2x

Comparable transactions analysis yielded 27 transactions in this industry, 7 of which disclosed deal multiples

19CONFIDENTIAL




($mm)

Implied Enterprise

Value ($mm)




12/06/10Claren Road Asset Management, LLC

Claren Road Asset Management, LLC is an employee owned hedge fund sponsor.The Carlyle Group (nka:The Carlyle Group LP)

Citigroup, Inc.; Goldman Sachs Asset Management International Ltd.; Petershill Fund Offshore LP

4,500 - - - -

11/17/10Pelagos Capital Management, LLC

Pelagos Capital Management, LLC is a privately owned investment manager. Franklin Resources Inc. 382 - - - -

09/27/10 Trilogy Global Advisors, LLC Trilogy Global Advisors, LLC is an employee owned investment manager. Affiliated Managers Group Inc. 12,442 - - - -

09/01/10Reams Asset Management Company LLC

Reams Asset Management Company LLC is an employee owned investment. Scout Investment Advisors, Inc. 9,800 $ 43 - - -

08/03/10 Montag & Caldwell Inc. Montag & Caldwell Inc. is a privately owned investment manager. BNP Paribas Fortis 12,656 - - - -

07/16/10RidgeWorth Capital Management, Inc., Money Market Management Business

RidgeWorth Capital Management, Inc., Money Market Management Business manages money market mutual fund assets.

Federated Investors, Inc.RidgeWorth Capital Management, Inc.

23,099 $ 34 - - -

06/18/10 QS Investors LLC QS Investors LLC is an employee owned investment manager. DB Advisors, LLC NA - - - -

05/17/10 GLG Partners, Inc. GLG Partners Inc. is a privately owned hedge fund sponsor. Man Group plc

Berggruen Holdings, Inc.; Sal. Oppenheim jr. & Cie. S.C.A.; J ackson Holding Services Inc.; Berggruen Holdings North America Ltd; Sage Summit LP; Istithmar World Capital P.J .S.C.; Lavender Heights Capital LP; Point Pleasant Ventures Ltd.

23,668 $ 1,891 6.2x NM NM

02/19/10INTECH Investment Management LLC

INTECH Investment Management LLC is a privately owned investment manager. J anus Capital Group, Inc. 43,969 $ 1,047 - - -

20CONFIDENTIAL




($mm)

Implied Enterprise

Value ($mm)




02/16/10 Logan Circle Partners, L.P. Logan Circle Partners, L.P. is a privately owned investment manager. Fortress Investment Group LLC Guggenheim Partners, LLC 12,100 $ 47 - - -

02/10/10 Pantheon Ventures Ltd.Pantheon Ventures Ltd. is an investment firm specializing in direct and fund of funds investments.

Affiliated Managers Group Inc. Frank Russell Company 22,000 $ 1,000 - - -

12/20/09 Advisory Research Holdings, Inc. Advisory Research Holdings, Inc. is a privately owned investment manager. Piper J affray Companies TA Associates, Inc. 6,550 $ 220 4.1x 8.4x 8.3x

12/20/09 Advisory Research Holdings, Inc. Advisory Research Holdings, Inc. is a privately owned investment manager. Piper J affray Companies TA Associates, Inc. NA $ 220 4.1x 8.4x 8.3x

12/12/09 Highbury Financial Inc.Highbury Financial Inc., an investment management holding company, through its subsidiary, Aston Asset Management LLC, provides permanent capital solutions to mid-sized investment management firms in the United States.

Affiliated Managers Group Inc. NA $ 85 2.5x 18.1x 17.4x

10/26/09 Allied Capital CorporationAs of April 1, 2010, Allied Capital Corporation, an investment management company, was acquired by Ares Capital Corporation.

Ares Capital Corporation NA $ 2,154 6.1x 8.0x 8.0x

08/03/09 Patriot Capital Funding, Inc.Patriot Capital Funding, Inc. is a private equity firm specializing in investments in small and mid sized companies.

Prospect Capital Corporation The Compass Group NA $ 194 5.6x 8.1x 7.9x

06/11/09

Barclays Global Investors, National Association (nka:BlackRock Institutional Trust Company, N.A.)

Barclays Global Investors, National Association (BGI) is a privately owned investment manager.

BlackRock, Inc.Barclays Global Investors UK Holdings Limited

NA $ 13,344 - - 7.3x

04/30/09INTECH Investment Management LLC

INTECH Investment Management LLC is a privately owned investment manager. J anus Capital Group, Inc. NA $ 843 - - -

Mean $ 581 6.1x 13.2x 13.1x

Median $ 478 4.8x 8.4x 8.3x

21CONFIDENTIAL

Comp Analysis Summary

Comparable Public Company Analysis implies an EV/LTM EBITDA multiple of 6.8x and 5.2x (after illiquidity and size discount) for Investment Banks and Asset Managers, respectively

Comparable Transaction Analysis implies an EV/LTM EBITDA multiple of 8.3x for Asset Managers while Investment Banks did not yield a sufficient population of transactions with disclosed multiples

Based on the comparable public company, comparable transaction analyses, and Griffin experience, Griffin would expect the range of value for ABC to be around 6.5x to 7.5x EV/EBITDA range

CONFIDENTIAL

III. Preliminary Financial Analysis

23CONFIDENTIAL

Preliminary Financial Analysis

Overview

Griffin completed a detailed analysis of ABC to better understand the Company’s strengths and weaknesses

Griffin analyzed the Company’s financial performance to explain trends and variances

Griffin examined ABC’s financial statements “from the perspective of a buyer”

24CONFIDENTIAL


Source: All information obtained from ABC audited financial statements.

Balance Sheet

2009 2010 2011 Transaction 2011

(000s) Actual Actual Actual Adjustments Proforma

Current assets:

Cash and cash equivalents $ 369 $ 450 $ 500 $ (500) $ -

Accounts receivable 10,000 11,000 12,000 - 12,000 - Work-in-process 5,000 5,700 6,000 - 6,000

Prepaid expenses and other current assets 1,500 1,500 2,000 - 2,000

Total current assets 16,869 18,650 20,500 (500) 20,000

Property, plant and equipment 9,500 9,750 10,000 - 10,000

Goodwill 10,000 10,000 10,000 - 10,000

Total assets $36,369 $38,400 $40,500 $ (500) $ 40,000

Current liabilities:

Line of credit - - - - -

Accounts payable 500 500 500 - 500

Accrued expenses 14,000 16,000 18,000 - 18,000

Total current liabilities 14,500 16,500 18,500 - 18,500

Long-term debt 12,000 11,000 10,000 (10,000) -

Deferred rent 1,800 1,900 2,000 - 2,000

Total liabilities 28,300 29,400 30,500 (10,000) 20,500

Equity 8,069 9,000 10,000 9,500 19,500

Total liabilities and equity $36,369 $38,400 $40,500 $ (500) $ 40,000

For the Fiscal Year Ended December 31,

25CONFIDENTIAL


Income Statement – Company Projections

Griffin feels that potential transaction partners will discount the future growth rate to 5% from 10% to more conservatively underwrite the transaction

2009 2010 2011 2012 2013 2014 2015 2016(000s) Actual Actual Actual Projected Projected Projected Projected ProjectedRevenues:

Professional Fees $ 85,750 $ 92,600 $ 100,000 $ 110,000 $ 121,000 $ 133,100 $ 146,410 $ 161,051

Total revenue 85,750 92,600 100,000 110,000 121,000 133,100 146,410 161,051

% Growth n/a 8% 8% 10% 10% 10% 10% 10%

Expenses:

Salaries, incentive compensation and employee benefits - Managing Directors

32,156 34,725 37,500 41,250 45,375 49,913 54,904 60,394

Salaries, incentive compensation and employee benefits - Non-Managing Directors

23,581 25,465 27,500 30,250 33,275 36,603 40,263 44,289

General and administrative 25,725 27,780 30,000 33,000 36,300 39,930 43,923 48,315

Depreciation and amortization expense 2,573 2,778 3,000 3,300 3,630 3,993 4,392 4,832

Interest expense 429 463 500 550 605 666 732 805

Total expenses 84,464 91,211 98,500 108,350 119,185 131,104 144,214 158,635

Income before income taxes 1,286 1,389 1,500 1,650 1,815 1,997 2,196 2,416

Income tax expense 424 458 500 545 599 659 725 797

Net income $ 862 $ 931 $ 1,000 $ 1,106 $ 1,216 $ 1,338 $ 1,471 $ 1,619

EBITDA Calculation Income before income taxes $ 1,286 $ 1,389 $ 1,500 $ 1,650 $ 1,815 $ 1,997 $ 2,196 $ 2,416 Interest expense 429 463 500 550 605 666 732 805 Depreciation and amortization 2,573 2,778 3,000 3,300 3,630 3,993 4,392 4,832 EBITDA $ 4,288 $ 4,630 $ 5,000 $ 5,500 $ 6,050 $ 6,655 $ 7,321 $ 8,053 EBITDA Margin % 5.0% 5.0% 5.0% 5.0% 5.0% 5.0% 5.0% 5.0%

For the Year Ended December 31, For the Year Ending December 31,

26CONFIDENTIAL


Income Statement – Griffin Conservative Projections

2009 2010 2011 2012 2013 2014 2015 2016(000s) Actual Actual Actual Projected Projected Projected Projected ProjectedRevenues:

Professional Fees $ 85,750 $ 92,600 $ 100,000 $ 105,000 $ 110,250 $ 115,763 $ 121,551 $ 127,628

Total revenue 85,750 92,600 100,000 105,000 110,250 115,763 121,551 127,628

% Growth n/a 8% 8% 5% 5% 5% 5% 5%

Expenses:


32,156 34,725 37,500 39,375 41,344 43,411 45,581 47,861


23,581 25,465 27,500 28,875 30,319 31,835 33,426 35,098

General and administrative 25,725 27,780 30,000 31,500 33,075 34,729 36,465 38,288

Depreciation and amortization expense 2,573 2,778 3,000 3,150 3,308 3,473 3,647 3,829

Interest expense 429 463 500 525 551 579 608 638

Total expenses 84,464 91,211 98,500 103,425 108,596 114,026 119,727 125,714

Income before income taxes 1,286 1,389 1,500 1,575 1,654 1,736 1,823 1,914

Income tax expense 424 458 500 520 546 573 602 632

Net income $ 862 $ 931 $ 1,000 $ 1,055 $ 1,108 $ 1,163 $ 1,222 $ 1,283

EBITDA Calculation Income before income taxes $ 1,286 $ 1,389 $ 1,500 $ 1,575 $ 1,654 $ 1,736 $ 1,823 $ 1,914 Interest expense 429 463 500 525 551 579 608 638 Depreciation and amortization 2,573 2,778 3,000 3,150 3,308 3,473 3,647 3,829 EBITDA $ 4,288 $ 4,630 $ 5,000 $ 5,250 $ 5,513 $ 5,788 $ 6,078 $ 6,381 EBITDA Margin % 5.0% 5.0% 5.0% 5.0% 5.0% 5.0% 5.0% 5.0%

For the Year Ended December 31, For the Year Ending December 31,

27CONFIDENTIAL


Valuation Analysis – No Compensation Cap

Adjusted Implied Enterprise Value(000s) EBITDA Addbacks EBITDA 6.50x 6.75x 7.00x 7.25x 7.50x

Forecasted 2011 EBITDA $5,000 - $5,000 $32,500 $33,750 $35,000 $36,250 $37,500

Implied Cash Enterprise Value 32,500 33,750 35,000 36,250 37,500

Less Balances as of12/31/11

Funded debt 10,000 10,000 10,000 10,000 10,000

Total 10,000 10,000 10,000 10,000 10,000

Add Balances as of 12/31/2011

Cash and cash equivalents 500 500 500 500 500

Total 500 500 500 500 500

Excess Cash / (Net Debt) (9,500) (9,500) (9,500) (9,500) (9,500)

Implied Equity Value to Seller6.50x 6.75x 7.00x 7.25x 7.50x

Total Cash Equity Value 23,000$ 24,250$ 25,500$ 26,750$ 28,000$

Per MD 460$ 485$ 510$ 535$ 560$

28CONFIDENTIAL


Compensation Policies of Publicly Traded Investment Banks

Total Compansation

/ RevenueCompany Ticker (% ) SourceInvestment Bank A A 49.0% PolicyInvestment Bank B B 41.7% PolicyInvestment Bank C C 49.1% PolicyInvestment Bank D D 49.3% PolicyInvestment Bank E E 47.1% PolicyInvestment Bank F F 57.5% CovenantInvestment Bank G G 73.0% PolicyInvestment Bank H H 56.3% PolicyInvestment Bank I I 55.0% TargetInvestment Bank J J 58.0% TargetInvestment Bank K K 59.0% TargetInvestment Bank L L 56.5% TargetInvestment Bank M M 50.0% TargetInvestment Bank N N 50.0% PolicyInvestment Bank O O 80.0% PolicyInvestment Bank P P 55.0% Target

Average 55.4%

Average compensation expense as a percentage of revenue for investment banks is approximately 55%

ABC Financial Services compensation as a percentage of revenue is 65%

29CONFIDENTIAL


2011 Income Statement – Actual vs. Proforma for 55% Compensation Cap

2011 2011

(000s)

Actual - 65%

Comp Cap

Proforma - 55% Comp Cap

Revenues:

Professional Fees $100,000 $100,000

Total revenue 100,000 100,000

% Growth n/a 0%

Expenses:


37,500 37.5% 27,500 27.5%


27,500 27.5% 27,500 27.5%

Total Salaries, incentive compensation and employee benefits - Non-Managing Directors

65,000 65.0% 55,000 55.0%

General and administrative 30,000 30,000

Depreciation and amortization expense 3,000 3,000

Interest expense 500 500

Total expenses 98,500 88,500

Income before income taxes 1,500 11,500

Income tax expense 500 3,795

Net income $ 1,000 $ 7,705

EBITDA Calculation Income before income taxes $ 1,500 $ 11,500 Interest expense 500 500 Depreciation and amortization 3,000 3,000 EBITDA $ 5,000 $ 15,000 EBITDA Margin % 5.0% 15.0%

Compensation per Managing Director $ 750 $ 550

For the Year Ended December 31,

If ABC Financial Services were to cap compensation at 55% of revenue, EBITDA would increase by $10 million and create significant equity value

Capital gains on the sale of stock are taxed at 15% (federal) vs. compensation taxed at 35% (highest marginal federal rate)

Average compensation per MD would decrease by $200,000 from $750,000 to $550,000. Based on compensation studies, $550,000 is in line with industry standards

30CONFIDENTIAL


Valuation Analysis – 55% Compensation Cap

Adjusted Implied Enterprise ValueEBITDA Addbacks EBITDA 6.50x 6.75x 7.00x 7.25x 7.50x

Forecasted 2011 EBITDA $5,000 10,000 $15,000 $97,500 $101,250 $105,000 $108,750 $112,500

Implied Cash Enterprise Value 97,500 101,250 105,000 108,750 112,500

Less Balances as of12/31/11

Funded debt 10,000 10,000 10,000 10,000 10,000

Total 10,000 10,000 10,000 10,000 10,000

Add Balances as of 12/31/2011

Cash and cash equivalents 500 500 500 500 500

Total 500 500 500 500 500

Excess Cash / (Net Debt) (9,500) (9,500) (9,500) (9,500) (9,500)

Implied Equity Value to Seller6.50x 6.75x 7.00x 7.25x 7.50x

Total Cash Equity Value 88,000$ 91,750$ 95,500$ 99,250$ 103,000$

Per MD 1,760$ 1,835$ 1,910$ 1,985$ 2,060$

Increase in Equity Value Due to Comp Cap per MD 1,300$ 1,350$ 1,400$ 1,450$ 1,500$

31CONFIDENTIAL


Private Equity LBO Model – Assumptions

Middle of valuation range is 7.0x EBITDA = $105 million

Private Equity investor wants MDs to have “skin in the game” via retained or “rolled” equity investment

Griffin estimates approximately 28% Rolled Equity stake would be required ($26.5 million)

Aligns economic interest between Private Equity and MDs via “second bite of the apple” for MDs

Through the effect of leverage, the MDs still own 47% of the common equity post-closing

Prudent levels of leverage used: 2.5x Senior Debt, 1.0x Subordinated Debt Reflects “asset-light” balance sheet

Assumes the Company is sold in 5 years for same exit multiple (7.0x) Model #1: 10% growth Company projections used

Model #2: Conservative 5% growth model is used

Cash liquidity to MDs is substantial, but not so much per MD ($1.2 million average after-tax) to enable them to quit and retire post-closing

MDs will also have to sign a 5-year Non-Compete and Non-Solicit Agreement

Private Equity common ownership on a fully-converted basis of 53% provides a 20-24% IRR depending on the growth scenario utilized

32CONFIDENTIAL


Private Equity LBO Model – Summary – 10% Revenue Growth

ABC Financial Services Griffin Financial Group, LLCLBO Model Summary & Assumptions ($000s) 2-Feb-12

Buyer's Sources of Funds Operating Summary$ %

Existing Cash -$ 0.0% Actual ProformaRevolver - 0.0% FY FY Projected - Fiscal Year Ending,Senior Term A 37,500 34.4% Dec-11 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec-16Senior Term B - 0.0% Net Revenues 100,000 $100,000 $110,000 $121,000 $133,100 $146,410 $161,051Senior Term C - 0.0% Gross Profit 45,000 45,000 49,500 54,450 59,895 65,885 72,473Other Sr. Debt - 0.0% Adjusted EBITDA 15,000 15,000 16,500 18,150 19,965 21,962 24,158Senior Sub Debt 15,000 13.7% Adjusted EBIT 12,000 12,000 13,200 14,520 15,972 17,570 19,326Junior Sub Debt - 0.0% Net Income to Common 7,475 2,113 466 593 753 1,833 1,011Seller Note - 0.0% Capital expenditures 2,500 $2,500 $2,700 $2,800 $2,900 $3,000 $3,100Convertible Preferred Equity 30,168 27.6%Mgmt Co-investment - 0.0% Leverage & Coverage RatiosManagement Rolled Equity 26,500 24.3%Sponsor Common Equity - 0.0% Proforma

Total 109,168$ 100.0% FYDec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec-16

Buyer's Uses of Funds Total Senior Debt 37,500$ 36,000$ 32,000$ 28,000$ 23,000$ 18,000$ $ % Total Sub Debt 15,000 15,457 15,928 16,413 16,905 0

Net Debt (Cash) 52,500 46,583 39,530 31,148 20,335 8,779 Purchase Price 105,000$ 96.2%Other 0.0% Senior Funded Debt / EBITDA 2.50 x 2.18 x 1.76 x 1.40 x 1.05 x 0.75 xOther - 0.0% Subordinated Debt / EBITDA 1.00 x 0.94 x 0.88 x 0.82 x 0.77 x 0.00 xOther - 0.0% Total Funded Debt / EBITDA 3.50 x 3.12 x 2.64 x 2.22 x 1.82 x 0.75 xOther - 0.0% EBITDA-Non-Fin Capex / Sr Debt Svc 2.00 x 2.88 x 1.89 x 2.15 x 2.08 x 2.44 xTransaction Fees & Expenses 4,168 3.8% EBITDA-Non-Fin Capex / Total Debt Svc 1.32 x 1.91 x 1.44 x 1.61 x 1.60 x 0.58 xExcess Cash - 0.0% EBITDA-Non-Fin Capex / Fixed Charges 1.32 x 1.91 x 1.44 x 1.61 x 1.60 x 0.58 x

Total 109,168$ 100.0%

IRR and Ownership SummarySeller's Sources of Funds

$ % $ Value Equity % Equity Close Exit ExercisePurchase price 105,000$ 99.5% Exit IRR Contribution Contribution Ownership Ownership PriceCash 500 0.5%

0.0% Exit EBITDA 12/31/16 6.50x 7.00x 7.50xTotal 105,500$ 100.0% Multiple

Senior Sub Debt 15.2% 15.2% 15.2% n/a 0.00% -$ Seller's Uses of Funds Junior Sub Debt nm nm nm n/a 0.00% -$

$ % Convertible Preferred Equity 22.7% 24.3% 25.8% 30,168 53.2% 53.2% 50.44% -$ Existing Debt 10,000$ 9.5% Mgmt Incentive Options nm nm nm n/a 0.0% 0.0% 5.25% -$ Transaction Fees & Expenses 3,000 2.8% Mgmt Co-investment nm nm nm - 0.0% 0.0% 0.00%Roll-over Equity 26,500 25.1% Management Rolled Equity 13.0% 15.2% 17.2% 26,500 46.8% 46.8% 44.31%Pre-tax Shareholder Proceeds 66,000 62.6% Sponsor Total Return nm nm nm - 0.0% 0.0% 0.00%Other - 0.0% Total 56,668$ 100.0% 100.0% 100.0%

Total 105,500$ 100.0%Debt Amort. & Interest Rates

Buyout Valuation Max Drawn At Amort AmortAmount Closing LIBOR Floor Spread Rate Unused Period Start Maturity

Enterprise Value 105,000$ EBITDA Multiple LTM Ended 12/31/11 7.0x Revolver $7,000 - 1.00% 4.00% 5.00% 0.50% n/a n/a n/aEBITDA Multiple Fcst Year Ending 12/31/09 7.0x Senior Term A 37,500 37,500 1.00% 4.00% 5.00% n/a 7 years 12/30/11 12/31/18EBITDA Multiple Proj Year Ending 12/31/12 6.4x Senior Term B - - 0.00% 0.00% 0.00% n/a 5 years 12/30/11 12/31/16

Senior Term C - - 0.00% 0.00% 0.00% n/a 5 years 12/30/11 12/31/16Enterprise Value 105,000$ Other Sr. Debt - - 0.00% 0.00% 0.00% n/a 5 years 12/30/11 12/31/16Less: Existing Debt (10,000) Seller Note - - 0.00% n/a 5 years 12/30/11 12/31/16Add: Cash 500 Seller's Equity Proceeds Before Fees 95,500$ Cash PIK Rate Warrants

Senior Sub Debt 15,000 15,000 12.00% 3.00% 15.00% 0.00% 1 12/31/2016 12/31/2016% Equity Sold 53.2% Junior Sub Debt - - 0.00% 0.00% 0.00% 0.00% n/a n/a n/a% Equity Retained 46.8% Convertible Preferred Equity30,168 30,168 0.00% 15.00% 15.00% 0.00% n/a n/a n/a

Projected - Fiscal Year Ending,

33CONFIDENTIAL


Private Equity LBO Model – Summary – 5% Revenue Growth ABC Financial Services Griffin Financial Group, LLCLBO Model Summary & Assumptions ($000s) 2-Feb-12

Buyer's Sources of Funds Operating Summary$ %

Existing Cash -$ 0.0% Actual ProformaRevolver - 0.0% FY FY Projected - Fiscal Year Ending,Senior Term A 37,500 34.4% Dec-11 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec-16Senior Term B - 0.0% Net Revenues 100,000 $100,000 $105,000 $110,250 $115,763 $121,551 $127,628Senior Term C - 0.0% Gross Profit 45,000 45,000 47,250 49,613 52,093 54,698 57,433Other Sr. Debt - 0.0% Adjusted EBITDA 15,000 15,000 15,900 16,860 17,885 18,978 20,147Senior Sub Debt 15,000 13.7% Adjusted EBIT 12,000 12,000 12,600 13,230 13,892 14,586 15,315Junior Sub Debt - 0.0% Net Income to Common 7,475 2,113 73 (246) (603) (92) (1,592)Seller Note - 0.0% Capital expenditures 2,500 $2,500 $2,700 $2,800 $2,900 $3,000 $3,100Convertible Preferred Equity 30,168 27.6%Mgmt Co-investment - 0.0% Leverage & Coverage RatiosManagement Rolled Equity 26,500 24.3%Sponsor Common Equity - 0.0% Proforma

Total 109,168$ 100.0% FYDec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec-16

Buyer's Uses of Funds Total Senior Debt 37,500$ 36,000$ 32,000$ 28,000$ 23,000$ 18,000$ $ % Total Sub Debt 15,000 15,457 15,928 16,413 16,905 0

Net Debt (Cash) 52,500 46,901 40,600 33,476 24,475 15,392 Purchase Price 105,000$ 96.2%Other 0.0% Senior Funded Debt / EBITDA 2.50 x 2.26 x 1.90 x 1.57 x 1.21 x 0.89 xOther - 0.0% Subordinated Debt / EBITDA 1.00 x 0.97 x 0.94 x 0.92 x 0.89 x 0.00 xOther - 0.0% Total Funded Debt / EBITDA 3.50 x 3.24 x 2.84 x 2.48 x 2.10 x 0.89 xOther - 0.0% EBITDA-Non-Fin Capex / Sr Debt Svc 2.00 x 2.77 x 1.76 x 1.92 x 1.80 x 2.03 xTransaction Fees & Expenses 4,168 3.8% EBITDA-Non-Fin Capex / Total Debt Svc 1.32 x 1.84 x 1.34 x 1.44 x 1.38 x 0.49 xExcess Cash - 0.0% EBITDA-Non-Fin Capex / Fixed Charges 1.32 x 1.84 x 1.34 x 1.44 x 1.38 x 0.49 x

Total 109,168$ 100.0%

IRR and Ownership SummarySeller's Sources of Funds

$ % $ Value Equity % Equity Close Exit ExercisePurchase price 105,000$ 99.5% Exit IRR Contribution Contribution Ownership Ownership PriceCash 500 0.5%

0.0% Exit EBITDA 12/31/16 6.50x 7.00x 7.50xTotal 105,500$ 100.0% Multiple

Senior Sub Debt 15.2% 15.2% 15.2% n/a 0.00% -$ Seller's Uses of Funds Junior Sub Debt nm nm nm n/a 0.00% -$

$ % Convertible Preferred Equity 18.5% 20.1% 21.6% 30,168 53.2% 53.2% 50.44% -$ Existing Debt 10,000$ 9.5% Mgmt Incentive Options nm nm nm n/a 0.0% 0.0% 5.25% -$ Transaction Fees & Expenses 3,000 2.8% Mgmt Co-investment nm nm nm - 0.0% 0.0% 0.00%Roll-over Equity 26,500 25.1% Management Rolled Equity 7.0% 9.3% 11.4% 26,500 46.8% 46.8% 44.31%Pre-tax Shareholder Proceeds 66,000 62.6% Sponsor Total Return nm nm nm - 0.0% 0.0% 0.00%Other - 0.0% Total 56,668$ 100.0% 100.0% 100.0%

Total 105,500$ 100.0%Debt Amort. & Interest Rates

Buyout Valuation Max Drawn At Amort AmortAmount Closing LIBOR Floor Spread Rate Unused Period Start Maturity

Enterprise Value 105,000$ EBITDA Multiple LTM Ended 12/31/11 7.0x Revolver $7,000 - 1.00% 4.00% 5.00% 0.50% n/a n/a n/aEBITDA Multiple Fcst Year Ending 12/31/09 7.0x Senior Term A 37,500 37,500 1.00% 4.00% 5.00% n/a 5 years 12/30/11 12/31/16EBITDA Multiple Proj Year Ending 12/31/12 6.6x Senior Term B - - 0.00% 0.00% 0.00% n/a 5 years 12/30/11 12/31/16

Senior Term C - - 0.00% 0.00% 0.00% n/a 5 years 12/30/11 12/31/16Enterprise Value 105,000$ Other Sr. Debt - - 0.00% 0.00% 0.00% n/a 5 years 12/30/11 12/31/16Less: Existing Debt (10,000) Seller Note - - 0.00% n/a 5 years 12/30/11 12/31/16Add: Cash 500 Seller's Equity Proceeds Before Fees 95,500$ Cash PIK Rate Warrants

Senior Sub Debt 15,000 15,000 12.00% 3.00% 15.00% 0.00% 1 12/31/2016 12/31/2016% Equity Sold 53.2% Junior Sub Debt - - 0.00% 0.00% 0.00% 0.00% n/a n/a n/a% Equity Retained 46.8% Convertible Preferred Equity30,168 30,168 0.00% 15.00% 15.00% 0.00% n/a n/a n/a

Projected - Fiscal Year Ending,

CONFIDENTIAL

IV. Sell-Side Process

35CONFIDENTIAL

Typical Engagement Phases Overview

Evaluation Preparation Solicitation Negotiation Finalization

Determine shareholder objectives and priorities

Economic Family Management Continued

involvement Company name

and culture

Perform preliminary analysis of Company and industry

Research market environment

Negotiate and sign engagement agreement with Shareholders / Company

Perform Griffin’s Company and industry due diligence

Prepare potential documents to “go to market”

“No-name” company summary

Confidentiality agreement

Memorandum

Research and identify potential buyers / investors

Determine potential buyers / investors to contact

Prepare buyer / investor data room files

Contact potential buyers / investors on a “no-name” basis

Sign confidentiality agreements with potential buyers / investors

Distribute memorandum to potential buyers

Solicit and negotiate 1st round bids

Select potential buyers / investors to meet with management and participate in facility tours

Hold management presentations / tours

Solicit and negotiate 2nd round bids

Provide data room files to remaining potential buyers / investors

Distribute draft purchase agreement to remaining potential buyers

Address due diligence questions and requests

Solicit and negotiate 3rd* round bids / letters of intent and, in some cases, “mark-up” to the transaction agreement

Choose a potential buyer / investor to move to the final phase

* additional bid rounds may be required or desired depending on the process

Lead negotiation of the “business” and “economic” issues in the transaction documents

Maximize of after tax net proceeds

Minimize escrows and indemnity exposure

Interface with clients other advisors

Legal Accounting / Tax

Coordinate and manage final buyer/ investor due diligence

Maintain transaction momentum and sense of urgency until close

In each phase, the client has the opportunity to control the direction of the process

36CONFIDENTIAL

Typical Engagement Timeline

2 weeks

2 – 3 weeks

4 - 6 weeks

8 - 10 weeks

I. EVALUATION

II. PREPARATION

III. SOLICITATION

V. FINALIZATION

IV. NEGOTIATION 4 weeks

Approximately 5-6 Months

Confidential Competitive AtmosphereTailor ProcessPHASES

37CONFIDENTIAL

Griffin’s Role and Responsibilities

Interview and advise the Seller on goals and objectives of the process

Tailor transaction process to achieve the Seller’s goals and objectives

Determine and collect information from the Seller that is necessary to market the business

Compose comprehensive written materials describing the operational, strategic, managerial, and financial elements of the business

Anticipate and advise the Seller on potential “business” and “valuation” issues that may be raised during the transaction process

Research and develop a list of prospective strategic and financial buyers / investors, and work with the Seller to determine which parties to approach

Contact and qualify prospective buyers or investors and secure confidentiality agreements

Distribute written materials describing the business and address questions about the business

Solicit and negotiate multiple rounds of offers and prioritize relative to Seller’s goals and objectives

Arrange and prepare management for meetings with prospective buyers / investors

Manage buyer / investor due diligence process including the organization of comprehensive data room files to be shared with interested parties in the later stages of the process

Advise Seller on offers received and selection of a buyer / investor

In conjunction with the Seller’s attorney, assist with negotiation of transaction documents

CREATE COMPETITIVE ATMOSPHERE AND TRANSACTION MOMENTUM

38CONFIDENTIAL

Company’s Role and Responsibilities

With Griffin’s assistance and advice, determine and prioritize the goals and objectives of the transaction process

Provide financial and operational information to Griffin for preparation of written materials describing the business

Review and approve written materials prepared by Griffin

Provide answers and / or information to Griffin in response to follow-up questions from prospective buyers / investors

Participate in presentations and facility tours with prospective buyers / investors

Provide Griffin with information for data room files, which will be shared with prospective buyers in the later stages of the process

Review offers and select buyer / investor based on consultation with Griffin

Respond to selected buyer’s / investor’s final due diligence requests

Review and execute transaction documents

STAY FOCUSED ON THE BUSINESS AND ACHIEVE BUDGET / FORECAST

CONFIDENTIAL

V. Potential Purchasers

40CONFIDENTIAL

Potential Purchasers

2006-2008 were record-breaking private equity fund raising years. There continues to be a tremendous amount of liquidity in the U.S. private equity markets waiting to be deployed (estimated $500 billion)

U.S. Fundraising and the number of funds continues to slow drastically from Q4 2007 through Q4 2011. When 2007-2008 fund capital commitments expire in 2012-2013, private equity liquidity could dry up dramatically unless fund raising picks up

Griffin believes ABC has the characteristics of a private equity platform company

Based on Griffin’s recent experience with professional/financial services companies, Griffin believes ABC fits the criteria for at least 200 private equity firms

Private Equity Buyers

$113

$184

$261

$323

$233

$120 $125

$154

428

494 505

551517

437 469 467

0

100

200

300

400

500

600

$0

$50

$100

$150

$200

$250

$300

$350

2004 2005 2006 2007 2008 2009 2010 2011

Num

ber

of Fu

nds

Dolla

rs i

n B

illio

ns

US Yearly Fundraising Activity

Aggregate Value ($ billions) Number of Funds

0

20

40

60

80

100

120

140

160

180

200

$0

$10

$20

$30

$40

$50

$60

$70

$80

Q12008

Q22008

Q32008

Q42008

Q12009

Q22009

Q32009

Q42009

Q12010

Q22010

Q32010

Q42010

Q12011

Q22011

Q32011

Q42011

US Quarterly Fundraising Activity

Aggregate Value ($ billions) Number of Funds

41CONFIDENTIAL

Griffin anticipates ABC will also have significant interest from strategic buyers Buoyed by record levels of corporate cash and poor organic revenue growth,

strategic M&A buyer activity is strong Foreign buyers are able to use the weak U.S. dollar to make favorable purchases

Potential Purchasers

Strategic Buyers

Griffin anticipates strategic buyers to include: Investment Banks Asset Managers

The major issue with large strategic buyers is they will most likely not want the MDs to retain ownership. They will substitute the Rolled Equity for an Earn-out – an inferior solution

There will also be operational and strategic risk inherent in any strategic combination that is lessened considerably with a Private Equity partner

Commercial Banks Consulting Firms

CONFIDENTIAL

VI. Summary

43CONFIDENTIAL

Summary

Questions and Answers What is the value of ABC Financial Services Firm?

Griffin believes the range of purchase price multiples for ABC Financial Services is 6.5x-7.5x

The equity value of ABC Financial Services depending on ABC Financial Services compensation cap. Below is a summary of equity value ranges:

We expect you to market the Company to strategic and financial buyers. What are the pros and cons of partnering with each type of buyer/investor? Strategic:

Pros: 1) Likely to pay a higher price, 2)knowledge of the industry

Cons: 1) Likely will not allow ABC Financial Services to roll equity, and participation in future upside is limited to an earn-out, 2) Likely will not keep all 400 employees (i.e. will look for synergies), 3) Change in Company culture and integration risks

Financial: Pros: 1) Will allow partial liquidity and rolled equity so MDs can take some chips off the

table, yet still participate in future upside, 2) capital and incentive to make acquisitions, 3) Company culture and 400 employees remain as is

Cons: 1) Likely will not be able to pay as much as a strategic buyers, 2) Company will have to operate with more leverage

Purchase Price Multiple

65% Compensation

Cap

55% Compensation

Cap Difference6.50x 23,000$ 88,000$ 65,000$ 6.75x 24,250 91,750 67,500 7.00x 25,500 95,500 70,000 7.25x 26,750 99,250 72,500 7.50x 28,000 103,000 75,000

44CONFIDENTIAL

Summary

Questions and Answers

What form of consideration to do you expect ABC Financial Services Firm to receive at closing? Post-closing? Strategic: Likely cash and earn-out (earn-out percentage from 20-50%)

Financial: Part cash, part rolled equity (20% – 40% rolled equity)

What type of transaction capital structure should ABC Financial Services Firm expect if it is purchased by a financial buyer (i.e. senior debt, subordinated debt, equity)? ABC Financial Services should expect a financial buyer to use senior debt,

subordinated debt and equity to finance the transaction

ABC Financial Services should expect approximately 60% of the purchase price to be funded using debt and the remaining 40% to be equity from a financial buyer’s committed fund

Please explain your sell-side process and how long it will take? 5-6 months (please refer to Section IV for a detailed timeline)

CONFIDENTIAL

Appendix I. Selected Griffin Team Members

46CONFIDENTIAL

Selected Griffin Team Members

EXPERIENCE

Mr. Lee has over 18 years of investment banking and private equity investing experience with middle market commercial and industrial companies

Personally initiated or managed over 50 transactions as an investment banker, and 3 as a private equity principal

50% of transaction experience is in sell-side mergers and acquisitions, 25% in private placements of debt and equity capital, and 25% in management buyouts and other buy-side merger and acquisition assignments

Experience includes Principal of Horizon Partners, Ltd (private equity investment firm), Director at Berwind Financial, L.P., and Investment Banking Officer at Crestar Securities Corp. Current President for the Philadelphia Chapter of the Association for Corporate Growth and past Board Director for Realpoint, LLC, Lantor, Inc., and AirWave Services Corp.

John A. LeeSenior Managing DirectorGriffin Financial Group LLC

Contact Information:Phone: (610) 205-6106Email: [email protected]

Office Address:620 Freedom Business CenterSuite 210P.O. Box 61926King of Prussia, PA 19406

47CONFIDENTIAL

Selected Griffin Team Members

EXPERIENCE

Mr. Sobota provides investment banking services to middle market commercial, industrial and services companies

Experience includes merger and acquisition advisory, capital raise and strategic planning services. Also advises clients on financial accounting matters

Public accounting experience with Deloitte & Touche LLP As an Audit Manager led client engagements for Fortune

150 and other clients within the commercial, industrial and services sectors

Involved in the accounting aspects of mergers and acquisitions and private and public placements of debt and equity

Certified Public Accountant and member of the Pennsylvania Institute of Certified Public Accountants and the American Institute od Certified Public Accountants

Received a B.S. in Accounting and a B.S. in Finance from DeSales University

Michael J. SobotaVice PresidentGriffin Financial Group, LLC

Contact Information:Phone: (610) 478-2294Email: [email protected]

Office Address:607 Washington St.P.O. Box 1497Reading, PA 19603

john a. lee, senior managing director jlee@go2griffin 610-205-6106

Documents