This fall 2009 presentation discussed valuation issues in buy-sell agreements as well as how the economic downturn impacted business value.

1. Timothy R. Lee, ASA Birmingham Estate Planning Council » September 3, 2009 Buy-Sell Agreements Convergence of Business Succession & Shareholder Planning

2. Who We Are MERCER CAPITAL Among the largest business valuation offices in the nation and the largest in the Southeast serving a national and international clientele MERCER CAPITAL INVESTMENT BANKING M&A and transaction advisory services for buyers and sellers, focusing on mid-market corporate development and divesture activities, reorganizations, fairness opinions, and strategic alternatives assessment

4. Economic Review – History

5. Economic Review – Where Are We?

6. Economic Review – Where Are We?

7. Economic Review – Where Are We?

8. Economic Review – Where Are We?

9. Economic Review – EESA, Now ARRA Graphics courtesy of Wikipedia.com

15. Types of Buy-Sell Agreements Fixed Price Agreements Formula Agreements Process Agreements

19. Types of Process Agreements Multiple Appraiser Agreements Single Appraiser Agreements

23. Single Appraiser Agreements Disadvantages

24. Six Defining Elements of a Process Agreement Standard of Value Level of Value “ As of” Date Appraiser Qualifications Appraisal Standards Funding Mechanism

27. Six Defining Elements of a Process Agreement

28. Six Defining Elements of a Process Agreement Price we hope to get if we sell the company together Price the rest of us can reasonably pay if we have to buy out someone else “ Fair market value of the (minority) interest”

29. Six Defining Elements of a Process Agreement $100 Per Share $100 Per Share $60 Per Share $140 Per Share

32. Six Defining Elements of a Process Agreement Proceeds are a Funding Vehicle Proceeds are a Corporate Asset

36. Other Resources

37. MERCER CAPTIAL 5860 Ridgeway Center Parkway, Suite 400 • Memphis, TN 38120 901.685.2120 (P) • 901.685.2199 (F) www.mercercapital.com Z. Christopher Mercer, ASA, CFA [email_address] Andrew K. Gibbs, CFA, CPA/ABV [email_address] James E. Graves, ASA, CFA [email_address] Timothy R. Lee, ASA [email_address] Travis W. Harms, CFA, CPA/ABV [email_address] Jean E. Harris, CFA [email_address] Questions? Matthew R. Crow, ASA, CFA [email_address] Wendy S. Ingalls, CPA/ABV, CBA, ASA [email_address] Nicholas J. Heinz [email_address] For further information, feel free to contact any of our senior professionals listed below:

38. Mercer Capital’s M&A Overview 2 nd Quarter, 2009 Prepared by Timothy R. Lee, ASA & Nicholas J. Heinz, ASA 901.685.2120 MERCER CAPITAL www.mercercapital.com