Mergers & Acquisitions No One Said It Was Easy - But You Can Do It Better

1. Mergers & Acquisitions No One Said It Was Easy - But You Can Do It Better IDENTIFY INVESTIGATE IMPLEMENT INTEGRATE 4200 Montrose, Suite 590  Houston, TX 77006 (713) 522-9656 Phone  (713) 522-9661 Fax www.wjmurray-assoc.com

2. NO ONE SAID IT WAS EASY - BUT YOU CAN DO IT BETTER IDENTIFY INVESTIGATE IMPLEMENT INTEGRATE • BENEFITS OF THE W J MURRAY & ASSOCIATES’ PROCESS • Fewer False Starts • Shorter Cycle Times • Acquisitions That Fit The Playbook • Fewer People Spinning Their Wheels • An Organization To Accomplish the Acquisition • Proven Partner Search Techniques • Tested Techniques For Valuing Companies • Successful Approaches To Acquisition Candidates • Proven Due Diligence Techniques • Effective Integration Techniques • Avoid The Pitfalls • LEADING TO: SUCCESSFUL ACQUISITIONS

3. NO ONE SAID IT WAS EASY - BUT YOU CAN DO IT BETTER IDENTIFY INVESTIGATE IMPLEMENT INTEGRATE • Engage the Search • Vehicle • Complete Initial • Screen • Anticipate External • Opportunities • Complete Business • Evaluation • Discuss with • Management • Gain Consensus • On The Short List • APET Game Plan • Company Contact • Business Analysis • Management Review • Letter of Intent • Due Diligence • Purchase Agreement • Goals • Gain Consensus On • Implementing The • Assimilation Plan • Obtain Commitment • To Execute The • Business Plan • Enterprise Strategy • *The Vision • *The Goals • *The Playbook • Acquisition Process • Execution Team - APET • Alternatives • *Internal Development • *Partnering • *Joint Ventures • How Does The Acquisition • Fit The Playbook? • The Screening Criteria

4. IDENTIFY • WHAT TO DO • Confirm The Enterprise Strategy • The Business • The Vision • The Value Proposition • The Competitors • The Goals • The Critical Success Factors • Demonstrate How The Acquisition Supports The Critical Success Factors And Goals • Strategic Alliance Versus Joint Venture • Select The Acquisition Process Execution • Team (APET) • Gain Consensus That Acquiring Is Superior To Internal Development Or Partnering • Agree On The Screening Criteria WHO DOES IT Senior Managers Senior Managers Senior Managers Senior Managers APET APET • OUTPUTS • Acquisition Criteria • Expected Benefits • Decision On Strategic • Alliance Or Joint • Venture • Purchase Price Range • Reconfirmation Of • The Enterprise Strategy • Internal Commitment • And Consensus To • Acquisition • Acquisition Process • Execution Team

5. IDENTIFY WHY ACQUIRE VERSUS INTERNALLY DEVELOP OR PARTNER DOES NOT FAVOR ACQUISITION FAVORS ACQUISITION IS THE PURPOSE TO ACQUIRE ACQUIRE A ACQUIRE KEY PEOPLE PEOPLE PROCESS CORE, HIGHLY STRATEGIC HAVE TIME & LIMITED WINDOW DEGREES OF FREEDOM OF OPPORTUNITY ACQUISITION ACTIVITY HIGH LOW IN THE MARKET ACQUISITION NONE CONSIDERABLE EXPERIENCE NUMBER OF FEW MANY ALTERNATIVES

6. IDENTIFY SAMPLE INITIAL SCREENING CRITERIA

7. INVESTIGATE WHO DOES IT Senior Managers APET APET APET APET Senior Managers & APET • WHAT TO DO • Engage The Search Engine • * Board Members • * Business Network • * Law Firm • * Accounting Firm • * Investment Bankers • * Senior Executives • * Banks • * Customers & Suppliers • Compete Initial Screens • Anticipate New Opportunities • Gain Consensus On Short List • Complete Second Phase Screen • Discuss Evaluation With • Management • OUTPUTS • Criteria For Ranking • Alternatives • Consensus On Top Candidates • Advantages/disadvantages • Associated With Targets • Range Of Acquisition Costs • Reaffirmation Of Purpose • /Goals • Commitment To Continue

8. INVESTIGATE SAMPLE SECOND-PHASE SCREENING CRITERIA

9. IMPLEMENT • WHAT TO DO • Develop The Game Plan Identify Resources • Make The Contact • Complete Pre-Due Diligence Analysis • Review With Management • Sign A Letter Of Intent • Complete The Due Diligence • Complete The Negotiations • Sign The Purchase Agreement WHO DOES IT APET Senior Management APET Senior Management & APET Senior Management APET APET Senior Management • OUTPUT • Purchase Agreement • * Purchase Price • * Terms & Conditions • Consensus On Integration • Check List

10. INTEGRATE • WHAT TO DO • Develop & Execute The Business Plan • * Value proposition • * Goals • * Budgets • * Metrics/scorecard • * Time-line-for implementation • * Task-force responsibilities/ • accountability • Develop & Implement An Assimilation Plan • * Functional Integration • Manufacturing/production • Sales/marketing • Engineering • R&D • Purchasing • * Human Resource • Personnel policies • Salary administration • * Financial Integration: Accounting, Tax • * Communication plan • Message • Timing • Responsibilities • * Pre- and Post- Acquisition Customer/ • Employee Survey • * Measure Progress: The Scorecard WHO DOES IT APET APET • OUTPUT • Integrated Company • * Direction • * Commitment • * Budgets • * Key issues identified • * Roles and Responsibilities • for key issues

11. INTEGRATE INTEGRATION CHECK LIST • ASSETS • Plant, Property & Equipment • Inventory • Personnel • IT • Capital Structure • ACTIVITIES • Business Relationship • Production Processes • Accounting Practices • Decision Making Process • Supply Chain • Customer Service • Purchasing • HR Processes • * Pension Plans • * Performance Appraisal • * Labor Relations • * Recruiting • Pricing • STANDARDS • Regulatory • * Environmental • * Safety • * Health • * Tax • * Licensing