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Piper JaffrayBowdoin College
Information Session
September 21, 2006Beg
in y
our
jour
ney
Who We Are
Piper Jaffray is the leading middle market investment bank
• Client-focused securities firm dedicated to delivering superior financial advice, products and transaction execution to businesses, institutions non-profits and public entities within targeted sectors
• Industry leader– M&A– Equity / Debt– Restructuring– Research
• Operates through two business segments:
– Corporate and Institutional Services– Public Finance Services
2
More Than 100 Years of Guiding Clients
3
1971
In 1971 Piper, Jaffray & Hopwood became the first regional brokerage firm to offer its own stock for public sale.
1895
In 1895 George B. Lane Commercial Paper and Collateral Loans & Co. was established and in 1917 merged with Piper, Jaffray & Co. to form Lane, Piper & Jaffray.
1992
In 1992 Piper, Jaffray & Hopwood became Piper Jaffray Inc. and the holding company name changed to Piper Jaffray Companies Inc.
1998
In 1998 Piper Jaffray was acquired by U.S. Bancorp and in 1999 changed its name to U.S. Bancorp Piper Jaffray.
2003
In 2003 Piper Jaffray once again became an independent, public securities firm through a spin-off from U.S. Bancorp.
In 2006 Piper Jaffray completed the sale of the company’s Private Client Services branch network.
2006
Source: Dealogic and Piper Jaffray
Most Active IPO Underwriters in 2005
Leading Middle Market Company Focus
IPOs Overall
Rank Manager # of Deals
1 Credit Suisse First Boston 452 J.P. Morgan 423 Citigroup Global Markets 404 UBS Securities 385 Goldman Sachs 376 Lehman Brothers 367 Merrill Lynch 348 Deutsche Bank Securities 329 Piper Jaffray 3110 Morgan Stanley 2911 Banc of America Securities 2912 Jefferies & Co. 2813 CIBC World Markets 2814 Bear Stearns & Co. 2715 Wachovia Capital Markets 26
Focus Sectors
Rank Manager # of Deals
1 Piper Jaffray 312 Credit Suisse First Boston 273 J.P. Morgan Securities 264 Goldman Sachs 255 Merrill Lynch & Co. 256 Citigroup Global Markets 237 Banc of America Securities 228 Lehman Brothers 229 CIBC World Markets 2210 Deutsche Bank Securities 2011 Wachovia Capital Markets 2012 Morgan Stanley 1913 William Blair & Co. 1914 Thomas Weisel Partners 1815 UBS Securities 16
Piper Jaffrayranked #1 in the number of IPOscompleted in its focus sectors—the growth areas of the economy—and ranked #9 in the number of IPOs completed overall in 2005
Top 20 M&A Advisors In 2005
Source: Thomson Financial and Piper Jaffray; U.S. based buyers/sellers only* Excludes Investment Banks with Average Deal Size>$500 million
Goldman Sachs & Co. 151Houlihan Lokey Howard & Zukin 126Citigroup 113Morgan Stanley 113JP Morgan 109Credit Suisse 108Banc of America Securities 103Merrill Lynch 103UBS Warburg 96Lehman Brothers 92Jefferies & Co. 76Wachovia 69Lazard 62Deutsche Bank 60Piper Jaffray 48M&A International 40Bear Stearns & Co. 39Keefe Bruyette & Woods 38William Blair & Co. 36Sandler O’Neill Partners 35
Number ofAll Advisors Deals Closed
Number ofMiddle Market Advisors* Deals Closed
Houlihan Lokey Howard & Zukin 126Jefferies & Co. 76Wachovia 69Piper Jaffray 48M&A International 40Keefe Bruyette & Woods 38William Blair & Co. 36Sandler O’Neill & Partners 35Lincoln Partners 33Daniels & Associates 32BB&T 30KPMG Corporate Finance 27Goldsmith Agio Helms & Co. 26Raymond James & Associate 24CIBC World Markets 24Robert W. Baird & Co. 23Rothschild 21Stephens 20McDonald Investments 20RBC Capital Markets 18
Our Guiding Principles
Since its beginning in 1895, Piper Jaffray has built its business by committing itself to its clients, people and communities.
We create and implement superior financial solutions for our clients. Serving clients is our fundamental purpose.
We earn our clients’ trust by delivering the best guidance and service.
Great people are our competitive advantage.
As we serve, we are committed to these core values:Always place our clients’ interests first
Conduct ourselves with integrity and treat others with respect
Work in partnership with our clients and each other
Maintain a high-quality environment that attracts, retains and develops the best people
Contribute our talents and resources to serve the communities in which we live and work
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Guides for the Journey
• We are committed to guiding our clients to success.• The best guides are:
– resourceful when the options are few– aggressive in reacting to changing conditions– trustworthy by remaining firmly committed to their clients’
success
• The same traits are inherent in the best investment bankers.
• It is our culture at Piper Jaffray--we will help you become the best guide for our clients’ journeys.
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Broad Product Offering Capabilities
Equity Securities M&A Advisory
High-Yield & Structured Products
Convertible Securities Debt Capital Markets
Corporate & Venture ServicesPrivate Placements Financial Restructuring
More resources dedicated to middle market growth companies on Wall Street:
• Lead manager on top performing IPOs in recent years
• Leading aftermarket trading support
• Largest number of middle market companies under coverage in focus sectors
• 350 companies under coverage with $2 billion or less market cap
Top-ranked middle market M&A advisor:
• Industry-focused M&A teams• Middle market M&A team focused
on industrial and manufacturing services industries
• Deep relationships with financial and strategic investors
• Advised more than 320 M&A transactions worth $45 billion since 2000
Significant experience in various types of convertible offerings including:
• Standard new issue offerings–overnight and marketed transactions
• Placement of private convertible notes or preferred stock offerings
• Refinancing of existing convertibles• Public and private restructuring of
existing convertible debt
Dedicated debt capital markets team:• More than 300 debt financings
raising $115 billion since 2002• Dedicated team of leveraged
finance experts with more than 120 years of collective experience
• Product expertise across entire leveraged capital spectrum and powerful distribution capabilities
• Senior, subordinated and syndicated loan capabilities through CIT Group
Extensive industry expertise and knowledge of the marketplace:
• Discussions with more than 800 institutional investors focused on private companies
• Raised more than $1.6 billion in private placement transactions since 2000
Dedicated corporate and venture services team with more than 70 years combined experience:
• Managed more than 140 distributions and traded more than 421 million shares since 2003
• Average block trade size of $35 million
• Managed over 340 10b5-1 trading plans
• Completed 68 Directed Share Programs with up to 2,000 participants; 31 were lead managed
Brings consultative approach to research and client relationships:
• Focused on securities under stress, bringing liquidity to an illiquid market
• Credit analysis that delivers deep, forward-looking examination of securities
• Value-added research on collateralized debt obligations, aircraft finance, health care and distressed credits
Leading advisor to financially stressed and distressed businesses, creditor constituencies and equity investors:
• Proven experience in Chapter 11, out-of-court workouts, sale of assets, reorganizations, acquisitions and exchange and tender offers
• Accurate company and securities valuations
• Ability to successfully evaluate various situations
• Access to key strategic relationships
• Ranked #1 in number of IPOscompleted in our focus sectors in 2005
• Lead manager on the top performing IPOs in the industry in recent years
• Nominated advisor to leading European growth companies
• Top ranked middle market M&A advisor
• BioPharmaceuticals• Health Care Services• Information-Driven Health Care• Life Sciences Tools/Diagnostics• Medical Technology
• Asset Management• Broker-Dealers• Depository Institutions• Financial Technology & Services• Insurance• Specialty Finance
Financial Institutions
Consumer
Health Care
• Apparel, Footwear & Softline Retail• Consumer Products• Food & Beverage• Restaurants• Specialty & Hardlines Retail • Computer Hardware & Semiconductors
• Enterprise Software• Internet• IT Services• Wireline & Wireless Communications
Technology
• Business Information Services• Facilities Services• Human Resource Services• Industrial Services• Learning Services• Marketing Services• Professional Services
Business Services
• Clean Technology• Distributed Power Generation• Ethanol/Bio-Fuels• Fuel Cells• Solar Power• Wind
Alternative Energy
• Aerospace• Automotive Products• Building Products• Flow & Process Controls• Industrial Distribution• Metal Processing• Packaging• Plastic Processing• Security & Safety• Specialty Chemicals• Specialty Vehicles• Other Manufacturing & Services
Industrial Growth
Unparalleled Industry Expertise
Consumer
Apparel and Apparel Retail
Consumer Products
Food & Beverage
Restaurants
Specialty Retail
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has agreed to acquire
Pending
Initial Public Offering
Pending
$135,000,000
Pending
has been acquired by
August 2006
$78,000,000
has been acquired by
April 2006
$44,845,338
Sole ManagedFollow-On Offering
June 2006
$382,184,810
Follow-On Offering
May 2006
$98,920,060
Follow-On Offering
May 2006
Recapitalization
May 2006
August 2006
BookrunInitial Public Offering
and Follow-On Offering
$468,386,400
February 2006
Initial Public Offering
$174,538,150
Services Acquisition Corp. International
Pending
has agreed to be acquired by
$265,000,000
Alternative Energy
Solar
Wind
Bio-fuels
Hydrogen
Fuel Cells
Advanced Materials
$300,000,000
Bookrun
Initial Public Offering
Pending
$25,775,000
Sole-Managed
Private Placement
May 2006
Solar Thin-Film Supplier
Bookrun
Initial Public Offering
Pending
Solar / Polysilicon
Sole-Managed
Private Placement
Pending
$75,000,000
Bookrun
Initial Public Offering
Pending
$95,737,500
Bookrun
Follow-On Offering
August 2006
$22,099,200
Bookrun
Initial Public Offering
August 2005
$394,450,000
Co-Managed
Follow-On Offering
March 2006
$250,000,000
Co-Managed
Initial Public Offering
Pending
Financial Institutions
• Banks & Investment Banks
• Financial Technologies & Services
• Specialty Finance
• Specialty Insurance
Undisclosed
has been acquired by Meridian Bank, N.A.
a subsidiary of
August 2006
$95,738,000
Follow-On OfferingBookrunning Manager
June 2006
$39,096,000
Follow-On OfferingCo-Lead Manager
June 2006
Patriot Capital Funding, Inc.
$146,625,000
Initial Public Offering
March 2006
$423,720,000
Follow-On OfferingCo-Manager
April 2006
$413,600,000
Follow-On OfferingCo-Manager
March 2006
$100,000,000
Preferred Units Sole Placement Agent
February 2006
$60,000,000
Initial Public OfferingCo-Manager
February 2006
$10,000,000
Reg Direct OfferingSole Placement Agent
February 2006
$115,900,000
Follow-On OfferingCo-Lead Manager
January 2006
$40,000,000
Sr. Unsecured NotesExclusive Placement
Agents
December 2005
$429,275,000
Follow-on OfferingCo-Manager
October 2005
Health Care
BioPharmaceuticals
Health Care Services
Information-Driven Health Care
Medical Technology
Tools & Diagnostics
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$56,400,000
Sole BookrunInitial Public Offering
April 2005
$45,000,000
Lead ManagedConvertible Offering
February 2005
$260,000,000
has been acquired by
July 2005
$167,650,000
Joint BookrunInitial Public Offering
June 2005
$33,975,429
Sole BookrunFollow-On Offering
June 2005
$715,000,000
has acquired
July 2006
$519,000,000
has been acquired by
February 2006
$1,189,400,000
has been acquired by
November 2005
$96,342,973
Follow-onOffering
July 2006
$150,000,000
has been acquired by
August 2005
$50,600,000
Initial Public Offering
March 2006
$104,500,000
Merged with
December 2005
Technology & Communications
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$199,391,400
Convertible & Follow-On Offering
November 2004
$241,500,000
Sole BookrunConvertible &
Follow-On Offering
February 2005
$1,012,000,000
Initial Public Offering
August 2004
$529,000,000
has acquired
July 2004
$109,090,854
Initial Public Offering
August 2005
$310,000,000
has acquired
August 2005
$21,000,000
Sole BookrunInitial Public Offering
August 2005
$141,000,000
has been acquired by
June 2005
$121,000,000
has acquired CRS Retail Systems Inc.
from
December 2005
$25,000,000
Private Placement
February 2006
$25,775,000
PIPE Offering
May 2006
$92,200,000
has been acquired by
June 2006
Computer Hardware & Semiconductors
Wireline & Wireless Communications
Enterprise Software
Internet
IT Services
Industrial Growth
Aerospace
Automotive Products
Building Products
Flow & ProcessControls
Industrial Distribution
Metal Processing
Packaging
Plastic Processing
Security & Safety
Specialty Chemicals
Specialty Vehicles
Other Manufacturing & Services
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a portfolio company of
has been acquired by
July 2006
has acquired
June 2006
has sold
to
May 2006
a portfolio company of
has been acquired by
April 2006
March 2006 November 2005 November 2005January 2006
a portfolio company of
has been acquired by
a division of United Road Services Inc.
has been acquired by has been acquired by
a portfolio company of
has been recapitalized by
with
has been acquired by
a portfolio company of
October 2005 September 2005 September 2005October 2005
a portfolio company of
has been acquired by anaffiliate of
a portfolio company of
has been acquired by
Numatics, Incorporated
has been acquired by
Emerson Electric Company
Business Services
Business Information Services
Facilities Services
Human Resource Services
Industrial Services
Learning Services
Marketing Services
Professional Services
IT Services
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August 2006
INITIAL PUBLIC OFFERING
In Registration
INITIAL PUBLIC OFFERING
In Registration
INITIAL PUBLIC OFFERING
July 2006
FOLLOW-ON OFFERING
March 2006
INITIAL PUBLIC OFFERING
November 2005
INITIAL PUBLIC OFFERING
In Process
PROJECT CHAMPAGNE
Rental Services Provider
PROJECT BRUINS
IT Solutions Provider
In Process
has been acquired by
a portfolio company of
December 2005 September 2005
HAS BEEN ACQUIRED BY
August 2005
HAS BEEN ACQUIRED BY
February 2006
HAS BEEN ACQUIRED BY
A PORTFOLIO COMPANY OF
Private Placements
Serve as agent to raise private equity and/or debt
Typical transaction range–$20 to $50 million
Structure deals, identify investors and manage the process
Quality relationships with venture capital and private equity investors
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$46,500,000
Series A ConvertiblePreferred Stock
November 2004
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$80,000,000
Private PlacementCommon Stock
October 2004
$13,000,000
Series C Convertible Preferred Stock
July 2005
$22,500,000
Series D ConvertiblePreferred Stock
December 2004
$25,000,000
Series A Convertible Preferred Stock
July 2006
$45,200,000
Series C ConvertiblePreferred Stock
July 2006
$21,500,000
Series A ConvertiblePreferred Stock
June 2006
$112,500,000
Preferred Equity
February 2006
$24,476,000
Series G Convertible Preferred Stock
February 2006
$12,000,000
Private Placement Common Stock
December 2005
$32,500,000
Series B ConvertiblePreferred Stock
November 2005
$18,000,000
Series C ConvertiblePreferred Stock
August 2005
Restructuring
Convertible Securities• Overnight and marketed transactions (typically
under Rule 144A)• $75 million - $1 billion+ in aggregate amount raised• Piper Team originated numerous Issuer-friendly
innovations– Auto-Conversion – Plus Cash®– Laddered Equity Hedge
• Typical market capitalization of issuer– Over $300 million
• Private convertible note or preferred stock offerings
• $15 - $75 million in aggregate amount raised• Typical market capitalization of issuer
– $50 - $300 million
• Registered exchange offers• Funded exchange offers• Private exchange offers• Private stock-for-bond swaps• Cash repurchases • Early conversions• Consent solicitations
Standard new issue
Private Placement of convertibles
Refinancing of existing convertibles
Offering Memorandum
$30,000,000
5.50% Senior Convertible Notesdue 2026 plus Warrants
Price 100%
We acted as sole placement agentof this private offering.
May 18, 2006
Prospectus
$199,324,000 Old Notes Exchanged$60,000,000 New Money
Offer to Exchange all 3.75%Convertible Subordinated Notes due 2007
for 6.52% Convertible SeniorSubordinated Notes due 2009
We acted as dealer-manager andplacement agent of this public offering.
December 31, 2002
Prospectus
$60,000,000 Old Notes Exchanged$12,000,000 New Money
Offer to Exchange all 6.50%Convertible Senior Notes due 2012
for 6.5% Convertible SNAPsSM due 2012
We acted as dealer-manager andplacement agent of this public offering.
February 8, 2006
Offering Memorandum
$75,000,000
10% Senior Secured Bridge Notes due 2005Mandatorily Exchangeable into
6% Senior Secured Convertible Notes Due 2009
We acted as sole placement agentof this private offering.
October 18, 2004
Offering Memorandum
$600,000,000
1.25% Convertible SubordinatedPlus Cash Notes(R) due 2008
Price 100%
We acted as book manager and structuringagent of this offering under SEC Rule 144A.
May 29, 2003
Prospectus
$373,750,000
3.25% Convertible Senior Subordinated Notes
Due 2026
We acted as lead managerof this registered offering.
June 21, 2006
Debt Capital Markets$805,000,000 $115,157,000
Private PlacementSole Placement Agent
Piper Jaffray
6.12% Senior Notes due 2015
Non-rated 144A
Repackaged EETCGrantor Trust
$190,000,000
Senior Unsecured Notes
10.00% Notes Due 2013
$560,000,000
Institutional Syndication
UAL00-1A1 / A2 Call
P-JETSSeries 2005-1
$40,000,000
Senior Secured Credit
Facilities & SubordinatedBridge Financing
7.625% Notes due 2013
$500,000,000
8.500% Notes due 2016
$200,000,000
6.650% Notes due 20366.500% Notes due 2018
$195,000,000
7.500% Notes due 2016
$300,000,000
8.125% Notes due 2016
$225,000,000
11.500% Notes due 2014
$270,000,000
7.875% Notes due 2015
$300,000,000
Transaction Types
Acquisition Capital
Recapitalizations
Growth Capital
Product Suite
Senior Credit Facilities
Second Lien Term Debt
Bridge Financing
Structured Financing
Mezzanine Debt
Senior & Subordinated Notes
Strategic Office Locations
Piper Jaffray has offices that are strategically located. Our headquarters are in Minneapolis, with investment banking and research offices in San Francisco, Palo Alto, Chicago, New York, London and strategic alliances in Madrid and Shanghai.
Chicago
Minneapolis
Palo AltoNew York
London
Shanghai
San Francisco
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Madrid
A Career in Investment Banking
Why is Piper Jaffray Unique?
Piper Jaffray has a unique culture
• A high-energy environment generates enthusiasm among our professionals
• Supportive executive team that respects the balance between professional and personal growth
• Exceptional staff from the top undergraduate and graduate institutions in the country
• Significant interaction with senior management of clients who value our expertise
• Opportunity to work closely with senior bankers• Superior career visibility in meritocracy-based culture
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Our Recruiting Philosophy
• We hire the best people and empower them to use their skills, innovation and creativity to find solutions for our clients.
• We seek people from diverse backgrounds who are highly motivated, dedicated and productive.
• We promote open exchange of ideas and a team-oriented approach.
• We invest heavily in our people because they are our greatest resource.
Andrew DuffChairman and CEO, Piper Jaffray
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A Day in the Life
Industry Team:Consumer
Location:Minneapolis
Education:B.S., California Polytechnic University
LauraInvestment Banking Analyst
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A Day in the Life
Investment Banking Analyst8:15 Arrive at work; check e-mail and voice mail8:30 Grab coffee with Consumer Group analysts8:30 Browse headlines from the Wall Street Journal, Capital Markets
Updates and industry specific publications such as Women’s Wear Daily
9:00 Draft Confidential Information Memorandum (CIM) for a sell-side M&A assignment for a grocery co-op corporation. Involves:
– Industry research on size of grocery market, including competition and local demographics
– Requesting, organizing and synthesizing due diligence information11:00 Participate in drafting call for Initial Public Offering (IPO) for action
sports apparel manufacturer. Involves:– Review of growth opportunities, key business strengths and company financials– Industry research on action sports market– Planning a trip to southern California to meet with company management and
tour headquarters (including on-site skate park) 26
A Day in the Life
Investment Banking Analyst
12:00 Lunch with Consumer Group analysts12:30 Develop management presentation for lead-managed
IPO for golf specialty retailer. Involves:– Research on golf industry– Review of historical and projected financials– Setting up a call with management to discuss presentation– Planning a trip with company management and bankers for IPO roadshow
3:30 Begin pitch for toy manufacturer. Involves:– Creating buyer profiles– Valuation analysis: comparable company analysis, comparable M&A
transactions, discounted cash flow analysis, leveraged buyout analysis– Work with Capital Markets to develop update on equity market conditions
5:30 Grab dinner with Consumer Group analysts6:00 Review draft of pitch with associate
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A Day in the Life
Investment Banking Analyst
7:30 Head to gym for quick workout8:30 Review pitch and courier book to senior banker’s
home10:00 Review CIM, e-mail to company and set up drafting call11:00 Head home
“P.S. No day is typical in investment banking—that’s what makes it exciting. You may be working on equity financings, buy- or sell-side M&A assignments or debt financings. Think on your feet because you may have to travel across country at a moment’s notice.”
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2006/2007 Recruiting Plan
Hiring Plan
• Investment Banking—30 Analysts for 2007• All industry groups and functional areas in most office locations
Process/Schedule
• Resume deadline—September 29• Interview invitation extended—week of October 2nd• First round interviews—in Boston, October 12th and 13th
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Career Opportunities at Piper Jaffray
Visit our Web site to learn more about career opportunities at Piper Jaffray:
www.piperjaffray.com/careers
Investment Banking recruiting contact:
• Megan McManus: 612 [email protected]
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