a unique middle market investment bank that delivers

A Unique Middle Market

Investment Bankthat Delivers Exceptional

Results

Seasoned, Systematic, SuccessfulSM


For the latest, most detailed information on FOCUS, please visit our Website:

www.focusenterprises.com

• Summaries of publicly announced transactions• List of currently active sectors• Detailed biographies of our professional staff • Office locations and contact information• Archives of the monthly newsletter and other useful documents• Easy online subscription to free monthly newsletter • Form for submitting online inquiries

FOCUS Enterprises, Inc., founded in 1982 in Washington, DC, provides arange of investment bank services tailored to the needs of middle market businesses andtheir executives. Today we are a national firm serving clients from offices in major citiesacross the United States. We specialize in serving businesses with revenue or transactionsizes between $5 million and $300 million, serving entrepreneurs, corporate owners, andvarious types of investors. FOCUS clients include large corporations and private equityfirms who engage FOCUS for transactions in our size range.

We have achieved a very high close rate on accepted buy side, sell side, and corporatefinance mandates because of the unique resources, process, and perspective that we bring tomiddle market investment banking. FOCUS has developed a systematic, open, and proventransaction process. It is the driving force of our firm and distinguishes us from otherinvestment banks serving the middle market.

With extensive investment banking transaction experience and a group of seasonedoperating and financial executives, our firm provides a unique value proposition. We bring astrong operating perspective, a wealth of practical experience, and a unique research andtransaction process to our middle market clients. Our deep and unique resources includeseasoned Partners and Principals, our research staff, our internal database of national andinternational contacts, and operating and deal experience in a range of industry sectors.

This brochure provides an overview of the firm, our distinctive approach, our range ofservices, and a summary of sectors where we are active. But it is nothing more than anintroduction. We encourage you to visit our website at www.focusenterprises.com foradditional details, the latest information on recent transactions, biographies of ourprofessional staff, an archive of newsletter articles, and a handy online form for subscribingto our monthly e-mail newsletter.

Of course, there is no substitute for a face-to-face conversation. Please call to set up ameeting if you would like to learn more. We encourage prospective clients to get to know uswell in advance of any potential assignment.


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FOCUS: A Unique Middle Market Investment Bankthat Delivers Exceptional Results

For over 24 years, FOCUS has specialized in serving business with revenue or transaction sizesbetween $5 million and $300 million. We understand the qualitative differences between a $10million transaction and a $300 million transaction, though the financial mechanics may be similar.

FOCUS provides a unique mix of investment banking and related services tailored to middle marketcompanies. Our service offerings have been tailored to the strategic and operational needs of ourclients, not to the retail brokerage or securities underwriting markets.

We are highly attuned to successful transaction completion. In fact, we won’t accept an assignmentthat we believe has less than a 75 percent probability of success. Our financial success is dependentupon successful transaction completion, not on document preparation, “listing fees”, or large upfrontretainer fees.

All FOCUS Partners are seasoned operating executives and/or deal makers. As you review thebiographies of our staff, you will find former CEOs, COOs, CFOs, and veteran middle marketinvestment banking executives. Most have completed dozens of deals before they joined our firm.

Our substantial operating experience gives us deep insights into management issues, strategicplanning considerations for acquisitions, divestitures, strategic partnering, capital raising, and post-transaction integration matters. Negotiating the transaction and completing the paperwork is onlythe beginning of a successful transaction. The firm also has been responsible for post-closingexecution and integration.

FOCUS is highly attuned to the critical needs and business realities of middle market operatingexecutives, corporate owners, strategic investors, and institutional financial investors. Our Partnershave been in those roles. Our experience is much broader than that of the typical investmentbanking professional.

Advisors, investment bankers, and other intermediaries with only a financial engineeringbackground cannot serve middle market clients nearly as well as FOCUS. In today’s selective M&Aenvironment, an effective intermediary needs our kind of experience to advise clients effectively.



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FOCUS Has a Proven,Structured, and Open Process

for Transaction ExecutionFOCUS provides time-efficient and cost-effective services, based on a proven, disciplined processsupported by ample internal resources. This transparent and well-documented process providesunique visibility and accountability in the transaction process. Often cited by clients as a uniquestrength of our firm, our transaction process will expedite the closing of the transaction andcontribute to your overall corporate success.

FOCUS clients experience a transaction process that is highly structured, disciplined, well-documented, and proven by over two decades of successful deal execution. This process leverages ourresearch, our operating experience, and two decades of experience in our market segment –businesses with revenue or transaction sizes between $5 million and $300 million. For example, weprovide weekly written reports of company-by-company contact activity in the contact phase ofevery engagement.

FOCUS has honed a research methodology that is especially effective in identifying smaller, privately-owned firms. Anyone who has attempted to identify smaller firms through commercial databasesknows the limitations of those sources – coverage of less than 50 percent, incomplete information,outdated information, and heavy dependency on information supplied voluntarily by the companies.While we employ such databases in our work, we also employ a wide range of additional sources,supplemented by our internal proprietary database of over 15,000 industry contacts.

FOCUS target lists generally include 100 to 150 target companies. We believe that in order togenerate three to five viable, interested, and qualified candidates, the process must start with a largetarget universe. In our target universe we include all firms that match the client’s specification, notjust those that are currently on the market. Our experience over the past two decades indicates thatmany of the best transaction candidates have not yet formally entered the marketplace. We want toengage such firms in a dialog on behalf of our clients well before the competition arrives.

FOCUS clients are served exclusively by our Partners and Principals. We simply don’t have juniorlevel associates in our firm. Once the target list and related materials are complete, our Partners andPrincipals will handle all target contacts – including every phone call, meeting, e-mail, or otherinteraction.

FOCUS Partners deal with target-company CEOs on a peer-to-peer basis. That’s because many ofus have been CEOs ourselves. Our clients benefit from this personal touch, based on over a centuryof C-level operating experience. We are able to establish a rapport quickly and productively,benefiting our clients.

FOCUS Transaction Execution: How It Works

FOCUS investment banking clients experience a proven transaction execution process that is highly-structured, disciplined, and well-documented, and is specifically tuned to the

special needs of your market. Most importantly, it is completed in a timely fashion.

Precise planning of the project is the first step where project mileposts are specified resulting indetailed deliverables from FOCUS as well as from the client. Next a research plan is developed by the FOCUS Partner, the firm’s research department, and the client.

If the project is a sell-side engagement, a buy-side assignment, or a partnering assignment,FOCUS research analysts identify a target listing of potential buyers, sellers, or partners. Ourflexible, responsive investment banking team works closely with clients to understand the projectcontext, and then develops a scope of work document defining the parameters, including schedulingand cost estimates. Deliverables typically include a written report, including documentation asappropriate, and an executive presentation.

If the assignment is to source debt or equity investment capital, FOCUS research analysts develop a target list of potential investors who may have a strategic or financial interest in investing in theclient company. The research process is usually complete within three weeks from the start when a published, bound research report is delivered.

Concurrent with research completion, a Confidential Information Memorandum is completed. This“book” is developed with management using precise guidelines developed by FOCUS. This sellingdocument is usually complete when the research for the project is complete.

FOCUS Partners then contact companies and/or investment firms on the research target list. Oncewe begin contacting target companies, we supply weekly written reports of company-by-companycontact activity. A FOCUS Partner is always in charge of client contact and appointments with theclient company are arranged on a very confidential basis. Management presentations are made andpreliminary due diligence is completed with the entire process managed by a FOCUS Partner.

Letters of Intent, draft partnership agreements, or investment “term sheets” usually are submitted tothe client company within four months from the project start, with closing of the arrangement ortransaction occurring 30-60 days later. With every step, FOCUS works closely with managementand keeps investors and the Board regularly informed.


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FOCUS ServicesOver the past two decades, FOCUS has consistently served the needs of smaller

and middle-market businesses with a range of services carefully attuned to their needs.

Merger, Acquisition and DivestitureOur industry expertise, research capabilities,and highly developed network of national and international contacts provide a solid base for initiating transactions, as well as foridentifying and evaluating potential sellers,buyers, and partners.

FOCUS Partners are experienced in all phases of the process and can provide servicesincluding market analysis, financial analysis,capitalization structure, due diligence,memorandum preparation, structuring oftransactions, negotiating, and closing financialterms tailored to the clients need and capitalmarket demands.

FOCUS Partners help clients restructure their businesses and assist clients in developingrealistic corporate development, acquisition,merger, or divestiture plans. Since theseactivities are strategic and have long-lastingconsequences, it is critical that the initialanalysis conducted by the firm be objectiveand thorough.

When representing potential acquirers, thefirm provides assistance in the initial strategicplanning stages by helping the client identifythe best targets and options. We assist clientsin evaluating their alternative strategiesincluding internal growth, merger, acquisition,and/or strategic partnering. FOCUS Partnersput their contact network to work on theclient’s behalf, quietly and discreetly, in orderto preserve confidential relationships andreputations.

When representing sellers, the firm assists itsclients in operating from a position of strength.By working closely with the client’s seniormanagement team, we assist in developing a business plan and a forecast that provides an optimal valuation. FOCUS Partners willdiscreetly contact only selected qualified buyers in order to maximize price, improve terms, andquickly complete the transaction.

If the transaction requires additional capital,FOCUS can access our extensive network ofequity and debt sources. Because our Partners are all highly experienced, “hands-on” operatingveterans, we also can assist with the post-acquisition integration process.

Corporate Finance:Debt and Equity FinancingAs one of our primary financing activities,the firm seeks to match the requirements of our clients to those of capital sources. Ourcontacts cover the full spectrum of debt andequity capital sources. On the debt side, theyinclude asset-based lenders, SBIC’s, commercialbanks, specialty finance firms, mezzanine/subordinated debt providers, and BDC/RIC’s.On the equity side, they include venture capitalfunds, corporate strategic investors, private equity funds emphasizing LBO’s and MBO’s,and integrated fund families investing a mix of equity and debt products across multiple stages of a firm’s evolution.



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FOCUS Partners are active in each step of the financing process beginning with a review of the corporate business plan. The firm acts as anintermediary between the capital source and theclient company. We advise on deal terms, assistwith negotiations, and work with legal counsel on the transaction closing. Client presentationsare prepared and rehearsed after which theappropriate capital sources are identified andcontacted. FOCUS contacts each potentialinvestor on the client’s behalf and assists withinvestor presentations, the “term sheet”negotiations, and in closing the transaction.

Strategic Advisory ServicesQuite often our firm is called upon to adviseclients on their strategic growth options.Since all FOCUS Partners have been operatingexecutives prior to joining the firm, we are ideallysuited to work with CEOs and full managementteams to assist them with looking at all of thecorporate development options and alternativesand to make specific recommendations tomanagement and the Board about therecommended options.

FOCUS will review all strategic plans, operatingplans, and near and long term financial forecasts.We will analyze the client’s balance sheet,operating statements, and all market trends before advising our client on a growth course.

As a result of this strategic study, FOCUS can identify and analyze a variety of strategicalternatives such as divestitures, capitalformation, and mergers and acquisitions. Optionstypically include sourcing of equity or debtcapital to restructure the balance sheet, seekingselected “tuck in” acquisitions to complement

organic growth, or divesting of a division or abusiness unit that is not longer strategic to theclient’s core business.

Once a strategic course is set, FOCUS willidentify and analyze a range of appropriatefinancing alternatives that support corporategrowth objectives and enhance shareholdervalue. FOCUS also advises on terms andstructure of private placements, subordinateddebentures, notes, convertible preferred stock,common stock, and partnership interests aswell as debt placements and refinancing forgrowth initiatives and strategic transactions.

Once our corporate development recommend-ations are reviewed and approved by our client, FOCUS will execute on the plan bycompleting the necessary investment bankingengagements to meet all objectives and toinsure smooth implementation.

Strategic Partnering and AlliancesOur strategic partnering services supply our clients with other companies that haveproducts and/or technologies that can benefitfrom additional sales channels, marketingskills, engineering expertise, manufacturingcapacity, or investment. A strategic partneringarrangement can take the form of a licenseagreement, a joint venture, a sale and serviceagreement, a contract manufacturingagreement, or an equity/debt investment.

FOCUS Partners are action-oriented in their assignments. A typical scenario usuallyinvolves an emerging growth company thathas a technology or product line, which is under-leveraged and can benefit from


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a relationship with a larger organization. Thelarger company can provide a distributionchannel, manufacturing capacity, developmentfunding to customize the technology orproduct to its market segment, and investmentcapital. The smaller company offers the largercompany a focused “quick time-to-market”and customizing capability that often does not exist in a larger company.

While the above scenario makes clear sense,often each organization lacks the available staff to concentrate on the potential of such a partnering arrangement. FOCUS Partnerspossess the skills to engineer such transactionsand are ideally suited to negotiate and close a deal to the benefit of both organizations.

Corporate ValuationsMany business owners ask, “What is mycompany worth?” Before committing to a sale, merger, or an investment, owners want to establish a reasonable range of corporatevaluation. We suggest our “ValuationSnapshot” as a cost-effective answer to thequestion. Rather than generate a large boilerplate document containing mostly quantitativefinancial analysis, we analyze two sets of veryspecific financial metrics.

First, we look at public company comparablesof same or similar companies. Second, we look at comparable documented financialtransactions for both public and privatecompanies to establish a reasonable range of valuation. Finally, we apply the firm’s

subjective judgments to these two sets of analysis, adjusting for the particulars of our client company operations, markets, andoperating history.

We share all the data we draw upon, as well as our assumptions and adjustments, in a simple spreadsheet form, accompanied by simpleexplanatory text. The entire document is aboutten pages long and is a low cost yet very effectiveway of establishing a range of corporate value.

Corporate Development ConsultingFOCUS Partners provide a wide range ofconsulting services that are intended to assistoperating management with preparing for an investment banking transaction. Our firm’sunique operational orientation prepares ourPartners and Principals to complete strategicplanning, business planning, financial planning,market sizing and analysis, and competitionstudies for our client companies.

In many cases, FOCUS is called upon to conduct a corporate “audit” in preparation for a transaction. In these cases, a FOCUS team is dispatched to the client company to analyzeeach functional area of the organization resultingmany times in very specific corrective actionrecommendations to client management.

Once recommendations have been implemented or corrective action is underway, our firm isideally positioned to assist the client companywith its investment banking needs.



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FOCUS Partners are Experts in a Variety of Business Areas

We have executed dozens of transactions in a range of market segments, but the same fundamentalsapply across all of them. Our on-going transaction process provides us with up-to-the-minutemarket knowledge in these sectors that may be of corporate development interest to you. Operatingnationally and internationally, FOCUS is currently working with buy- and sell-side corporateclients, private equity groups, holding companies, and early stage venture capital firms in thefollowing areas:

AerospaceAutomotiveBuilding Products Business Process Outsourcing Business ServicesCall Center Construction DistributionEducation and e-LearningEnergy, Oil, and Gas Food and Beverage Government Contracting Healthcare Information Services and Databases Information Technology: Hardware Information Technology: Services Information Technology: Software International

Leisure Manufacturing Media and PublishingMedical Devices and Equipment Medical DiagnosticsMetals and Mining Payment Systems Professional Services Retail RFID Technology Satellite Communications Security Systems and ServicesSports Supply Chain Management Systems Integration Technology Telecomm and WirelessTransportation


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For the latest, most detailed information on FOCUS, please visit our Website:


• Summaries of publicly announced transactions• List of currently active sectors• Detailed biographies of our professional staff • Office locations and contact information• Archives of the monthly newsletter and other useful documents• Easy online subscription to free monthly newsletter • Form for submitting online inquiries

Atlanta • Chicago • San Francisco • Washington, DC

1150 Connecticut Avenue NWSuite 515Washington, DC 20036

202-785-9404202-785-9413 fax www.focusenterprises.com

a unique middle market investment bank that delivers

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