i ntroduction to b rentwood c apital a dvisors d ecember 3, 2003

INTRODUCTION TO BRENTWOOD CAPITAL ADVISORS

DECEMBER 3, 2003

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• Partner-owned and NASD-licensed investment bank founded in 1999Partner-owned and NASD-licensed investment bank founded in 1999• Private placement and financial advisory assignmentsPrivate placement and financial advisory assignments

OVERVIEW OF BRENTWOOD CAPITAL ADVISORSBCA FBCA FOCUSOCUS

• Focused transaction ranges: $10 million to $100 millionFocused transaction ranges: $10 million to $100 million• Represent proven business models and management teamsRepresent proven business models and management teams

• Early to Late-Stage EquityEarly to Late-Stage Equity

• Subordinated DebtSubordinated Debt

• Senior DebtSenior Debt

• Sell/Buy-side M&A ServicesSell/Buy-side M&A Services

• Fairness OpinionsFairness Opinions

• Leveraged BuyoutsLeveraged Buyouts

• Leveraged BuildupsLeveraged Buildups

• RecapitalizationsRecapitalizations

PPRIVATERIVATE P PLACEMENTSLACEMENTS FFINANCIALINANCIAL A ADVISORYDVISORY

• Background on BCA professionals:Background on BCA professionals:- Over $6 billion in completed financing and advisory assignmentsOver $6 billion in completed financing and advisory assignments

- Over 80 years of combined industry experience with leading regional Over 80 years of combined industry experience with leading regional investment banks and law firmsinvestment banks and law firms

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• Head of Private Capital Group, Head of Private Capital Group, SunTrust Equitable SecuritiesSunTrust Equitable Securities• Co-Head – Capital Markets Group / Senior Vice President, Co-Head – Capital Markets Group / Senior Vice President, Wachovia CorporationWachovia Corporation

• Co-Head – Corporate Finance Group, Co-Head – Corporate Finance Group, J.C. Bradford & Co.J.C. Bradford & Co.

• Associate – Investment Banking Group, Associate – Investment Banking Group, SunTrust Equitable SecuritiesSunTrust Equitable Securities

• Analyst – Investment Banking Group, Analyst – Investment Banking Group, Robert W. Baird & CompanyRobert W. Baird & Company

• Vice President – Merchant Banking, Vice President – Merchant Banking, Nelson Capital CorporationNelson Capital Corporation

OVERVIEW OF BRENTWOOD CAPITAL ADVISORSBCA PBCA PROFESSIONALSROFESSIONALS

Kevin Murphy – Managing Partner Kevin Murphy – Managing Partner ((19 Years of Industry Experience19 Years of Industry Experience):):

Tom Wylly – Senior Partner Tom Wylly – Senior Partner ((26 Years of Industry Experience26 Years of Industry Experience):):

Nick Carteaux – Vice President Nick Carteaux – Vice President ((Eight Years of Industry ExperienceEight Years of Industry Experience):):

Jack Harrington – Vice President Jack Harrington – Vice President ((Eight Years of Industry ExperienceEight Years of Industry Experience):):

Jonathan Smith – Associate Jonathan Smith – Associate ((Three Years of Industry ExperienceThree Years of Industry Experience):):

• BCA Professionals and Experience:BCA Professionals and Experience:

• Managing Director and Head of Nashville Office, Managing Director and Head of Nashville Office, McDonald Investments, Inc.McDonald Investments, Inc.• Managing Director and Co-Head of M&A, Managing Director and Co-Head of M&A, J.C. Bradford & Co.J.C. Bradford & Co.• Partner, Partner, Bass Berry & Sims (Nashville Law Firm)Bass Berry & Sims (Nashville Law Firm)

Gentry Barden – Partner Gentry Barden – Partner ((17 Years of Industry Experience17 Years of Industry Experience):):

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OVERVIEW OF BRENTWOOD CAPITAL ADVISORSBCA DBCA DELIVERS:ELIVERS:

PPRIVATERIVATEEEQUITYQUITY

SSUBORDINATEDUBORDINATEDDDEBTEBT

SSENIORENIORDDEBTEBT

FFINANCIALINANCIALAADVISORYDVISORY

BCA’BCA’S S TTRANSACTIONRANSACTION EEXPERTISEXPERTISE• Optimal capital structuresOptimal capital structures

• Relationships with leading capital Relationships with leading capital sources sources

• Extensive transaction track recordExtensive transaction track record

• Deep market and segment expertiseDeep market and segment expertise

• Objective adviceObjective advice

• Proper market positioningProper market positioning

• Highly competitive processesHighly competitive processes

• Creative persistence in closing Creative persistence in closing transactionstransactions

““Credibility . . . Proven Track Record”Credibility . . . Proven Track Record”

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OVERVIEW OF BRENTWOOD CAPITAL ADVISORSSSELECTEDELECTED R RECENTECENT T TRANSACTIONS – RANSACTIONS – PPRIVATE RIVATE PPLACEMENTSLACEMENTS

• Leading dental practice Leading dental practice management company management company

offering a offering a full range of full range of general and specialty general and specialty dental dental servicesservices

• Operates dental and Operates dental and orthodontic orthodontic practices practices within Sears Dental and within Sears Dental and

DentalWorks locationsDentalWorks locations

• Raised Raised $22.5 million$22.5 million in a in a combination of combination of Senior and Senior and Subordinated DebtSubordinated Debt financing financing

Senior / Subordinated Debt FinancingSenior / Subordinated Debt Financing

DentalCare Partners, Inc. DentalCare Partners, Inc.

• Leading operator of surgery Leading operator of surgery centers centers providing providing surgical procedures surgical procedures across across many specialtiesmany specialties

• Raised Raised $40 million$40 million in in Subordinated Subordinated DebtDebt from DLJ from DLJ Investment Investment Partners and Partners and existing investorsexisting investors

• Proceeds provided capital Proceeds provided capital for for growth and growth and acquisitionsacquisitions

Growth FinancingGrowth Financing

Symbion, Inc. Symbion, Inc.

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Senior Debt Financing Senior Debt Financing

Prime Office Products, Inc. Prime Office Products, Inc.

Growth EquityGrowth Equity

Psychiatric Solutions, Inc. Psychiatric Solutions, Inc.

• Leading nationwide network Leading nationwide network of of office distributors for office distributors for small and small and medium-sized medium-sized commercial commercial businessesbusinesses

• Raised Raised $17 million in Senior $17 million in Senior DebtDebt from PNC Business from PNC Business Credit: Credit: (i) $15 million (i) $15 million revolver; and revolver; and (ii) $2 (ii) $2 million secured term loanmillion secured term loan

• Proceeds refinanced existing Proceeds refinanced existing credit credit facility and provided facility and provided capital forcapital for growth and growth and acquisitionsacquisitions

• Leading provider of Leading provider of behavioral behavioral healthcare healthcare servicesservices

• Raised Raised $25 million PIPE$25 million PIPE financing financing from Oak from Oak Investment Partners, Investment Partners, Salix Salix Ventures and Brown Brothers Ventures and Brown Brothers

HarrimanHarriman

• Raised Raised $20 million of $20 million of Subordinated Subordinated DebtDebt from from Brown Brothers Brown Brothers Harriman’s 1818 Mezzanine Harriman’s 1818 Mezzanine FundFund

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• Develops, acquires and Develops, acquires and manages manages specialty specialty surgical hospitals surgical hospitals through physician partnershipsthrough physician partnerships

• Experienced management Experienced management team team consisting of former consisting of former executives executives and co-and co-founders of OrthoLink founders of OrthoLink Physician’s CorporationPhysician’s Corporation

• Raised Raised $15.6 million in $15.6 million in Preferred Preferred EquityEquity from from Wachovia Capital Wachovia Capital Partners and Noro-Moseley Partners and Noro-Moseley

PartnersPartners

Growth EquityGrowth Equity

Surgical Alliance Corporation Surgical Alliance Corporation

• Leading provider of geriatric Leading provider of geriatric healthcare serviceshealthcare services

• Raised Raised $12 million in Senior $12 million in Senior DebtDebt from Healthcare from Healthcare Business Credit Business Credit Corporation to fund future Corporation to fund future working working capital needscapital needs

• Sponsored by Bruckmann, Sponsored by Bruckmann, Rosser Rosser & Sherrill, a $770 & Sherrill, a $770 million, New million, New York-based York-based private equity fundprivate equity fund

Senior DebtSenior Debt

HealthEssentials Solutions, Inc. HealthEssentials Solutions, Inc.

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OVERVIEW OF BRENTWOOD CAPITAL ADVISORSSSELECTEDELECTED R RECENTECENT T TRANSACTIONS – RANSACTIONS – PPRIVATE RIVATE PPLACEMENTS / LACEMENTS / FFINANCIAL INANCIAL AADVISORYDVISORY

• Leading provider of “at-risk” Leading provider of “at-risk” youth youth servicesservices

• Going private transaction of Going private transaction of Children’s Comprehensive Children’s Comprehensive

ServicesServices

• Provided merger and Provided merger and acquisition acquisition advisory advisory services regarding the services regarding the purchase of Children’s purchase of Children’s Comprehensive ServicesComprehensive Services

• Raised Raised $10 million of $10 million of Preferred Preferred EquityEquity from from Harbert Corporation Harbert Corporation and and Red River CapitalRed River Capital

Change of Control EquityChange of Control Equity

KEYS Group Holdings LLC KEYS Group Holdings LLC

Century Foods International, Inc. * Century Foods International, Inc. *

* Transactions managed by BCA professionals while at predecessor firms.* Transactions managed by BCA professionals while at predecessor firms.

• Privately held nutritional Privately held nutritional supplement contract supplement contract

manufacturer headquartered in manufacturer headquartered in WisconsinWisconsin

• Served as exclusive financial Served as exclusive financial advisor to the company - advisor to the company - performed extensive auction performed extensive auction processprocess

• $115 million$115 million transaction transaction

• Strategic SaleStrategic Sale to Hormel to Hormel FoodsFoods

Strategic SaleStrategic Sale

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OVERVIEW OF BRENTWOOD CAPITAL ADVISORSSSELECTEDELECTED R RECENTECENT T TRANSACTIONS – RANSACTIONS – FFINANCIAL INANCIAL AADVISORYDVISORY

• Leading provider of Leading provider of behavioral behavioral healthcare healthcare services through services through freestanding psychiatric freestanding psychiatric hospitalshospitals

• Provided Provided Fairness OpinionFairness Opinion for PIPE for PIPE transaction transaction (valuation of PSYS (valuation of PSYS equity equity securities)securities)

Fairness OpinionFairness Opinion


• Leading provider of Leading provider of behavioral behavioral healthcare healthcare services through services through freestanding psychiatric freestanding psychiatric hospitalshospitals

• Provided Provided Fairness OpinionFairness Opinion for for PMR transaction PMR transaction (valuation of (valuation of transaction transaction and PSYS common and PSYS common shareholder consideration)shareholder consideration)



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OVERVIEW OF BRENTWOOD CAPITAL ADVISORSSSELECTEDELECTED R RECENTECENT T TRANSACTIONS – RANSACTIONS – FFINANCIAL INANCIAL AADVISORYDVISORY

* Transactions managed by BCA professionals while at predecessor firms.* Transactions managed by BCA professionals while at predecessor firms.

• Leading provider of “at-risk” Leading provider of “at-risk” youth youth servicesservices

• Served as exclusive financial Served as exclusive financial advisor to the company in advisor to the company in

response response to unsolicited to unsolicited offer offer


• Strategic SaleStrategic Sale to KEYS to KEYS Group Group Holdings LLCHoldings LLC

Strategic Sale / Fairness OpinionStrategic Sale / Fairness Opinion

Children’s Comprehensive Services * Children’s Comprehensive Services *

• Leading provider of medical Leading provider of medical eligibility transaction eligibility transaction

servicesservices

• Advised Board of Directors Advised Board of Directors on sale on sale of healthcare of healthcare information services information services company to Crescent Capital company to Crescent Capital

InvestmentsInvestments


• Provided a Provided a Fairness OpinionFairness Opinion in in connection with the connection with the transactiontransaction


The Potomac Group, Inc. / MedifaxEDI * The Potomac Group, Inc. / MedifaxEDI *

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OVERVIEW OF BRENTWOOD CAPITAL ADVISORSRRECENTLYECENTLY C COMPLETEDOMPLETED T TRANSACTIONS AND RANSACTIONS AND CCURRENT URRENT EENGAGEMENTSNGAGEMENTS

February 2003February 2003PIPE FinancingPIPE Financing

$25,000,000$25,000,000

PsychiatricSolutions, Inc.

July 2003July 2003Subordinated DebtSubordinated Debt

$40,000,000$40,000,000

Symbion, Inc.

September 2002September 2002Private EquityPrivate Equity

$15,600,000$15,600,000

Surgical AllianceCorporation

April 2002April 2002Fairness OpinionFairness Opinion

UndisclosedUndisclosed


July 2002July 2002Subordinated DebtSubordinated Debt

$20,000,000$20,000,000


May 2002May 2002Senior DebtSenior Debt

$12,000,000$12,000,000

HealthEssentialsSolutions, Inc.

January 2002January 2002Private EquityPrivate Equity

$10,000,000$10,000,000

KEYS GroupHoldings, LLC

• Since January 1, 2002, BCA has completed:Since January 1, 2002, BCA has completed:

• Eight financing transactionsEight financing transactions, raising, raising $162.1 $162.1 million million for its clients, or approximately for its clients, or approximately $20.0 million per $20.0 million per transaction; andtransaction; and

• Two financial advisoryTwo financial advisory assignments assignments

• Active engagementsActive engagements ($345.0 million in ($345.0 million in transaction value):transaction value):

- Distribution Company:Distribution Company:- $270.0 Million (Senior Debt and $270.0 Million (Senior Debt and Subordinated Debt)Subordinated Debt)

- Tax Software Provider:Tax Software Provider:- $75.0 Million (Senior Debt, Subordinated $75.0 Million (Senior Debt, Subordinated Debt and Equity)Debt and Equity)

- Behavioral Health Residential Treatment Behavioral Health Residential Treatment Center:Center:

- Undisclosed (Sell-side Advisory)Undisclosed (Sell-side Advisory)

- Medical/Surgical and Psychiatric Hospital:Medical/Surgical and Psychiatric Hospital:- Undisclosed (Sell-side Advisory)Undisclosed (Sell-side Advisory)

May 2003May 2003Senior DebtSenior Debt

$17,000,000$17,000,000

Prime OfficeProducts

September 2003September 2003Subordinated DebtSubordinated Debt

$22,500,000$22,500,000

DentalCarePartners, Inc.

Senior andSenior and

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OVERVIEW OF BRENTWOOD CAPITAL ADVISORSTTHEHE C COMPANYOMPANY W WEE K KEEPEEP

MMEDIAEDIA / C / COMMUNICATIONSOMMUNICATIONS

HHEALTHCAREEALTHCARE S SERVICESERVICES

BBUSINESSUSINESS S SERVICESERVICES / / OOUTSOURCINGUTSOURCING

CCONSUMERONSUMER / R / RETAILETAIL

DDISTRIBUTIONISTRIBUTION / L / LOGISTICSOGISTICS

EEDUCATIONDUCATION / T / TRAININGRAINING

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OVERVIEW OF BRENTWOOD CAPITAL ADVISORSWWORKINGORKING WITHWITH P PORTFOLIOORTFOLIO C COMPANIESOMPANIES OF ANDOF AND S SELLINGELLING S SECURITIESECURITIES TOTO L LEADINGEADING IINSTITUTIONALNSTITUTIONAL I INVESTORSNVESTORS

REPRESENTATIVE PRIVATE EQUITY AND SUBORDINATED DEBT FUNDS

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OVERVIEW OF BRENTWOOD CAPITAL ADVISORS

- David Bartholomew, David Bartholomew, StaffmarkStaffmark

- Barbara Cannon, Barbara Cannon, CelerisCeleris

- Paul Christians, Paul Christians, Prime OfficePrime Office

- Michael Cote, Michael Cote, SecureWorksSecureWorks

- W. Earl Reed, W. Earl Reed, Allegro GroupAllegro Group

- Cartter Patten, Cartter Patten, Patten & Patten & PattenPatten

- Don Taylor, Don Taylor, American American

HealthwaysHealthways

- Ed Wissing, Ed Wissing, American American HomePatientHomePatient

C

- Bob Dupuis, Bob Dupuis, Bluestar & Bluestar & AxonnAxonn

- Rock Morphis, Rock Morphis, Surgical Surgical Alliance & Heritage HealthAlliance & Heritage Health

- Ed Nelson, Ed Nelson, Nelson CapitalNelson Capital

• BCA’s Advisory Board is comprised of experienced operators who are BCA’s Advisory Board is comprised of experienced operators who are highly knowledgeable and respected within select industry verticalshighly knowledgeable and respected within select industry verticals

• BCA’s Advisory Board, consisting of the following businessmen and BCA’s Advisory Board, consisting of the following businessmen and women, assists in due diligence and industry-related research:women, assists in due diligence and industry-related research:

REPRESENTATIVE INDUSTRY VERTICAL EXPERTISE

BCA’BCA’SS A ADVISORYDVISORY B BOARDOARD

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• Senior debt landscape continues to change- Commercial loans – personal financial statements and guaranties- Corporate loans:

• Market is improving- New participants- Banks marginally more expensive

MARKET OVERVIEWSSENIORENIOR D DEBTEBT C CAPITALAPITAL M MARKETSARKETS

StatusStatus

Lower Middle-MarketLower Middle-Market

Middle-MarketMiddle-Market

Upper Middle-MarketUpper Middle-Market

Large CorporateLarge Corporate

Cash FlowCash Flow

$5 to $15 million$5 to $15 million



$50 million +$50 million +

Loan TypeLoan Type

Asset-basedAsset-basedStretch piece Stretch piece Last-out-seniorLast-out-senior

Asset-basedAsset-basedCash flowCash flowLast-out-seniorLast-out-senior

Cash flowCash flow““B” term loanB” term loanHigh yieldHigh yield

Public bondPublic bond

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Funding:Funding: At Close FacilityStructure:Structure: Asset-Based Cash FlowAdvance Rates:Advance Rates: A/R 50% 85%

Inventory 40%

90%Term Loan:Term Loan: Fixed Assets 0% 60%

Airball 0% 30%Revolver Maturity:Revolver Maturity: 364 Days 5 YearsTerm Loan Maturity:Term Loan Maturity: 1 Year 7 YearsAmortization:Amortization: 2 Years BulletInterest Rate:Interest Rate: P or LIBOR +

200P+5% or LIBOR + 600

Commitment Fee:Commitment Fee: 0% 2%Facility Fee:Facility Fee: 0% 2%Covenants:Covenants: None Many

SSENIORENIOR D DEBTEBT F FINANCINGINANCING P PARAMETERSARAMETERSMARKET OVERVIEW

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• Companies with cash flow greater than $10 million have multiple sources- Mezzanine funds- Insurance companies- SBICs

• Current competitive environment favors issuers- Significant amount of capital seeking to be deployed- Target rates of return have been lowered- Additional flexibility being shown (prepayment penalties, fees, etc.)

• Subordinated debt lenders are offering “revolver-like” facilities- Draw on commitments as needed- Pay closing fees on amounts drawn- Unused fee similar to senior debt revolver

• Interest-only pricing available to companies with EBITDA greater than $20 million- Cash coupon typically 12% to 14%- PIK coupon typically 3% to 5%- Interest-only, final maturity of 5 to 7 years- Flexible structure

MARKET OVERVIEWSSUBORDINATEDUBORDINATED D DEBTEBT C CAPITALAPITAL M MARKETSARKETS

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Valuation:Valuation: Low HighFunding:Funding: At Close FacilityTotal %:Total %: 17% 25%Cash Interest:Cash Interest: 10% 18%Equity:Equity: 0% Warrant CoverageTerm:Term: 3 Years 9 YearsStructure:Structure: Amortizing BulletUpfront Fees:Upfront Fees: None 3%Prepayment Prepayment Penalty:Penalty:

2% 12%Covenants:Covenants: None ManyExercise Price:Exercise Price: Nominal MarketAnti-Dilution:Anti-Dilution: Full

RatchetWeighted Average

Registration Rights:Registration Rights: Demand ShelfBoard Representation:Board Representation: None Multiple

SSUBORDINATEDUBORDINATED D DEBTEBT F FINANCINGINANCING P PARAMETERSARAMETERSMARKET OVERVIEW

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• Private equity firms are eager to invest in strong companies with proven management teams and predictable cash flow

• Due to a sluggish M&A environment, private equity investors are willing to pay a premium for acquisition candidates with significant annual cash flows

• Buyout funds have lowered their return requirements from mid-30%s to mid-20%sand will not close on any deals with even minor issues

MARKET OVERVIEWPPRIVATERIVATE E EQUITYQUITY C CAPITALAPITAL M MARKETSARKETS

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Valuation:Valuation: Low HighLiquidity:Liquidity: None 5 YearsRegistration Rights:Registration Rights: Demand ShelfLiquidation Liquidation Preference:Preference:

Non-Part. ParticipatingPrincipal &

Accrued Div.3x to 4x

Dividend Rate:Dividend Rate: 5% 12%Automatic Conversion:Automatic Conversion: Exit (none) @ Strike PriceAnti-Dilution:Anti-Dilution: Full

RatchetWeighted Average

Board Representation:Board Representation: None Multiple

EEQUITYQUITY F FINANCINGINANCING P PARAMETERSARAMETERSMARKET OVERVIEW

i ntroduction to b rentwood c apital a dvisors d ecember 3, 2003

Documents

years of industry experience

tom wylly senior partner

combination of senior

head of nashville office

dlj investment partners

sears dental

cohead of ma

nick carteaux vice president