Impact of Repurchase Obligation on Value April 21, 2006 Presented by: Radd Riebe Ohio Employee Ownership Center 20 th Annual Conference

Impact on Value Redeem vs. Recycle Assumptions: Enterprise Value$10,000,000 Debt $0 Equity Value$10,000,000 Shares Outstanding 1,000,000 Value per Share $ % ESOP Assume: Repurchase of 50,000 Shares from corporate funds

Impact on Value Equity Value Stock Purchased Post-Repurchase Equity Value Shares Outstanding Value Per Share Redeem $10,000,000 $500,000 $9,500, ,000 $10.00 Recycle $10,000,000 $500,000 $9,500,000 1,000,000 $9.50

Impact on Value Impact of Sinking Fund or Cash Surrender Value of Life Insurance  $1,000,000 sinking fund on company’s balance sheet Redeem Recycle Equity Value$10,000,000$10,000,000 Sinking Fund$ 1,000,000 $ 1,000,000 Total Equity Value$11,000,000$11,000,000 Stock Purchased $550,000 $550,000 Post Repurchase Equity Value $10,450,000$10,450,000 Shares Outstanding 950,000 1,000,000 Value Per Share $11.00 $10.45

Impact on Value Impact of Debt to Repurchase Shares  Repurchase 50% of the ESOP stock for $5,000,000 using debt Redeem Recycle Equity Value$10,000,000$10,000,000 Debt$ 5,000,000 $ 5,000,000 Post-Repurchase Equity Value$ 5,000,000$ 5,000,000 Outstanding Shares 500,000 1,000,000 Value Per Share $10.00 $5.00