1. NuLevel Strategic Solutions, LLC 200 S. Tryon Street, 10 th Floor, Ste. 1000 Charlotte, NC 28202 www.nulevelsolutions.com August 22, 2011 David Willis, Principal / Presenter david@nulevelsolutions.com Office: 888.503.3218 Fax: 888.503.6170 In Partnership With:

2. Strategic planning is an organizational process geared towards establishing clear and measurable growth- related goals. These goals are directly tied to the mission and vision of the organization and, require specific action by the members of the organization, in order to be fully realized. Strategic Planning Defined Charlotte Module ProgramStrategic Planning Overview2

3. Does Strategic Planning Really Matter? Isn’t it really about who you know? And, being in the right place at the right time? Big Question Charlotte Module ProgramStrategic Planning Overview3

4. What About Mission and Vision? “Our Mission Propels our Vision…Our Vision Propels our Goals…Our Goals Propel our Actions…Our Actions Dictate the Outcome. Absent these, we are nothing more than opportunity chasers drifting in the wind.” David Willis, Principal NuLevel Strategic Solutions, LLC Mission & Vision Charlotte Module ProgramStrategic Planning Overview4

5. 10/17/2015CONFIDENTIAL5  Clearly communicate:  Why firm exists (Problem firm is here to solve)  Who customers are and what value it will bring to them  Firm’s core values / core strengths  Motivate employees  Excite and inspire customers  Be developed and reinforced by key stakeholders  Differentiate us  SERVE AS THE FOCAL POINT FOR ALL STRATEGIC DECISIONS Mission Statement Should…

6. Charlotte Module ProgramStrategic Planning Overview6  Address where a firm wants to be in 3 to 5 years  Be broad in nature  Be driven by owners’ with stakeholders’ needs in mind  Serve as the “goal line” for all strategic decisions Vision Statement Should…

7. “We changed the world but failed to achieve business success.” “We had a plan. We just didn't get a chance to make it work.” Shawn Fanning, 2008 Founder, Napster Napster’s Plan Charlotte Module ProgramStrategic Planning Overview7

8. “We made several big mistakes. We were conflicted about who we were and what we wanted to do. We embraced the bad boy rebel image that our users enjoyed, but we knew that we had to make peace with the labels to have a viable business.” Shawn Fanning, 2008 Founder, Napster Napster’s Downfall Charlotte Module ProgramStrategic Planning Overview8

9.  Revolutionized Music Distribution Industry Sector  Went Bankrupt in the process  Paved the way for other on-line distributors  Itunes one of the greatest benefactors – launched a year after Napster’s dissolution  Apple considered the Napster model in its strategic plan  Itunes now represents over $1.5B in revenue for Apple Napster’s Impact Charlotte Module ProgramStrategic Planning Overview9 Strategic Planning matters, only to the extend to which it is properly developed and implemented.

10. So Why Do it, Anyway?? Charlotte Module ProgramStrategic Planning Overview10

11.  Realize vision  Pro-actively defend against external forces  Customer / Internal Alignment  Develop measurable and successful track record for attracting future capital  Attract and retain high caliber talent  Rapid shifts in the market / industry conditions  Improve short-term decision making capabilities  Better understand supply chain and parallel supply chains  Revenue diversification  Prepare for exit / liquidation event  Better respond to existing and new problem(s) Why Do it? Charlotte Module ProgramStrategic Planning Overview11

12. FocusCharacteristicRiskRequirement Life-StyleConservative growth Nominal risk – driven by owner’s desire to improve overall performance of business and, seeks to achieve financial stability Growth will generally be financed by debt capital and operational cash flows GrowthFocus on building wealth – with potential liquidation event in mind Moderate risk – driven by calculated risks, aggressive approach towards organic and acquisitive growth In addition to debt and operating cash flows, strategy may require private outside investments – potentially resulting in some loss of control Super Growth Building wealth with high-end liquidation event in mind High risk – driven by innovation, M&A and, aggressive market share capture Strategy requires high level of initial investment (debt and outside equity; significant ownership and control may be loss Strategic Planning Approaches Charlotte Module ProgramStrategic Planning Overview12

13. The following are key inhibitors to effectively carrying out strategic planning process:  Pursuing unrealistic goals  Owner control issues  Failure to obtain stakeholder buy-in  Poor overall health  Misalignment of roles  Opportunity chasing  Niche focus  Saturated Markets  Failure to execute Strategic Planning Inhibitors Charlotte Module ProgramStrategic Planning Overview13

14. Stages of Strategic Planning Charlotte Module ProgramStrategic Planning Overview14

15. Stage 1: Plan-to-Plan  Evaluate owner objectives  Determine available resources  Plan methodology  Assemble strategic advisory team  Hire Consultant(s)  Re-evaluate and refine (if necessary) mission and vision Charlotte Module ProgramStrategic Planning Overview15

16. Current Situation Mission & Vision Health Historical Performance Industry & Market Conditions Capacity / Resources Stakeholders Stage 2: Assessment Charlotte Module ProgramStrategic Planning Overview16

17. Stage 3: S.W.O.T Analysis Customer Inefficiencies Consolidation New Markets New Regulations Substitutes New Entrants Limit Capital Poor Credit Limited Capacity Inefficiencies Lack of Systems Core Values Core Competencies Capacity Access to Capital Innovation / IP SW OT Internal External Charlotte Module ProgramStrategic Planning Overview17

18. Stage 4: Benchmarking  Benchmarking requires us to look internally and externally to better understand how to move forward  Some examples include: −On average, 1 Project Manager is required for every $1 million in new revenue −10 month average revenue conversion cycle −On average, it takes 6 months for new hires to begin generating revenues −Company will be required to add on an additional 200 SF in office space for every new hire  These types of benchmarks will greatly enhance our ability to determine overall cost of the strategic plan Charlotte Module ProgramStrategic Planning Overview18

19. Stage 5: Goal Setting Goals Quantitative Qualitative Strategic Priorities Mission Vision Opportunities Current Situation Charlotte Module ProgramStrategic Planning Overview19

20. Stage 6: Requirements TalentEquipmentStrategic PartnersConsultantsSystemsTechnology Charlotte Module ProgramStrategic Planning Overview20

21. Action Plan defines performance and:  Includes very specific actions necessary for achieving Stated Goals  Role assignment - will hold key employees and stakeholders accountable for the success of the strategy  Serves as a measurement tool for success throughout the duration of the planning period  Serves as a baseline for compensation and incentives  Can and will likely be modified throughout the planning period  Enables all strategic actions to be tied-back to Mission Stage 7: Action Plan Charlotte Module ProgramStrategic Planning Overview21

22. Financial Plan Considerations:  Ramp-up  Working capital and capital expenditures  Optimal capital structure and sources of capital  Timing of capital requirements  Valuation  Return of and on capital Stage 8: Financial Plan Charlotte Module ProgramStrategic Planning Overview22

23.  Average 6 to 12 months till Execution Stage  Capital access critical for this stage  Requires strong, sustainable commitment from key stakeholders  Individual and / or committee should be assigned to oversight of execution Stage 9: Execution Charlotte Module ProgramStrategic Planning Overview23

24.  Strategy team participants should meet periodically – more frequently, early on  Timeline and metrics should be evaluated during each meeting  Adjustments to be made accordingly; however, with consensus  Celebrate successes and, build upon short-comings Stage 10: Review Charlotte Module ProgramStrategic Planning Overview24