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Risk Free Rate 2.

69%
Market Risk Permium 5.7%
Beta 1.92
Cost of Equity 13.63%
Interest Rate Spread 2%
Cost of Debt 4.69%
After Tax Cost of Debt 3%
Debt to Value Ratio 40.7%

WACC 9.32%
Expected Growth Rate in Sales 9%
EBITDA Margin 1%
Capex (as % of Sales) 0.15%
Terminal Growth Rate 4%
Tax Rate 35%

2013 2014 2015


Sales 93376 101780 110940
EBITDA 1,228 1,221 1,331
D&A 56 57 58
EBIT 1,173 1,164 1,273
EBIT (1-T) 762 757 827
Plus: D&A 56 57 58
Minus: Change in WC 12.59 12.84
Minus: Capex 140 153 166

FCFF 648.55 706.50


TV
Present Value of
Intermediate Cash
Flows 2,945.76
PV of TV 11,439.75
Value of the Firm 14,385.51
2016 2017 2018
120925 131808 143671
1,451 1,582 1,724
60 61 63
1,391 1,520 1,661
904 988 1,080
60 61 63
13.09 13.36 13.62
181 198 216

769.66 838.48 913.49


17860.6
Bluntly Media Combined Income Statement

2013E 2013 (3Q)


(in 000s) $ $

Revenue 93,376 70,032


Cost of sales 78,299 58,725
Gross income 15,077 11,308
Operating expenses 13,917 10,438
Income from operations 1,160 870
Interest and dividend income - -
Net income before taxes 1,160 870
Taxes (1) (1)
Net income 1,159 869

Interest expense (included in operating expenses) 13 10


EBIT 1,173 880

DA (included in operating expenses) 56 42


EBITDA 1,228 921
EBITDA margin 1.3% 1.3%
Year ended Dec. 31,
2012 2011 2010 2009
$ $ $ $

77,266 73,214 80,528 65,231


65,648 61,670 68,612 53,383
11,619 11,544 11,917 11,848
10,978 10,893 11,323 10,878
641 651 593 970
- - 1 5
641 651 594 975
(1) (1) (1) (1)
640 650 593 974

12 9 15 5
653 661 608 975

13 34 5 14
666 695 613 989
0.9% 0.9% 0.8% 1.5%
Bluntly Media Balance Sheet
Dec. 31, Sep. 30, Dec. 31,
(in 000s) 2013E 2013 2012 2011
$ $ $ $
ASSETS
Current assets
Cash and cash equivalents 1,836 1,019 2,315 169
Accounts receivable 8,871 8,187 6,925 7,362
Total current assets 10,707 9,206 9,240 7,531

Property and equipment


Furniture, fixtures and equip. 283 278 317 265
Less: Accumulated deprec. 144 130 235 201
Total property and equipment 139 148 82 64

Other assets
Security deposit 150 150 150 150
Total other assets 150 150 150 150

Total assets 10,996 9,505 9,472 7,745

LIABILITIES AND STOCKHOLDERS' EQUITY


Current liabilities
Accounts payable 9,742 8,560 9,212 7,315
Accrued expenses 205 199 - -
Loans payable 74 74 52 49
Due to customer 56 42 35 109
Total current liabilities 10,077 8,875 9,299 7,473

Long-term liabilities
Loans payable 92 92 93 146
Total long-term liabilities 92 92 93 146

Total liabilities 10,170 8,968 9,392 7,619

Stockholders' equity
Additional paid-in capital - - 198 198
Retained earnings/capital 826 537 (119) (71)
Total stockholders' equity 826 537 79 127

Total liabilities and stockholders'


equity 10,996 9,505 9,471 7,745
Dec. 31,
2010 2009
$ $

1 549
8,881 6,515
8,883 7,064

549 544
549 544
- 0

150 150
150 150

9,033 7,215

8,500 6,497
- -
47 44
16 13
8,564 6,555

195 242
195 242

8,759 6,796

198 198
76 220
274 418

9,033 7,215
Bluntly Media Statement of Cash Flows

(in 000s USD)

Cash flow from operating activities


Net income (loss)
Adjustments to reconcile net income (loss) to net cash used in operating activities
Depreciation and amortization
Increase (decrease) in cash flows from operating assets and liabilities
Accounts receivable
Accounts payable/accrued expenses
Due to customers
Prepaid expenses/accounts payable
Net cash from (used for) operational activities

Cash flows from investing activities


Acquisition of property and equipment
Net cash from (used for) investing activities

Cash flow from (used for) financing activities


Distributions to parent company
Distributions to shareholders
Loan payable
Net cash from (used for) financing activities

Net increase (decrease) in cash balance

Cash at beginning of year

Cash at end of period


Period
Year ended ended Sep.
Dec. 31, 30, Year ended Dec. 31,
2013E 2013 2012 2011 2010 2009

1,159 869 640 650 593 974

56 42 13 34 5 14

(1,946) (1,262) 437 1,519 (2,366) 1,428


594 (603) 1,927 (1,179) 2,006 (1,928)
21 7 (74) 92 3 (20)
(64) (48) (30) (6) (3) -
(181) (997) 2,913 1,110 238 467

(113) (108) (30) (99) (4) (13)


(113) (108) (30) (99) (4) (13)

(213) (212) - - - -
- - (688) (798) (737) (167)
28 21 (49) (47) (44) 286
(185) (191) (737) (845) (781) 119

(479) (1,296) 2,146 167 (547) 573

2,315 2,315 169 1 549 (24)

1,836 1,019 2,315 169 1 549


Bluntly Media Combined Statement of Retained Earnings
Dec. 31 Sep. 30, Dec. 30,
(in 000s USD) 2013 2013 2012

Balance, beginning of year (119) (119) (71)


Net income 1,159 869 640
Distribution to parent company (213) (212)
Distribution to shareholders - - (688)
Balance, end of year 826 537 (119)
ned Earnings
Dec. 30,
2011 2010 2009

76 220 (587)
650 593 974

(798) (737) (167)


(71) 76 220
Bluntly Media Financial Projections
Working capital growth % 2%
DA growth % 3%

(in 000s USD) 2013E 2014 2015 2016

Working capital 629.28 641.87 654.70 667.80


Depreciation and amortization 55.52 56.91 58.33 59.79
2017 2018

681.15 694.78
61.29 62.82
Precedent M&A Transactions

S&P Close 10/14/13 1710.14

Transaction
Date Target / Acquirer Target's Business S&P Value (in
mil USD)

05/03/10 MBS Insight, Inc. / e-Dialog, Inc. General (Agency) 1202.26 $ 22.2
09/16/03 Datamark, Inc. / eCollege.com, Inc. General (Agency) 1029.32 $ 85.1

02/20/00 Snyder Communications, Inc. / General (Agency) 1346.09 $ 1,961.1


Havas (ENXTPA:HAV)
Grizzard Communications Group,
07/14/99 Inc. / MSGI Technology Solutions, General (Agency) 1398.17 $ 131.9
Inc. (OTCPK:MSGI)
05/18/98 AmeriComm, LLC / DIMAC General (Agency) 1105.82 $ 160.2
Corporation

08/12/99 IntelliQuest Information Group, Inc. / Data/Analytics/Research 1298.16 $ 100.3


WPP plc (LSE:WPP)

06/14/99 Abacus Direct Corporation / Data/Analytics/Research 1294.00 $ 1,122.6


DoubleClick Inc.

05/27/98 Acxiom / May & Speh, Inc. / Acxiom Data/Analytics/Research 1092.23 $ 814.9
Corporation (NasdaqGS:ACXM)

03/13/98 Experian Marketing Solutions, Inc. / Data/Analytics/Research 1068.61 $ 773.2


Experian Information Solutions, Inc.

04/14/97 Direct Marketing Technology, Inc. / Data/Analytics/Research 743.73 $ 298.7


Experian Information Solutions, Inc.

Vertrue Incorporated / One Equity


03/22/07 Partners LLC; Oak Investment Digital-focused 1434.54 $ 790.5
Partners; Rho Capital Partners, Inc.;
Brencourt Advisors, LLC

12/26/00 NetCreations, Inc. / Telecom Italia Email-focused 1315.19 $ 112.6


Media SpA (BIT:TME)

02/28/05 RainMakers International, Inc. / Cord TV/Radio 1203.60 $ 2.0


Blood America Inc. (OTCPK:CBAI)
MULTIPLES
Adj. Adj.
TEV/ TEV/ TEV/ Adj. TEV/
TEV/ TEV/
Rev. EBITDA EBIT EBITDA
Rev. EBIT
1.3x 6.3x 7.1x 1.8x 9.0x 10.1x
2.6x 15.6x 19.4x 4.3x 25.9x 32.2x

2.8x 20.7x 31.2x 3.6x 26.3x 39.6x

1.8x 16.6x 25.8x 2.2x 20.3x 31.5x

0.8x 5.8x 12.1x 1.2x 9.0x 18.6x

1.5x 47.6x - 2.0x 62.7x -

21.7x 52.4x 57.6x 28.6x 69.2x 76.1x

6.7x 22.5x 28.1x 10.4x 35.2x 43.9x

2.6x 13.8x 36.5x 4.1x 22.1x 58.5x

4.6x - 19.9x 10.6x - 45.8x

1.0x 7.2x 9.5x 1.2x 8.5x 11.3x

1.5x 8.1x 9.0x 1.9x 10.5x 11.8x

4.6x 19.1x 19.3x 6.6x 27.2x 27.5x


Comparable Public Companies

($ in millions; last 12 months as of 9/30/2013)


Head
Company Ticker Industry TEV
office
WPP plc UK LSE:WPP Integrated Ad Agency $34,171
Omnicom Group Inc. US NYSE:OMC Integrated Ad Agency $21,300
Publicis Groupe SA FR ENXTPA:PUB Integrated Ad Agency $19,234
The Interpublic Group of Companies, Inc. US NYSE:IPG Integrated Ad Agency $8,198
Havas FR ENXTPA:HAV Integrated Ad Agency $3,698
MDC Partners Inc. US TSX:MDZ.A Integrated Ad Agency $1,672
Chime Communications plc UK LSE:CHW Integrated Ad Agency $499
M&C Saatchi plc UK AIM:SAA Integrated Ad Agency $318
NasdaqGS:CTC
Constant Contact, Inc. US T Direct Marketing Services $727

Harte-Hanks Inc. US NYSE:HHS Direct Marketing Services $512


NasdaqGS:QNS
QuinStreet, Inc. US T Direct Marketing Services $335

Jaywing plc UK AIM:JWNG Direct Marketing Services $30


Lyris, Inc. US OTCPK:LYRI Digital Marketing Solutions $19
Mobiquity Technologies, Inc. US OTCPK:MOBQ Digital Marketing Solutions $18
CornerWorld Corporation US OTCPK:CWRL Integrated Ad Agency $8
Multiples

Revenue EBITDA EBIT Net income TEV/Rev. TEV/EBITDA TEV/EBIT

$16,306 $2,781 $2,152 $1,255 2.1x 12.3x 15.9x


$14,471 $2,135 $1,850 $978 1.5x 10.0x 11.5x
$8,940 $1,732 $1,498 $1,011 2.2x 11.1x 12.8x
$7,063 $841 $684 $391 1.2x 9.8x 12.0x
$2,322 $376 $323 $166 1.6x 9.8x 11.5x
$1,141 $73 $34 -$79 1.5x 22.8x 49.2x
$482 $14 $5 -$9 1.0x 35.4x 106.2x
$264 $31 $26 $1 1.2x 10.4x 12.3x

$277 $23 $5 $10 2.6x 31.1x 134.6x

$752 $80 $60 $18 0.7x 6.4x 8.6x

$303 $31 $3 $68 1.1x 10.8x 133.8x

$55 $6 $2 $1 0.5x 5.2x 12.5x


$35 $2 $0 $0 0.5x 8.4x 46.3x
$3 -$4 -$5 $5 5.5x -4.1x -3.8x
$7 $3 $3 $1 1.3x 3.3x 3.3x
Average 1.6x 12.2x 37.8x
Comparable Betas
Tax 35% Used for unlevering beta
Average r-squared across company regressions 25%

Company Beta (5Y) Debt Equity


WPP plc 0.81 34% 64%
Omnicom Group Inc. 1.25 50% 42%
Publicis Groupe SA 0.56 23% 76%
The Interpublic Group of Companies, Inc. 1.81 39% 49%
Havas 0.83 40% 60%
MDC Partners Inc. 1.41 108% -43%
Chime Communications plc 0.72 17% 83%
M&C Saatchi plc 0.98 7% 89%
Constant Contact, Inc. 1.01 0% 100%
Harte-Hanks Inc. 1.28 24% 76%
QuinStreet, Inc. 1.83 24% 76%
Jaywing plc 0.5 5% 95%
Lyris, Inc. -0.3 14% 66%
Mobiquity Technologies, Inc. 0.39 13% 87%
CornerWorld Corporation -1.67 155% -55%
Average 0.7607 36.86% 57.59%
Debt Equity
Minority interest Preferred equity Unlevered beta
2% 0% 0.59
8% 0% 0.65
1% 0% 0.46
6% 5% 1.17
0% 0% 0.58
35% 0% -1.22
1% 0% 0.63
4% 0% 0.91
0% 0% 1.01
0% 0% 1.07
0% 0% 1.52
0% 0% 0.48
0% 20% -0.27
0% 0% 0.36
0% 0% 2.02
3.87% 1.68% 0.6635
Unlevered 1.327 <- average r squared is 25%
D/E 0.687
Levered 1.920