Transaction Assumptions

($ in millions, except per share data)

Summary Financial Data

Code Name
Ticker
Current Price
52-Week High
52-Week Low

M&A

Acquirer

Target

BuyerCo
BBB

TargetCo
TTT

5/17/2008
4/2/2008
8/24/2007

$31.75
$40.36
$27.18

5/17/2008
6/4/2007
6/13/2006

Consideration
Transaction Price
Percent Cash Considera

$12.81
$28.22
$10.49

Basic Shares Outstanding

Treasury Method Shares
In-the-Money Convertible Shares
Fully Diluted Shares Outstanding

207.050
2.899
0.000
209.949

34.922
0.099
0.000
35.021

Equity Value
Net Debt
Enterprise Value

$6,665.9
(729.6)
$5,936.3

$448.6
83.4
$532.0

Convert 1
$450.0
$43.12
10.436
0.5%
no

Face Value
Conversion Price
Convertible Shares
Interest Rate
In the Money?
LTM Date
Last Fiscal Year End
Research Report Analyst
Research Report Date

Convert 2
$0.0
NA
0.000
0.0%
no

Convert 1
$230.0
$26.77
8.592
2.5%
no

Convert 2
$0.0
NA
0.000
0.0%
no

3/31/2008
9/30/2007

3/31/2008
12/31/2007

Deutsche Bank
4/24/2008

Goldman Sachs
4/27/2008

Deal Structure
Target LT Debt: 0=refina
Acquisition Type: 0=stoc
Section 338 Election?

Acquisition Debt
Interest Rate on Debt
Amortization Period for N

Cash
Interest Rate on Cash
Minimum Cash Balance
Fees & Expenses
Advisory Fees
Financing Fees
Synergies
Include Synergies?
Cost Synergies
SG&A Synergies

Purchase Price Allocat

% of Excess PP Allocate
Amortization Period (yrs
Step-Up of Target's Fixe
Depreciation Period (yrs

Options Data

Tranche 1
Tranche 2
Tranche 3
Tranche 4
Tranche 5
Tranche 6
Tranche 7
Tranche 8
Tranche 9

Number of
Options (m)
0.270
1.548
2.855
2.431
2.182
3.394
2.678
2.138
2.631

Average
Strike
$2.31
12.31
22.00
25.07
27.88
31.31
34.35
38.63
52.72

BuyerCo
Cumulative Cumulative
Options (m) Strike ($m)
0.270
$0.6
1.818
19.7
4.673
82.5
7.104
143.4
9.286
204.3
12.680
310.5
15.358
402.5
17.496
485.1
20.127
623.8

Cumulative
Avg. Strike
$2.31
10.82
17.65
20.19
22.00
24.49
26.21
27.73
30.99

Treasury
Shares
0.250
0.948
0.877
0.511
0.266
0.047
0.000
0.000
0.000

Other
Tax Rate
Calendar Year or Fiscal
Cash or GAAP?

Tranche 10

Tranche 1
Tranche 2
Tranche 3
Tranche 4
Tranche 5
Tranche 6
Tranche 7
Tranche 8
Tranche 9
Tranche 10

0.329

Number of
Options (m)
0.209
0.059
0.221
0.300
0.269
0.211
0.187
0.000
0.000
0.000

70.00

Average
Strike
$9.04
10.03
11.53
12.69
19.54
27.06
45.75
0.00
0.00
0.00

20.456

646.9

TargetCo
Cumulative Cumulative
Options (m) Strike ($m)
0.209
$1.9
0.268
2.5
0.489
5.0
0.789
8.8
1.058
14.1
1.269
19.8
1.456
28.4
1.456
28.4
1.456
28.4
1.456
28.4

31.62
Total

0.000
2.899

Cumulative
Avg. Strike
$9.04
9.26
10.28
11.20
13.32
15.60
19.48
19.48
19.48
19.48
Total

Treasury
Shares
0.062
0.013
0.022
0.003
0.000
0.000
0.000
0.000
0.000
0.000
0.099

M&A Assumptions
Consideration
Transaction Price
Percent Cash Consideration

3
40.0%

Deal Structure
Target LT Debt: 0=refinanced, 1=assumed
Acquisition Type: 0=stock, 1=asset
Section 338 Election?

1
0
no

Acquisition Debt
Interest Rate on Debt
Amortization Period for New Debt (yrs)

6.00%
7

Interest Rate on Cash

Minimum Cash Balance

2.0%
$100.0

Fees & Expenses

Advisory Fees
Financing Fees

$30.0
1.0%

Include Synergies?
Cost Synergies
SG&A Synergies

yes
$25.0
$50.0

Purchase Price Allocation

% of Excess PP Allocated to Intangibles
Amortization Period (yrs)
Step-Up of Target's Fixed Assets
Depreciation Period (yrs)

25.0%
5
$15.0
10

13.8%
FY
Cash

Accretion / Dilution Analysis

($ in millions, except per share data)

Standalone
BuyerCo
Transaction Value Per Share
Equity Purchase Price

$6,665.9

All Stock
$12.00
$419.9

$13.00
$455.4

$14.00
$491.1

$15.00
$526.8

Multiples Analysis
FY 2008P Revenue
FY 2009P Revenue

1.90x
1.71x

1.10x
1.08x

1.18x
1.15x

1.25x
1.23x

1.33x
1.30x

FY 2008P EBITDA
FY 2009P EBITDA

8.9x
8.1x

3.9x
4.0x

4.1x
4.3x

4.4x
4.5x

4.7x
4.8x

13.6x
11.7x

4.2x
4.5x

4.6x
4.9x

4.9x
5.3x

5.3x
5.7x

$606.9
224.286
$2.71

$606.9
224.286
$2.71

$606.9
224.286
$2.71

$606.9
224.286
$2.71

FY 2008P Cash P/E

FY 2009P Cash P/E
BuyerCo Standalone
FY 2009P Cash Net Income
FY 2009P Shares Outstanding
FY 2009P Cash EPS
After-Tax Acquisition Adjustments
TargetCo FY 2009P Cash Net Income
Interest Lost on Cash Used
Incremental Interest on New Debt
Interest Gained on Conversion of Convert(s)
Deferred Stock-Based Compensation
Amortization of Indentifiable Intangibles
Depreciation of Acquired Tangible Assets
Write-Down of Deferred Revenue

$96.9
(0.5)
(1.3)
(12.9)

Pro Forma Cash Net Income Without Synergies

After-Tax Synergies
Pro Forma Cash Net Income With Synergies
Dilutes Shares - Treasury Method
BuyerCo FY 2009P Shares Outstanding
Shares Issued for TargetCo Basic Shares
Total Shares Post-Transaction

$96.9
(0.5)
(1.3)
(12.9)

$96.9
(0.5)
(1.3)
(12.9)

$96.9
(0.5)
(1.3)
(12.9)

$689.1
64.7
$753.7

$689.1
64.7
$753.7

$689.1
64.7
$753.7

$689.1
64.7
$753.7

224.286
13.225
237.511

224.286
14.344
238.630

224.286
15.468
239.754

224.286
16.593
240.879

FY 2009P Cash EPS Without Synergies

$ Accretion / Dilution
% Accretion / Dilution
Pre-Tax Synergies to Breakeven
% of Combined Opex (Excl. Syngergies)

$2.71

$2.90
$0.20
7.2%
($53.8)
(1.6%)

$2.89
$0.18
6.7%
($50.3)
(1.5%)

$2.87
$0.17
6.2%
($46.8)
(1.4%)

$2.86
$0.15
5.7%
($43.2)
(1.3%)

FY 2009P Cash EPS With Synergies

$ Accretion / Dilution
% Accretion / Dilution
Pre-Tax Synergies to Breakeven
% of Combined Opex (Excl. Syngergies)

$2.71

$3.17
$0.47
17.3%
($128.8)
(3.9%)

$3.16
$0.45
16.7%
($125.3)
(3.8%)

$3.14
$0.44
16.2%
($121.8)
(3.7%)

$3.13
$0.42
15.6%
($118.2)
(3.6%)

All Stock

60.0% Stock / 40.0% Cash

$16.00
$562.5

$17.00
$598.3

$18.00
$634.0

$12.00
$419.9

$13.00
$455.4

$14.00
$491.1

$15.00
$526.8

$16.00
$562.5

1.41x
1.38x

1.49x
1.46x

1.57x
1.53x

1.10x
1.08x

1.18x
1.15x

1.25x
1.23x

1.33x
1.30x

1.41x
1.38x

5.0x
5.1x

5.2x
5.4x

5.5x
5.7x

3.9x
4.0x

4.1x
4.3x

4.4x
4.5x

4.7x
4.8x

5.0x
5.1x

5.6x
6.0x

6.0x
6.4x

6.3x
6.8x

4.2x
4.5x

4.6x
4.9x

4.9x
5.3x

5.3x
5.7x

5.6x
6.0x

$606.9
224.286
$2.71

$606.9
224.286
$2.71

$606.9
224.286
$2.71

$606.9
224.286
$2.71

$606.9
224.286
$2.71

$606.9
224.286
$2.71

$606.9
224.286
$2.71

$606.9
224.286
$2.71

$96.9
(0.5)
(1.3)
(12.9)

$96.9
(0.5)
(1.3)
(12.9)

$96.9
(0.5)
(1.3)
(12.9)

$96.9
(1.3)
(12.9)

$96.9
(1.3)
(12.9)

$96.9
(1.3)
(12.9)

$96.9
(1.3)
(12.9)

$96.9
(1.3)
(12.9)

$689.1
64.7
$753.7

$689.1
64.7
$753.7

$689.1
64.7
$753.7

$689.6
64.7
$754.3

$689.6
64.7
$754.3

$689.6
64.7
$754.3

$689.6
64.7
$754.3

$689.6
64.7
$754.3

224.286
17.718
242.004

224.286
18.843
243.129

224.286
19.967
244.253

224.286
7.935
232.221

224.286
8.606
232.892

224.286
9.281
233.567

224.286
9.956
234.242

224.286
10.631
234.917

$2.85
$0.14
5.2%
($39.7)
(1.2%)

$2.83
$0.13
4.7%
($36.2)
(1.1%)

$2.82
$0.12
4.3%
($32.6)
(1.0%)

$2.97
$0.26
9.7%
($71.0)
(2.2%)

$2.96
$0.26
9.4%
($68.9)
(2.1%)

$2.95
$0.25
9.1%
($66.8)
(2.0%)

$2.94
$0.24
8.8%
($64.6)
(2.0%)

$2.94
$0.23
8.5%
($62.5)
(1.9%)

$3.11
$0.41
15.1%
($114.7)
(3.5%)

$3.10
$0.39
14.6%
($111.2)
(3.4%)

$3.09
$0.38
14.0%
($107.6)
(3.3%)

$3.25
$0.54
20.0%
($146.0)
(4.5%)

$3.24
$0.53
19.7%
($143.9)
(4.4%)

$3.23
$0.52
19.3%
($141.8)
(4.3%)

$3.22
$0.51
19.0%
($139.6)
(4.3%)

$3.21
$0.50
18.7%
($137.5)
(4.2%)

Cash

All Cash
$17.00
$598.3

$18.00
$634.0

$12.00
$419.9

$13.00
$455.4

$14.00
$491.1

$15.00
$526.8

$16.00
$562.5

$17.00
$598.3

1.49x
1.46x

1.57x
1.53x

1.10x
1.08x

1.18x
1.15x

1.25x
1.23x

1.33x
1.30x

1.41x
1.38x

1.49x
1.46x

5.2x
5.4x

5.5x
5.7x

3.9x
4.0x

4.1x
4.3x

4.4x
4.5x

4.7x
4.8x

5.0x
5.1x

5.2x
5.4x

6.0x
6.4x

6.3x
6.8x

4.2x
4.5x

4.6x
4.9x

4.9x
5.3x

5.3x
5.7x

5.6x
6.0x

6.0x
6.4x

$606.9
224.286
$2.71

$606.9
224.286
$2.71

$606.9
224.286
$2.71

$606.9
224.286
$2.71

$606.9
224.286
$2.71

$606.9
224.286
$2.71

$606.9
224.286
$2.71

$606.9
224.286
$2.71

$96.9
(1.3)
(12.9)

$96.9
(1.3)
(12.9)

$96.9
(7.8)
(1.3)
(12.9)

$96.9
(8.4)
(1.3)
(12.9)

$96.9
(9.0)
(1.3)
(12.9)

$96.9
(9.6)
(1.3)
(12.9)

$96.9
(10.2)
(1.3)
(12.9)

$96.9
(10.8)
(1.3)
(12.9)

$689.6
64.7
$754.3

$689.6
64.7
$754.3

$681.8
64.7
$746.5

$681.2
64.7
$745.9

$680.6
64.7
$745.3

$680.0
64.7
$744.7

$679.4
64.7
$744.0

$678.8
64.7
$743.4

224.286
11.306
235.592

224.286
11.980
236.266

224.286
224.286

224.286
224.286

224.286
224.286

224.286
224.286

224.286
224.286

224.286
224.286

$2.93
$0.22
8.2%
($60.4)
(1.8%)

$2.92
$0.21
7.9%
($58.3)
(1.8%)

$3.04
$0.33
12.3%
($86.9)
(2.7%)

$3.04
$0.33
12.2%
($86.2)
(2.6%)

$3.03
$0.33
12.1%
($85.5)
(2.6%)

$3.03
$0.33
12.0%
($84.8)
(2.6%)

$3.03
$0.32
11.9%
($84.0)
(2.6%)

$3.03
$0.32
11.8%
($83.3)
(2.5%)

$3.20
$0.50
18.3%
($135.4)
(4.1%)

$3.19
$0.49
18.0%
($133.3)
(4.1%)

$3.33
$0.62
23.0%
($161.9)
(5.0%)

$3.33
$0.62
22.9%
($161.2)
(4.9%)

$3.32
$0.62
22.8%
($160.5)
(4.9%)

$3.32
$0.61
22.7%
($159.8)
(4.9%)

$3.32
$0.61
22.6%
($159.0)
(4.9%)

$3.31
$0.61
22.5%
($158.3)
(4.8%)

$18.00
$634.0
1.57x
1.53x
5.5x
5.7x
6.3x
6.8x

$606.9
224.286
$2.71

$96.9
(11.5)
(1.3)
(12.9)
$678.1
64.7
$742.8

224.286
224.286
$3.02
$0.32
11.7%
($82.6)
(2.5%)
$3.31
$0.61
22.4%
($157.6)
(4.8%)

Contribution Analysis
($ in millions, except per share data)

BuyerCo
FY08
FY09

TargetCo
FY08
FY09

Combined (1)
FY08
FY09

Revenue
% Growth

$3,120.0
10.0%

$3,470.0
11.2%

$458.1
13.8%

$468.0
2.2%

$3,578.1
10.5%

$3,938.0
10.1%

EBITDA
% Margin

$667.9
21.4%

$734.2
21.2%

$130.2
28.4%

$126.5
27.0%

$798.1
22.3%

$860.7
21.9%

GAAP Net Income

% Margin

$415.5
13.3%

$507.1
14.6%

$76.3
16.7%

$70.6
15.1%

$491.9
13.7%

$577.8
14.7%

Cash Net Income

% Margin

$516.3
16.5%

$606.9
17.5%

$102.8
22.4%

$96.9
20.7%

$619.1
17.3%

$703.8
17.9%

Contribution
Revenue
EBITDA
GAAP Net Income
Cash Net Income

87.2%
83.7%
84.5%
83.4%

88.1%
85.3%
87.8%
86.2%

12.8%
16.3%
15.5%
16.6%

11.9%
14.7%
12.2%
13.8%

100.0%
100.0%
100.0%
100.0%

100.0%
100.0%
100.0%
100.0%

(1) Excludes acquisition accounting and financing adjustments and synergies.

(2) Excludes acquisition accounting and financing adjustments.

Synergies

Synergies
FY08
FY09

Pro Forma (2)

FY08
FY09

$0.0

$0.0

$3,578.1
10.5%

$3,938.0
10.1%

$0.0

$75.0

$798.1
22.3%

$935.7
23.8%

$0.0

$64.7

$556.5
15.6%

$642.4
16.3%

$0.0

$64.7

$683.7
19.1%

$768.5
19.5%

Purchase Price Ratio Analysis

($ in millions, except per share data)

TargetCo
$12.81
Common Stock
Stock Options
ITM Convertible Securities
Total Diluted Equity Value
Net Debt
Total Enterprise Value

$12.00

$13.00

Transaction Prices Per TargetCo S

$14.00

$447.4
1.3
0.0
$448.6
83.4
$532.0

$419.1
0.8
0.0
$419.9
83.4
$503.3

$454.0
1.4
0.0
$455.4
83.4
$538.8

$488.9
2.2
0.0
$491.1
83.4
$574.5

$12.81
28.22
10.49
12.64
12.12
11.71
12.03

0.0%
(54.6%)
22.1%
1.3%
5.7%
9.4%
6.5%

(6.3%)
(57.5%)
14.4%
(5.1%)
(1.0%)
2.5%
(0.2%)

1.5%
(53.9%)
23.9%
2.8%
7.3%
11.0%
8.1%

9.3%
(50.4%)
33.5%
10.8%
15.5%
19.6%
16.4%

FY 2008P Revenue
FY 2009P Revenue
FY 2010P Revenue

$458.1
468.0
470.5

1.16x
1.14x
1.13x

1.10x
1.08x
1.07x

1.18x
1.15x
1.15x

1.25x
1.23x
1.22x

FY 2008P EBITDA
FY 2009P EBITDA
FY 2010P EBITDA

$130.2
126.5
125.9

4.1x
4.2x
4.2x

3.9x
4.0x
4.0x

4.1x
4.3x
4.3x

4.4x
4.5x
4.6x

FY 2008P EBITA
FY 2009P EBITA
FY 2010P EBITA

$116.1
112.4
111.8

4.6x
4.7x
4.8x

4.3x
4.5x
4.5x

4.6x
4.8x
4.8x

4.9x
5.1x
5.1x

$2.85
2.65
2.64

4.5x
4.8x
4.9x

4.2x
4.5x
4.6x

4.6x
4.9x
4.9x

4.9x
5.3x
5.3x

Premiums Analysis:
Current Price
52-Week High
52-Week Low
7-Day Trading Average
30-Day Trading Average
60-Day Trading Average
90-Day Trading Average

TargetCo

Multiples Analysis:

FY 2008P Cash P/E

FY 2009P Cash P/E
FY 2010P Cash P/E

ansaction Prices Per TargetCo Share

$15.00
$16.00
$523.8
3.0
0.0
$526.8
83.4
$610.2

$558.8
3.8
0.0
$562.5
83.4
$645.9

$17.00
$593.7
4.6
0.0
$598.3
83.4
$681.6

$18.00
$628.6
5.4
0.0
$634.0
83.4
$717.4

BuyerCo
$31.75
$6,573.8
92.1
0.0
$6,665.9
(729.6)
$5,936.3
BuyerCo

17.1%
(46.8%)
43.0%
18.7%
23.8%
28.1%
24.7%

24.9%
(43.3%)
52.5%
26.6%
32.0%
36.6%
33.0%

32.7%
(39.8%)
62.1%
34.5%
40.3%
45.2%
41.3%

40.5%
(36.2%)
71.6%
42.4%
48.5%
53.7%
49.6%

0.0%
(21.3%)
16.8%
(0.5%)
3.9%
5.7%
3.2%

$31.75
40.36
27.18
31.92
30.56
30.04
30.77

1.33x
1.30x
1.30x

1.41x
1.38x
1.37x

1.49x
1.46x
1.45x

1.57x
1.53x
1.52x

1.90x
1.71x
1.54x

$3,120.0
3,470.0
3,856.0

4.7x
4.8x
4.8x

5.0x
5.1x
5.1x

5.2x
5.4x
5.4x

5.5x
5.7x
5.7x

8.9x
8.1x
7.1x

$667.9
734.2
832.7

5.3x
5.4x
5.5x

5.6x
5.7x
5.8x

5.9x
6.1x
6.1x

6.2x
6.4x
6.4x

10.6x
9.0x
7.9x

$559.1
659.5
747.3

5.3x
5.7x
5.7x

5.6x
6.0x
6.1x

6.0x
6.4x
6.5x

6.3x
6.8x
6.8x

13.6x
11.7x
10.5x

$2.34
2.71
3.02

Sources & Uses of Funds

($ in millions, except per share data)

Current
Price
$12.81

Transaction Prices Pe
$12.00

$13.00

Sources & Uses

Uses
TargetCo Common Consideration
TargetCo Options Consideration
TargetCo Preferred Consideration
Total Equity Consideration

$448.6
6.9
0.0
$455.5

$419.9
6.1
0.0
$426.0

$455.4
7.0
0.0
$462.4

TargetCo Revolver Refinanced

TargetCo Convertible Debt Assumed
TargetCo Convertible Debt Refinanced/Retired
TargetCo Non-Convertible LT Debt Assumed
TargetCo Non-Convertible LT Debt Refinanced/Retired
Total Levered Consideration

0.0
230.0
0.0
0.0
0.0
$685.5

0.0
230.0
0.0
0.0
0.0
$656.0

0.0
230.0
0.0
0.0
0.0
$692.4

Acquirer Refinanced Debt

Financing Fees
Advisory Fees
Total Uses

0.0
0.0
30.0
$715.5

0.0
0.0
30.0
$686.0

0.0
0.0
30.0
$722.4

Sources
BuyerCo Common Consideration
BuyerCo Options Consideration
BuyerCo Preferred Consideration
Cash Consideration
BuyerCo Revolver
Acquisition Debt
TargetCo LT Debt Assumed
Total Sources

$269.2
6.9
0.0
209.4
0.0
0.0
230.0
$715.5

$251.9
6.1
0.0
198.0
0.0
0.0
230.0
$686.0

$273.2
7.0
0.0
212.2
0.0
0.0
230.0
$722.4

0.000

0.000

0.000

Check

Cash Schedule
Cash Available
BuyerCo Existing Cash
TargetCo Existing Cash
Minimum Cash Balance
Total Cash Available
Cash Needed
Cash Paid to TargetCo Shareholders
Financing Fees

$1,181.8
146.6
(100.0)
$1,228.4

$1,181.8
146.6
(100.0)
$1,228.4

$1,181.8
146.6
(100.0)
$1,228.4

$179.4
0.0

$168.0
0.0

$182.2
0.0

Advisory Fees
BuyerCo Debt Retired
TargetCo Debt Retired
Cash Needed Before Revolver
Optional Paydown of TargetCo Revolver
Optional Paydown of BuyerCo Revolver
Total Cash Needed

30.0
0.0
0.0
$209.4
0.0
0.0
$209.4

30.0
0.0
0.0
$198.0
0.0
0.0
$198.0

30.0
0.0
0.0
$212.2
0.0
0.0
$212.2

Transaction Prices Per TargetCo Share

$14.00
$15.00
$16.00

$17.00

$18.00

ses

$491.1
8.0
0.0
$499.1

$526.8
8.9
0.0
$535.8

$562.5
9.9
0.0
$572.5

$598.3
10.9
0.0
$609.2

$634.0
12.0
0.0
$646.0

0.0
230.0
0.0
0.0
0.0
$729.1

0.0
230.0
0.0
0.0
0.0
$765.8

0.0
230.0
0.0
0.0
0.0
$802.5

0.0
230.0
0.0
0.0
0.0
$839.2

0.0
230.0
0.0
0.0
0.0
$876.0

0.0
0.0
30.0
$759.1

0.0
0.0
30.0
$795.8

0.0
0.0
30.0
$832.5

0.0
0.0
30.0
$869.2

0.0
0.0
30.0
$906.0

$294.7
8.0
0.0
226.4
0.0
0.0
230.0
$759.1

$316.1
8.9
0.0
240.7
0.0
0.0
230.0
$795.8

$337.5
9.9
0.0
255.0
0.0
0.0
230.0
$832.5

$359.0
10.9
0.0
269.3
0.0
0.0
230.0
$869.2

$380.4
12.0
0.0
283.6
0.0
0.0
230.0
$906.0

0.000

0.000

0.000

0.000

0.000

ule

$1,181.8
146.6
(100.0)
$1,228.4

$1,181.8
146.6
(100.0)
$1,228.4

$1,181.8
146.6
(100.0)
$1,228.4

$1,181.8
146.6
(100.0)
$1,228.4

$1,181.8
146.6
(100.0)
$1,228.4

$196.4
0.0

$210.7
0.0

$225.0
0.0

$239.3
0.0

$253.6
0.0

30.0
0.0
0.0
$226.4
0.0
0.0
$226.4

30.0
0.0
0.0
$240.7
0.0
0.0
$240.7

30.0
0.0
0.0
$255.0
0.0
0.0
$255.0

30.0
0.0
0.0
$269.3
0.0
0.0
$269.3

30.0
0.0
0.0
$283.6
0.0
0.0
$283.6

Purchase Price Allocation and Accounting Adjustments

($ in millions, except per share data)

Current
Price
$12.81

Transaction Prices Per

$12.00

$13.00

Fair Value of Options Issued by Acquirer

Unvested Options
Weighted Average Strike
Weighted Average Remaining Term (yrs)
Black Scholes Value Per Option
Options Outstanding
Fair Value of Unvested Options

$14.60
4.0
$5.89
0.980
$5.8

$14.60
4.0
$5.30
0.980
$5.2

$14.60
4.0
$6.03
0.980
$5.9

Vested Options
Weighted Average Strike
Weighted Average Remaining Term (yrs)
Black Scholes Value Per Option
Options Outstanding
Fair Value of Vested Options

$29.49
2.7
$2.28
0.476
$1.1

$29.49
2.7
$1.96
0.476
$0.9

$29.49
2.7
$2.35
0.476
$1.1

Purchase Price Calculation

Common Equity Consideration
Fair Value of Unvested Options
Fair Value of Vested Options
Fair Value of Preferred Stock
Total Purchase Price

$448.6
5.8
1.1
0.0
$455.5

$419.9
5.2
0.9
0.0
$426.0

$455.4
5.9
1.1
0.0
$462.4

Unearned Compensation
Adjusted Purchase Price

$0.0
$455.5

$0.0
$426.0

$0.0
$462.4

Purchase Price Allocation

Adjusted Purchase Price
Less: Target Book Value of Net Assets
Excess Purchase Price to Allocate

$455.5
(97.9)
$357.6

$426.0
(97.9)
$328.2

$462.4
(97.9)
$364.6

Write-Up of Tangible Assets

Write-Up of Identifiable Intangible Assets
Write-Off of Target's Existing Goodwill
Write-Off of Target's Existing DTL
Allocation to Goodwill (Before DTL Allocation)

$15.0
89.4
(61.1)
0.0
$314.3

$15.0
82.0
(61.1)
0.0
$292.2

$15.0
91.1
(61.1)
0.0
$319.5

DTL From Write-Up of Assets

DTL From Deferred Compensation
Total Goodwill Created

($14.4)
0.0
$328.7

($13.4)
0.0
$305.6

($14.6)
0.0
$334.1

Amortization of Identifiable Intangibles

Excess of Purchase Price Over Book Value
% Allocated to Identifiable Intangibles
Write-Up of Intangible Assets
Amortization Period (yrs)
Annual Incremental Amortization Expense

$357.6
25.0%
$89.4
5.0
$17.9

$328.2
25.0%
$82.0
5.0
$16.4

$364.6
25.0%
$91.1
5.0
$18.2

Marginal Tax Rate

After-Tax Annual Amortization Expense

13.8%
$15.4

13.8%
$14.1

13.8%
$15.7

Depreciation of Fixed Asset Write-Up

Write-Up of Tangible Assets
Depreciation Period (yrs)
Annual Incremental Depreciation Expense
Marginal Tax Rate
After-Tax Annual Depreciation Expense

$15.0
10.0
$1.5

$15.0
10.0
$1.5

$15.0
10.0
$1.5

13.8%
$1.3

13.8%
$1.3

13.8%
$1.3

Deferred Revenue Write-Down

TargetCo Deferred Revenue Balance
% Fair Value to Book Value
Deferred Revenue Write-Down

$20.0
25.0%
$15.0

$20.0
25.0%
$15.0

$20.0
25.0%
$15.0

Deferred Revenue Period (yrs)

Annual Deferred Revenue Write-Down

1.0
$15.0

1.0
$15.0

1.0
$15.0

Marginal Tax Rate

After-Tax Annual Write-Down Expense

13.8%
$12.9

13.8%
$12.9

13.8%
$12.9

Deferred Stock-Based Compensation Expense (FIN 44)

Intrinsic Value of Unvested Options
Write-Up for Deferred Compensation
Annual Compensation Expense
Margin Tax Rate
After-Tax Annual Compensation Expense

$0.0
0.0
0.0
13.8%
$0.0

$0.0
0.0
0.0
13.8%
$0.0

$0.0
0.0
0.0
13.8%
$0.0

Options Calculations

Tranche 1
Tranche 2
Tranche 3
Tranche 4
Tranche 5
Tranche 6
Tranche 7

Options
0.000
0.000
0.000
0.000
0.000
0.000
0.000

Ex. Price
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00

$12.81
$0.0
0.0
0.0
0.0
0.0
0.0
0.0

$12.00
$0.0
0.0
0.0
0.0
0.0
0.0
0.0

Intrinsic Value at Transaction

$13.00
$0.0
0.0
0.0
0.0
0.0
0.0
0.0

Tranche 8
Tranche 9
Tranche 10
Total

Tranche 1
Tranche 2
Tranche 3
Tranche 4
Tranche 5
Tranche 6
Tranche 7
Tranche 8
Tranche 9
Tranche 10
Total

0.000
0.000
0.000
0.000

$0.00
$0.00
$0.00

Vesting Period
Life
Remaining
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0

Tranche 1
Tranche 2
Tranche 3
Tranche 4
Tranche 5
Tranche 6
Tranche 7
Tranche 8
Tranche 9
Tranche 10
Total

Remaining
Vest. Per.
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0

Unvested Black Scholes Value

Stock Price
Strike Price
Expiration (yrs)
Volatility
Dividend Yield
Risk-Free Rate
d1
d2
N(d1)
N(d2)
Black Scholes Value Per Option
Vested Black Scholes Value
Stock Price
Strike Price
Expiration (yrs)
Volatility

0.0
0.0
0.0
$0.0

0.0
0.0
0.0
$0.0

0.0
0.0
0.0
$0.0

$0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
$0.0

$0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
$0.0

$0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
$0.0

$0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
$0.0

Annual Compensation Exp

$0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
$0.0

Unearned Compensation

$0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
$0.0

$12.81
$14.60
4.0
60.0%
0.0%
4.0%
0.6243
(0.5757)
0.7338
0.2824
$5.89

$12.00
$14.60
4.0
60.0%
0.0%
4.0%
0.5699
(0.6301)
0.7156
0.2643
$5.30

$13.00
$14.60
4.0
60.0%
0.0%
4.0%
0.6366
(0.5634)
0.7378
0.2866
$6.03

$12.81
$29.49
2.7
60.0%

$12.00
$29.49
2.7
60.0%

$13.00
$29.49
2.7
60.0%

Dividend Yield
Risk-Free Rate
d1
d2
N(d1)
N(d2)
Black Scholes Value Per Option

0.0%
4.0%
(0.2433)
(1.2292)
0.4039
0.1095
$2.28

0.0%
4.0%
(0.3095)
(1.2954)
0.3785
0.0976
$1.96

0.0%
4.0%
(0.2283)
(1.2142)
0.4097
0.1123
$2.35

Transaction Prices Per TargetCo Share

$14.00
$15.00
$16.00

$17.00

$18.00

sued by Acquirer

$14.60
4.0
$6.77
0.980
$6.6

$14.60
4.0
$7.54
0.980
$7.4

$14.60
4.0
$8.32
0.980
$8.2

$14.60
4.0
$9.12
0.980
$8.9

$14.60
4.0
$9.93
0.980
$9.7

$29.49
2.7
$2.78
0.476
$1.3

$29.49
2.7
$3.23
0.476
$1.5

$29.49
2.7
$3.71
0.476
$1.8

$29.49
2.7
$4.22
0.476
$2.0

$29.49
2.7
$4.74
0.476
$2.3

$491.1
6.6
1.3
0.0
$499.1

$526.8
7.4
1.5
0.0
$535.8

$562.5
8.2
1.8
0.0
$572.5

$598.3
8.9
2.0
0.0
$609.2

$634.0
9.7
2.3
0.0
$646.0

$0.0
$499.1

$0.0
$535.8

$0.0
$572.5

$0.0
$609.2

$0.0
$646.0

$499.1
(97.9)
$401.2

$535.8
(97.9)
$437.9

$572.5
(97.9)
$474.6

$609.2
(97.9)
$511.3

$646.0
(97.9)
$548.1

$15.0
100.3
(61.1)
0.0
$347.0

$15.0
109.5
(61.1)
0.0
$374.5

$15.0
118.7
(61.1)
0.0
$402.1

$15.0
127.8
(61.1)
0.0
$429.6

$15.0
137.0
(61.1)
0.0
$457.2

($15.9)
0.0
$362.9

($17.1)
0.0
$391.7

($18.4)
0.0
$420.5

($19.7)
0.0
$449.3

($20.9)
0.0
$478.1

alculation

Allocation

able Intangibles
$401.2
25.0%
$100.3
5.0
$20.1

$437.9
25.0%
$109.5
5.0
$21.9

$474.6
25.0%
$118.7
5.0
$23.7

$511.3
25.0%
$127.8
5.0
$25.6

$548.1
25.0%
$137.0
5.0
$27.4

13.8%
$17.3

13.8%
$18.9

13.8%
$20.5

13.8%
$22.0

13.8%
$23.6

$15.0
10.0
$1.5

$15.0
10.0
$1.5

$15.0
10.0
$1.5

$15.0
10.0
$1.5

$15.0
10.0
$1.5

13.8%
$1.3

13.8%
$1.3

13.8%
$1.3

13.8%
$1.3

13.8%
$1.3

$20.0
25.0%
$15.0

$20.0
25.0%
$15.0

$20.0
25.0%
$15.0

$20.0
25.0%
$15.0

$20.0
25.0%
$15.0

1.0
$15.0

1.0
$15.0

1.0
$15.0

1.0
$15.0

1.0
$15.0

13.8%
$12.9

13.8%
$12.9

13.8%
$12.9

13.8%
$12.9

13.8%
$12.9

$0.0
0.0
0.0
13.8%
$0.0

$0.0
0.0
0.0
13.8%
$0.0

$0.0
0.0
0.0
13.8%
$0.0

$0.0
0.0
0.0
13.8%
$0.0

Intrinsic Value at Transaction Price of:

$14.00
$15.00
$16.00
$0.0
$0.0
$0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0

$17.00
$0.0
0.0
0.0
0.0
0.0
0.0
0.0

$18.00
$0.0
0.0
0.0
0.0
0.0
0.0
0.0

Asset Write-Up

Write-Down

sation Expense (FIN 44)

$0.0
0.0
0.0
13.8%
$0.0

ulations

0.0
0.0
0.0
$0.0

0.0
0.0
0.0
$0.0

0.0
0.0
0.0
$0.0

0.0
0.0
0.0
$0.0

0.0
0.0
0.0
$0.0

Unearned Compensation Entry

$0.0
$0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
$0.0
$0.0

$0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
$0.0

$0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
$0.0

$0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
$0.0

Annual Compensation Expense

$0.0
$0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
$0.0
$0.0

$0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
$0.0

$0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
$0.0

$0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
$0.0

$14.00
$14.60
4.0
60.0%
0.0%
4.0%
0.6984
(0.5016)
0.7575
0.3080
$6.77

$15.00
$14.60
4.0
60.0%
0.0%
4.0%
0.7559
(0.4441)
0.7751
0.3285
$7.54

$16.00
$14.60
4.0
60.0%
0.0%
4.0%
0.8096
(0.3904)
0.7909
0.3481
$8.32

$17.00
$14.60
4.0
60.0%
0.0%
4.0%
0.8602
(0.3398)
0.8051
0.3670
$9.12

$18.00
$14.60
4.0
60.0%
0.0%
4.0%
0.9078
(0.2922)
0.8180
0.3851
$9.93

$14.00
$29.49
2.7
60.0%

$15.00
$29.49
2.7
60.0%

$16.00
$29.49
2.7
60.0%

$17.00
$29.49
2.7
60.0%

$18.00
$29.49
2.7
60.0%

0.0%
4.0%
(0.1532)
(1.1391)
0.4391
0.1273
$2.78

0.0%
4.0%
(0.0832)
(1.0691)
0.4669
0.1425
$3.23

0.0%
4.0%
(0.0177)
(1.0036)
0.4929
0.1578
$3.71

0.0%
4.0%
0.0438
(0.9421)
0.5175
0.1731
$4.22

0.0%
4.0%
0.1018
(0.8841)
0.5405
0.1883
$4.74

Pro Forma Balance Sheet

($ in millions, except per share data)

Transaction Value Per Share

$14.00

BuyerCo
3/31/2008

TargetCo
3/31/2008

Assets
Current Assets
Cash and Equivalents
Accounts Receivable
Inventory
Deferred Income Taxes
Other Current Assets
Total Current Assets

$1,181.8
568.5
0.0
109.0
113.5
$1,972.7

$146.6
131.4
0.0
8.8
8.2
$295.1

Net PP&E
Goodwill
Intangibles
Investments/Restricted Cash
Unearned Compensation
Deferred Financing Fees
Other Assets
Total Assets

$296.3
1,487.6
284.7
0.0
0.0
0.0
464.0
$4,505.4

$33.0
61.1
37.5
0.0
0.0
0.0
14.3
$440.9

$186.1
395.3
35.9
209.2
0.0
2.2
$828.7

$20.7
15.4
2.9
20.0
36.2
0.0
$95.2

Revolver
Non-Convertible Debt
Convertible Debt
Deferred Income Taxes
Other Long-Term Liabilities
Total Liabilities

$0.0
0.0
450.0
0.0
503.0
$1,781.7

$0.0
0.0
230.0
0.0
17.9
$343.1

Preferred Stock, par value

Common Stock, par value
APIC
Treasury Stock
Accum. & Other Comp. Income (Loss)
Retained Earnings
Total Stockholders' Equity
Total Liabilities and Stockholders' Equity

$0.0
3.9
2,212.7
(774.7)
6.6
1,275.2
$2,723.7
$4,505.4

$0.0
0.6
350.7
(667.9)
(0.4)
414.7
$97.9
$440.9

Liabilities and Stockholders' Equity

Current Liabilities
Accounts Payable
Accrued Expenses
Income Taxes Payable
Deferred Revenue
Other Current Liabilities
Current Portion of Long-Term Debt
Total Current Liabilities

Check

0.000

0.000

Adjustments
Write-Up
Financing

($226.4)

15.0
301.8
100.3
0.0
0.0

$0.0
0.0
0.0
15.9

$0.0
294.0
(342.8)
667.9
0.4
(444.7)

Pro Forma
3/31/2008

$1,102.0
699.9
0.0
117.8
121.7
$2,041.4
$344.3
1,850.5
422.5
0.0
0.0
0.0
478.3
$5,137.0

$206.8
410.7
38.8
229.2
36.2
2.2
$923.9
$0.0
0.0
680.0
15.9
520.9
$2,140.7
$0.0
298.5
2,220.7
(774.7)
6.6
1,245.2
$2,996.3
$5,137.0
0.000

Pro Forma Income Statement

($ in millions, except per share data)

FY Ended September 30,

2005A
2006A
2007A
Total Revenue
% Growth

2008E

FY Ending September 30,

2009E

$2,409.4
NA

$2,860.9
18.7%

$3,238.7
13.2%

$3,578.1
10.5%

$3,938.0
10.1%

COGS
COGS Synergies
% of Sales
Gross Profit
% Margin

1,478.1
61.3%
$931.3
38.7%

1,754.4
61.3%
$1,106.5
38.7%

1,978.7
61.1%
$1,260.0
38.9%

2,185.1
61.1%
$1,393.0
38.9%

2,363.3
(25.0)
59.4%
$1,599.7
40.6%

SG&A
SG&A Synergies
% of Sales

300.2
12.5%

454.2
15.9%

557.2
17.2%

594.9
16.6%

714.0
(50.0)
16.9%

EBITDA
% Margin

$631.1
26.2%

$652.3
22.8%

$702.8
21.7%

$798.1
22.3%

$935.7
23.8%

Existing Depreciation
New Depreciation
% of Sales
Existing Amortization
New Amortization
% of Sales
Total D&A
% of Sales

92.5
3.8%
41.1
1.7%
133.6
5.5%

91.4
3.2%
55.8
2.0%
147.2
5.1%

102.1
3.2%
93.6
2.9%
195.7
6.0%

122.9
1.5
3.5%
81.4
20.1
2.8%
225.9
6.3%

88.8
1.5
2.3%
81.9
20.1
2.6%
192.3
4.9%

Stock-Based Comp
% of Sales

61.0
2.5%

59.6
2.1%

64.9
2.0%

65.3
1.8%

64.3
1.6%

EBIT
% Margin

$436.5
18.1%

$445.5
15.6%

$442.2
13.7%

$506.9
14.2%

$679.1
17.2%

EBITA
% Margin

$538.6
22.4%

$560.9
19.6%

$600.7
18.5%

$673.7
18.8%

$845.4
21.5%

Interest (Income) / Expense

Equity (Income)
Minority Interest
Other (Income) / Expense
Other Transaction Adjustments

(39.2)
(0.1)
0.0

(39.8)
15.0

Income Before Taxes

$713.0

$870.2

Provision for Tax

% Tax Rate

98.2
13.8%

119.8
13.8%

PF Cash Net Income

% Margin

$614.8
17.2%

$750.4
19.1%

PF Cash Diluted EPS

$2.67

$3.21

230.380

233.567

Diluted Shares Out

BuyerCo Standalone Cash Diluted EPS

$ Accretion / (Dilution)
% Accretion / (Dilution)
Incremental Pre-Tax Synergies to Breakeven

$2.34
$0.33
14.3%
($89.1)

$2.71
$0.51
18.7%
($137.2)

Capex
% of Sales

$199.1
5.6%

$217.7
5.5%

FY Ending September 30,

2010E
2011E

2012E

$4,326.5
9.9%

$4,760.1
9.9%

$5,241.5
9.9%

2,600.0
(25.0)
59.5%
$1,751.5
40.5%

2,863.7
(25.0)
59.6%
$1,921.5
40.4%

3,156.5
(25.0)
59.7%
$2,110.1
40.3%

767.9
(50.0)
16.6%

844.0
(50.0)
16.7%

928.4
(50.0)
16.8%

CAGR
2008-2012
10.0%

10.9%

$1,033.6
23.9%

$1,127.5
23.7%

$1,231.7
23.5%

99.5
1.5
2.3%
82.0
20.1
2.4%
203.1
4.7%

109.1
1.5
2.3%
82.0
20.1
2.1%
212.7
4.5%

119.8
1.5
2.3%
82.0
20.1
1.9%
223.4
4.3%

70.3
1.6%

77.0
1.6%

84.5
1.6%

$760.2
17.6%

$837.7
17.6%

$923.8
17.6%

16.2%

$932.6
21.6%

$1,016.8
21.4%

$1,110.4
21.2%

13.3%

(47.8)
0.0

(47.8)
0.0

11.5%

(47.8)
0.0

$980.4

$1,064.6

$1,158.1

12.9%

135.0
13.8%

146.6
13.8%

159.5
13.8%

$845.4
19.5%

$918.0
19.3%

$998.7
19.1%

12.9%

$3.56

$3.80

$4.07

11.1%

237.567

241.567

245.567

$3.02
$0.54
17.8%
($148.3)

$3.28
$0.52
16.0%
($146.6)

$3.56
$0.51
14.3%
($144.7)

$240.5
5.6%

$207.1
4.4%

$204.9
3.9%

BuyerCo Income Statement

($ in millions, except per share data)

FY Ended September 30,

2005A
2006A
2007A
Total Revenue
% Growth

2008P

FY Ending September 30,

2009P

$2,038.6
NA

$2,480.1
21.7%

$2,836.2
14.4%

$3,120.0
10.0%

$3,470.0
11.2%

COGS
% of Sales
Gross Profit
% Margin

1,295.6
63.6%
$743.0
36.4%

1,565.8
63.1%
$914.3
36.9%

1,771.0
62.4%
$1,065.2
37.6%

1,945.5
62.4%
$1,174.5
37.6%

2,113.5
60.9%
$1,356.5
39.1%

SG&A
% of Sales

253.6
12.4%

392.3
15.8%

482.4
17.0%

506.6
16.2%

622.3
17.9%

EBITDA
% Margin

$489.4
24.0%

$522.0
21.0%

$582.8
20.5%

$667.9
21.4%

$734.2
21.2%

Depreciation
% of Sales
Amortization
% of Sales
Total D&A
% of Sales

78.5
3.9%
15.4
0.8%
$93.9
4.6%

80.3
3.2%
37.6
1.5%
$117.9
4.8%

90.0
3.2%
75.0
2.6%
$165.0
5.8%

108.8
3.5%
61.8
2.0%
$170.6
5.5%

74.7
2.2%
62.0
1.8%
$136.7
3.9%

Stock-Based Comp
% of Sales

44.5
2.2%

46.2
1.9%

53.6
1.9%

54.5
1.7%

53.7
1.5%

EBIT
% Margin

$351.0
17.2%

$357.9
14.4%

$364.2
12.8%

$442.8
14.2%

$543.8
15.7%

EBITA
% Margin

$410.9
20.2%

$441.7
17.8%

$492.8
17.4%

$559.1
17.9%

$659.5
19.0%

Interest (Income) / Expense

Equity (Income)
Minority Interest
Other (Income) / Expense
Income Before Taxes

(26.6)
4.3
$433.2

(45.5)
3.8
$483.4

(42.6)
(8.0)
$543.4

(36.8)
$595.9

(44.3)
$703.8

Provision for Tax

% Tax Rate

85.8
19.8%

71.4
14.8%

57.3
10.5%

79.6
13.4%

96.9
13.8%

Cash Net Income

% Margin

$347.4
17.0%

$412.0
16.6%

$486.1
17.1%

$516.3
16.5%

$606.9
17.5%

Cash Diluted EPS

$1.63

$1.89

$2.18

$2.34

$2.71

Diluted Shares Out

212.571

218.534

223.256

221.099

224.286

$12.3
35.7
10.1

$32.0
39.4
21.9

$67.1
47.9
6.1

$53.5
47.2
-

$53.5
46.3
-

$289.3

$318.7

$365.0

$415.5

$507.1

Cash to GAAP Reconciliation:

Amortization
Stock-Based Comp
One-Time Charges
GAAP Net Income

% Margin

14.2%

12.8%

12.9%

13.3%

14.6%

GAAP Diluted EPS

$1.36

$1.46

$1.63

$1.88

$2.26

Capex
% of Sales

$71.4
3.5%

$80.7
3.3%

$166.4
5.9%

$183.1
5.9%

$203.6
5.9%

FY Ending September 30,

2010P
2011E

2012E

CAGR
2008-2012

$3,856.0
11.1%

$4,284.9
11.1%

$4,761.6
11.1%

11.1%

2,347.8
60.9%
$1,508.2
39.1%

2,609.0
60.9%
$1,676.0
39.1%

2,899.2
60.9%
$1,862.4
39.1%

675.5
17.5%

750.6
17.5%

834.1
17.5%

$832.7
21.6%

$925.3
21.6%

$1,028.3
21.6%

85.4
2.2%
62.0
1.6%
$147.4
3.8%

94.9
2.2%
62.0
1.4%
$156.9
3.7%

105.5
2.2%
62.0
1.3%
$167.5
3.5%

59.6
1.5%

66.2
1.5%

73.6
1.5%

$625.7
16.2%

$702.2
16.4%

$787.2
16.5%

15.5%

$747.3
19.4%

$830.4
19.4%

$922.8
19.4%

13.3%

(52.3)
$799.6

(52.3)
$882.7

(52.3)
$975.1

110.1
13.8%

121.5
13.8%

134.3
13.8%

$689.5
17.9%

$761.2
17.8%

$840.8
17.7%

13.0%

$3.02

$3.28

$3.56

11.1%

228.286

232.286

236.286

$53.5
51.4
-

$53.5
57.1
-

$53.5
63.5
-

$584.6

$650.6

$723.9

12.2%

11.4%

13.1%

14.9%

15.2%

15.2%

15.2%

$2.56

$2.80

$3.06

$226.3
5.9%

$192.8
4.5%

$190.5
4.0%

13.0%

TargetCo Income Statement

($ in millions, except per share data)

FY Ended September 30,

2005A
2006A
2007A

2008P

FY Ending September 30,

2009P

Total Revenue
% Growth

$370.8
NA

$380.8
2.7%

$402.5
5.7%

$458.1
13.8%

$468.0
2.2%

COGS
% of Sales
Gross Profit
% Margin

182.5
49.2%
$188.3
50.8%

188.6
49.5%
$192.2
50.5%

207.7
51.6%
$194.8
48.4%

239.6
52.3%
$218.5
47.7%

249.8
53.4%
$218.2
46.6%

SG&A
% of Sales

46.6
12.6%

61.9
16.3%

74.8
18.6%

88.3
19.3%

91.7
19.6%

EBITDA
% Margin

$141.7
38.2%

$130.3
34.2%

$120.0
29.8%

$130.2
28.4%

$126.5
27.0%

Depreciation
% of Sales
Amortization
% of Sales
Total D&A
% of Sales

14.0
3.8%
25.7
6.9%
$39.7
10.7%

11.1
2.9%
18.2
4.8%
$29.3
7.7%

12.1
3.0%
18.6
4.6%
$30.7
7.6%

14.1
3.1%
19.6
4.3%
$33.7
7.4%

14.1
3.0%
19.9
4.3%
$34.0
7.3%

16.5
4.4%

13.4
3.5%

11.3
2.8%

10.8
2.4%

10.6
2.3%

EBIT
% Margin

$85.5
23.1%

$87.6
23.0%

$78.0
19.4%

$85.7
18.7%

$81.9
17.5%

EBITA
% Margin

$127.7
34.4%

$119.2
31.3%

$107.9
26.8%

$116.1
25.3%

$112.4
24.0%

Interest (Income) / Expense

Equity (Income)
Minority Interest
Other (Income) / Expense
Income Before Taxes

4.9
0.1
$122.7

0.9
$118.3

$107.9

(2.4)
(0.1)
$118.6

$112.4

Provision for Tax

% Tax Rate

24.3
19.8%

17.5
14.8%

11.4
10.5%

15.8
13.4%

15.5
13.8%

Cash Net Income

% Margin

$98.4
26.5%

$100.8
26.5%

$96.5
24.0%

$102.8
22.4%

$96.9
20.7%

Cash Diluted EPS

$2.81

$2.98

$2.71

$2.85

$2.65

Diluted Shares Out

35.064

33.880

35.580

36.080

36.580

Cash to GAAP Reconciliation:

Amortization
Stock-Based Comp
One-Time Charges

$20.6
13.2
8.2

$15.5
11.4
3.4

$16.6
10.1
0.7

$17.0
9.4
0.1

$17.2
9.1
-

GAAP Net Income

$56.4

$70.5

$69.1

$76.3

$70.6

Stock-Based Comp
% of Sales

% Margin

15.2%

18.5%

17.2%

16.7%

15.1%

GAAP Diluted EPS

$1.61

$2.08

$1.94

$2.12

$1.93

Capex
% of Sales

$26.0
7.0%

$12.5
3.3%

$18.0
4.5%

$16.0
3.5%

$14.1
3.0%

FY Ending September 30,

2010P
2011E

2012E

CAGR
2008-2012

$470.5
0.5%

$475.2
1.0%

$480.0
1.0%

1.2%

252.2
53.6%
$218.3
46.4%

254.7
53.6%
$220.5
46.4%

257.3
53.6%
$222.7
46.4%

92.4
19.6%

93.3
19.6%

94.3
19.6%

$125.9
26.8%

$127.2
26.8%

$128.4
26.8%

14.1
3.0%
20.0
4.3%
$34.1
7.2%

14.2
3.0%
20.0
4.2%
$34.2
7.2%

14.4
3.0%
20.0
4.2%
$34.4
7.2%

10.7
2.3%

10.8
2.3%

10.9
2.3%

$81.1
17.2%

$82.1
17.3%

$83.1
17.3%

(0.8%)

$111.8
23.8%

$112.9
23.8%

$114.0
23.8%

(0.4%)

$111.8

$112.9

$114.0

15.4
13.8%

15.5
13.8%

15.7
13.8%

$96.4
20.5%

$97.4
20.5%

$98.3
20.5%

(1.1%)

$2.64

$2.66

$2.69

(1.4%)

36.580

36.580

36.580

$17.2
9.2
-

$17.2
9.3
-

$17.2
9.4
-

$69.9

$70.8

$71.7

0.5%

(0.3%)

(1.0%)

(1.6%)

14.9%

14.9%

14.9%

$1.91

$1.94

$1.96

$14.2
3.0%

$14.3
3.0%

$14.5
3.0%

(1.9%)

TargetCo DCF Valuation

($ in millions, except per share data)

FY Ending September 30,

2009
2010

2007

2008

Revenue
% Growth

$402.5
5.7%

$458.1
13.8%

$468.0
2.2%

$470.5
0.5%

EBITDA
% Margin

120.0
29.8%

130.2
28.4%

126.5
27.0%

125.9
26.8%

Less: Depreciation
EBITA
Tax Rate

(12.1)
107.9
35.0%

(14.1)
116.1
35.0%

(14.1)
112.4
35.0%

(14.1)
111.8
35.0%

$70.1

$75.5

$73.1

$72.7

12.1
(18.0)
(9.5)

14.1
(16.0)
8.3

14.1
(14.1)
3.1

14.1
(14.2)
1.6

$54.7

$81.9

$76.2

$74.2

Unlevered Net Income

Plus: Depreciation
Less: Capital Expenditures
Less: Change in Working Capital
Free Cash Flow

DCF Analysis (2008-2012): EBITDA Multiple Method

Discount
Rate
(WACC)

Discount
Rate
(WACC)

11.0%
12.0%
13.0%

Total Enterprise Value

Terminal EBITDA Multiple
4.5x
5.0x
5.5x
$627.7
$665.8
$703.9
$605.7
$642.1
$678.6
$584.8
$619.6
$654.5

11.0%
12.0%
13.0%

Implied Perpetuity Growth Rate

Terminal EBITDA Multiple
4.5x
5.0x
5.5x
(2.0%)
(0.8%)
0.2%
(1.1%)
0.1%
1.1%
(0.2%)
1.0%
2.0%

(1) Assumes net debt of $83.4mm as of 5/16/08.

(2) Assumes outstanding diluted shares of 35.021 million.

Terminal EBITDA
Discount
Rate
(WACC)

11.0%
12.0%
13.0%

Terminal EBITDA
Discount
Rate
(WACC)

11.0%
12.0%
13.0%

tember 30,

CAGR
2008-2012

2011

2012

$475.2
1.0%

$480.0
1.0%

1.2%

127.2
26.8%

128.4
26.8%

(0.3%)

(14.2)
112.9
35.0%

(14.4)
114.0
35.0%

(0.4%)

$73.4

$74.1

(0.4%)

14.2
(14.3)
1.9

14.4
(14.5)
2.3

$75.2

$76.4

(1.7%)

Total Equity Value (1)

Terminal EBITDA Multiple
4.5x
5.0x
5.5x
$544.3
$582.4
$620.5
$522.3
$558.7
$595.2
$501.4
$536.2
$571.1
Total Price Per Share (2)
Terminal EBITDA Multiple
4.5x
5.0x
5.5x
$15.54
$16.63
$17.72
$14.91
$15.95
$16.99
$14.32
$15.31
$16.31

Net Debt
FDSO

$83.4
35.021