INVESTMENT TEAM - Merit Capital · INVESTMENT TEAM Investment Team: ... David M. Jones, ......

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Merit’s partners average over 20 years of investing experience. Our diverse backgrounds and long tenures in the deal business have resulted in a well-defined investment strategy and the confidence to creatively structure our investment to fit each opportunity’s distinctive circumstances.

Thomas F. Campion, CFA, Managing Director, joined Merit in 1997. From 1993 to 1997, Tom was a Director of Prudential Asset Management Asia in Hong Kong, a general partner of private equity funds, including equity investments in private companies throughout the Asia Pacific region. From 1987 through 1992, Tom was a Vice President of Prudential Capital Corporation in Newark and Chicago, responsible for originating and managing private placements. While at Prudential Capital, he also earned his Charted Financial Analyst designation. From 1983 to 1986, Tom worked at the former Arthur Andersen in Milwaukee, where he received his Certified Public Accountant designation.

Tom received his M.B.A. from the University of Wisconsin, Madison, where he graduated with honors and his B.B.A. in Accountancy from St. Norbert College, where he graduated magna cum laude.

Tom currently serves on the Board of Directors of Brook Furniture Rental, MTI International, Inc., The Plastics Group, Inc., Manistique Papers, Inc., Dr. Comfort LLC, Active Minerals International, LLC and Ferrara Fire Apparatus, Inc.

Tom’s community activities include coaching his four children, and serving on the St. Norbert College Advisory Board, the Highlands Foundation and the Apostolate to the Handicapped Board.

Evan R. Gallinson, Principal, joined Merit in 2005. Evan was previously in the Mergers and Acquisitions group at BMO Capital. Prior to that, Evan worked in Corporate Finance at William Blair & Company, and focused on mergers acquisitions as well as public and private equity offerings. Evan also worked in the Mergers Acquisitions group at PriceWaterhouseCoopers.

Evan received his M.B.A. from Northwestern University’s Kellogg School of Management with a concentration in finance and entrepreneurship. He earned his B.B.A. with a concentration in finance from the University of Michigan.

Evan currently serves on the Board of Directors of B.E.T. – er Mix, Inc., Manistique Papers, Inc., Design Space, Inc., Cobra Wire Cable and Digney York.

Evan is currently a Co-Chairman of Chicago Area Private Equity Executives (CAPEX). He is an active member with University of Michigan’s Ross School of Business Alumni Club of Chicago.

INVESTMENT TEAM

Investment Team: pp 1-5 Active Investments: pp 6-12 Realized Investments: pp 12-20


David M. Jones, Managing Director, joined Merit in 1993 in conjunction with the closing and initial investing of Fund I. David was previously a senior consultant with Peterson Consulting, a national business valuation and litigation consulting firm, and specialized in business and product line valuations in intellectual property disputes.

David earned an M.B.A. with honors from the University of Chicago and a B.B.A. from the University of Notre Dame in 1988.

A Managing Director of Merit Capital Partners since 2000, David currently serves on the Board of Directors of Peerless Industrial Group, Inc., Sales Performance International, Inc., B.E.T. - er Mix, Inc. and Cobra Wire Cable.

David, currently attempting to survive raising 11-year-old triplets, coaches youth soccer and baseball and is active in St. Mary Church of Riverside, Illinois. David also is active with the Employee Stock Ownership Association having served as a member of the Finance Committee since 2001.

Leonard H. Lillard, CFA, Principal, joined Merit in 2006. From 1999 to 2005, Len was a Co-Founder and Principal of WestCap Partners Private Equity Fund. WestCap focused on acquiring lower middle-market companies with attractive growth prospects located in the Western United States. From 1996 to 1998, Len was a Director of Banc One Capital Partners where he established the firm’s western Regional Office in Phoenix, Arizona. Prior to that Len served nine years at Prudential Capital Corporation, an affiliate of the Prudential Insurance Company of America. In these capacities, he invested over $1 billion in senior debt, mezzanine and equity securities.

Len is a Chartered Financial Analyst and received an M.B.A. and B.S. from the University of Michigan where he was awarded an athletic scholarship to play varsity basketball.

Len has served on the Board of Directors for Desert Plastics and Unique Home Design, Inc. He is also a Trustee and head of the Investment Committee for Phoenix Country Day School. Len serves on the Board of Directors for VTI Instruments Corporation.

Len’s community activities include coaching and supporting the various soccer, chess and basketball teams his three sons participate in as well as Boys Team Charity events. Len and his wife Karen reside in Paradise Valley, Arizona.


Timothy J. MacKenzie, CFA, Managing Director, joined Merit in 1993 in conjunction with the closing and initial investing of Fund I. Tim was previously a Senior Vice President of Fiduciary Capital, an investment advisor to two publicly raised mezzanine funds located in Milwaukee. Prior to that, he worked at Prudential Capital Corporation in both the Dallas and Milwaukee regional offices, most recently as Vice President in charge of the Milwaukee office. His responsibilities with Prudential Capital included the management of a significant portfolio and the generation of private placement and mezzanine investments. From 1982 to 1986, Tim was a Vice President with RepublicBank Dallas, specializing in domestic and multi-national middle market lending.

Tim received his M.B.A. from the University of Illinois with a concentration in finance and a B.A. from Northwestern University in 1980 with a major in economics. Tim received the designation of Chartered Financial Analyst in 1990.

As a Managing Director of Merit Capital Partners since 1993, Tim currently serves on the Board of Directors of May Logistics Services, Inc., Design Space, Inc., Digney York, Skyline Windows, LLC. and Alden Industries, Inc.

Tim’s community activities include coaching his three children in soccer, basketball and baseball. He is a former Chairman of Young Life-DuPage County, a non-denominational outreach ministry targeting high school students. Tim is actively involved as a mentor with Bridge Communities, a transitional housing association working with homeless families. He is a Member of the local AYSO Board of Directors and former Trustee of his local church.

Jason B. Moskowitz, Vice President, joined Merit in 2007. Jason was previously an Associate at Pfingsten Partners, a middle market private equity firm. Prior to Pfingsten, Jason worked in the corporate finance department at William Blair & Company in Chicago and London, focusing on mergers and acquisitions as well as private and public equity offerings.

Jason received an M.B.A. from Northwestern University’s Kellogg School of Management with a concentration in finance and a B.B.A., magna cum laude, from the University of Notre Dame with a concentration in finance and business economics.

Jason currently serves on the Board of Directors of Fleischer’s Bagels, Inc. and Tom Cat Bakery, Inc. He also works extensively with the management of Angus Industries, Inc.


Daniel E. Pansing, Managing Director, joined Merit in 1999. He began his career at the First National Bank of Omaha where he was a Management Trainee, gaining exposure to all aspects of the bank’s operations. He later joined the bank’s Commercial Lending Department. In 1995, Dan moved to Chicago to join LaSalle Bank’s (now Bank of America) credit training program. As a Commercial Loan Officer at LaSalle, Dan focused on leveraged and asset based transactions with middle market companies.

Dan received his M.B.A., with honors, in 1999 from the Anderson School at U.C.L.A. As a Venture Fellow, his studies focused on finance and entrepreneurial studies. In 1993, Dan earned a B.S. in Political Science, magna cum laude, from Miami University in Oxford, Ohio. He graduated Phi Beta Kappa.

Dan is involved with several Merit portfolio companies, serving on the Board of Directors of Angus Industries, Inc. and Skyline Windows, LLC. He is also active with Clarion Technologies.

In addition to his community service activities, Dan is a member of the Association for Corporate Growth and the Employee Stock Ownership Association.

Terrance M. Shipp, Managing Director, is a founding partner of Merit. Prior to forming the general partner of Fund I in 1991, Terry was a Partner in LaSalle Capital Group, a Chicago-based management buyout firm. Between 1982 and 1990, Terry worked at Prudential Capital Corporation, most recently as Regional Vice President in charge of the firm’s Chicago and Cleveland offices, which specialized in middle-market mezzanine investments. Terry was responsible for a staff of approximately 12 investment professionals and a portfolio over $1 billion. During his eight years with Prudential Capital, he was actively involved in a significant number of the mezzanine investments generated by the Chicago office. His responsibilities included origination, structuring, due diligence, negotiation, monitoring and disposition activities.

Terry received his M.B.A., with distinction, from Northwestern University’s Kellogg Graduate School of Management and a B.S., magna cum laude, from the University of Colorado.

Terry currently serves on the Board of Directors of Peerless Industrial Group, Acme Industries, Inc., MTI International, Inc., The Plastics Group, Inc., Fleischer’s Bagels, Versatile Processing Group and Tom Cat Bakery, Inc.

Terry is actively involved in his local church and community soccer organization as well as a host of other charitable causes.


Marc J. Walfish, Managing Director, is a founding partner of Merit Capital Partners. Prior to founding Merit, Marc worked for thirteen years at The Prudential Insurance Company of America, most recently as Senior Vice President of Prudential Capital Corporation. In this capacity, Marc was based in Chicago and was responsible for the firm’s four Midwest offices and a portfolio of over $2 billion.

Marc earned his M.B.A. and B.S.B.A., cum laude, from Boston University.

Marc currently serves on the Board of Directors of AAR Corporation, May/ADS and VTI Instruments Corporation.

Marc’s community service activities include coaching youth soccer and serving on the Board of the local AYSO. Marc also serves on the Board of his local community and is a past President. Marc serves as a regular guest lecturer at the University of Iowa’s Tippie College of Business.

Benjamin W. Yarbrough, Vice President, joined Merit in 2008. Ben was previously a Consultant at Marakon Associates, a boutique strategy consulting firm based in New York City and London serving global Fortune 200 clients. At Marakon, Ben worked across various industries, including healthcare, financial services and consumer products. Prior to Marakon, Ben was a Fellow at the United States Golf Association Foundation in Colorado Springs, helping to manage the USGA’s grants program.

Ben received an M.B.A. from the University of Chicago Graduate School of Business with concentrations in finance and entrepreneurship. He earned his B.A. in economics from the University of Pennsylvania.

Ben currently serves on the Board of Directors of Ferrara Fire Apparatus, Inc.


Active Minerals International, LLC | activeminerals.comDate of Investment: May 2007Date of Disposition: ActiveActive Minerals International, LLC, (“AMI”), headquartered in Hunt Valley, Maryland, is a processor and global distributor of industrial minerals. AMI conducts manufacturing operations in two facilities, located in Georgia and Florida, and maintains four separate sales facilities throughout Asia in Taipei, Taiwan; Shanghai, China; Tokyo, Japan; and Seoul, South Korea. AMI controls significant reserves of high quality kaolin and attapulgite clay in the Southeastern United States.

Merit provided subordinated debt and equity to finance the acquisition.

Alden Industries, Inc. | pvi.comDate of Investment: June 2008Date of Disposition: ActiveAlden Industries, Inc. (“Alden”), a holding company formed in 1990, is headquartered in Fort Worth, Texas where it manufactures commercial water heaters, firetube boilers, multi-tube boilers and related component parts. Alden serves the North American commercial and institutional water heater markets through three operating subsidiaries: PVI Industries, LLC, Webster Engineering and Manufacturing Co., and Riverside Hydronics, LLC. The company maintains manufacturing facilities in Fort Worth, Texas and Winfield, Kansas.

Merit provided subordinated debt to finance the recapitalization.

Merit Capital Partners invests across the United States primarily in manufacturing, services, or distribution businesses. Our investments are typically structured as buyouts, recapitalizations, or growth/acquisition financings and are sourced directly or through investment banks or larger equity funds.

We invest alongside management and shareholders in a variety of different transactions:

• Management Buyouts • Shareholder Liquidity / Recapitalizations • Acquisition and Growth Financings • Corporate Divestitures • ESOP Financings • Fundless / Small Fund Sponsored Transactions

ACTIVE INVESTMENTS

PORTFOLIO


Angus Industries, Inc. | angus-palm.comDate of Investment: September 2004Date of Disposition: ActiveAngus Industries, Inc. is one of the largest manufacturers of operator stations and rollover protective structures (e.g. cabs) for mobile equipment in the United States. The Company designs and manufactures cabs for the construction, agricultural, mining, forestry, and material handling equipment industries, among others. The Company is headquartered in Watertown, South Dakota, with additional manufacturing facilities in Greeneville, Tennessee, Northwood, Iowa and Florence, South Carolina.

Merit provided subordinated debt in support of the recapitalization of the ESOP.

B.E.T. – er Mix, Inc. | betermix.comDate of Investment: June 2006Date of Disposition: ActiveB.E.T. – er Mix, Inc. (“BMI”) is a manufacturer and distributor of ready mixed concrete and concrete block to the Tampa, Florida metropolitan area. The Company owns and operates two ready mixed plants in Hudson and Zephyrhills, Florida, as well as two block machines in Hudson. BMI owns its distribution fleet of 46 front-loading mixer trucks and seven block-hauling trucks.


Brook Furniture Rental, Inc. | bfr.comDate of Investment: July 1998Date of Disposition: ActiveBrook Furniture Rental, Inc. (“Brook”), headquartered in Chicago, Illinois, primarily rents furniture, accessories and related services to individuals, corporations and small companies in the “rent-to-rent” segment of the furniture rental industry. The “rent-to-rent” segments serve both corporate and individual customers who desire flexibility in meeting their temporary and transitional needs. Brook’s current key markets—, Los Angeles, San Francisco and Chicago, are all significant business centers. In addition, Brook has expanded into the Atlanta, Dallas and Washington, DC markets.

Merit provided subordinated debt with warrants to finance the recapitalization and expansion.

Clarion Technologies, Inc. | clariontechnologies.comDate of Investment: July 2000Date of Disposition: ActiveClarion Technologies, Inc. (“Clarion”), headquartered in Grand Rapids, Michigan, is a full-service injection molder. Clarion supplies injection molded plastic parts to customers in three primary industries: consumer goods and appliances, automotive and office furniture. In each of these markets, Clarion aims to serve large customers with multi-year programs. Sales efforts in Clarion’s consumer and appliance are generally aimed at OEMs such as Frigidaire, Maytag, and American Yard Products. In the automotive industry, Clarion focuses on serving Tier 1 automotive suppliers such as Visteon, Delphi, Magna, JCI, and Lear.

Merit provided subordinated debt with warrants to finance Clarion’s acquisition program.


Cobra Wire and Cable, Inc. | cobrawire.comDate of Investment: March 2007Date of Disposition: ActiveCobra Wire and Cable, Inc. (“Cobra”) develops and sells proprietary wire and cable products that are utilized by customers in a variety of industries. The Company’s products serve niche applications where performance under severe operating conditions is critical to maintaining optimal performance and flexibility. Cobra maintains its headquarters in Hatboro, Pennsylvania and also has warehouses and sales centers in Plano, Texas and Sparks, Nevada.

Merit invested both subordinated debt and equity in support of the acquisition.

Design Space, Inc. | designspaceinc.comDate of Investment: December 2006Date of Disposition: ActiveDesign Space, Inc. (“DSI”) is a leading regional manufacturer of modular buildings. The vast majority of DSI’s buildings are manufactured for commercial uses such as mobile construction field offices, office buildings, classrooms, health care/medical buildings, daycare centers, and toilet/shower units. DSI sells through a network of dealers rather than working directly with the buildings ultimate customer. Approximately 95% of these structures are custom built to the end-user’s specifications. DSI operates three plants in southern Georgia.


Digney York, LLC | digneyyork.comDate of Investment: August 2007Date of Disposition: ActiveDigney York, LLC (“Digney”), headquartered in Vienna, Virginia, is a provider of interior renovation services to the luxury hospitality industry. The majority of Digney’s projects include the renovation of luxury hotel guest rooms to customer specifications, although the Company will also rework other areas of the hotel including the lobby area and other public spaces. The Company is able to provide its services throughout North America.

Merit invested both subordinated debt and equity in support of the recapitalization.

Dr. Comfort, LLC | drcomfortdpm.comDate of Investment: February 2006Date of Disposition: ActiveDr. Comfort, LLC (“Dr. Comfort”) provides therapeutic shoes and custom inserts primarily to the niche diabetic footwear segment. Headquartered in Mequon, Wisconsin, the Company serves the 21 million diabetics in the United States, of which roughly 25% will develop diabetes related foot problems, through a nationwide network of podiatrists and drugstores.

Merit provided subordinated debt and equity in support of the recapitalization.


Ferrara Fire Apparatus, Inc. | ferrarafire.comDate of Investment: March 2009Date of Disposition: ActiveFerrara Fire Apparatus, Inc., (“FFA”), headquartered in Holden, Louisiana, manufactures and sells fire apparatus in the United States and internationally. FFA manufactures over 300 fire trucks per year at its Louisiana facility and sells both directly and through a network of independently owned dealers. FFA was founded by Chris Ferrara in 1982 and has quickly grown to become one of the leading US manufacturers of fire apparatus, offering Pumpers, Aerials, Tankers and Rescue Vehicles.

Merit provided subordinated debt and equity to finance a recapitalization with Chris Ferrara remaining as President and CEO.

Fleischer’s Bagels, Inc. | fleischersbagels.comDate of Investment: July 2005Date of Disposition: ActiveFleischer’s Bagels, Inc. (“Fleischer’s”), headquartered in Macedon, New York, is one of the country’s leading producers of premium quality packaged bagels. Fleischer’s produces and sells approximately 200 million fresh, frozen, and refrigerated packaged bagels annually. Fleischer’s sells and distributes bagels primarily through grocery stores and mass merchants under the Fleischer’s brand name, as well as private label and co-pack arrangements. The Company also has a facility in Charlotte, North Carolina.


ISI Detention Contracting Group, Inc. | isidet.comDate of Investment: October 2004Date of Disposition: ActiveISI Detention Contracting Group, Inc., is a provider of fully integrated hardware, electronic security equipment, and low voltage products (access control, closed circuit television, alarms, etc.) to the correction facility market as well as the private commercial and industrial markets across the U.S. The Company is headquartered in San Antonio, Texas with additional facilities in Dallas, Austin and Denver.

Merit provided subordinated debt in support of the recapitalization.

Manistique Papers, Inc. | manistiquepapers.comDate of Investment: November 2006Date of Disposition: ActiveManistique Papers, Inc. (“MPI”) is a producer of uncoated groundwood specialty papers and newsprint made from 100% recycled fiber. The Company is located in Manistique, Michigan and has been manufacturing paper since 1920. MPI operates a single paper machine that has over 130,000 tons of annual capacity. MPI’s products mainly serve the commercial printing industry, with niche positions in foodservice and office products. The largest end use of the Company’s paper for free-standing inserts, which are typically distributed along with newspapers.



May Logistics Services, Inc. | maylogistics.comDate of Investment: December 1998Date of Disposition: ActiveMay Logistics Services, Inc. (“May”), headquartered in Homewood, Illinois, provides logistics management and a variety of customized services related to its customers’ logistics needs through its operating subsidiary ADS. ADS is a national provider of logistics services to producers and consumers of steel, aluminum and non-ferrous metals.

Merit provided subordinated debt and common stock used to finance the acquisition by management and a major equity fund sponsor.

MTI International, Inc. | mtielectronics.comDate of Investment: May 1999Date of Disposition: ActiveMTI International, Inc. (“MTI”), headquartered in Menomonee Falls, Wisconsin, is a full service provider of electronic contract manufacturing services, including the design and testing of PCB assemblies and custom thick-film hybrid circuit design and manufacturing. MTI offers both low cost and regional manufacturing solutions by providing complete turnkey services which include component procurement, PCB assembly, box build, in-circuit test development, functional test development, printed circuit board layout and hybrid microcircuit design. MTI provides its manufacturing services to several industries, including telecommunications, computers and peripherals, industrial controls, medical, automotive, gaming and consumer products.

Merit provided subordinated debt with warrants to finance the recapitalization by management.

Peerless Industrial Group, Inc. | peerlesschain.comDate of Investment: May 1997Date of Disposition: ActivePeerless Industrial Group, Inc. (“Peerless”), headquartered in Winona, Minnesota, is a leading manufacturer of industrial and hardware chain and traction products. Peerless’ chain is used in an extremely broad range of home, farm, recreational and industrial applications.

Merit provided subordinated debt with common stock to finance the acquisition by management and an outside investor group.

The Plastics Group, Inc. | theplasticsgroup.netDate of Investment: April 2000Date of Disposition: ActiveThe Plastics Group, Inc. (“TPG”), headquartered in Willowbrook, Illinois, is a market leader in the design, engineering and manufacture of custom blow-molded and rotational-molded plastic parts for a variety of end-market applications. TPG derives the majority of its revenues from custom products and tooling that it designs and manufactures for specific customers’ applications. TPG derives its remaining revenues from the sale of consumer products, including a proprietary line of blow-molded gas and water containers, drain pans and rotationally molded septic tanks. TPG sells its consumer products to major retailers and distributors in a wide variety of industries.

Merit provided subordinated debt and common stock to finance the acquisition by management and a major equity fund sponsor.


Sales Performance International, LLC | spisales.comDate of Investment: November 2001Date of Disposition: ActiveSales Performance International, LLC (“SPI”), headquartered in Charlotte, North Carolina, is a sales and marketing management consulting firm. SPI has helped enable the world’s leading corporations to drive sustainable revenue growth through sales performance improvement. Since 1988, SPI has been the leader in helping global companies successfully transition from selling products to marketing and selling high value solutions. With deep industry and sales performance improvement expertise, broad global resources and a proven track record, SPI collaborates with clients to deliver strategic, operational and tactical solutions in a pragmatic way. SPI’s customers include are: Microsoft, Heineken, Hitachi Data Systems, Manpower, IBM, WIX, and MC.

Merit provided subordinated debt with warrants to finance the acquisition of SPI by management.

Skyline Windows, LLC | skylinewindows.comDate of Investment: October 2007Date of Disposition: ActiveSkyline Windows, LLC (“Skyline”), headquartered in New York City, is a manufacturer and installer of high quality aluminum replacement windows. The Company primarily serves the metropolitan New York City market, providing window systems for high-rise commercial, institutional and residential (condos and apartments) buildings. With approximately 90% of the Company’s business sold into the replacement market, Skyline’s strengths include complex engineering and design work as well as occupied building installations.

Merit invested both subordinated debt and equity in support of the recapitalization.

Tom Cat Bakery, Inc. | tomcatbakery.comDate of Investment: December 2008Date of Disposition: ActiveTom Cat Bakery, Inc. (“Tom Cat”), headquartered in Long Island City, New York, produces premium artisan bread and sweet goods for casual and fine dining restaurants, Starbucks, other specialty retailers and foodservice companies. Recognized as one of the founders of the artisan bread market in New York City, Tom Cat maintains one of the largest artisan bread and sweet goods product lines in the Northeast with over 350 products.

Merit invested subordinated debt and equity to support the acquisition.

Versatile Processing Group | versatileprocessing.comDate of Investment: August 2005Date of Disposition: ActiveVersatile Processing Group (“Versatile”), headquartered in Indianapolis, Indiana, is a provider of metals recycling and other related services to the utility industry. Versatile’s service offerings includes the recycling of metal and plastic stripped from discarded wire and cable, the sorting and recycling of various scrap metals and the decommissioning and recycling of used transformers and other related electrical equipment.

Merit provided subordinated debt, preferred equity and common equity to finance the acquisition.


VTI Instruments Corporation | vtiinstruments.comDate of Investment: May 2008Date of Disposition: ActiveVTI Instruments Corporation (“VTI”) designs, manufactures and distributes modular test and measurement equipment to a worldwide customer-base. Headquartered in Irvine, California, VTI’s instruments are used in the aerospace, defense, medical, pharmaceutical and wireless industries to evaluate the performance of complex products and systems.


Acme Industries, CorporationDate of Investment: May 1998Date of Disposition: August 2007Acme Industries, Corporation (“Acme”), headquartered in Des Plaines, Illinois, specializes in the precision machining of large parts, with computer controlled machining centers capable of handling parts up to 8,000 pounds. Acme’s value-added services include design, engineering, precision machining and prototype machining. Major customers include the Electromotive Division (EMD) of General Motors, Deere and Company and Allison Transmissions.

Merit provided subordinated debt and common stock used to finance the acquisition by current management.

Advanced H2O, Inc.Date of Investment: June 2005Date of Disposition: December 2007Advanced H2O, Inc. (“Advanced”), bottles and distributes purified water in the Pacific Northwest. The Company provides private label bottled water to various prominent grocers and retailers including Costco, Safeway, Albertson’s, Fred Meyer’s and Winco, among others. The Company has the capacity to purify, bottle and ship 25 million cases of water annually through its manufacturing facility in Burlington, Washington.

Merit provided both subordinated debt and common equity in support of the leveraged buyout.

Alden Industries, Inc. Date of Investment: May 1997Date of Disposition: November 2004Alden Industries, Inc. (“Alden”), a holding company formed in 1990, is headquartered in Fort Worth, Texas where it manufactures commercial water heaters, firetube boilers, multi-tube boilers and related component parts. Alden serves the North American commercial and institutional water heater markets through three operating subsidiaries: PVI Industries, LLC, Webster Engineering and Manufacturing Co., and Riverside Hydronics, LLC. The company maintains manufacturing facilities in Fort Worth, Texas and Winfield, Kansas.


REALIZED INVESTMENTS


Associated Sales and Bag Co.Date of Investment: April 1994Date of Disposition: April 1996Associated Sales and Bag Co. (“Associated”), headquartered in Milwaukee, Wisconsin, is a leading mail distributor of packaging, shipping and safety products. Associated’s principal product lines consist of polyethylene bags, bag closing devices, packaging products and disposable safety items, which are sold to over 80,000 customers throughout the United States.

Merit provided subordinated debt with contingent interest in the recapitalization.

AutoLign Manufacturing Group, Inc.Date of Investment: December 1998Date of Disposition: October 2007AutoLign Manufacturing Group, Inc. (“AutoLign”), headquartered in Milan, Michigan, is a leading domestic manufacturer of plastic parts for the automotive collision aftermarket in North America. AutoLign designs, manufactures and distributes replacement collision parts including plastic bumpers, facias, support beams and brackets primarily for domestic automobile models. AutoLign primarily sells its products to independent distributors for resale to collision repair shops, dealers and other auto body shops to replace damaged automobile bumpers and related components. AutoLign also designs, manufactures and distributes custom accessory packages for the auto and truck aftermarket.

Merit provided subordinated debt and common stock to finance the acquisition by a group of experienced industry executives.

Avail Medical Products, Inc.Date of Investment: June 1995Date of Disposition: November 2000Avail Medical Products, Inc. (“Avail”), headquartered in Dallas, Texas, operates in a niche segment of the medical products industry, supplying custom-designed disposable products to national and regional manufacturers of medical supplies. Avail’s products are used principally in an operating room environment to improve efficiencies and prevent infections, with major customers including Johnson & Johnson and Baxter International.

Merit provided subordinated debt and common stock of Avail to finance the acquisition of the company by a group of experienced industry executives. Subsequently, Merit provided additional capital to fund an add-on acquisition.

Beacon Sales Acquisition, Inc.Date of Investment: September 2000Date of Disposition: September 2004Beacon Sales Acquisition, Inc. (“Beacon”), headquartered in Boston, is a distributor of roofing products to the Eastern and Southeastern United States and Eastern Canada with a broad product offering to meet the requirements of commercial and residential roofing contractors, builders, general contractors, and retailers. Beacon’s branches typically sell in excess of 3,000 SKUs. Beacon serves the residential and commercial roofing markets, with the majority of its work representing re-roofing versus new construction.

Merit provided subordinated debt with warrants to finance two major add-on acquisitions.


C.D. Baird and Co., Inc.Date of Investment: March 1994Date of Disposition: December 2004C.D. Baird and Co., Inc., headquartered in Wisconsin, is a market leader in the finishing segment of the temporary point-of-purchase display industry. The Company produces a wide variety of displays for end-users in a number of industries, including brewing, soft drinks, liquor, entertainment/video and consumer products.

Merit provided subordinated debt and common stock to finance the acquisition by management and a newly-formed ESOP.

CompuDyne Corporation | compudyne.comDate of Investment: December 1998Date of Disposition: October 2001CompuDyne Corporation (“CompuDyne”), headquartered in Baltimore, Maryland, is a leading provider of security systems for the domestic corrections industry. CompuDyne is engaged primarily in the design, installation and maintenance of both electronic security and physical security (cell doors, guard booths, locking mechanisms, etc.) products.

Merit provided subordinated debt and common stock to finance the acquisition of CompuDyne’s largest competitor.

Dunn-Edwards CorporationDate of Investment: April 2001Date of Disposition: October 2003Dunn-Edwards Corporation (“Dunn”), headquartered in Los Angeles, California, is a leading manufacturer and distributor of high-quality paint in California, Arizona, and Nevada. Dunn supplies approximately 400 products, with nearly 80% of revenue generated from sales of company-manufactured interior and exterior architectural (i.e. residential and commercial property) paints and coatings. The balance of Dunn’s sales is comprised of equipment and other paint sundries (sprayers, rollers, brushes, drop cloths, etc.) as well as other wall-covering materials.

Merit provided subordinated debt to finance the recapitalization of Dunn by management and a newly-formed ESOP.

Eagle Plastics, Inc.Date of Investment: December 1993Date of Disposition: July 1998Eagle Plastics, Inc. (“Eagle”), headquartered in Hastings, Nebraska, is a leading manufacturer of plastic pipe in the Midwest. Eagle specializes in extruding polyvinyl chloride and polyethylene pipe products for use in plumbing, turf irrigation, water wells, sewer lines, natural gas transportation and fibre optics.

Merit provided subordinated debt and common stock to finance a leveraged acquisition by management and other investors.


Excell MaterialsDate of Investment: October 2003Date of Disposition: February 2007Excell Materials (“Excell”), headquartered in Pittsburgh, operates in three primary business segments. Excell’s first line of business is the recovery and subsequent resale of metals contained in slag generated by stainless steel producers. Excell’s second business segment concentrates on the sale of the residual aggregate to a wide variety of end users in the commercial turf/ agriculture and cement markets. Excell also provides services to steel makers, consisting of slag handling, mobile equipment rental, storage facility rental, and other slag-handling operations. Excell maintains operations in the United States, Canada, South Africa and Brazil.

Merit provided subordinated debt and common stock to finance the acquisition by a group of experienced industry executives.

Global Energy Equipment Group, LLCDate of Investment: June 1998Date of Disposition: July 2000Global Energy Equipment Group, LLC (“Global”), headquartered in Tulsa, Oklahoma, offers a broad product line of auxiliary equipment for the natural gas-fired power generation industry. Global is a leading designer, marketer and fabricator of heat recovery steam generators, specialty boilers, gas turbine exhaust systems, inlet houses, turbine enclosures and a variety of related support packages. Global is capable of designing and manufacturing virtually every major component for a gas-fired power plant with the exception of the turbine and generator.

Merit invested subordinated debt, preferred stock and common stock used to finance the acquisition by management and an outside investor group.

The HammerBlow CorporationDate of Investment: August 1997Date of Disposition: August 2000The HammerBlow Corporation (“HammerBlow”), headquartered in Wausau, Wisconsin, is a leading manufacturer of jacks and couplers primarily for use in agricultural equipment and utility trailers. Approximately 50% of HammerBlow’s sales are to OEMs and 50% are to the after-market throughout the United States and Canada.

Merit provided subordinated debt and preferred stock to finance the recapitalization.

Houston Harvest Gift Products, LLCDate of Investment: October 1994Date of Disposition: November 2006Houston Harvest Gift Products, LLC (“HHGP”), headquartered in Franklin Park, Illinois, is one of the largest manufacturers and marketers of ready-to-eat popcorn in collectible gift canisters in the United States. The HHGP designs and manufactures a full line of popcorn products which are sold in decorative tins. HHGP is also one of the largest assemblers and marketers of food gift packages. HHGP’s products are sold primarily during the holiday gift season and are distributed principally through mass merchants and warehouse clubs.

In 1994 Merit provided subordinated debt to finance the recapitalization of Golden Harvest Products, Inc. In December 1997, Golden Harvest merged with Houston Foods, its largest competitor, to form HHGP.


ITI Marketing Services, Inc.Date of Investment: September 1993Date of Disposition: August 1995ITI Marketing Services, Inc. (“ITI”), headquartered in Omaha, Nebraska, is a leading provider of inbound and outbound telemarketing services. ITI specializes in serving large accounts requiring both high quality and substantial volume, including Sprint, CUC International, Time and GE.

Merit provided subordinated debt with warrants to finance ITI’s internal growth.

JHT Holdings, Inc.Date of Investment: December 1999Date of Disposition: June 2006JHT Holdings, Inc. (“JHT”), headquartered in Kenosha, Wisconsin, through its predecessors, has provided logistic and distribution services for 65 years to three industry segments. JHT’s truck transport segment provides transportation services for manufacturers of heavy (Class 8) and medium duty (Class 5-7) trucks. JHT’s auto transport segment moves new and used automobiles and light trucks while the special commodities segment transports a variety of freight throughout the U.S. JHT’s customers include Freightliner, DaimlerChrysler, Navistar International, PACCAR, Ford Motor Company, Alcoa and Caterpillar.

Merit provided subordinated debt with warrants to finance the recapitalization.

Lavelle Industries, Inc.Date of Investment: November 1993Date of Disposition: December 1998Lavelle Industries, Inc. (“Lavelle”), headquartered in Burlington, Wisconsin, is a leading manufacturer of rubber plumbing replacement parts, selling these products to plumbing wholesalers and large hardware retailers such as Home Depot and Ace Hardware. Lavelle also manufactures a wide variety of mechanical rubber parts, which it custom designs for OEM end users in a wide variety of industries.

Merit proved subordinated debt with warrants to finance the recapitalization.

Mail Box Capital CorporationDate of Investment: August 1999Date of Disposition: September 2001Mail Box Capital Corporation (“Mail Box”), headquartered in Dallas, is a leading mailing services firm in the southwest United States, offering a full line of lettershop, printing and presorting capabilities. Mail Box also is one of the largest independent mailing firms in the country, processing approximately one billion pieces of mail each year.

Merit provided subordinated debt with warrants to finance the acquisition by management.


Midwest Folding Products, Inc.Date of Investment: April 1997Date of Disposition: February 2003Midwest Folding Products, Inc. (“Midwest”), headquartered in Chicago, is a leading manufacturer of institutional furniture. The bulk of Midwest’s sales are derived from two principal product lines, mobile tables and folding tables. The majority of Midwest’s products are sold to schools, hotels and other institutions.

Merit provided subordinated debt and preferred stock used to finance the recapitalization.

Olsen Engineering, LPDate of Investment: May 1998Date of Disposition: November 2005Olsen Engineering, LP (“Olsen”), headquartered in Eldridge, Iowa, is engaged in metal parts and component manufacturing including bar work, tube fabrication, welding and miscellaneous machine work. Olsen manufactures approximately 4,200 distinct part numbers, selling its products to large agricultural and construction original equipment manufacturers throughout the Midwest, such as Deere and Company and Case New Holland.

Merit provided senior subordinated debt with warrants and junior subordinated debt to finance the acquisition by management and an outside investor group.

Parksite, Inc.Date of Investment: May 2000Date of Disposition: November 2003Parksite, Inc. (“Parksite”), headquartered in Batavia, Illinois, is a distributor specializing in specialty branded building products. Parksite generally focuses its efforts on high quality, branded building products for which it can receive an exclusive distributorship. Among the key products that Parksite currently distributes are Corian (a solid-surface product), Tyvek (housewrap) and Trex (synthetic wood decking materials). Parksite essentially acts as the outsourced sales and marketing arm for its suppliers.

Merit provided subordinated debt to finance the acquisition of a large East Coast competitor by the Company’s 100% owned ESOP.

Peak Lime, Inc.Date of Investment: December 2001Date of Disposition: August 2007Peak Lime, Inc. (“Peak Lime”), headquartered in Birmingham, Alabama, manufactures lime (also known as quicklime) and hydrate lime (water added to form a slurry) and distributes it throughout the southeastern United States. Lime is a widely-used industrial material with applications in steel manufacturing, chemical production, utilities (for flue gas desulfurization), construction, water treatment, and acid neutralization. Peak Lime’s state-of-the-art manufacturing plant is capable of producing approximately 430,000 tons of quicklime annually, with current environmental permits to produce 395,000 tons per year.

The acquisition of Peak Lime was led by Peak Investments, LLC, a firm with a history of acquiring “orphan” chemical operations and improving operating results through a combination of focused management, expense control, improved capital allocation and asset utilization. Merit provided subordinated debt and preferred stock to finance the acquisition.


Peak Sulfur, Inc.Date of Investment: April 2002Date of Disposition: August 2005Peak Sulfur, Inc. (“Peak Sulfur”), headquartered in Kansas City, Kansas, manufactures, trades, and distributes sulfur-related products including commercial-grade sulfuric acid and ultra-pure sulfuric acid. Additionally, Peak Sulfur receives and regenerates sulfuric acid which has been used by refineries, and then sells fresh commercial acid back to the refinery. The acquisition of Peak Sulfur was led by Peak Investments, LLC (“Peak”), a firm with a history of acquiring “orphan” chemical operations and improving operating results through a combination of focused management, expense control, improved capital allocation and asset utilization.

Merit provided subordinated debt and preferred stock used to finance the acquisition of Peak Sulfur by Peak in 2002. In mid-2003, Merit invested additional subordinated debt and equity in conjunction with Peak Sulfur’s acquisition of a division of Arch Chemical. The division was a manufacturer of commercial grade sulfuric acid and a provider of regenerated sulfuric acid services.

Penda CorporationDate of Investment: April 2000Date of Disposition: December 2005Penda Corporation (“Penda”), headquartered in Portage, Wisconsin, is a leading manufacturer of large thermoformed and composite truck accessories and industrial components. Penda’s principal product line is plastic liners for pickup truck cargo beds. Major OEM customers include GM, DaimlerChrysler, and Toyota. Penda broadened its focus to include the bedliner aftermarket, thermoformed products outside the bedliner markets, and expanded its product line through acquisitions to include fiberglass accessories such as truck-caps, van tops, and running boards.

Merit provided subordinated debt and common stock to finance the acquisition by management and several equity fund sponsors.

Rostra Technologies, Inc.Date of Investment: November 1993Date of Disposition: September 2003Rostra Technologies, Inc. (“Rostra”), headquartered in Laurinburg, North Carolina, is a manufacturer of electronic, electromechanical and mechanical control devices and tools. Rostra’s primary focus is on electronic parts for the automotive aftermarket, although it also serves the automotive and truck OEM markets and various niche markets.

Merit provided subordinated debt with warrants to finance the recapitalization.


Ruud Lighting, Inc.Date of Investment: December 2001Date of Disposition: January 2007Ruud Lighting, Inc. (“Ruud”), headquartered in Racine, Wisconsin, designs, assembles and markets lighting fixtures and systems for end-use by commercial, industrial and retail customers. Ruud generates 80% of its revenue from sales made directly to contractors; 11% from national accounts, such as Jack in the Box and Burger King; and the remaining 9% from international sales and sales made through distributors or directly to individual customers. Ruud has three basic classifications of products: outdoor (floodlights, landscape lights and poles), industrial (fixtures used to illuminate factories and workspaces) and commercial (primarily recessed and track fixtures for offices, schools, hospitals, and retail stores).

Merit provided subordinated debt with warrants to finance the acquisition by management.

SP Industries, Inc.Date of Investment: December 1996Date of Disposition: March 2005SP Industries, Inc. (“SPI”), headquartered in Buena, New Jersey, is a leading manufacturer of laboratory glassware and laboratory equipment. SPI is comprised of five relatively similar-sized divisions, which primarily serve the needs of the pharmaceutical, biotechnology and research industries, as well as a variety of OEM users.

Merit provided subordinated debt and common stock to finance the acquisition by management and an outside investor group.

TEKRA CorporationDate of Investment: December 1995Date of Disposition: December 1999TEKRA Corporation (“TEKRA”), headquartered in New Berlin, Wisconsin, is a leader in the distribution of plastic films, tape adhesives, coated products, printing substrates and laminating materials. TEKRA’s products, which are sold to over 1,700 customers, are used ultimately in a wide variety of applications, including automobile instrument panels, microwave oven touch panels, bar code labels, computer key boards and advertising displays.


WL Plastics CorporationDate of Investment: October 2003Date of Disposition: November 2005WL Plastics Corporation (“WL”), headquartered in Casper, Wyoming, manufactures large-diameter polyethylene (“PE”) pipe for sale in the Rocky Mountains and throughout the western half of the United States. WL manufactures PE pipe from 1-24 inches in diameter but focuses its efforts on diameters of at least 4 inches. Although WL was founded to serve the large number of oil and gas customers in the region, management has worked to diversify its business beyond this segment. Currently, WL’s sales are focused on three segments: oil and gas, water and sewer, and mining and industrial.

Merit provided subordinated debt with common stock to finance the acquisition by management and outside investors.


Wm. E. Wright, LPDate of Investment: August 1995Date of Disposition: November 2000Wm. E. Wright, LP (“Wrights”), headquartered in West Warren, Massachusetts, is a premier manufacturer and marketer of products for the retail home sewing, home decorating and crafts industries. Wrights’ product lines include apparel and craft trim, tapes and braids, ribbon and knitting/crocheting instruments. Wrights, which is the market leader in all of its products other than ribbon, has approximately 5,000 retail customers throughout the U.S. and Canada.


INVESTMENT TEAM - Merit Capital · INVESTMENT TEAM Investment Team: ... David M. Jones, ......

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