EMAIL DETAILS

Again, if you want reading material. Not sure I 100% understand it though.

Eric D. Schwerin
eschwerin@rosemontseneca.com

Sent from my iPhone

Begin forwarded message:

> From: "Neil Callahan \(Rosemont Seneca\)" <ncallahan@rosemontseneca.com>
> Date: September 4, 2012 10:31:22 PM EDT
> To: <eschwerin@rosemontseneca.com>
> Subject: OSI Update
> Reply-To: <ncallahan@rosemontseneca.com>
>
> Hey Eric,
>
> Hope you are enjoying the festivities, good stuff – the lefties are always better speech writers!
>
> Just a quick update, (I just gave a similar update to Devon, he is all caught up) - OSI is back on track and in good standing. Landmark provided a strong introduction to Riverwood and they want to do the deal, and would want to do the whole thing if our syndicate was not so tight with Management and Landmark. Michael Marks (who is the founder and a self-made billionaire) is the lead on the deal and talked with the seller with John on Monday that we will talk the entire stake for a $60m valuation.
>
> Riverwood wants to keep RSTP at $20m max and they will take whatever else is available ($25-$35m). Landmark wants all they can get but they understand if we want to take a piece, but they want to cut us back to as little as possible which is the ultimate Jedi mind trick on our part. So for the GP commitment we already have $500k from RSTP I investors, so we'd only need to find $500k to close. I need your help to close that gap. There won't be any room for any other co-investors, which is great.
>
> So it's up the seller who may just sit and hold, this is the only offer they will get until 2013, so they will have to decide what they really want to do. I think we get it done at $70m which tees us up for a 3.5x in 24-36 months. Riverwood also wants to put cash on the company's balance sheet and take down some more equity which is a great sign.
>
> We took a detour trying to get Landmark's competitors into our vehicle which was a tactical error on our part. That would have made this deal less special/proprietary to Landmark (which they want so they can market deals like this to their LPs - proprietary deal flow, outsized returns, etc.) And it put our sponsors at Landmark in a bit of funky political position inside of their firm - that we were shopping the deal to their competitors while we were under MOU. I had to navigate that a bit up in Massachusetts with Jamie Sunday (my relationship at Landmark).
>
> John sort of lost it for a few weeks when he was freaking out about his reputation, blah blah blah.
>
> But that extra time allowed the deal to get stale and ideally the price down. And Landmark's intro to Riverwood was breakthrough. They are the only two firms on the planet who want to do this deal :)
>
> Landmark wants to do the deal us - Rosemont Seneca, and that is why they have hung in there with us and provided introductions, etc. We should not lose sight of that, we could a lot more with them and leverage this deal with their LPs, etc.
>
> So this is nice step up deal for the RSTP concept: $2m, to $2.25m to $20m - with great upside potential, but enough of a fee stream to keep the concept going.
>
> So we will see what happens. Worst case is that it does not get done, but John saves faces and does not have to commit harakiri - we got a fully finance deal at a competitive price and the seller did not accept and we walk away heads up high.
>
> With Cataphora, Counsyl and OSI we will have a solid track record take it to the next level. I'd love for us all to team up to get this done this year, we could make a shit load of money and have a ton of fun doing it.
>
> Have fun this week.
>
> Best,
>
> Neil
>
> Neil Callahan
> Rosemont Seneca Partners
> 401 Greenwich Street, Suite 300
> New York, New York 10013
> 917-945-9516 (m)
> 866-749-8879 (f)
> www.rosemontsenecatech.com
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> =2