Ridgestone makes investments in businesses that are led by strong management teams, have excellent growth opportunities, and have strong cash flow characteristics. Ridgestone is an active investor, and prefers to acquire a significant or majority share of the equity in any given transaction. Ridgestone’s target transactions typically have the following characteristics: • Positive cash flow or a realistic path to positive cash flow within one year • At least $10 million of run-rate revenue • Equity investment of approximately $5 million to $10 million • A management group comprised of excellent operators with strong industry experience • Geographic preference for businesses based in Southern California If a potential investment meets our criteria, we will consider any of the following investment structures: • Equity investment for growth capital • Partner with a management team to acquire a privately owned company • Leveraged recapitalization with a change of control • Acquisition of a division of a public company • Private investment in public equity securities (PIPES) • Going-private transaction of a public company Ridgestone views itself as a partner with the management teams of our portfolio companies, and provides valuable support to our management teams in areas where we have expertise. Some of the specific areas where we have expertise include: defining or realigning strategic vision, executive recruiting, introducing strategic partners, raising capital, and evaluating, structuring and financing strategic acquisitions.