Tiburon Strategic Advisors CEO Summit XXI October 12-13, 2011

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Tiburon CEO Summit XXI October 12-13, 2011

Table of Contents

Tiburon CEO Summit XXI Overview • Agenda...... 1 • Attendee List...... 2

Day 1: Wednesday • Welcome: Skip Schweiss & Chip Roame...... 3 • Keynote Opening Presentation: Chip Roame...... 4 • Award Presentation: Bill Sharpe...... 5 • General Session Panel Discussion: Innovation (Facilitated by Chip Roame)...... 6 • Break-Out Sessions...... 7 1. The Democratization of Alternative Investments: A Good Thing or Window Dressing & a Recipe for Disaster?: Kirk Michie, John Coyne, John Rooney, & Jon Sundt (The Consulate Room, Third Floor) 2. Convergence: The Evolution from Selling Products to Providing Solutions: Cheryl Nash (Salon IV, First Floor) 3. The Fiduciary Opportunity: Succeeding in a Changing Advisory Landscape: Viggy Mokkarala (Salon V, First Floor) 4. The Impact of Emerging Media on the Wealth Management Industry: Neal Ringquist (The Ambassador Room, Third Floor) 5. Impact Investing: Doing Well By Doing Good: Ron Cordes (The Directors Room, Third Floor) • General Session Panel Discussion: Regulations & the 2012 Elections (Facilitated by Chip Roame)...... 8 • General Session Guest Presentation: Pete Kight...... 9 • Award Presentation: Rob Arnott...... 10

Day 2: Thursday • Day Two Kick-Off: Cheryl Nash...... 11 • General Session Guest Presentation: Michael Sapir...... 12 • General Session Guest Presentation: Paul Steiger...... 13 • General Session Panel Discussion: Ask the Consumers (Facilitated by Gail Graham)...... 14 • General Session Panel Discussion: Tiburon CEO Summit XXI Insights (Facilitated by Chip Roame)...... 15

Tiburon CEO Summit XXI Reference Documents • Tiburon Brochure...... 16 • Tiburon Managing Partner Chip Roame Biography...... 17 • Tiburon CEO Summits...... 18 • Tiburon CEO Summit XXI Sponsors...... 19 • Tiburon CEO Summit XXI Volunteers...... 20 • Tiburon CEO Summits Past Media Coverage...... 21

Upcoming CEO Summit: Tiburon CEO Summit XXI

Tiburon CEO Summit XXI will officially start at 7:45am on Wednesday, October 12, 2011 at the Ritz Carlton Hotel in San Francisco, CA, include a group dinner that night at a waterfront restaurant in Tiburon and finish at 12:00pm on Thursday, October 13, 2011.

More casually, Tiburon CEO Summit XXI will begin with a cocktail reception the prior evening Tuesday October 11, 2011 at 6:00pm at the Ritz Carlton Hotel.

Meeting Agenda

The planned agenda is as follows:

Tuesday, October 11, 2011

6:00pm-9:00pm: Cocktail Reception

Tiburon will host a casual cocktail reception at the Ritz Carlton Hotel

Wednesday, October 12, 2011

7:00am-7:45am: Continental Breakfast

Attendees should feel free to bring breakfast foods to the opening session

7:45am-8:15am: Tiburon CEO Summit XXI Welcome

Presented by Skip Schweiss (President, TD Ameritrade Trust Company) & Chip Roame (Managing Partner, Tiburon Strategic Advisors)

8:15am-9:45am: Keynote Opening Presentation

State of the Financial Services Industry Presented by Chip Roame (Managing Partner, Tiburon Strategic Advisors)

9:45am-10:00am: Cell Phone Break

10:00am-11:00am: Tiburon CEO Summit Award Presentation CEO Summit XXI Keynote Opening Presenter Bill Sharpe (Professor Emeritus, Stanford Chip Roame University) (Managing Partner, Tiburon Strategic Advisors) Facilitated by Chip Roame (Managing Partner, Tiburon Strategic Advisors)

11:00am-11:15am: Refreshments & Cell Phone Break

11:15am-12:00pm: General Session Panel Discussion

Innovation Facilitated by Chip Roame (Managing Partner, Tiburon Strategic Advisors) CEO Summit XXI Tiburon client panelists: Award Recipient Ron Cordes (Co-Chairman, Genworth Bill Sharpe (Professor Emeritus, Financial Wealth Management) Stanford University) Ric Edelman (Co-CEO, The Edelman Financial Group) Bill Harris (CEO, Personal Capital Corporation) Neal Ringquist (President, Advisor Software)

12:00pm-1:15pm: Box Lunches & Break-Out Sessions

Five break-out session choices: The Democratization of Alternative Investments: A Good Thing or Window Dressing & a Recipe for Disaster?: Kirk Michie, John Coyne, John Rooney, & Jon Sundt Convergence: The Evolution from Selling Products to Providing Solutions: Cheryl Nash The Fiduciary Opportunity: Succeeding in a Changing Advisory Landscape: Viggy Mokkarala The Impact of Emerging Media on the Wealth Management Industry: Neal Ringquist Impact Investing: Doing Well by Doing Good: Ron Cordes Please take lunch to your choice of break-out sessions

1:30pm-2:30pm: General Session Panel Discussion CEO Summit XXI Guest Speaker Pete Kight Regulations & the 2012 Elections (Managing Partner, The ComVest Group) Facilitated by Chip Roame (Managing Partner, Tiburon Strategic Advisors) Tiburon client panelists: Marion Asnes (Chief Marketing Officer, Envestnet) Tony Batman (CEO, 1st Global Capital Corporation) Dave Baum (Partner, Investment Products & Services Group, Alston & Bird) Paul Schaeffer (Business Head, Strategy & CEO Summit XXI Thought Leadership, Forward Management) Award Recipient Skip Schweiss (President, TD Rob Arnott (CEO, Research Affiliates) Ameritrade Trust Company)

2:30pm-2:45pm: Refreshments & Cell Phone Break

2:45pm-3:30pm: General Session Guest Presentation

Presented by Pete Kight (Managing Partner, The ComVest Group) Introduction by Chip Roame (Managing Partner, Tiburon Strategic Advisors)

3:30pm-3:45pm: Cell Phone Break

3:45pm-4:45pm: Tiburon CEO Summit Award Presentation

Rob Arnott (CEO, Research Affiliates) Facilitated by Chip Roame (Managing Partner, Tiburon Strategic Advisors)

4:45pm-6:30pm: Free Time & Bus or Ferryboat to Tiburon

Ferry boat option #1: 4:55pm walking departure from the hotel to catch the 5:25pm ferryboat (arrival approximately at 5:45pm, well before the start of cocktails) Ferry boat option #2: 5:45pm walking departure from the hotel to catch the 6:15pm ferryboat (arrival at 6:35pm, just after start of cocktails) Bus option: 6:05pm departure from the hotel lobby (arrival approximately at 6:30pm, close to the start of cocktails)

6:30pm-9:30pm: Tiburon CEO Summit XXI Group Dinner at Servino's Restaurant in Tiburon, CA

6:30pm-7:30pm: Cocktail Hour 7:30pm-9:30pm: Dinner

Thursday, October 13, 2011

7:00am-7:45am: Continental Breakfast

Attendees should feel free to bring breakfast foods to the opening session

7:45am-8:00am: Tiburon CEO Summit XXI Day #2 Kick-Off

Presented by Cheryl Nash (Interim President, Fiserv Investment Services)

8:00am -8:45am: General Session Presentation

Michael Sapir (CEO, ProShares) Introduction by Chip Roame (Managing Partner, Tiburon Strategic Advisors)

8:45am-9:00am: Cell Phone Break

9:00am-9:45am: General Session Guest Presentation

CEO Summit XXI Guest Speaker Presented by Paul Steiger (CEO, Pro Publica) Michael Sapir Introduction by Chip Roame (Managing Partner, (CEO, ProShares) Tiburon Strategic Advisors)

9:45am-10:00am: Refreshments & Cell Phone Break

10:00am-11:00am: General Session Panel Discussion

Ask the Consumers Facilitated by Gail Graham (Executive Vice President, Fidelity Institutional Wealth Services) Consumer Panelists:

Jon C. CEO Summit XXI Joe G. Guest Speaker Paul Steiger Julia L. (CEO, Pro Publica) Alex N.

11:00am-11:15am: Deli Buffet & Cell Phone Break

11:15am -12:00pm: General Session Panel Discussion Tiburon CEO Summit XXI Insights Facilitated by Chip Roame (Managing Partner, Tiburon Strategic Advisors) Client Panelists: Atindra Barua (CEO, Trust Fort) Craig Gordon (President, RBC Correspondent & Advisor Services) Viggy Mokkarala (Executive Vice President, Envestnet) Frank Trotter (President, EverBank Direct)

Sarah Sage is responsible for all logistics, photography, & media relations; feel free to contact her with any questions at 415-789-2540 or [email protected]

Attendee List

Tiburon sends invitations to its semi-annual CEO Summits exclusively to C- level executives, executive vice presidents, & other business heads at its 300+ corporate clients. Other managing directors and senior vice presidents (and all others) are not invited in order to keep the discussion focused on CEO-level issues and to try to manage the size of each CEO Summit to 150 client attendees.

Tiburon CEO Summit XXI Confirmed Attendee List

Tiburon is pleased to announce that the following 138 Tiburon clients have already confirmed their attendance for Tiburon CEO Summit XXI:

Chip Roame (Managing Partner, Tiburon Strategic Advisors) Blaine Aikin (CEO, Fiduciary 360) David Akellian (Executive Vice President, Custom Clearing Services, LPL Financial) John Alshefski (Business Head, Business Development, Investment Manager Services, SEI Investments) Daniel Applegarth (Chief Financial Officer, NorthStar Financial Services Group) Andy Arenberg (Global Business Head, ETF Distribution, Russell Investments) Rob Arnott (CEO, Research Affiliates) Marion Asnes (Chief Marketing Officer, Envestnet) Chuck Baldiswieler (CEO, TCW Funds) David Ballard (Chief Information Officer, Advisor Group, American International Group (AIG)) Atindra Barua (CEO, TrustFort) Tony Batman (CEO, 1st Global Capital Corporation) Dave Baum (Partner, Investment Products & Services Group, Alston & Bird) Ed Beggs (CEO, Laser App Software) Don Black (Business Head, Marketing & Communications, Barron’s) Stephanie Bogan (CEO, Quantuvis Consulting) Joe Bottazzi (Executive Vice President, Business Development, Edelman Financial Services) John Bunch (President, Retail Distribution, TD Ameritrade) Yvette Butler (Business Head, Wells Fargo Advisor Solutions) Gidon Caine (Partner, Securities Litigation, Alston & Bird) Bruce Cameron (CEO, Berkshire Capital Securities) Frank Campanale (CEO, First Allied Wealth Management) David Canter (Executive Vice President, Practice Management & Consulting, Fidelity Institutional Wealth Services) Christian Chan (Business Head, Investments, Wells Fargo Funds Management Group) Lenny Chang (Co-Founder, Focus Financial Partners) Dave Chun (CEO, Equilar) Carolyn Clancy (Executive Vice President, Funds Network, Fidelity Investments) Bernie Clark (Executive Vice President, Advisor Services, The Charles Schwab Corporation) John Cochran (Managing Director, Lovell Minnick Partners) Steve Cohen (Chief Strategy Officer, ProShares) David Conover (President, EverBank Wealth Management) Ron Cordes (Co-Chairman, Genworth Financial Wealth Management) Trish Cox (Business Head, Schwab Corporate Brokerage Services, The Charles Schwab Corporation) John Coyne (President, Brinker Capital) Peter Crenier (Business Head, Business Development, Investment Services, Fiserv) Jeff Cusack (President, Intermediary Distribution, Forward Management) Scott David (Business Head, Third-Party Distribution, T. Rowe Price Group) Surajeet Deka (Executive Vice President, TrustFort) Stuart DePina (CEO, Tamarac) Jeffrey Dunham (CEO, Dunham & Associates) Ric Edelman (Co-CEO, The Edelman Financial Group) Randy Epright (Chief Operating Officer, Advisor Group, American International Group (AIG)) Mike Everett (Chief Marketing Officer, My Vest Corporation) Tom Florence (CEO, 361 Capital) Rob Foregger (Chief Strategy Officer, Personal Capital Corporation) Chris Frieden (Partner, Financial Services & Products, Alston & Bird) Rick Frisbie (Chief Administrative Officer, Franklin Templeton Investments) Matt Frymier (President, Sterling Stamos Capital Management) Dave Goerz (Chief Investment Officer, High Mark Capital Management) Debby Goldberg (Chief Development Officer, Pro Publica) Craig Gordon (President, RBC Correspondent & Advisor Services) Gail Graham (Executive Vice President, Marketing, Fidelity Institutional Wealth Services) Jennifer Grancio (Business Head, Distribution, US iShares) Bill Hackett (CEO, Matthews International Capital Management) Carrie Hansen (President, Mutual Funds, Genworth Financial Wealth Management) Bill Harris (CEO, Personal Capital Corporation) Neesha Hathi (Chief Operating Officer, Schwab Performance Technologies) Gary Holland (Publisher, Barron’s) Dave Hubbard (President, Exemplar Financial Network) Rich Hunter (Chief Financial Officer, Commonwealth Financial Network) Cliff Jack (Chief Distribution Officer, Jackson National Life Insurance Company) Tom Johnson (Business Head, Business Development, Retirement Income Security Products, New York Life) Tif Joyce (President, Joyce Financial Management) Dan Kern (President, Advisor Partners) Pete Kight (Managing Partner, The ComVest Group) Chip Kispert (CEO, Beacon Strategies) David Knoch (President, 1st Global Capital Corporation) Rajini Kodialam (Co-Founder, Focus Financial Partners) Paul Koontz (General Partner, Foundation Capital) Michael Larsen (Executive Vice President, Affiliate Relations, Research Affiliates) Marshall Levin (Partner, Beacon Strategies) Chuck Lewis (CEO, My Vest Corporation) Matt Lynch (CEO, Capital Analysts) Norman Mains (Chief Risk Officer, Forward Management) JC Massar (Chairman, Capital International Financial Services, Capital Group Companies) Pat McClain (Co-CEO, Hanson McClain) Jim McCool (Executive Vice President, Institutional Services, The Charles Schwab Corporation) Dennis McDonald (Business Head, Investment Strategy Group, Individual Products, TIAA-CREF Financial Services) Kirk Michie (President, Triton Pacific Securities) Viggy Mokkarala (Executive Vice President, Sales & Client Service, Envestnet) Ed Moore (President, Edelman Financial Services) Randy Moore (Partner, Financial Services & Products Group, Alston & Bird) Mike Mulcahy (President, Bridgeway Capital Management) John Murray (Chief Information Officer, Genworth Financial Wealth Management) Glenn Myers (Chief Operating Officer, The MDE Group) Jim Nagengast (CEO, Securities America) Cheryl Nash (Interim President, Investment Services, Fiserv) Mark Nerud (CEO, Jackson National Asset Management) Bruce Nollenberger (President, Think Equity Asset & Wealth Management) Bill O’Conor (Executive Vice President, Financial Services Group, Penton Media) Bill O’Grady (Managing Director, Strategic Planning, Alpha One Capital Partners) Curt Overway (President, Managed Portfolio Advisors, Natixis Global Associates) John Phillips (Executive Vice President, Strategic & Global Sales, National Financial Services) Jim Polisson (CEO, Global Exchange Traded Fund Business, Russell Investments) Laura Pollard (Executive Vice President, Fidelity ActionsXchange) Alex Potts (CEO, Loring Ward Group) Andy Putterman (CEO, Fortigent) Arvind Ramnani (Business Head, US Technology Equity Research, UBS) David Reich (Executive Vice President, LPL Financial Retirement Partners) Alan Reid (CEO, Forward Management) Neal Ringquist (President, Advisor Software) Tony Rochte (Senior Managing Director, North American Intermediary Business Group, State Street Global Advisors) John Rooney (Managing Principal, Commonwealth Financial Network) Larry Roth (CEO, Advisor Group, American International Group (AIG)) Andrew Rudd (CEO, Advisor Software) Rich Santos (Group Publisher, Registered Rep & Trust & Estates, Wealth Management Group, Penton Media) Michael Sapir (CEO, ProShares) Paul Schaeffer (Business Head, Strategy & Thought Leadership, Forward Management) Skip Schweiss (President, TD Ameritrade Trust Company) Bill Sharpe (Professor Emeritus, Graduate School of Business, Stanford University) Brandon Sharrett (Business Head, Global Sales, Investment Services, Fiserv) Sterling Shea (Business Head, Advisory & Wealth Management Programs, Barron’s) Babu Sivadasan (Executive Vice President, Engineering & Product Development, Envestnet) David Smith (Group Publisher, Financial Advisor & Private Wealth Magazines) Cliff Stanton (Chief Investment Officer, Prima Capital Management) Paul Steiger (CEO, Pro Publica) Tom Steinberger (Global Business Head, Business Development, Pensco Trust Company) Beth Stelluto (Executive Vice President, Product & Platform Development, LPL Financial) Hal Strong (Operating Executive, Genstar Capital) Nick Stuller (CEO, Meridian-IQ) Peter Sundman (CEO, Clear Bridge Advisors) Jon Sundt (CEO, Altegris Investments) Marie Swift (CEO, Impact Communications) Susan Theder (Chief Marketing Officer, Cetera Financial Group) Leno Toich (Co-CEO, Informa Investment Solutions) Nicolo Torre (Chief Investment Officer, Advisor Software) Doug Townsend (Chief Operating Officer, Jackson National Life Distributors) Frank Trotter (President, EverBank Direct) Enrique Vasquez (CEO, Genworth Financial Investment Services) Mitch Vigeveno (CEO, Turning Point) Steve Warren (Chief Operating Officer, My Vest Corporation) Gib Watson (CEO, Prima Capital Management) Scott Welch (Senior Managing Director, Investment Research & Strategy, Fortigent) Alan Werba (Chairman, Loring Ward) Jim Wiandt (CEO, Index Universe) Craig Wietz (President, First Rate Investment Systems) Spencer Williams (CEO, Rollover Systems) Michael Winnick (Business Head, Strategic Partnerships & US Intermediary Distribution, Russell Investments) Emmett Wright (Chief Investment Officer, Northwestern Mutual Wealth Management Company)

Tiburon is also pleased & appreciative to welcome the following consumers who will share their views of the financial services industry at Tiburon CEO Summit XXI:

John C. Julia L. Alex N. Joe V.

Tiburon is also pleased to welcome the following journalists who have registered to attend specific sessions at Tiburon CEO Summit XXI:

Janet Levaux (Managing Editor, Research Magazine) Brooke Southall (Editor-in-Chief, RIA Biz) Jennifer Tekneci (Reporter, Merger Markets)

Attending Tiburon's CEO Summits

Tiburon maintains a list of over 3,000 executive-level clients at over 300 companies who have engaged the firm, many of whom have actively participated in prior Tiburon CEO Summits. Attendance at each Tiburon CEO Summit is limited to 150 executives and is reserved for Tiburon's clients. If you are an executive-level Tiburon client and would like to participate in a future Tiburon CEO Summit, please contact Tiburon's Managing Principal Chip Roame . If you are not yet a client and interested, please contact Sarah Sage . Tiburon CEO Summit XXI

Welcome October 12, 2011

Outline

• Tiburon CEO Summit XXI Moderator Welcome & Prior Experiences, Agenda Highlights, & Ground Rules

• Tiburon Overview, Tiburon CEO Summit Vision, & Tiburon CEO Summit XXI Introductions

1 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Tiburon CEO Summit XXI - Moderator Welcome & Prior Experiences

Tiburon CEO Summit XXI Moderator Welcome & Prior Experiences

Involvement history

Favorite past speakers, success stories, & other memories

Tiburon gift -> photo books

Attendance & sponsorship logic

Anticipated sessions & events

Source: Tiburon Research & Analysis 2 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Tiburon CEO Summit XX – Award Recipients & Guest Speakers

Tiburon CEO Summit XX Award Recipients & Guest Speakers (Last April in New York)

• Keith Banks (US • David Carroll (Wells • Ed Finn (Barron’s) Trust) Fargo Corporation) • Allen Thorpe (Hellman • Jack Bogle (The • Mark Casady (LPL & Friedman) Vanguard Group) Financial) (Award (Award Recipient) Recipient)

• Charles Brandes • Ric Edelman (Brandes Investment (Edelman Financial Partners) Services)

Source: Tiburon Research & Analysis 3 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Tiburon CEO Summit XX Attendees Rated the Event a 9.2 on a 10.0 Scale, Consistent with All Scores Since Moving to the Ritz Carlton Hotels

Tiburon CEO Summits Overall Satisfaction (1-10; 10 = High)

9.2 9.3 9.1 9.2 8.5 8.7 8.7 8.6 8.7

CEO CEO CEO CEO CEO CEO CEO CEO CEO Summit Summit Summit Summit Summit Summit Summit Summit Summit XII XIII XIV XV XVI XVII XVIII XIX XX

Source: Tiburon Research & Analysis 4 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Tiburon CEO Summits XII – XX Attendees Gave Pete Kight & Don Phillips the Top Scores Amongst General Session Speakers

Tiburon CEO Summit XII - XX General Session Speakers Feedback Scores

Pete Kight (XVII) 9.3

Don Phillips (XIII) 9.3

David Tittsworth (XVIII) 9.2

Steve Forbes (XVIII) 9.1

Mark Yusko (XIX) 9.1

Ric Edelman (XX) 9.0

Steven Lockshin (XVII) 9.0

Meir Statman (XIX) 8.9

Bill Hambrecht (XV) 8.9

Ed Bernard (XVIII) 8.9

Source: Tiburon Research & Analysis 5 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Tiburon CEO Summit XXI - Agenda Highlights

Tiburon CEO Summit XXI Agenda Highlights

Tiburon keynote opening presentation (Chip Roame)

Award recipients presentation (Rob Arnott & Bill Sharpe)

Guest speakers (Pete Kight, Michael Sapir, & Paul Steiger)

Four panel discussions (innovation; regulations & elections; ask the consumers; highlights)

Five break-out sessions at lunch today

Dinner this evening in Tiburon

Source: Tiburon Research & Analysis 6 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Tiburon CEO Summit XXI – Four Simple Ground Rules

Tiburon CEO Summit XXI Four Simple Ground Rules

Please appreciate the candor of the meeting & participate Tiburon CEO Summits culture

Please state name & company when asking questions

Please help us start & end the sessions on time

Please help enforce the media policy Chip’s opening & awards presentations only And even then “right to declare off record” Media room for one-on-one interviews

Source: Tiburon Research & Analysis 7 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Tiburon Considers Feedback Forms as a Core Part of Participation and is Aiming to Collect 100% of these Forms Onsite

Tiburon CEO Summits Feedback Forms Collected

106 104

85 70 70 62 57 46 42

CEO CEO CEO CEO CEO CEO CEO CEO CEO Summit Summit Summit Summit Summit Summit Summit Summit Summit XII XIII XIV XV XVI XVII XVIII XIX XX

Source: Tiburon Research & Analysis 8 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Tiburon CEO Summit XXI – Moderator Process Tips

Tiburon CEO Summit XXI Moderator Process Tips

Lunch Sessions, moderators, & rooms listed in binder Ritz Carlton Hotel box lunches today Please efficiently take lunch to break-out session of choice for immediate start

Dinner (meet in hotel lobby) Group walk to ferry at 4:55pm for 5:25pm ferry Group walk to ferry at 5:45pm for 6:15pm ferry Bus at 6:05pm

Source: Tiburon Research & Analysis 9 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Tiburon CEO Summit XXI - DJIA Predictions (October 11, 2011)

Tiburon CEO Summit XXI DJIA Predictions (October 11, 2011)

• High: 12,850 (Paul Schaefer)

• Actual: TBD [11,123 on 10/6/11]

• Closest to the Pin: TBD [Neesha Hathi & Andrew Rudd at 11,111]

• Low: 9,500 (David Chun & Mike Everett)

Source: Tiburon Research & Analysis 10 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Outline

• Tiburon CEO Summit XX Moderator Welcome & Prior Experiences, Agenda Highlights, & Ground Rules

• Tiburon Overview, Tiburon CEO Summit Vision, & Tiburon CEO Summit XXI Introductions

11 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Tiburon Strategic Advisors

Tiburon Strategic Advisors

• Focus on corporate-level strategy - Serve senior executives only at financial services companies - Key services: strategy consulting & market seminars - Served over 300 corporate clients and completed over 1,300 projects since 1998 - Make available access to Tiburon’s series of 200+ research documents ($5K each; $25K for access to all research for all employees for a year) - Host semi-annual Tiburon CEO Summits

• Chip Roame background - McKinsey & Company - The Charles Schwab Corporation - Tiburon since 1998 (13+ years)

Source: Tiburon Research & Analysis 12 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Tiburon Strategic Advisors Services

Market Seminars & Research Conference Projects Speeches Tiburon Research Access Program Strategy Advisory Consulting Board Roles Projects

Source: Tiburon Research & Analysis 13 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Tiburon Strategic Advisors

Tiburon Strategic Advisors

Re-committed to research first methodology Chip as lead research manager

Abolished reports in favor of “live” access to PowerPoint slides Adding podcasts soon

Spun off financial institutions research series Akin to stock analysts, the Tiburon way

Source: Tiburon Research & Analysis 14 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Tiburon Strategic Advisors (Continued)

Chip limiting self to market seminars, conference speeches, & board roles Envestnet board

Add principals & partners (finally) Test in late 2011 or early 2012 Expand in 2012

Source: Tiburon Research & Analysis 15 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Tiburon CEO Summit XXI is the Largest Ever San Francisco Tiburon CEO Summit and in Line with the Continual Upward Trend

Tiburon CEO Summits Client Attendees

171

140 138 128 117 118 109 95 90 81

XII XIII XIV XV XVI XVII XVIII XIX XX XXI

Source: Tiburon Research & Analysis 16 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Tiburon CEO Summit XXI – Award Recipients

Tiburon CEO Summit XXI Award Recipients

Focusing on Consumer (& Other Client) Needs Rob Arnott Challenging & Bill Sharpe Conventional Wisdom

Taking Responsibility

Source: Tiburon Research & Analysis 17 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Tiburon CEO Summit XXII – Award Recipients & Guest Speakers

Tiburon CEO Summit XXII Award Recipients & Guest Speakers (April 17-18, 2010 * Ritz Carlton Hotel * New York, NY) (Work in Progress)

• Tony Batman (CEO, • David Booth (CEO, • Al West (CEO, SEI 1st Global) Dimensional Fund Investments) (Award Advisors) (Award Recipient) • Chris Blunt Recipient) (Executive Vice President, New York • Tom Bradley Life) (President, TD Ameritrade Institutional)

Source: Tiburon Research & Analysis 18 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Tiburon CEO Summits – Attendee Criteria

Tiburon CEO Summits Attendee Criteria

Tiburon Conference Research Access Speeches & Program Market Seminars

CEO Summit Sponsors

Consulting & Advisory Research Board Roles Projects

Source: Tiburon Research & Analysis 19 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Tiburon CEO Summit XXI - Thanks

Tiburon CEO Summit XXI Thanks

Sponsors (sounding board & the co- champions of this event)

Moderators (Skip Schweiss & Cheryl Nash) (volunteer on top of sponsorship)

Volunteers (pays equally poorly)

Award recipients & guest speakers (for making the time to join us)

Attendees (for your business) (greet thy neighbor)

Source: Tiburon Research & Analysis 20 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Tiburon Strategic Advisors

Comments

• Focus on corporate-level strategy - Serve senior executives only at financial services companies - Key services: market seminars, market research, & strategy consulting - Served over 300 corporate clients and completed over 1,300 projects since 1998 - Host semi-annual CEO Summits, offer free weekly research releases, and offer free business benchmarking tools for all types of advisors

• Chip Roame background - McKinsey & Company - Charles Schwab & Company - Tiburon since 1998

Source: Tiburon Research & Analysis 21 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ The State of the Financial Services Industry

Tiburon CEO Summit XXI Keynote Opening Presentation October 12, 2011

Outline

• Broad Market Environment – World Events, Economy, Markets, & Financial Services Industry Stumbles – Consumer Wealth, Growing Baby Boomer Issues, and Attitudinal & Behavioral Changes

• Financial Services Industry Strategies – Product Trends – Markets & Distribution Channel Evolution – Strategic Activity

• The Wild Card: Regulatory Agenda & the 2012 Elections

• Take-Aways: Top Ten Fundamental Trends

1 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ World Events, Economy, Markets, & Financial Services Industry Stumbles

World Events, Economy, Markets & Financial Services Industry Stumbles

World Events 9/11 ten year anniversary Osama bin Laden killed Arab Spring (& Summer) Palestinians push for statehood East Coast natural disasters Hurricane Irene Earthquake Solyndra –> oops

Source: 9/12/11 Triton Pacific Email (Michie); 8/26/11 Joyce Financial Management Conversation (Joyce); Tiburon Research & Analysis 2 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

World Events, Economy, Markets, & Financial Services Industry Stumbles (Continued)

World Events, Economy, Markets & Financial Services Industry Stumbles (Continued)

Economy Corporate profits strong Municipals holding their own Meredith Whitney very wrong (again) Biggest failures & bailouts = financial services firm Bank failures again in 2011 Biggest bankruptcies ever -> Lehman Brothers & Washington Mutual

Source: 10/3/11 TD Ameritrade Email (Schweiss); 10/2/11 Trading Economics Web Site; 9/12/11 Triton Pacific Email (Michie); 8/26/11 Joyce Financial Management Conversation (Joyce); Tiburon Research & Analysis 3 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ World Events, Economy, Markets, & Financial Services Industry Stumbles (Continued)

World Events, Economy, Markets & Financial Services Industry Stumbles (Continued)

Economy (Continued) Continued high unemployment rate (9.1%) 1948-2010 average: 5.7% (2.5% in 1953 to 10.8% in 1982) Seven more years at current recovery rate to reach 5.7% average Housing not recovering European sovereign debt crisis High US debt Unpredictable tax policies Unclear future of Obama care Politics impacting economy (the S&P downgrade)

Source: 10/4/11 Capital Analysts Email (Lynch); 10/3/11 TD Ameritrade Email (Schweiss); 10/2/11 Trading Economics Web Site; 9/12/11 Triton Pacific Email (Michie); 8/26/11 Joyce Financial Management Conversation (Joyce); Tiburon Research & Analysis 4 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

World Events, Economy, Markets, & Financial Services Industry Stumbles (Continued)

World Events, Economy, Markets & Financial Services Industry Stumbles (Continued)

Stock Markets Negative returns (-5% to -9% YTD) Obama missed memo regarding presidential third years Volatile returns VIX at 42.96 (near 12 month high of 48.00) +/- 4% for four days in a row Mixed views on the future of the stock markets

Source: 10/2/11 Market Watch Web Site; 9/15/11 Joyce Financial Management Email (Joyce); 8/26/11 Joyce Financial Management Conversation (Joyce); 4/11/11 Fortune; 4/7/11 TD Ameritrade Email (Schweiss); 4/3/11 Advisor Perspectives; 4/1/11 ETF Trends; 3/28/11 Morningstar Web Site; 12/22/10 Investment News; 9/22/10 Morningstar Web Site; Tiburon Research & Analysis 5 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ World Events, Economy, Markets, & Financial Services Industry Stumbles (Continued)

World Events, Economy, Markets & Financial Services Industry Stumbles (Continued)

Housing Market Decline was not just 2008 like stock market but continued into 2009-2011 Huge diminished equity - took away the feeling of being wealthier through untapped home equity Impacts consumer sentiment Impacts real retirement planning calculations Still struggling Largest investment for most US households Limiting worker mobility

Source: 10/4/11 Triton Pacific Email (Michie); 10/3/11 TD Ameritrade Email (Schweiss); 9/15/11 Joyce Financial Management Email (Joyce); 8/26/11 Joyce Financial Management Conversation (Joyce); 4/11/11 Fortune; 4/7/11 TD Ameritrade Email (Schweiss); 4/3/11 Advisor Perspectives; 4/1/11 ETF Trends; 3/28/11 Morningstar Web Site; 12/22/10 Investment News; 9/22/10 Morningstar Web Site; Tiburon Research & Analysis 6 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

World Events, Economy, Markets, & Financial Services Industry Stumbles (Continued)

World Events, Economy, Markets & Financial Services Industry Stumbles (Continued)

Financial Services Industry Stumbles Examples UBS (a $2.2 billion loss!) Galleon Group (with Goldman Sachs and McKinsey & Company) Primary Research (expert networks) Berkshire Hathaway Provident Royalties & Medical Capital

Source: 10/4/11 Triton Pacific Email (Michie); 8/26/11 Joyce Financial Management Conversation (Joyce); 4/7/11 Turning Point Email (Vigeveno); 4/7/11 TD Ameritrade Email (Schweiss); 4/4/11 Business Wire; 2/19/09 Grail Partners Presentation (Putnam) (Saint Louis Federal Reserve); Tiburon Research & Analysis 7 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ World Events, Economy, Markets, & Financial Services Industry Stumbles (Continued)

World Events, Economy, Markets & Financial Services Industry Stumbles (Continued)

Financial Services Industry Stumbles (Continued) Examples (Continued) 2008 Economic Crisis Federal Reserve Borrowings (Goldman Sachs Group, etc.) UBS & Barclays (LIBOR manipulation) SAC (Steve Cohen) Gundlach-TCW Result New competition -> Do it yourself

Source: 10/4/11 Triton Pacific Email (Michie); 8/26/11 Joyce Financial Management Conversation (Joyce); 4/7/11 Turning Point Email (Vigeveno); 4/7/11 TD Ameritrade Email (Schweiss); 4/4/11 Business Wire; 2/19/09 Grail Partners Presentation (Putnam) (Saint Louis Federal Reserve); Tiburon Research & Analysis 8 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

The Unemployment Rate Remains at a Substantial 9.1%...

Unemployment Rate

10.0% 9.5% 9.1%

7.4%

6.0% 5.7% 5.4% 4.9% 5.0% 4.4%

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Source: 10/2/11 Trading Economics Web Site; 8/20/11 San Francisco Chronicle; 8/20/11 Wall Street Journal (Labor Department); 4/7/11 Impact Communications Email (Swift); 4/7/11 Bridgewater Email (Milliman); 4/7/11 TD Ameritrade Email (Schweiss); 4/3/11 Advisor Perspectives; 4/1/11 Wall Street Journal; 4/1/11 San Francisco Chronicle; 4/1/11 ETF Trends; 12/13/10 Advisor One; 9/7/10 Bureau of Labor Statistics Web Site; Tiburon Research & Analysis 9 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ 7-8 More Years at Current Pace of Job Growth to Get Back Down to 5.0% Pre-Financial Crisis Unemployment Rate

7-8 Years for Jobs Recovery?

Facts Shaved 0.9% off of unemployment rate since end of 2009 (10.0% to 9.1% over one year & eight months) or 0.5% per year

Projections To fall another 3.4% to reach historical 5.7% average unemployment rate: 6.8 more years! To fall another 4.1% to reach 5.0% pre-financial crisis unemployment rate: 8.2 more years!

Source: 10/2/11 Trading Economics Web Site; 4/7/11 Impact Communications Email (Swift); 4/7/11 Bridgewater Email (Milliman); 4/7/11 TD Ameritrade Email (Schweiss); 12/13/10 Advisor One; Tiburon Research & Analysis 10 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

The Dow Jones Industrial Average Has Lost 5% in 2011 After Gains of 19% & 14% in 2009 & 2010

Dow Jones Industrial Average Market Returns

19% 16% 14%

9% 6% 2% 2000 2001 2002 2005 2008 2011

2003 2004-1% 2006 2007 2009 2010 -5% -6% -7%

-17%

-31%

Source: 10/2/11 CNN Web Site; 10/2/11 Morningstar Web Site; 9/4/11 Morningstar Web Site; 4/14/11 Brandes Investment Partners Presentation (Brandes); 4/7/11 TD Ameritrade Email (Schweiss); 4/1/11 ETF Trends; 3/28/11 Morningstar Web Site; 11/5/10 Wall Street Journal; 9/22/10 Morningstar Web Site; 4/15/09 Zebra Capital Management Presentation (Ibbotson); 4/3/09 Morningstar Web Site; Tiburon Research & Analysis 11 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ The S&P 500 Historically Performs Best in the Third Presidential Year But Obama May Not Have Received the Memo

Standard & Poor’s 500 Average Excess Real Returns By Presidential Cycle Year

9.5%

Year 1 Year 2 Year 4

Year 3 -0.3%

-3.8% -5.5%

Source: 2/06 Morgan Creek Capital Management Presentation (Yusko) (EMO); Tiburon Research & Analysis 12 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Tiburon CEO Summit XXII - DJIA Predictions (April 16, 2012)

Tiburon CEO Summit XXII DJIA Predictions (April 16, 2012)

• High: 14,000 (David Akellian, Bruce Cameron, & Cheryl Nash)

• Actual: TBD

• Closest to the Pin: TBD

• Low: 8,000 (Tony Batman & John Rooney)

Source: 10/4/11 Commonwealth Email (Rooney); 10/3/11 Personal Capital Email (Foregger); 10/3/11 EverBank Email (Trotter); 10/3/11 Alston & Bird Email (Moore); 10/3/11 Prima Capital Email (Watson); 10/3/11 Berkshire Capital Securities Email (Cameron); 10/3/11 Pensco Email (Steinberger); 10/3/11 TD Ameritrade Email (Schweiss); 10/2/11 Triton Pacific Email (Michie); Tiburon Research & Analysis 13 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ The Median Home Price Has Dropped to $156,000, Down About 33% from its Peak of $230,000 in 2006

Median Home Price ($ Thousands)

$230 $225 $220 $205 $195 $185 $185 $165 $170 $170 $160 $156

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 1Q/11

Source: 10/4/11 Triton Pacific Email (Michie); 4/11/11 Fortune; 4/7/11 TD Ameritrade Email (Schweiss); 4/3/11 Advisor Perspectives; 12/31/09 Federal Reserve Flow of Funds Report; 3/12/09 Federal Reserve Flow of Funds Data; 4/1/08 National Association of Realtors Web Site; 3/17/08 Barron’s; 12/31/07 Federal Reserve Flow of Funds Report; 3/31/07 Federal Reserve Flow of Funds Report; 4/11/05 Business Week; Tiburon Research & Analysis 14 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Consumers Households Now Own Just 39% of the Value of their Homes, Down from 59% in 2005 and 69% in 1985

Consumer Households Equity as a Share of Household Real Estate

69%

61% 59% 57% 58% 57% 58% 57% 55% 54% 50%

39% 40% 39%

1985 1990 1995 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Source: 4/3/11 Advisor Perspectives; 12/31/09 Federal Reserve Flow of Funds Report; 3/12/09 Federal Reserve Flow of Funds Data; 12/31/07 Federal Reserve Flow of Funds Report; 3/31/07 Federal Reserve Flow of Funds Report; 4/11/05 Business Week; 9/20/04 Fortune (HSBC); Tiburon Research & Analysis 15 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Consumer Households Lost $2.6 Trillion in Private Business Valuations After the Peak in 2006

Consumer Investments in Privately Owned Businesses ($ Trillions)

$8.8 $8.7 $8.4

$7.3

$6.4 $6.4 $6.2 $5.4 $5.0

2002 2003 2004 2005 2006 2007 2008 2009 2010

Source: 10/4/11 Triton Pacific Email (Michie); 4/8/11 Fidelity Investments Email (Graham); 4/7/11 TD Ameritrade Email (Schweiss); 12/31/10 Federal Reserve Flow of Funds Report; 6/30/10 Federal Reserve Flow of Funds Report; Tiburon Research & Analysis 16 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Outline

• Broad Market Environment – World Events, Economy, Markets, & Financial Services Industry Stumbles – Consumer Wealth, Growing Baby Boomer Issues, and Attitudinal & Behavioral Changes

• Financial Services Industry Strategies – Product Trends – Markets & Distribution Channel Evolution – Strategic Activity

• The Wild Card: Regulatory Agenda & the 2012 Elections

• Take-Aways: Top Ten Fundamental Trends

17 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Consumer Wealth, Growing Baby Boomer Issues, and Attitudinal & Behavioral Changes

Consumer Wealth, Growing Baby Boomer Issues, and Attitudinal & Behavioral Changes

Consumer Wealth Triple whammy - stock market, home values, & small business values all declined, knocking 20% off consumer investable assets (inverse of 1990s wealth effect) Investable assets are ~22% & retirement plan assets are ~16% of household assets for $100,000-$1.0 million households (~38%) Principal residences are ~23% & other real estate holdings are ~14% of household assets for $100,000-$1.0 million households (~37%) Small businesses are ~16% of household assets for $100,000- $1.0 million households (~16%, highly variable though)

Source: 10/4/11 Triton Pacific Email (Michie); 9/12/11 Triton Pacific Email (Michie); 8/26/11 Joyce Financial Management Conversation (Joyce); 4/14/11 Edelman Financial Services Presentation (Edelman); 4/8/11 Fidelity Investments Email (Graham); 4/7/11 Bridgewater Email (Milliman); 4/7/11 TD Ameritrade Email (Schweiss); 4/7/11 Shah & Associates Email (Shah); 4/7/11 Impact Communications Email (Swift); Tiburon Research & Analysis 18 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Consumer Wealth, Growing Baby Boomer Issues, and Attitudinal & Behavioral Changes

Consumer Wealth (Continued) Recovery (well… maybe it is a recovery) Investable assets & retirement plan assets (stock market) back in 2009-2Q/11 but not housing and small business valuations Numbers of high net worth prospects were slowly recovering • 8.4 millionaire households in 2010 still down from 9.2 in 2007 (now likely down further!) Wealth gap widening • Moderate net worth households hit relatively hardest because real estate is dominant asset • Comparables… Yuri Milner’s new house and Leon Black’s birthday party

Source: 10/4/11 Triton Pacific Email (Michie); 9/12/11 Triton Pacific Email (Michie); 8/26/11 Joyce Financial Management Conversation (Joyce); 4/14/11 Edelman Financial Services Presentation (Edelman); 4/8/11 Fidelity Investments Email (Graham); 4/7/11 Bridgewater Email (Milliman); 4/7/11 TD Ameritrade Email (Schweiss); 4/7/11 Shah & Associates Email (Shah); 4/7/11 Impact Communications Email (Swift); Tiburon Research & Analysis 19 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Consumer Wealth, Growing Baby Boomer Issues, and Attitudinal & Behavioral Changes (Continued)

Consumer Wealth, Growing Baby Boomer Issues, and Attitudinal & Behavioral Changes (Continued)

Growing Baby Boomer Issues First baby boomers turn 65 in 2011 (birth years 1946 to 1964) Many unprepared for retirement (57% have less than $100,000) Average life expectancy reaches 78 And it is +10-20 years for those who reach retirement age Assets expected to be liquidated (especially home & small business valuations) are down in value Inheritances not materializing (~2% of baby boomers to receive over $100,000) And now… the twin threats of elder care and the kids moving back in

Source: 10/4/11 Triton Pacific Email (Michie); 8/26/11 Joyce Financial Management Conversation (Joyce); 4/14/11 Edelman Financial Services Presentation (Edelman); 4/8/11 Fidelity Investments Email (Graham); 4/7/11 Bridgewater Email (Milliman); 4/7/11 TD Ameritrade Email (Schweiss); 4/7/11 Shah & Associates Email (Shah); 4/7/11 Impact Communications Email (Swift); 12/13/10 Advisor One; Tiburon Research & Analysis 20 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Consumer Wealth, Growing Baby Boomer Issues, and Attitudinal & Behavioral Changes (Continued)

Attitudinal Changes Scared Weak consumer sentiment Consumer fear is back (partly due to volatility) Skeptical Still believe in their financial advisors but cynical regarding financial services industry Demanding more conservative, simplistic, & transparent solutions Likely to push the unbundling of products & advice Potential to see self-serve revolution

Source: 10/4/11 Triton Pacific Email (Michie); 10/4/11 Capital Analysts Email (Lynch); 9/15/11 Joyce Financial Management Email (Joyce); 9/13/11 Joyce Financial Management Email (Joyce); 8/26/11 Joyce Financial Management Conversation (Joyce); 4/14/11 Edelman Financial Services Presentation (Edelman); 4/8/11 Fidelity Investments Email (Graham); 4/7/11 Bridgewater Email (Milliman); Tiburon Research & Analysis 21 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Context is Important… Consumer Households Have $29.2 Trillion of Investable Assets, $72.6 Trillion of Total Assets, and $58.7 Trillion of Net Worth…

Consumer Households Net Worth ($ Trillions)

$6.8 $72.6 $13.9 $23.2 $58.7

$13.4 $29.2

Investable Retirement Personal Other Illiquid Total Total Total Assets Plan Assets Assets Assets Household Household Household Assets Liabilities Net Worth

Source: 10/4/11 Triton Pacific Email (Michie); 9/16/11 Federal Reserve Flow of Funds Report; 4/8/11 Fidelity Investments Email (Graham); 4/7/11 TD Ameritrade Email (Schweiss); 12/31/10 Federal Reserve Flow of Funds Report; 6/30/10 Federal Reserve Flow of Funds Report; Tiburon Research & Analysis 22 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Consumers Households Have $29.2 Trillion in Investable Assets, Almost Back to the 2006 Peak of $29.7

Consumer Households Investable Assets ($ Trillions)

$29.7 $28.3 $28.5 $28.3 $29.2 $26.0 $23.7 $21.9 $18.4 $15.9

2002 2003 2004 2005 2006 2007 2008 2009 2010 2Q/11

Source: 9/16/11 Federal Reserve Flow of Funds Report; 4/8/11 Fidelity Investments Email (Graham); 4/7/11 TD Ameritrade Email (Schweiss); 12/31/10 Federal Reserve Flow of Funds Report; 6/30/10 Federal Reserve Flow of Funds Report; Tiburon Research & Analysis 23 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Consumers Have $13.4 Trillion in Retirement Plan Assets, Back to the 2007 Peak

Consumer Households Retirement Plan Assets ($ Trillions)

$13.4 $13.4 $12.7 $13.0 $11.9 $11.4 $10.6 $10.4 $9.7 $8.2

2002 2003 2004 2005 2006 2007 2008 2009 2010 2Q/11

Consumer Households Lost $4.6 Trillion (42%) of their Real Estate Equity After the 2006 Peak, an Amount that Has Yet to Significantly Recover

Consumer Households Real Estate Equity ($ Trillions)

$10.9 $10.4 $9.6 $9.3 $8.9 $8.3 $7.8 $6.8 $6.3 $6.3

2002 2003 2004 2005 2006 2007 2008 2009 2010 2Q/11

Source: 9/16/11 Federal Reserve Flow of Funds Report; 4/8/11 Fidelity Investments Email (Graham); 4/7/11 TD Ameritrade Email (Schweiss); 12/31/10 Federal Reserve Flow of Funds Report; 6/30/10 Federal Reserve Flow of Funds Report; Tiburon Research & Analysis 25 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Consumer Households Lost $2.6 Trillion (30%) of their Private Business Valuations After the 2006 Peak, Another Amount that Has Yet to Significantly Recover

Consumer Investments in Privately Owned Businesses ($ Trillions)

$8.8 $8.7 $8.4 $7.3 $6.8 $6.4 $6.4 $6.2 $5.4 $5.0

2002 2003 2004 2005 2006 2007 2008 2009 2010 2Q/11

The Number of Consumer Households with Over $1.0 Million in Financial Assets Dropped 27% in 2008 to 6.7 Million and then Recovered About Two-Thirds of that Amount in 2009-2010

Consumer Households With $1.0+ Million Financial Assets (Millions)

9.0 9.2 8.4 8.4 7.8 7.5 6.7 6.2 6.2

2002 2003 2004 2005 2006 2007 2008 2009 2010

Source: 4/7/11 TD Ameritrade Email (Schweiss); 3/15/11 Spectrem Group Report; 4/14/11 Edelman Financial Services Presentation (Edelman); 6/30/10 Federal Reserve Flow of Funds Report; 3/10/10 American Banker (Spectrem Group); 3/9/10 Insurance Newscast (Spectrem); 5/21/09 Wall Street Journal; 5/14/09 1st Global Presentation (Batman) (Spectrem); 3/16/09 Money Management Executive (Spectrem); Tiburon Research & Analysis 27 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Baby Boomers’ Pending Retirement will Still Drive More Assets into the Investable Assets Market

Consumer Households Assets ($ Trillions)

$6.8 $72.6

$23.2

$13.4 $29.2

Investable Retirement Personal Other Illiquid Total Assets Plan Assets Assets Assets Household Assets

Source: 10/4/11 Triton Pacific Email (Michie); 9/16/11 Federal Reserve Flow of Funds Report; 4/8/11 Fidelity Investments Email (Graham); 4/7/11 TD Ameritrade Email (Schweiss); 12/31/10 Federal Reserve Flow of Funds Report; 6/30/10 Federal Reserve Flow of Funds Report; Tiburon Research & Analysis 28 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

The Conference Board’s Consumer Confidence Index is 45, Down from its 2000 Peak of 129 and Still Near its Historic Low Since 1973

Conference Board Consumer Confidence Index (Index = 100)

129

109 102 104 95 92 81 66 53 45 39 28

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Source: 10/4/11 Conference Board Web Site; 10/4/11 Triton Pacific Email (Michie); 3/31/09 Wall Street Journal (Conference Board); 2/18/09 San Francisco Chronicle (Conference Board); 2/18/09 Conference Board Web Site; 2/16/09 New York Times; 10/9/08 Conference Board Web Site; 10/12/28/04 Conference Board Web Site; 7/19/04 Financial Times (Conference Board); 1/28/04 San Francisco Chronicle; Tiburon Research & Analysis 29 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Many Financial Advisors Report Prospects are More Skeptical

Financial Advisor Comment on the Financial Crisis

“Prospects seem more skeptical quizzing us how our strategies would have fared better than where they were in 2008-2009”

Source: 10/19/10 Waypoint Wealth Partners Conversation (Bowes); Tiburon Research & Analysis 30 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

And Some Financial Advisors Note that, in Parallel, Prospects Have Become More Sophisticated

Financial Advisor Comment on the Financial Crisis

“Clients are becoming more sophisticated and want to be more involved”

Source: 11/3/10 Rockland Conversation (Barker); Tiburon Research & Analysis 31 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ The Consumer Savings Rate Has Jumped Back Above 5.0% Since the Start of the Crisis in 2008

Consumer Savings Rate

8.0% 8.0%

7.0% 7.0%

6.0% 5.8% 5.8% 5.6% 5.1%

2.4% 2.4% 2.1%

1.3%

0.2% 2005 2006 2007

1960 1968 1976 1984 1992 2000 2001 2002 2003 2004 2008 2009 2010 2011 -0.4% -0.5% -1.0%

Source: 10/4/11 Triton Pacific Email (Michie); 9/28/10 US Bureau of Economic Analysis Web Site; 3/9/09 Joyce Financial Management Email (Joyce); 2/10/09 Wall Street Journal (US Bureau of Economic Analysis); 10/16/08 Fortune; 2/1/2007 MSNBC Web Site; 1/26/05 New York Times (Federal Reserve); 12/30/04 Wall Street Journal; 11/4/04 US Department of Commerce Web Site; 8/1/01 San Francisco Chronicle; Tiburon Research & Analysis 32 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Outline

• Broad Market Environment – World Events, Economy, Markets, & Financial Services Industry Stumbles – Consumer Wealth, Growing Baby Boomer Issues, and Attitudinal & Behavioral Changes

• Financial Services Industry Strategies – Product Trends – Markets & Distribution Channel Evolution – Strategic Activity

• The Wild Card: Regulatory Agenda & the 2012 Elections

• Take-Aways: Top Ten Fundamental Trends

33 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Product Trends

Product Trends

Fundamentals Brokerage accounts contain two-thirds stocks & bonds All packaged products combined make up the other one-third Mutual funds have more assets than all other packaged products combined Hence use mutual funds’ data to show style & pricing trends… But exchange traded funds to slowly take share now

Source: 9/11/11 Turning Point Email (Vigeveno); 5/16/11 Russell Investment Group Conversation (Winnick); 4/14/11 Brandes Investment Partners Presentation (Brandes); 4/7/11 TD Ameritrade Email (Schweiss); Tiburon Research & Analysis 34 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Product Trends (Continued)

Fundamentals (Continued) Commissions to fee-accounts is the obvious trend Unbundling of advice from products All channels now > 50% fee-account AUA Net flows often >75% fee-accounts Improves transparency & eases regulatory burden Investment styles Equity mutual fund net flows volatile quarter to quarter Bond mutual fund net flows have fallen off the table but remained positive

Source: 10/5/11 Capital Analysts Email (Lynch); 10/5/11 Lipper Web Site; 8/26/11 Joyce Financial Management Conversation (Joyce); 5/16/11 Russell Investment Group Conversation (Winnick); 4/14/11 Brandes Investment Partners Presentation (Brandes); 4/7/11 TD Ameritrade Email (Schweiss); Tiburon Research & Analysis 35 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Product Trends (Continued)

Product Trends (Continued)

Fundamentals (Continued) Winners analysis tells the story Black Rock now largest money management firm -> product combination of ETFs & hedge funds Vanguard > Fidelity Investments ($1.6 trillion; became #1 in 2010) • Product -> Indexing (led in 2010 flows $49 to $3 billion with 80% to index products) • Channel -> do it yourselfers & independent advisors

Source: 8/26/11 Joyce Financial Management Conversation (Joyce); 5/16/11 Russell Investment Group Conversation (Winnick); 4/14/11 Brandes Investment Partners Presentation (Brandes); 4/7/11 TD Ameritrade Email (Schweiss); Tiburon Research & Analysis 36 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Product Trends (Continued)

Mutual Funds Remain the kingpin in investable assets & retirement plan assets $8.4 trillion in long-term mutual fund AUM (~21% of all financial assets) $78 billion flows into long-term mutual funds in 2011 but negative in both July & August Leaders distancing themselves

Source: 10/5/11 Lipper Web Site; 8/26/11 Joyce Financial Management Conversation (Joyce); 4/14/11 Edelman Financial Services Presentation (Edelman); 4/13/11 Hellman * Friedman Presentation (Thorpe); 4/11/11 Morningstar Email (Hannan); 4/8/11 Fidelity Investments Email (Graham); 4/7/11 Bridgewater Email (Milliman); 4/4/11 Wall Street Journal; Tiburon Research & Analysis 37 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Product Trends (Continued)

Product Trends (Continued)

Mutual Funds (Continued) Fast growing fee-based financial advisors (RIAs) market still heavily reliant on mutual funds Mutual fund wrap account programs growing quickly Product innovation continues Institutional class mutual funds increasingly important Target date mutual funds rebounded nicely Alternative funds were booming, now stagnating

Source: 10/5/11 Lipper Web Site; 4/14/11 Edelman Financial Services Presentation (Edelman); 4/13/11 Hellman * Friedman Presentation (Thorpe); 4/11/11 Morningstar Email (Hannan); 4/8/11 Fidelity Investments Email (Graham); 4/7/11 Bridgewater Email (Milliman); 4/4/11 Wall Street Journal; Tiburon Research & Analysis 38 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Product Trends (Continued)

Indexing 80% of assets still actively managed Black Rock, State Street, & Vanguard are the leaders (same point coming in ETFs) Powerful views Active is a zero sum game (and less than zero sum after taxes & expenses) ($102 billion spent on active management) Low expenses = most reliable indicator of mutual fund performance Control what you can - expenses & taxes

Source: 9/22/11 Google News Alerts; 4/5/11 Money Management Executive; Tiburon Research & Analysis 39 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Product Trends (Continued)

Product Trends (Continued)

Indexing Trends are supporting growth in indexing Skeptical consumers Importance of retirement plan costs Growth of fee-based financial advisor channel Growth of fee-base accounts (across all channels) Side impact… Shining light on expenses everywhere

Source: 9/22/11 Google News Alerts; 4/5/11 Money Management Executive; Tiburon Research & Analysis 40 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Product Trends (Continued)

Exchange Traded Funds Exchange traded funds reached $1.0 trillion (actually all exchange traded products) in 2010 $121 billion net flows (~50% of mutual funds) Higher net flows than mutual funds in several categories Black Rock, State Street, & Vanguard = 84% market share

Source: 8/26/11 Joyce Financial Management Conversation (Joyce); 4/11/11 Morningstar Email (Hannan); 4/6/11 RIA Biz; 4/5/11 Money Management Executive; Tiburon Research & Analysis 41 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Product Trends (Continued)

Product Trends (Continued)

Exchange Traded Funds (Continued) Market evolving quickly Vanguard gaining on Black Rock & State Street Established & new niche entrants (e.g., ProShares; Russell Investments) Worldwide trend accelerating

Source: 4/11/11 Morningstar Email (Hannan); 4/6/11 RIA Biz; 4/5/11 Money Management Executive; Tiburon Research & Analysis 42 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Product Trends (Continued)

Exchange Traded Funds (Continued) Supporting trends Consumer need for simplicity Schwab & Fidelity ETF price war Schwab acquisition of Windhaven Investment Management TD Ameritrade emphasis on Amerivest RIAs at 7% ETFs; other FAs at 3% But… Anyone making any money?

Source: 4/11/11 Morningstar Email (Hannan); 4/6/11 RIA Biz; 4/5/11 Money Management Executive; Tiburon Research & Analysis 43 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Product Trends (Continued)

Product Trends (Continued)

Active ETFs – Really? Risks of transparency & disclosing day-to-day holdings Susceptible to front running & free riding schemes Large mutual fund companies not totally entering ETFs-of-ETFs: Black Rock Fixed Income: Alliance Bernstein, Eaton Vance, Janus Capital Group, T. Rowe Price Group Equities: JP Morgan Chase, Legg Mason, The Dreyfus Corporation

Source: 10/4/11Triton Pacific Email (Michie); 4/8/11 Fidelity Investments Email (Graham); 4/5/11 ETF Trends; Tiburon Research & Analysis 44 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Product Trends (Continued)

Alts! Alts! Alts! Consumers & financial advisors showing interest in wide variety of investments Hedge funds & commodities Options & foreign exchange (Schwab-Options Express & TD Ameritrade-Think or Swim) Timber Private equity & venture capital Anything other than stocks & bonds! Ability to perform adequate due diligence? Ability to access the top quartile performers?

Source: 10/5/11 Capital Analysts Email (Lynch); 10/4/11 Triton Pacific Email (Michie); 10/2/11 Triton Pacific Email (Michie); 8/16/11 Joyce Financial Management Conversation (Joyce); 4/14/11 Edelman Financial Services Presentation (Edelman); 4/13/11 Hellman & Friedman Presentation (Thorpe; 4/7/11 Bridgewater Email (Milliman); 4/7/11 TD Ameritrade Email (Schweiss); Tiburon Research & Analysis 45 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Mutual Funds are the Dominant Packaged Investment Product…

Packaged Investment Products Assets Under Management ($ Billions)

$8,400

$3,000

$1,900 $1,800 $1,743

$720 $578

Long-Term Separately Exchange Hedge Annuities Life Venture Mutual Managed Traded Funds Insurance Capital & Funds Accounts Funds (Cash Value) Private Equity

Source: 10/4/11 Triton Pacific Email (Michie); 10/14/08 Morningstar Presentation (Mansueto); 3/05 ICI Web Site; 7/19/04 Barron’s; 4/04 Research (MMI); 12/15/03 Investment News (Cerulli); 7/03 Ticker; 5/27/02 Merrill Lynch Presentation (Cerulli) (Doe); 10/01 Investment Consulting News; 7/13/01 Cerulli Presentation (Strategic Insight) (Cerulli); 7/11/01 RunMoney Conversation (Jorgensen); 7/2/01 RunMoney Quarterly Report; Tiburon Research & Analysis 46 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Long-Term Mutual Funds & Exchange Traded Funds Dominated 2010 Product Net Flows

2010 Packaged Investment Product Net Flows ($ Billions)

$246

$121

$37 $22 $16

Long-Term Separate Exchange Hedge Variable Mutual Funds Accounts & Traded Funds Annuities Commingled Funds Investment Trusts

Source: 10/4/11 Triton Pacific Email (Michie); 4/11/11 Morningstar Email (Hannan); 8/30/10 Morningstar Presentation (Mansueto); Tiburon Research & Analysis 47 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Wirehouses, Regional Broker/Dealers, & Independent Broker/Dealers are Now All Capturing Over Half of their Net Flows in Fee-Accounts

Markets & Distribution Channel Net Flows By Pricing Method

Commissions 44% 47% 49%

56% Fees 53% 51%

Wirehouses Regional Independent Broker/Dealers Broker/Dealers

Source: 10/4/11 Triton Pacific Email (Michie); Tiburon Research & Analysis 48 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Morgan Stanley Smith Barney Has Just 28% of its Assets Under Administration in Fee-Accounts But Now Says that it Gathers Nearly All New Assets in Fee-Accounts

Morgan Stanley Smith Barney Assets Under Administration & Net Flows By Pricing Method

11%

Commissions 72%

89%

Fees 28%

Assets Under Administration Net Flows

Source: 10/4/11 Triton Pacific Email (Michie); Tiburon Research & Analysis 49 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Tying Product & Fee Trends Together is Revealing… Broker Wrap Accounts & Mutual Fund Advisory Programs, the Simple Products, are Winning in the Fee-Accounts Market

Fee-Account Assets Under Management By Product

Fee-Based Brokerage Accounts 18% 39% Broker Wrap 14% Accounts Growth Mutual Fund Advisory Programs 21% 29%

Separately Managed Accounts 46% 39%

Unified Managed Accounts 1% 2005 2011 0%

Source: 10/4/11 Triton Pacific Email (Michie); 8/11 Envestnet Presentation (Bergman) (Cerulli); Tiburon Research & Analysis 50 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Equity Mutual Fund Net Flows Have Been Extremely Volatile Quarter-to- Quarter, with the Current Quarter Being the Worst (Through Two Months)

Equity Mutual Funds Net Flows ($ Billions)

$42.4 $34.9 $21.5

Q1/09$3.3 Q4/09 Q2/10 Q3/10$1.9 Q2/11 Q3/11

Q2/09 Q3/09 Q1/10 Q4/10 Q1/11 -$13.1 -$19.8 -$21.2

-$41.4 -40.4

-$85.6

Source: 10/5/11 Lipper Web Site; 8/11 Envestnet Presentation (Bergman) (SIM Fund); Tiburon Research & Analysis 51 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Fixed Income Mutual Fund Net Flows Have Fallen Off the Table But Stayed Positive

Fixed Income Mutual Funds Net Flows ($ Billions)

$125.9

$107.3 $99.2 $92.6 $85.8

$60.4 $53.4 $45.6

$17.6 $2.5 $6.0

Q1/09 Q2/09 Q3/09 Q4/09 Q1/10 Q2/10 Q3/10 Q4/10 Q1/11 Q2/11 Q3/11

Source: 10/5/11 Lipper Web Site; 10/4/11 Triton Pacific Email (Michie); 8/11 Envestnet Presentation (Bergman); Tiburon Research & Analysis 52 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

The Investments Process is Being Polarized with Twin Growth Patterns in Both Market-Linked Products and Alternative Investments 1998 view still Polarization of Investments Process correct

Polarization

Market-Linked Alternative Products Investments

Venture Indexed Index Exchange Other Hedge Capital & Separate Mutual Traded Real Estate Alternative Funds Private Accounts Funds Funds Investments Equity

Source: 10/4/11 Triton Pacific Email (Michie); Tiburon Research & Analysis 53 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Over Three-Quarters of Investable Assets are Actively Managed

Investment Assets By Investment Management Style

Index 20%

Active 80%

Source: 10/4/11 Triton Pacific Email (Michie); 8/13/10 Santa Clara University Presentation (Statman); Tiburon Research & Analysis 54 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Indexing – Powerful Views

Indexing (Powerful Views)

Active is a zero sum game (Statman) And less than zero sum after taxes & expenses $102 billion spent on active management

Low expenses (Morningstar) Most reliable indicator of fund performance

Control what you can (Evensky) Expenses & taxes

Source: 9/22/11 Google News Alerts; 4/5/11 Money Management Executive; Tiburon Research & Analysis 55 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Indexing – Support Trends

Indexing (Support Trends)

Indexing Trends are supporting growth in indexing Skeptical consumers Importance of retirement plan costs Growth of fee-based financial advisor channel Growth of fee-based accounts (across all channels) Side impact… Shining light on expenses everywhere

Source: 9/22/11 Google News Alerts; 4/5/11 Money Management Executive; Tiburon Research & Analysis 56 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

One Financial Advisor Commented that His Quantitative and Low-Cost Business Model was Proven Correct by the 2008-2009 Financial Crisis

Financial Advisor Comment on Products & Services

“2008-2009 reinforced our quantitative and low-cost orientation”

Source: 1/26/10 Gemmer Asset Management Conversation (Gemmer); Tiburon Research & Analysis 57 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Exchange Traded Fund Assets Reached $1.0 Trillion in 2010

Exchange Traded Fund Assets ($ Billions)

$1,082 $1,013

$782

$608 $578

$410 $300 $210 $140 $91 $100 $36

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Source: 10/5/11 Black Rock Web Site; 10/4/11 Triton Pacific Email (Michie); 10/3/11 Money Management Executive; 5/22/11 Financial Times; 4/11/11 Morningstar Email (Hannan); 3/28/11 Investment Company Institute; 3/11 National Stock Exchange; 2/26/11 Wall Street Journal; 1/6/11 USA Today; 8/30/10 Morningstar Presentation (Mansueto); 2/22/10 Money Management Executive (Financial Research Corporation); Tiburon Research & Analysis 58 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Pro Funds’ Pro Shares Offers 100 Exchange Traded Funds, Up 50% Since 2008

Pro Funds Exchange Traded Funds

100 100

2008 2010 2011

Source: 12/13/10 Barron’s; 12/7/10 Barron’s; 9/5/08 Pro Shares Web Site; Tiburon Research & Analysis 59 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Hedge Funds Have $1.8 Trillion Assets, Back Above their Peak and Up 30% Since their Bottom in 2008-2009

Hedge Fund Assets ($ Trillions)

$1.8 $1.7 $1.7

$1.5 $1.4 $1.4

$1.1

$0.9

$0.7 $0.6 $0.5

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Source: 10/5/11 Barclay Hedge Web Site; 10/4/11 Triton Pacific Email (Michie); 4/5/11 Barclay Hedge; 8/30/10 Morningstar Presentation (Mansueto); 3/8/10 Money Management Executive (Hennessee Group); 3/3/10 Money Management Executive (Hennessee Group); ; 4/15/09 Zebra Capital Management Presentation (Ibbotson) (HFR; Van Hedge Fund Advisors; Morningstar); 10/14/08 Morningstar Presentation (Mansueto); Tiburon Research & Analysis 60 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Hedge Funds Institutionalization

Hedge Funds Institutionalization Flight to Quality -> Start-ups emerging again but assets flowing to more established firms Pricing pressure -> Losing pricing control; institutional investors driving down pricing Retailization -> Mutual fund hedge funds to surpass limited partnership hedge funds ($150 billion AUM) Staffing -> This is a brain drain one way (far faster than break-away broker trend) Ever think about which portfolio managers will be left at the mutual fund firms when their choice is to make 2 & 20? Enforcement -> +3.00% (Khuzami) (promotes slow & steady growth just like Bernie)

Source: 10/4/11 Triton Pacific Email (Michie); 4/14/11 Edelman Financial Services Presentation (Edelman); 4/13/11 Hellman & Friedman Presentation (Thorpe; 4/7/11 Bridgewater Email (Milliman); 4/3/11 Wall Street Journal; 2/11 Credit Suisse Analysis; 8/30/10 Morningstar Presentation (Mansueto); Tiburon Research & Analysis

61 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Variable Annuities’ Assets Under Management Saw a Decrease in Growth in 2010 After a Strong 2009

Variable Annuities Assets Under Management ($ Trillions)

$1.5 $1.4

$1.1

2008 2009 2010

Source: 4/11/11 Morningstar Email (Hannan); 4/5/11 Annuity Digest; 3/7/11 Insured Retirement Institute; 3/5/11 Financial Advisor Magazine; 8/30/10 Morningstar Presentation (Mansueto); Tiburon Research & Analysis 62 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Other Financial Advisors Worry About Variable Annuities…

Financial Advisor Comment on Products & Services

“Variable annuities are needed most by non-investment savvy people which is unfortunate because they are complex products”

Source: 1/26/10 Park Place Wealth Advisors Conversation (Gannett); Tiburon Research & Analysis 63 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Outline

• Broad Market Environment – World Events, Economy, Markets, & Financial Services Industry Stumbles – Consumer Wealth, Growing Baby Boomer Issues, and Attitudinal & Behavioral Changes

• Financial Services Industry Strategies – Product Trends – Markets & Distribution Channel Evolution – Strategic Activity

• The Wild Card: Regulatory Agenda & the 2012 Elections

• Take-Aways: Top Ten Fundamental Trends

64 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™

Markets & Distribution Channels Evolution

Fundamentals Market Size: Financial advisors (45%) > institutional (34%) > self-serve (21%) Growth Rates: Financial Advisors (9%) > self-serve (4%) > institutional (2%) Everything clear? Classic question… Does Tiburon focus on the financial advisor markets?

Source: 9/11/11 Turning Point Email (Vigeveno); 8/26/11 Joyce Financial Management Conversation (Joyce); 4/14/11 Edelman Financial Services Presentation (Edelman); 4/8/11 Fidelity Investments Email (Graham); 4/7/11 Turning Point Email (Vigeveno); 4/7/11 Shah & Associates Email (Shah); Tiburon Research & Analysis 65 11.10.12 – Tiburon CEO Summit XXI © Tiburon Strategic Advisors, LLC™ Markets & Distribution Channels Evolution (Continued)