2010 Black Stone Investor Day

2010 Blackstone Investor Day
September 23, 2010
Hilton New York New York, NY
ForwardLookingStatementsandImportantDisclosures
ThispresentationmaycontainforwardlookingstatementswithinthemeaningofSection27AoftheSecuritiesAct of 1933 and Section 21E of the Securities Exchange Act of 1934 which reflect Blackstones current views with respectto,amongotherthings,Blackstonesoperationsandfinancialperformance.Youcanidentifytheseforward lookingstatementsbytheuseofwordssuchasoutlook, believes, expects, potential, continues, may, will, should, seeks, approximately, predicts, intends, plans, estimates, anticipates orthenegative version of these words or other comparable words. Such forwardlooking statements are subject to various risks anduncertainties.Accordingly,thereareorwillbeimportantfactorsthatcouldcauseactualoutcomesorresultsto differ materially from those indicated in these statements. Blackstone believes these factors include but are not limitedtothosedescribedunderthesectionentitledRiskFactors initsAnnualReportonForm10Kforthefiscal yearendedDecember31,2009,assuchfactorsmaybeupdatedfromtime to time in its periodic filings with the SEC, which are accessible on the SECs website at www.sec.gov. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in the SEC filings. Blackstone undertakes no obligation to publicly update or review any forwardlooking statement, whether as a resultofnewinformation,futuredevelopmentsorotherwise. ThispresentationincludesNonGAAPFinancialMeasures.Youshouldalsoreadtheappendixtothispresentation ReconciliationofNonGAAPFinancialMeasures. ThisreleaseisforinformationalpurposesonlyanddoesnotconstituteanofferofanyBlackstonefundoranofferto enter into any investment program with Blackstone. Such an offer may only be made by means of an offering memorandum, which would have a complete description of the relevant fund or program, including the risks applicablethereto.
Agenda Thursday,September23,2010
Time 8:00 8:05am 8:05 8:20am 8:20 9:00am 9:00 9:40am 9:40 10:25am 10:25 10:45am 10:45 11:25am 11:30 12:10pm 12:10 12:30pm 12:30 1:30pm 1:30 1:45pm 1:45 2:35pm 2:35 3:25pm 3:25 4:30pm 4:30 5:30pm Function IntroductionandOverviewofTheBlackstoneGroup
JoanSolotarSeniorManagingDirector,ExternalRelationsandStrategy, TheBlackstoneGroup
Location TrianonBallroom,3rdFloor TrianonBallroom,3rdFloor TrianonBallroom,3rdFloor TrianonBallroom,3rdFloor TrianonBallroom,3rdFloor PetitTrianon,3 Floor TrianonBallroom,3rdFloor TrianonBallroom,3rdFloor PetitTrianon,3rd Floor MercuryBallroom,3rdFloor PetitTrianon,3rd Floor TrianonBallroom,3rdFloor TrianonBallroom,3rdFloor TrianonBallroom,3 Floor PetitTrianon,3rd Floor
rd rd
WelcomeRemarks
StephenA.SchwarzmanChairman,CEO&CoFounder,TheBlackstoneGroup
FinancialOverview
LaurenceTosi(LT)ChiefFinancialOfficer,TheBlackstoneGroup
PortfolioOperationsGroup
JamesQuellaSeniorManagingDirector,TheBlackstoneGroup
PrivateEquity
GarrettMoranSeniorManagingDirector,TheBlackstoneGroup VikrantSawhneySeniorManagingDirector,TheBlackstoneGroup
BREAKCyberCaf BlackstoneAdvisoryPartners
JohnStudzinskiSeniorManagingDirector,TheBlackstoneGroup
Restructuring&ReorganizationAdvisory
TimothyColemanSeniorManagingDirector,TheBlackstoneGroup
BREAKCyberCaf GSOCreditPlatformWorkingLunch
BennettGoodmanSeniorManagingDirector,TheBlackstoneGroup&Founder, GSOCapitalPartners
BREAKCyberCaf RealEstate
JonathanGraySeniorManagingDirector,TheBlackstoneGroup
BlackstoneAlternativeAssetManagement(BAAM) J.TomilsonHillViceChairman,TheBlackstoneGroup WrapupandQ&A

StephenA.SchwarzmanChairman,CEO&CoFounder,TheBlackstoneGroup HamiltonE.JamesPresident&COO,TheBlackstoneGroup
COCKTAILRECEPTION
TableofContents
I. II. III. IV. V. VI. VII. VIII. IX. Appendix A. B.
IntroductionandOverviewofTheBlackstoneGroup FinancialOverview PortfolioOperationsGroup PrivateEquity BlackstoneAdvisoryPartners Restructuring&ReorganizationAdvisory GSOCreditPlatform RealEstate BlackstoneAlternativeAssetManagement(BAAM)
ReconciliationofNonGAAPFinancialMeasures SpeakerBiographies
I.
Introduction and Overview of The Blackstone Group
OverviewoftheBlackstoneGroup
Private Equity
Real Estate
Creditand Marketable Alternatives
Financial Advisory
Globalleaderininstitutionalalternativeassetmanagementwith $101.4billionofFeeEarningAUM Leader:Brand,scaleanddiversitycreatesuniquesynergiesandsuperiorreturns Consistency:Returnedanaverageof2.4xcapitalandanetIRR>25%inPrivateEquityandRealEstatefunds
sinceinception(1) Growth:15straightyearsoffeeearningassetgrowthata27%CAGR Outperformance:Raised$20billioninnewfundsduringdowncycle Value:Created$13billion ofinvestorvalueinthelast12months;returned$30billioningainsover25years

Strong,predictablefreecashflowdrivenbylongtermassetmanagementcontracts Over70%ofFeeEarningAUMareunderlongtermcontracts;notsubjecttoredemptionrisk GeneratedNetFeeRelatedEBITDAof$547millionandDistributableEarningsof$609millioninthelast
12 months
Robustbalancesheetwith$1.6billionofcashandliquidinvestments A ratingfromS&Pwithstableoutlook;A+ ratingfromFitchwithstableoutlook Deep,experiencedmanagementteam Presidesoverstrongriskmanagementprocessesandstrictcapitaldisciplineacrossallcycles Approximately66%ofequityisownedbypartnersandemployeescreatingacultureofownershipandlongterm
________________________________________________
accountability
Note:DataasofJune30,2010. (1) Pastperformanceisnotnecessarilyindicativeoffutureresults.
II.
Financial Overview
AnUnparalleledRecordofConsistentGrowth
PrivateEquity
$25.2billionFeeEarningAUM
RealEstate
Credit&MarketableAlternatives
FinancialAdvisory
M&A,Restructuring& Reorganization,ParkHill PlacementAgent
AssetsUnderManagement(1)
($inbillions)
FeeEarningAUM
$120 $100 $80 $60 $40 $22 $20 $3 $0 $4 $8 $8 $12 $13 $14 $27 $32 $96
$117
$16billionin committedcapital notyetpayingfees
$101
15YearCAGR CAMA 40%
$91
CAGR27%
$51
$83 $70
Real Estate 33% Private Equity 18%
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 June 2010
________________________________________________
(1)
ChartreflectsTotalAUMforyears19952006,andFeeEarningAUMthereafter.
1
BlackstoneFinancials KeyRevenueDrivers
Privates (PE,RE,GSOMezz) MarketableAlternatives (FoHFs,BREDS,GSOHedge)
ManagementFees
FeeEarningAUM (Committed/InvestedCapital)
FeeEarningAUM (NAVincludingmarks)
Transaction&AdvisoryFees
Activitybased
Activitybased
PerformanceFees
CarriedInterest (20%ofPositiveReturns)(1)
IncentiveFees (%ofPositiveReturns)
PrincipalGainsonBX InvestmentsinFunds
________________________________________________
BXReturnsonits GPInvestments(2%3%)
BXReturnsonits GPInvestments(2%3%)
(1)
Assumespreferredreturnhurdleisachievedbythefund.
2
FeeRevenueStreams
($inmillions)
$1,800 $1,500 FeeRevenues $1,200 $900 $600 $300 $0 2007 ManagementFees 2008 AdvisoryFees 2009 Transaction&OtherFees 2010LTM FeeEarningAUM $804 $360 $1,042 $1,000 $1,024 $1,636 $472 $1,562 $123 $398 $1,518 $127 $391 $1,618 $166 $428
($inbillions)
$180 $150 $120 $90 $60 $30 $0 FeeEarningAUM
ManagementFeesareauniquelyconsistentrevenuestream RecurringrevenuesdrivenbyFeeEarningAUM $70billion(~70%)ofFeeEarningAUMissubjecttolongtermlockups(1012years) TransactionandAdvisoryFeeshavematerialupsidegeneratedbyactivitylevels Morethan50%ofFeeEarningAUMiseligibleforTransactionFees Firmsexpensebaseiscoveredbyfeestreamsandisprofitableacrossallsegments IncludesallexpensesexceptPerformanceFeeCompensationforpartnersandemployees 70%oftotalexpensebaseisvariable

3
RealizedPerformanceRevenueStreams
($inmillions) ($inbillions)
$1,200 RealizedPerformanceFees $995 $900 $600 $322 $300 $0 $133 $23 2003 $24 2004 2005 2006 $55 $37 $916
$1,055
$160 FeeEarningAUM $120 $91 $96 $101 $80 $40 $0
$83
$39 2007 2008 FeeEarningAUM
$74
$169
2009
2010LTM
RealizedPerformanceFees
PerformanceFeesconsistofCarriedInterest andIncentiveFees CarriedInterestgeneratedbyPrivateEquity,RealEstate,andGSO(Mezz) IncentiveFeesgeneratedbyRealEstateDebtStrategies(BREDS), BAAM,andGSO(Hedge) PerformanceFeesarerecordedonanaccrualbasis;RealizedPerformanceFeesonacashbasis WhileonanaccrualbasisPerformanceFeesarevariableandcanbenegative,therecanbeno
negativeRealizedPerformanceFeesoverthelifeofafund=RisklessUpside
Whilelumpy,PerformanceFeesaregeneratedwithconsistentreturnsovertime
BlackstoneFinancials 2010LTM($inmillions) KeyFinancialMetrics GAAP Income(Loss)BeforeProvisionforTaxes +IPOandAcquisitionRelatedCharges +AmortizationofIntangibles Income(Loss)ofNonControllingInterests EconomicNetIncome ENI =EconomicNetIncome NetPerformanceFeesandAllocations InvestmentIncome(Loss) TaxesPayable NetFeeRelatedEarnings NFRE =NetFeeRelatedEarnings +NetRealizedPerformanceFeesandAllocations +RealizedInvestmentIncome(Loss) DistributableEarnings DE =DistributableEarnings $609
5
$(1,657)
$1,251
$441
PrivateEquityProfile
FeeEarningAUMof$25.2billion Capitalissubjectto10yearlockup
FeeRevenues
FeeRevenues
($inmillions)
$500 $400 $300 $200 $100 $0
2007 2008 2009
($inbillions)
$50 $392 $125
$370 $327 $115 $58
$367 $97
$40 $30 $20
FeeEarningAUM
ManagementFeespaidoncommittedcapital,
notcarryingvalue:
Insulatedfrommarketcyclicality TransactionFeescreateupside PerformanceFeesof20%paidonrealized gains $2.1billionsince2003;positivethrough
$255
$269
$271
$267
$10 $0
2010LTM
ManagementFees FeeEarningAUM
Transaction&OtherFees
($inmillions)
RealizedPerformanceFees $700 $600 $500 $400 $300 $200 $100 $0 $(100) $79 $(1) $602 $666 $574
($inbillions)
$50 $40 $30 FeeEarningAUM
downcycle
SubstantialDryPowder toinvest Financialprofilecreatescompetitiveadvantage
$231 $34 $81
$20 $10 $0 $(10)
forpatientinvestmentandsuperiorreturns
RealizedNetIRRssinceinceptionof25%
2003 2004 2005 2006 2007 2008 2009 2010 LTM RealizedPerformanceFees FeeEarningAUM
6
RealEstateProfile
FeeEarningAUMof$23.8billion Capitalissubjectto10yearlockupforcarry FeeRevenues
($inmillions)
$600 $500 FeeRevenues $400 $300 $200 $100 $0 $233 $296 $338 $336 $40 $361 $33 $366 $33 $571
($inbillions)
$50 $40 $30 $20 $328 $333 $10 $0 FeeEarningAUM
funds
ManagementFeespaidoncommittedcapital,
notcarryingvalueforcarryfunds
PerformanceFeesof20%paidonrealized
2007
2008
2009
2010LTM
gains
SubstantialDryPowder toinvest RealizedNetIRRssinceinceptionof28%
ManagementFees FeeEarningAUM
Transaction&OtherFees
($inmillions)
RealizedPerformanceFees $400 $300 $200 $100 $0 $(100) $34 $67 $25 $(3) $209 $347 $327
($inbillions)
$40 $30 $20 $10 $14 $0 $(10) FeeEarningAUM
2003 2004 2005 2006 2007 2008 2009 2010 LTM

RealizedPerformanceFees FeeEarningAUM
7
CreditandMarketableAlternativesProfile
FeeEarningAUMof$52.4billion Highlydiversifiedbystrategy,sectorandvintage Countercyclicalelementsdrivegrowth Flexiblestrategiestailoredtoclientand FeeRevenues
($inmillions)
$600 $500 FeeRevenues $400 $300 $200 $100 $0 2007 2008 2009 2010LTM $40 $20 $0 $327 $488 $394 $427 $80 $60 FeeEarningAUM
($inbillions)
$100
opportunity
Limitedpartnersarepredominatelyinstitutional Despiteindustryshakeoutandredemptions,
BAAM andGSOhadnetinflowsin2008and 2009

GainingmarketshareasBAAMandGSO
FeeRevenues
FeeEarningAUM
outperformrelevantbenchmarks
CAMAFeeEarningAUMMixasofJune30,2010
CreditHedge
($inmillions)
RealizedPerformanceFees $160 $120 $154
($inbillions)
$90 FeeEarningAUM
5%3%
GSO 45%
ClosedEnd MutualFunds(Asia)
$60 $80 $47 $40 $0 2003 2004 2005 2006 2007 2008 2009 2010 LTM
RealizedPerformanceFees FeeEarningAUM
$73 $41 $15 $0 $43 $30
Customized Strategies/ 33% CLOs
52% 7%
Customized Solutions (BAAM)
$20
$24
CreditDrawdown
FinancialAdvisoryProfile
Purestrategicadvisorybusinesses BlackstoneRestructuringandReorganization Leadingrestructuringandreorganization FeeRevenues
($inmillions)
$500 $400 $300 $200 $100 $0 2007 $368
$411
$396
$434
franchise,providingcountercyclicalbenefits 2009wassecondconsecutiverecordyearin termsof restructuringrevenues

BlackstoneAdvisoryPartners Boutiqueglobaladvisorybusiness,growing
revenueseveninadownmarket
ParkHillGroup Leadingprivateequityandrealestate
2008
2009
2010LTM
NetFeeRelatedEarnings
($inmillions)
fundraisingbusinessforthirdparties
Revenuesperpartnernearlydoublethatof
$100 $80 $60 $40 $20 $0 2007 (1) ProForma $71
$95 $78
$91
independentpeers
Investedaggressivelyingrowthduringthe
down cycle
Businesseshavecountercyclicalelements
leadingtobalanced,stableprofitabilityand growth
________________________________________________
2008
2009
2010LTM
(1)
2007ProFormaincludesalladjustmentsrelatedtotheInitialPublicOfferingandReorganization,asifsuchtransactionhadbeencompletedinJanuary1,2007.
9
StrongBalanceSheet(1)
($inmillions)
A ratingfromS&Pwithstableoutlook;A+
June30,2010 TotalCashandLiquidInvestments
RatingfromFitchwithstableoutlook
$3.45billioninInvestments NorecoursetoBXbalancesheet Nodirectinvestments/proprietary
CashandCashEquivalents TreasuryCashManagementStrategies LiquidInvestments TotalCashandLiquidInvestments TotalDebt $507 813 274 $1,594
positions
Diversifiedbybusiness,fund,vintage,
$1,070millionRevolver LoansPayable 10YearNoteDue2019 BalanceSheetItemswithOffsettingAssets TotalDebt TotalPartners Capital CurrentMarketCapitalization(2)
________________________________________________ (1) Representsdeconsolidatedbalancesheetaspresentedinpublicfilings. (2) CurrentMarketCapitalizationcalculatedusingBXclosingpriceasofSeptember20,2010andBlackstonesEconomicNetIncome AdjustedUnitsasofJune30,2010.
10
sectorandregion
Added$400millionof10.5yearnotesat
592 65 $657 $5,813 $12,397
5.875%;longtermcapitalforgrowth
III. Portfolio Operations Group
OurMission:SustainableCompetitiveAdvantageDeliveringLongTermValue
BlackstonesPortfolioOperationsGroup workswithourinvestmentteamsandportfolio
companyseniormanagementtohelpacquiredbusinessesbecomemoreproductive, competitiveandefficient
Intheprocess,webuildstrongerenterprises,preserveandcreatejobs,andenableour
portfoliocompaniestoachievelastingvalueforbothourfundinvestorsandsuccessor owners
BlackstonesGlobalReachandScale BlackstonePrivateEquitys62portfoliocompaniesextendacrossabroadrangeofgeographiesand industries,andcollectivelyrepresentaportfolioofsubstantialscale
Geographies
NorthAmerica Europe Asia/Africa
Industries
39 9 14
Industrials& Energy Healthcare Tech,Media&Telecom Hospitality/Leisure BusinessServices FinancialServices Retail/Consumer
Size(1)
18 10
Approximately715,000total Over$110billiontotal
revenues
10 8 6 5 5
employees
EquityinvestedbyBlackstone
fundsof$24 billion
Totalcurrententerprisevalue
over$200billion
________________________________________________
(1)
IncludesBXownershippercentageofDTandHarrahs.Totalenterprisevaluerepresentsmarktomarketvalueasof6/30/10.
2
SourcesofSustainableCompetitiveAdvantage
FinancialStability
BusinessSystems/FinancialControls WorkingCapitalOptimization TaxOptimization
Strategy&PerformanceEnhancement
GlobalPeerReviewProcess 100dayPlanning LeadershipDevelopment ManagementAssessment TalentManagement
Productivity&Competitiveness
ProcessRedesign/Lean SupplyChain ProcurementProcessesandConsortiaBuying IT/Outsourcing HealthcareBenefits
CorporateGovernance
BoardCompositionandProcess
CorporateResponsibility
Ethics/FCPA SocialResponsibility EnvironmentalManagement
StructuralTransformation
TransformationalChange
RevenueOptimization
GotoMarket Redesign StrategicSalesandMarketing Pricing/SalesForceOptimization CrossSelling
GoodProgressin2009and2010 alongsidevaluedeliverywithintheportfoliocompanies
InvestinginGrowthandLeadershipbyhiringspecialistsin:
Growth Leadershipandmanagementdevelopment
Portfolio Operations Organization
Expandedfunctionalcapabilitieswithsenioroperatingadvisors
IT,Lean,SupplyChain SalesforceEffectiveness PricingandMarketing AdvertisingandBranding
Reviewedandreorganizedportfoliocompanyboards
Portfolio Monitoring and Governance
Increaseduseofsenioradvisors/independentdirectors RebalancedBXprofessionals
Newquarterlyportfolioreviewprocess
Sectorfocusedpeerreviews Combininginvestmentandoperatingexecutives CEOledportfoliocompanydeepdives
SupportModelCombinesSectorandFunctionalExpertise PortfolioOperationsGrouphasgrowntoover60FTEsoverthepastsixyears
DealPartners Focusedon IndustrySectors Blackstone Portfolio Companies Business Services Consumer/ Retail Financial Institutions Hospitality/ Leisure Healthcare India Industrial/ Chemical/Energy Tech,Media, Telecom
________________________________________________
14Sector Focused exCEOs Senior Advisors
19GeneralistandFunctionally SpecializedExecutives(1) GlobalPortfolio OperationsGroup

Strategy&PerformanceEnhancement Governance Leadership/ManagementAssessment TransformationalChange LeanProcessRedesign SupplyChain/Procurement Pricing/SalesForce HealthcareBenefits BusinessSystems/FinancialControls IT/Operations
30FulltimeEquivalents PortfolioStrategic SupportGroups

CoreTrustPurchasingGroup EquityHealthcareGroup CrossSelling
Global SectorTeams
Platforms
TBMConsulting E&YWorkingCapital
Optimization
E&Y/DeloitteTax
Optimization
(1)
NorthAmerica,Europe,Asia.
5
WorkingCollaborativelywithManagement,DealTeamsandCoSponsors
OurPortfolioWide,Transformational,andFunctionalInitiativeshavegeneratedorareontracktogenerateover$4billionof
annualizedgrossEBITDAimpact
$4billion=$36billionofTEV,or~20%oftotalPrivateEquity portfolioTEVat9xportfoliomultiple
PortfolioWideInitiatives
GroupPurchasingincludingCore
TransformationalInitiatives
Largescale,companywide
FunctionalInitiatives
Morefocusedprogramsaimedat
Trust leveragespurchasingpower oftheportfolioinnonstrategic indirectgoodsandservices

EquityHealthcareimprovesthe
programsaimedatdriving significantvalue
Managementupgrades Integratedcorporateprograms:
increasingtheefficiencyand effectivenessofaparticular functionintheportfoliocompany

Examplesinclude:
qualitylevelsofindividual healthcareandappliesgroup purchasingtohealthcarebenefits

CrossSellingpromotesportfolio
Corporatewiderestructuring Growthinitiatives;pricingand salesproductivity Leanprocessredesign Plantconsolidationand lowcostsourcing Supplychain,procurement,and distributionoptimization ITandoperationsrestructuring andcosourcing
Pricing SalesForceProductivity LeanProcessDesign ITProductivity Cosourcing Procurement Outsourcing
companies purchasinggoodsand servicesfromeachother

WorkingCapitaloptimization
increasescashflowandimproves assetutilization
Over150TouchPointsacrossthePortfolioCompanies
Integrated Group Equity Performance IT& Sales& Working NumberofTouches Purchasing Healthcare &BOD Lean Outsourcing Marketing Capital+Tax Europe
SelectPortfolioCos. AllcargoGlobalLogistics AlliantHoldings AlliedBarton ApriaHealthcareGroup Biomet BlueStar CatalentPharmaceuticals CenterParcs Cineworld DJO 36 28 20 10 15 8 12 23
India
15
China
2
FreescaleSemiconductor GokaldasExports HiltonHotels MichaelsStores Nielsen
Travelport
PortfolioWideInitiatives Ourportfoliowideinitiativeshavegeneratedorareontracktogenerateover $640millionof annualizedgrossEBITDAimpact,plusanadditional$600millioninonetimecashsavings
GroupPurchasingincludingCoreTrust EquityHealthcare CollaborativePlatforms WorkingCapitalOptimization
GroupProcurement Progress2009vs.2010 Substantialbenefitsfromaggregatingandintegratingpurchasing Original2005target$100million$150millionsavingson$3billionindirectspend Achieved$240millionannualizedsavingsin2008 $300millionannualized
savingsin2009
Newtarget$350+millionannualizedsavingsin2010 Over~$1.4billionofannualspendmanagedthroughtheprogram 80% 85%ofportfoliocompaniesparticipateglobally 35+categoriesavailabletoday Globalcapabilityforover10categories Nocosttoparticipateinvirtuallyallcategories
EquityHealthcare(EH)CustomClinicalModel 5xclinicalstaffsolelydedicatedtoEHand2.5xengagementofmembersatrisk vs.standard models

MemberandProviderOutreach
Behavioral Health/EAP
Medical Claims Pharmacy Claims Lab Data
D A T A
Centersof Excellence
Vendors Line
24HourNurse
W A R Demo E graphics H Behavioral O Health U Claims S E
P R E D I C T I O N
PersonalHealth Advocate
Pharmacy
Maternity
PreadmissionCalls EnhancedDischargePlanning PostDischargeCalls CaseManagement IntegrationwithVendorPartners MedicalDirector/SupportStaff CustomerService

Online Coaching &Modules Disease Management
HRA Telephonic Coaching
ABCCo. Healthand Wellness Programs
CareAlerts
IntegrationofDatawith HealthRiskAssessment/ HealthRiskAssessment FutureBiometrics

10
EquityHealthcare FirstYearResults:2009
AggregateEHtrendis6.4%vs.U.S.corporateaverage~10.6%(1) 2009estimatednetsavingsof$35millionfor25portfoliocompanies $19millionmedicalclaimsavingsduetobetterqualityanddecisionmaking $16millionadministration(ASO)feesavings Aggressivesavingstargetof$100+million Continuedinvestmentinincentivesandplandesign Newmembershipgrowth
________________________________________________
(1) SegalTrendSurvey.
11
CrossSellingOpportunityandProgram(B2B) CrosssellingB2Bprogramcontinuestogrowrapidly,withmaterialrevenueandEBITDAimpact
FulltimeresourceinPortfolioOperationsGrouptocoordinatecrosssellingprograms(B2BandB2C)
SpecificProduct/ServiceOpportunitiesExamples:
Intelenet businessprocessoutsourcing Orbitz,HiltonHotels,LaQuinta travel Allcargo logistics TMobileWireless telecom SunGard businessservices RGIS inventorymanagement PerformanceFoodGroup fooddistribution
services
AlliantInsurance insurance,employee
benefitsconsulting
AlliedBarton securityservicesand
employeescreening
RepublicServices wastemanagement
intohotels,themeparks
Merlin,MichaelsStores,Universal,Tragus,
CineWorld,CenterParcs,others employee promotionaldiscounts/comarketing
12
CrossSellingPlatform BlackstoneB2CMarketplace
ExclusiveBlackstone
platform
Objectiveistopromote
Blackstoneportfolio companies
31U.S.basedportfolio
companiesparticipatingwith 350k+employees... U.K.plannedinphase2

AvailabletointerestedLPs Abilitytointegrate
ExclusiveBlackstoneOffers toemployees
Includesmanynon
Blackstonemerchants
LaunchedinMay
13
CxOOnlineNetworkforPortfolioSeniorExecutives(CEO,CFO,CPO,CHRO,CMO,CIO)
WelcometoTheBlackstoneGroupCEONetwork
WelcometotheCEONetwork!OursitepromotesrelationshipbuildingamongtheCEOsofourPortfolio Companies,suchasyourself.Youwillfindthelatestpersonalandcontactinformationformembersaswell asopportunitiestointeractwiththemthroughsurveysanddiscussionboards. TobegintheprocessyouwillneedtoregisterbyclickingontheNewMemberRegistration linkbelow.If youhavealreadyregisteredwithus,pleaseloginbyenteringyourEmailaddressandPasswordandthen clickingontheLogin buttonbelow. Wehopeyouenjoyyourexperienceandencourageyourfeedbackas wecontinuetoupdatethesiteto meetyourneeds.
CEONetwork
14
EnvironmentalSustainabilityInitiative PortfolioOperationsGroupplanstoretainaChiefSustainabilityOfficer(CSO)todriveportfolio wideinitiatives

EnvironmentalSustainabilityTaskForceformedin2008toestablishBlackstoneasPEindustryleader
inenvironmentalstewardship
Threeprimaryareasoffocus: Blackstoneenergyconsumptionandenvironmentalimpact Portfolioenergyconsumptionandenvironmentalimpact(bothPEandRE) Environmentalriskassessmentinallinvestmentprocesses Targetingmeaningfulenergyandcarbonreductionsoverthenextfiveyears Toptierofcompaniesglobally Sharingexpertiseacrossportfolio FullcompliancewithCRCmandateacrossEuropeanportfolio Broadcommunicationprogrambeinglaunchedthisquarter Documentingenvironmentalandcostbenefitsforthefirmandportfolio
15
OurMission:SustainableCompetitiveAdvantageDeliveringLongTermValue
BlackstonesPortfolioOperationsGroup workswithourinvestmentteamsandportfolio
companyseniormanagementtohelpacquiredbusinessesbecomemoreproductive, competitiveandefficient
Intheprocess,webuildstrongerenterprises,preserveandcreatejobs,andenableour
portfoliocompaniestoachievelastingvalueforbothourfundinvestorsandsuccessor owners
16
IV. Private Equity
BlackstoneCapitalPartnersOverview(1)
GlobalLeaderin PrivateEquity
Invested$33billionofequitycapitalin142transactionssinceDecember1988

Successful LongTermTrack Record
Returnsgeneratedinfullyinvestedfundsfrominceptionthrough06/30/10 GrossIRRof33%(25%net)2.5xMoIConrealized/partiallyrealizedinvestments Over23years,BCPhasoutperformedtheS&PIndexby16%annually(2)

Investment Strategy
Transformationalvalueaddedoperationscapability MidMarket/GrowthEquityFocus
Globalreach Demonstratedexpertiseattimingeconomiccycles Deepexperienceincorporatepartnerships

CapitalAvailablefor BetweenBCPVandBCPVI,wecurrentlyhaveapproximately$13.5billionofavailablecapital Investment

Alignmentof Interests
$2.3billiontotalinvested/committedcapitalbyBlackstoneanditsprofessionals 7%oftotalcapitalinvested

DeepInvestment Team
________________________________________________
28SeniorManagingDirectors
Note: Pastperformanceisnotnecessarilyindicativeoffutureresults.BCPVhasinvested$17.4billionasofJune30,2010witharealized/unrealizedvalueof$17.2billion,generatingagrossIRRof0.5%, andanetIRRof2%.TherecanbenoassurancethatanyBCPfundwillachieveits objectivesoravoidsubstantiallosses. (1) InformationisasofJune2010unlessotherwisestated.Includes BlackstoneCommunicationsPartners,asectorspecificfund. (2) S&P500AnnualReturnhasbeencalculatedastheinternalrateofreturnofthetotalcontributionsanddistributions(including fees,drawdownofexpenses,returnofcapitalandrecoupedlosses),and thecorrespondingannualrateofreturnoftheS&P500Indexfromeachcontribution/distributiondatetothequarterendforallinvestments.ForBCPIandBCPII,theS&Preturnhasbeencalculated fromthemostmaterialinvestmenttranchedatetothefinalexit dateforeachinvestment.S&P500AnnualRateofReturnisprovidedsolelyasanindicationofreturnsthatcouldbeearnedby investorsbymakingsimilarinvestmentsintheS&P500Index.BlackstonesfundsdifferfromtheS&P500Indexinthat,amongotherfactors,Blackstonesfundsareactivelymanagedentitiesthatbear feesanduseleverage. 1
BlackstoneProvidesAdvantagesNotAvailabletoStandalonePrivateEquityFirms Expertiseanddealsourcingbeyondthereachofanystandaloneprivate equity firm
RestructuringAdvisory
Restructuringsinvolving over$925billionof totalliabilities
CorporateAdvisory
Over$450billionof transactions
RealEstate
$24billionAUM
Credit/GSO
$29billionAUM
FundofHedgeFunds
$29billionAUM
DealSourcing/Bankruptcy Investing/Restructuring ProcessInsight
DealSourcing/Corporate Partnerships/Proprietary StructuredEquity
RealEstateAsset Optimizationand Financing /JointInvesting
JointInvesting/Market Insights /CaptiveSourceof DebtforPortfolioFinancing
GlobalMacro/ TargetIdentification/ PublicMarketInsights
$28billioninAUM 28 SMDs/ 89Professionals
________________________________________________
Note:DataasofJune30,2010.
2
Flexible,MultiStrategyInvesting NotMegaDeals Thestrengthsofalargeplatformappliedtolesscompetitivemediumsizeddeals InvestmentsbyStrategy(1)

EarlyStage/ LargePrivate Transactions Startups 3% 13%
24%ingrowth
equity
PlatformBuildups/ IndustryConsolidations 11%
LargePublicto Privates 21%
24%inlarge
transactions
16%inminority
anddistressed investments
Structured Equity 1% MinorityStakes 12% DistressedInvestments/ RescueFinancings 3%
36%insmall and
mediumsizeddeals
Small andMedium SizedBuyouts 36%
________________________________________________
(1)
Basedoninvested/committedcapitalfrom2000throughSeptember17,2010.Percentagesmaychangeovertime.
3
GlobalReach,SingleFund,OneHighStandard
Europe 5SMDs 16Professionals 5LocalCountryRepresentatives
Sweden
Asia 4SMDs 23Professionals
UnitedStates 19SMDs 48Professionals

SanFrancisco MenloPark Dallas NewYork
London
Paris
Germany Beijing Italy Istanbul Shanghai Mumbai HongKong Tokyo
Switzerland Madrid
Blackstone Headquarters PrivateEquityOffice
Chicago
Boston
LosAngeles
AffiliatedOffice Advisors
Houston
Atlanta
StrategySessions/ LeadGeneration Topdown
ReviewCommittee Gatesdealsand
Workshop Detaileddrill
FirstInvestment Committee Pricerange,
FinalInvestment Committee Settlesonfinal
100DayPlanReview Reviewsresults,
themesand bottomuptarget identificationto driveproactive dealsourcing
laysout workstreamsfor allnewdeals
downsintothe companys strengths, weaknesses, opportunities, andthreats
structure,value creationplan,risks, upside opportunities, downside protection
priceandtactics
operational enhancement plan,engagement ofstrategic supportgroups, capitalstructure optimization,and liquidityprotection
RankedhighestamongChiefInvestmentOfficersforinvestmentprocessandriskmanagement(1)
________________________________________________
(1)
CitigroupInvestmentResearch:ChiefInvestmentOfficerSurvey,September25,2007(toourknowledge,themostrecentsurveyofitskind).
4
ConsistentInvestmentPerformance EveryclosedBCP/BCOMfundhasbeeninthetopquartileorbetter.(1)Over23years,wehave outperformedtheS&PIndexby16%annually

($inmillions)
ThroughJune30,2010 Realized/PartiallyRealizedInvestments TotalInvestments Gross Gross Net Net Total S&P500 Blackstone Total Annual Annual Annual Annual Invested Annual Invested Rateof Rateof Rateof Rateof Out (2) (2) (3) MOIC Return Capital Return Return Capital MOIC Return Return Performance $679 2.6x 28% 19% $679 2.6x 28% 19% 13% 6% BCPI BCPII 1,201 2.6x 55% 37% 1,292 2.5x 50% 32% 11% 21% 3,402 2.0x 23% 18% 4,026 2.0x 17% 13% 1% 12% BCPIII 1,215 1.8x 27% 24% 2,132 1.3x 14% 7% 1% 6% BCOM 4,373 3.1x 79% 62% 7,219 2.4x 53% 39% 2% 37% BCPIV 10,870 2.5x 33% 25% 15,349 2.2x 29% 21% 5% 16% SubtotalClosed BCPV Total 1,504 $12,374 1.5x 2.4x 23% 33% 15% 25% 17,428 $32,777 1.0x 1.5x 0% 26% 2% 16% 7% 0% 5% 16%
____________________________________________
Note: (1) (2) (3)
Pastperformanceisnotnecessarilyindicativeoffutureresults.InherentinaninvestmentinanyBCP/BCOMfundissignificantriskandvolatility,andtherecanbenoassurancethatanyBCP/ BCOMfundwillachieveitsobjectivesoravoidsubstantiallosses. BasedoneachclosedBCP/BCOMfundsnetIRRasofJune30,2010comparedtoThomsonReuters dataasofMarch31,2010,themostcurrentdataavailable.AsBCPVisstillinvesting,itisnot consideredaclosedfundandisexcludedfromthisanalysis.AsBCOMisasectorspecificcommunicationsfund,BCOMs netIRRwascomparedtotheThomsonReuters TelecomFundsIndexrather thantheBuyout/MezzanineFundsIndexusedtocomparetheBCPfunds. IncludesinvestmentsmadebyBlackstonesSidebySideinvestmententities;excludesLPCoinvestments. S&P500AnnualReturnhasbeencalculatedastheinternalrateofreturnofthetotalcontributionsanddistributions(including fees,drawdownofexpenses,returnofcapitalandrecoupedlosses), andthecorrespondingannualrateofreturnoftheS&P500Index fromeachcontribution/distributiondatetothequarterendforallinvestments.ForBCPIandBCPII,theS&Preturnhasbeen calculatedfromthemostmaterialinvestmenttranchedatetothe finalexitdateforeachinvestment.S&P500AnnualRateofReturnisprovidedsolelyasanindicationofreturnsthatcouldbe earnedbyinvestorsbymakingsimilarinvestmentsintheS&P500 Index.BlackstonesfundsdifferfromtheS&P500Indexinthat,amongotherfactors,Blackstonesfundsareactivelymanaged entitiesthatbearfeesanduseleverage. 5
RecentValuationChanges Theportfoliohasappreciatedby39%inthelastfivequarters BCPOverallPortfolio

20%
15.8%
10% 7.7% 4.1% 0% 2Q2009

________________________________________________
4.3% 2.4% 3Q2009 4Q2009 1Q2010 2Q2010
Note:Returnstoinvestorswillultimatelybereducedbymanagementfees,carriedinterest,andotherfeesandexpenses.Pastperformanceisnotnecessarily indicativeoffutureresults.InherentinaninvestmentinanyBCP/BCOMfundissignificantriskandvolatility,andtherecan benoassurancethatanyBCP/BCOM fundwillachieveitsobjectivesoravoidsubstantiallosses.

6
TheMajorityofBCPDealsAreunder$2BillionTEV Blackstoneisanopportunisticmulticap investor,withnearlytwothirdsofourdealsinthelast tenyearshavingaTEVunder$2billion TotalEnterpriseValueofTransactions,20002010

($inmillions)
>$5,000
TDC Freescale Nielsen Michaels Biomet BankUnited eAccess Hilton
11Deals
Ish Spirit
SunGard
Travelport
TRWAutomotive Nalco Celanese Pinnacle TexasGenco Viatel
BlueStar WeatherChannel
$2,000$5,000
ExtendedStay
22Deals
CTIHoldings UniversalOrlando
UB Catalent Merlin/LEGOLAND Stiefel Orangina DJO FGIC SouthernCross/NHP Freedom CenterParcs
SeaWorld
<$2,000
61Deals
2000
________________________________________________
2001
2003
2005
2006
2008
2010
2011
Note:OnlyTEV>$2,000labeled.ExcludesBankUnited,whichdoesnothaveaTEVcomparabletoothertransactions.
7
AdvantagesofScale
Brandnamematters Dedicated50+personPortfolioOperationsGroupfocusedoncreatingvalue Highproportionofexclusivedeals Preferredaccesstodebtfinancingincapitalconstrainedmarkets Processadvantagesfromsellingagents,includinglastlooks Broadnetworkofrelationshipstofinddeals Corporatepartnerships Globalperspective evenondomesticcompanies Deepfinancialandoperatingdomainexpertiseineachmajorsector Strategicalliances China,Korea,Brazil
BlackstonesApproachtotheCreditMarkets
Maintainabroadrangeofactiveandcollaborativerelationships
Proactive
withinvestmentbanks,commercialbanks,hedgefundsand mutualfunds
Opportunistic
Continuallystayaheadof,andtakeadvantageof,new
technology (e.g.,amend/extend)
Customized
Tailorthecapitalstructureofeachinvestmenttosuitthat
particularinvestmentthesis
Comprehensive and Coordinated
ManagethedebtobligationsoftheBCPportfoliocompanieson
anintegratedbasis,leveragebestpracticesandrelationships acrosstheportfolioandthefirm(e.g.,GSO,BAAM)
StayingPower Aggressivebalancesheetinitiatives protectingourcapitalandcapturingvalue.Over50%ofour portfoliocompanies combineddebtwaseliminated,refinancedorextendedin2009and2010YTD

($inbillions)
DebtElimination (viaBuybacks,DiscountedExchanges, andDebt/EquitySwaps) Refinancings Extensions Total
$6.9 12.2 33.7 $52.8
$3billionofequityvaluecreated
10
BuiltinFinancialFlexibility
StrongLiquidityandCovenantPosition
Almost2/3ofBCPVscapitalisinvestedincompanieswithnomaintenancecovenants Comfortablecovenantcushionsforcompanieswithcovenants Lessthan3%ofBCPVportfoliocompanydebtmaturesbefore2013;65%matures2015andbeyond
BCPVDebtMaturities(1) 50%
%ofTotalBCPVDebt
46.7%
40%
33.2%
30%
21.0%
20% 10% 0%
0.2% 1.0%0.9% 3.1% 0.2% 3.1%
16.4%
15.8% 10.7%
16.9% 8.2% 4.7% 7.6% 1.2% 7.5%
1.6%
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018+
BCPVDebtMaturitiesasofDecember2008
________________________________________________
BCPVDebtMaturitiesasofSeptember2010
(1) Representstranchematuritiesandexcludesundrawnrevolvers,whereapplicable.Excludespublics,developmentstagecompanies(AmericanPetroleum Tankers,OSUM,andPBF),debtportfolios(CitiandDeutscheBank),Bayview,BankUnited,Harrahs,andSummitMaterials(newin3Q2009).Informationbased onJune30,2010valuations.ThesestatisticsattributeallofHiltonsdebttoBCP;BREPandcoinvestorsownthemajorityofHilton.

11
CreditMarketsOutlookforBCPVI AstheBCPVIinvestmentperiodbegins,weexpecttobeataveryfavorablepointinthecreditcycle
Favorableenvironmentforsaleofnoninvestmentgradedebttoinstitutionalinvestors

Ratesareathistoriclows Spreadsarewellabovehistoricmedians Defaultratesdeclining Ashiftinassetallocationfrompublicequitiestofixedincome Growingfocusamonginsurancecompaniesandpensionfundsonmeritsoffloatingratebankdebt RecordyearforHYissuance
Bankinginstitutionshavehealed

Exposuresto2007vintageLBOs havelargelybeendivested Bankshaveshiftedlendingfocusdisproportionatelytobestinclass PEfirmswithstrongesttrackrecords Traditionalplayershaveemergedstrongerduetoconsolidation Crediblenewplayershaveemerged
BCPhasmorearrowsinthequiver thanbeforethecrisis:

GSO Blackstonescreditplatform Outstandingrelationshipswithlargedirectlenders OngoingdialoguewithPMs athedgefundsandmutualfunds Directrelationshipswithcapitalmarketsandsyndicatedesksat themajorbrokerdealers
12
BCPVOutlook
WeexpectBCPVtogeneratea2xMOIC(1)

AveragerevenueandEBITDAgrowthratesof5.1%and8.3%,respectively Averagemarginimprovementof80bps
Solidbalancesheetswithcomfortablecovenantandmaturityprofiles
91%ofBCPVcapitalinvested/committed
Expecttocloseinvestmentperiodinthenextfewmonths
________________________________________________
(1) WhileBlackstonecurrentlybelievesthattheassumptionsonwhichthisprojectionisbasedarereasonableundercurrentcircumstances,thereisnoguarantee thattheconditionsonwhichsuchassumptionsarebasedwillmaterializeorotherwisebeapplicabletothesefunds. Therecanbenoassurancethatanyfund managedbyBlackstonewillbeprofitableoravoidsubstantiallosses. Aboveprojectionsdonotincludeanyassumptionsregardinginvestmenttimehorizon orthe rateofreturnonfundsmanagedbyBlackstone.Ultimatereturnstoinvestorswillbereducedbymanagementfees,fundexpensesandcarriedinterest.

13
OverviewofCurrentEnvironment Blackstonehasatrackrecordofgeneratingcompellingreturnsacrossallcyclesandiswell positionedtotakeadvantageofthiseconomicenvironment MarketEnvironment

Wearecautiousoneconomicgrowth
Opportunity
Postrecessionvintageshavehistoricallyprovided
prospects
Anabundanceofprivateequityinthe
thehighestreturns
BCPhassignificantdrypowderandaglobal
marketmakesontherundealsvery difficult
Debtmarketshavereboundedand
opportunityset
Focusonexclusiveopportunitiesdrivenby
industry/regionaldepth
RecentInvestments SummitMaterials Aggregatesbuildup PBFRefining depressedrefiningopportunities SeaWorld furtheringourthemeparkfranchise Dili modernizingdistributioninChina
supportattractivedealmaking butcreditspreadsarehigherand covenantsaretighter

Equityvaluationsarerelativelyattractive Butcyclicalsransoonerinthiscycle
thanpreviously Weassumevaluationswillnotreturn to06/07levels
14
BestPrivateEquityInvestmentsOriginateat theBottomoftheCycle
PrivateEquityIndustryReturnsbyVintagevs.U.S.GDPGrowth
35% 30% MeanNetIRRbyVintage 25% 20% 15% 10% 5% 0% 5% 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2% 2006 2008 2010 19% 15% 11% 9% 6% 15% 11% 7% 7% 1% 15%15% 16% 23% 21%
?
31% 29% 27% 26% 22%
5%
Precedent 4% suggests shouldbe 3% excellent vintage 2% years
YoYU.S.GDPGrowth
1% 0% 1% NA NA NA 2% 3%
TopofCycle
BottomofCycle
U.S.GDPGrowth
________________________________________________
Source:GlobalInsight;CambridgeAssociatesLLC;U.S.privateequityPooledMeanNetIRRtolimitedpartnersbyvintageyearasofMarch31,2010.Vintageyear fundsformedsince2006aretooyoungtohaveproducedmeaningfulreturns.GDPprojectionsaspertheInternationalMonetaryFund,2009.
15
FundraisingandNewInitiatives
BCPVI
Somesubscriptiondocumentsstilloutstanding,howeverweanticipateafinalfundsizeof over $13.5billion Giventhecurrentandexpectedinvestments/commitmentsforBCP V,weexpecttoclosethe BCPVinvestmentperiodinthenextfewmonths

CleanTechnology Growthequityindisruptivetechnologies
Estimatedfundsizeof$500million Expectfinalclosein1Q2011
RMBFund Chinagrowthstrategies
Estimatedfundsizeof5billionRMB(approximately$740million) Firstcloseexpectedin4Q2010
16
FundraisingandNewInitiatives(Contd)
Infrastructure ValueorientedandvalueaddedInfrastructureinvesting,currentlyfocusedon
NorthAmericanopportunities: EnergyandUtilities Transportation Communications Estimatedfundsizeof>$1billion Expectfinalclosein4Q2011

Othernewinitiativesunderevaluationinclude:
Energyfund EmergingAsiafund ExpandedpresenceinLatinAmerica
17
V.
Blackstone Advisory Partners
A.
BAP Overview
2010 Blackstone Investor Day A. BAP Overview
BlackstoneAdvisoryPartners
LeadingAdvisor Independentand Objective
Advisoronover$450billionoftransactionssince1985
Aleadingglobalindependenttrustedadvisorypracticewithlimitedconflictsofinterestandahigh
levelofseniorattentiontoclients
Adviseonandexecutecomplextransactions:
BroadExpertise
MergerandAcquisitionAdvisory StrategicandFinancialAdvisory StructuredProducts DivestituresandReorganizations JointVenturesandMinorityInvestments
InternationalReach DiverseIndustry Coverage ExperiencedTeam
InternationalhubsinNewYork,London,HongKong,andPariswithassignmentsthroughouttheU.S.,
Europe,andAsia
FinancialInstitutions,EnergyandNaturalResources,Chemicals, Technology&Communications,
Media,Consumer,RealEstate,Industrials,andMinerals&Mining
20SeniorManagingDirectorswithanaverageofover20yearsof industryexpertise 138professionalsglobally
OverviewofBlackstoneAdvisoryPartners:SuperiorInvestmentBankingAdvice Givenouruniquephilosophyandapproachtocorporateadvisoryassignments,Blackstoneiswell suitedtoadviseclientsoncomplexstrategicinitiatives

AbsenceofConflictsofInterest
Abletoprovideobjectivefinancialadvisoryservice;nounderwriting,equityresearch,ortradingconflicts Emphasisonlongtermrelationshipswithselectclients;absoluteconfidentiality
Independence
DepthofExpertise;SeniorLevelAttention
Intellectual Capital
SeniorManagingDirectorswithaveragetenureof20yearsinInvestmentBanking,nearlyallofwhomhaveled
industryfocusedinvestmentbankingfranchisespreviously Extensiveindustrynetwork,seniorlevelrelationshipsandregularstrategicdialoguewithFortune500 companies CreativeSolutionsforComplexIssues
Innovation
Extensiveexperienceadvisingadiversesetofclients,includingpublicandprivatecompanies,boards,and
sovereignentitiesonstrategic,financial,andstructuredtransactions StructuredfinanceteamfocusesoncustomizedM&Asolutionsandcreativefinancingsolutions UniquePerspectivesonValueCreation HiredPrincipal Mentality
InvestorFocus
Distinctiveabilitytobringanownersmindsettobearonadvisoryengagements;extensiveexperienceworking
withtheFirmsportfoliocompanies GlobalPresenceandAbilitytoCapitalizeonOtherBlackstoneBusinesses
International Network
NetworkofinternationalofficesandinternationaladvisoryboardallowBlackstonetoofferglobalcrossborder
advisoryservices Abilitytoleveragefirmknowledgeinprivateequity,restructuring,hedgefund,realestateandvaluation expertise

3
SeniorLevelCoverage Handson AttentionfromanExclusiveGroupofTopBankers Blackstonescorporateadvisorybusinessconsistsof20SMDswithanaverageof20yearsindustry experienceand138bankersaroundthe world

TeamMember JohnStudzinski MartinAldersonSmith DavidBradley IvanBrockman MaryAnneCitrino PeterCohen JiteshGadhia MartinGudgeon GregHewett JonathanKoplovitz ThomasMiddleton LarryNath RaffiqA.Nathoo WilliamOglesby ChrisPasko JeanManuelRichier AnthonySteains JeanMichelSteg ThomasStoddard JianpingZheng FocusArea HeadofBlackstoneAdvisory FinancialInstitutions Chemicals Technology,MenloPark ConsumerProducts Media&Entertainment UK&India EuropeanRestructuring StructuredProducts EuropeanM&A Telecom StructuredProducts Energy Paper&Packaging,HealthcareIT Technology,Boston France Asia/Metals&Mining France FinancialInstitutions GreaterChina YearsofExperience inIndustry 31 25 25 16 27 19 20 21 10 20 25 22 20 27 21 20 16 31 19 15 YearJoinedBlackstone 2006 1991 2009 2007 2004 2009 2010 2007 2005 1996 2003 2005 1992 2004 2007 2009 2008 2009 2008 2008
AdvisoryProductCategories IntellectualCapitalatWork
M&AandCorporateAdvisory
SectorExpertise Generaladviceandexecutionofacquisitions,mergers,jointventures,minority investments,assetswaps,divestitures,leveragedbuyouts,specialcommittees andtakeoverdefenses Abilitytoadviseonlargecap(>$10billion),midcapandsmallcap(<$500 million)transactions
IPOandCapitalMarketsAdvisory
Board/ManagementAdvice Adviceonsharerepurchases,dividendpolicyandcostofcapital Independentviewsondebtandequitycapitalraising Privatecapitalplacementservices Coordinationofselectionofunderwriters/lendersandnegotiationof terms SectorExpertise Ownermindsetinhelpingclientsdevelopstrategiesforraisingcapitalor monetizingpositions
StructuredProducts
Wedevelopanddelivercustomizedsolutionstomeetourclients complexfinancial andstrategicobjectives.Typicalengagementsinclude

RestructuringandReorganizationAdvice
BroadRelationships Strongrelationshipswithissuers,lenders,distresseddebtinvestors,legal advisorsandothers StrategicandFinancialAcumen Expertiseincorporatefinanceandbusinessstrategy,helpingbothcompanies andcreditorsdevelopstrategicbusinessplans,financialforecastsand restructuringalternatives IndepthKnowledgeofRestructuringProcess ComprehensiveunderstandingofU.S./Europeanrestructuringprocessand provenabilitytomanageittomaximizevalue
Structuredfinancings,particularlyfornontraditionalassets CreatingcustomizedM&Asolutions Structuringjointventureswithstrategicorfinancialpartners Advisingclientsoncapitalstructureissues
BlackstoneAdvisory:RepresentativeLargeCapTransactions BlackstoneAdvisoryPartnershasadvisedonnumeroushighprofiletransactionsglobally
$180Billion SoleGlobal Coordinator
Advisorto on
andAdvisorto onthecombinationofits globalpowerbusiness with
93Billionand N/A
Advisorto onitsmergerwith
$46Billion
Advisorto
$23Billion
AdvisortotheBoard ofDirectorsof
$20Billion
Advisorto
10Billion
Advisorto
$18Billion
Advisorto
onitsproposed mergerwith
onthebuyoutledby CEORichardKinder including
onitsstrategic investmentin
onitssaleto
onthejoint acquisitionof
$17Billion
Advisorto
6.6Billion(1)
Soleadvisorto
$8.3Billion
Advisorto
$8.0Billion
Advisoronthesale of to
$7.6Billion
Advisorto
$3.7Billion
Advisorto
$3.3Billion
Advisorto
onthesaleto onaminority investmentin onitsacquisitionof
onthesaleofits U.S.regulated utilityoperationsto PPLCorporation
onitsacquisitionof Kraftsfrozenpizza business
onitssaleof Folgersthrougha ReverseMorris TrustStructureto
________________________________________________
(1)
RepresentstotalcapitalcommitmentfromCDB.
6
B.
BAP Highlights
2010 Blackstone Investor Day B. BAP Highlights
M&AMarketOverview YTD2010M&Adealvolumeisup~20%andacquisitionmultipleshaveincreasedfromrecentlows U.S.M&AActivity

16,000 12,000 8,000 4,000 0 1999 2000 2001 2002 2003 2004 2005 2006 DealValue
$337 $355 $220 $212 $211 $159
$2,000 ($inbillions) 12,714 12,767 10,079 8,923 8,771 9,893 10,041 12,350 13,220 $1,500 11,363 9,181 4,532 2007 2008 2009 6,502 $1,000 $500 $0 YTD6/09 YTD6/10
NumberofDeals
Avg.Deal Size(1) ($M) $307 $226 $181 $137 $157 $209 $274
U.S.EnterpriseValue/LTMEBITDAMultiples(2)
15x 12x 9x 6x 3x 0x
________________________________________________
9.1x
8.1x
7.1x
8.0x
8.2x
9.5x
11.0x
11.1x
11.8x
10.4x 8.0x
9.4x
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
LTD6/10
Source:DealogicandWallStreetresearch. (1) Averagefordiscloseddealsonly. (2) Excludesdealsinfinancialservicessector.

8
M&AMarketOverview(Contd) Adiversifiedsetofindustrieshavecontributedto20101HM&Aactivity,withalmost50%ofthe volumecomingfromtheAmericas

20101HM&AActivitybyRegion
Africa/MiddleEast Japan 3.0% 3.9% AsiaPacific 18.8%
20101HM&AActivitybyTargetIndustry
Media HighTechnology 6% RealEstate 7% 5% 20% Energy& Power
Healthcare 8%
49.1% Americas
17% 12% Telecom

Europe 25.2%
Industrials
10% Consumer&Retail
15% Financials
TotalVolume:$1,065billion
________________________________________________
Source:ThomsonReutersfor1H2010.
9
BAPMarketOverview BAPcontinuestobuildaninternationalfranchisewithlastingrelationshipswithsomeoftheworlds mostdynamiccompanies

Overthepast5yearsBAPhasmaintainedanddevelopedstrongrelationshipswithlargeclients,includingsubstantialrepeatbusiness
IncreasingvisibilitythroughrecenthighprofileassignmentsincludingGDFSuez,E.ON,AIG,Chinalco,P&G,Nestle,andXerox Feesgeneratedfromlargecapclientsincreasedfrom23%ofthetotalin2005to47%in2009 OpenedLondonofficein2007 OpenedHongKongofficein2008 OpenedParisofficein2009 Internationalrevenueincreasedfrom8%in2005to32%in2009
ThegrouphasexpandedthenumberofinternationalclientsthroughexpansioninEuropeandAsia
DespitethedownturnintheM&Amarket,BAPhascontinuedtogrowbothitsrevenuebaseandpersonnel,morethandoublingin
sizesince2007whilemaintainingstrongprofitability
Added19newSMDsandMDstothefirminthepasttwoyears
PersonnelGrowth
160 120 80 40 0 2006 51
(TotalProfessionalHeadcount)
PersonnelGrowth
(SMDsandMDs) 50
121 95 138 40 30 20 10 0 2008 2009 Aug10 17 2006 21 27 36
42
69
2007
2007
2008
2009
Aug10
10
BAPMarketOverview(Contd) Inthepast5yearsBAPhassignificantlyincreaseditscoverage ofindustriesandgeographies

CoverageUniverse

2005 Consumer&Retail Energy,Power&Utilities FIG Media RealEstate Telecom

Consumer&Retail Energy,Power&
2010

Industries
Mergers&Acquisitions
Utilities FIG Media RealEstate Telecom Mergers& Acquisitions
Chemicals CleanTechnology Insurance Metals&Mining Technology
Products
StructuredProducts PrivatePlacements FinancialAdvisory IPO&Equity Advisory DebtAdvisory& Restructuring

NewYork Atlanta
NewYork Atlanta
Geographies
London HongKong Boston MenloPark Paris Beijing

11
2009and2010YTDPerformanceSummary Despiteachallengingmacroenvironment,BAPrecordedyearoveryeargrowthin2009andiswell positionedforstrongperformancein2010

2009highlightsincluded: Yearoveryearrevenuegrowth,despiteM&Amarketslowdown Added4newSMDs GeographicexpansionwiththeopeningofParisoffice,increased Germanpresenceand
buildoutofAsiaoffices
BolsteredcapabilitiesinFIG,Chemicals,andMedia Maintainedstrongrevenue/SMDrelativetocompetitors 2010achievementsincluded: Top10rankinginM&Aleaguetablesin1Q Strongpipelineofover100projects Diversetransactionbaseacrossindustriesandgeographies ExpandedEuropeanandAsianbusiness Approximately50%ofdealshaveaninternationalcomponent
12
2009and2010YTDPerformanceSummary(Contd) BAPcontinuestodiversifyitsbusinesstofillglobalmarketopportunitieswhilemaintainingits productivity

LTMBAPRevenuebyRegion
AsiaPacific 6% Europe 24% 70%
LTMBAPRevenuebyIndustry
Media Energy&Power 5% 18% 18% 14% Industrials 23% Financials
HighTechnology RealEstate,1%
Americas
Healthcare 10% 3% Telecom 8% Consumer&Retail
2009RevenueperSMD(1)
($inmillions)
$8.0 $6.0 $4.0 $2.0 $0.0 BAP
________________________________________________
2009RevenueperProfessional(1)
($inmillions)
$2.0
$7.8 $5.9
$1.5 $1.0 $0.5 $0.0 $1.4 $1.2
CompAverage
BAP
CompAverage
(1)
Source:200910KsforEvercore,GreenhillandLazardsadvisorybusinesses.
13
KeyInitiativesfor2011 BAPstandsuniquelypositionedandreadytocapitalizeontheglobalrecovery,withanumberofkey initiativesfor2011

RecenttrendssuggestanincreaseinM&AvolumeinFall2010/2011
Openingofcreditmarketshasencouragedstrategicsandfinancialstopursuenewdeals EmergingmarketM&Aisincreasing;Blackstonesinternationalpresenceandstrongbrandallowittobenefit
ContinuedturmoilanduncertaintyatlargerfirmsprovidesbusinessandhiringopportunitiesforBAP
BoutiqueM&Amarketsharehasincreasedoverthepastdecade Majordealmakersatlargebankshavebeenmovingtosmalleradvisoryfirmsatrecordlevels
2011areasoffocusinclude:
Europe:Germanyandpotentialalliancesforotherjurisdictions (EasternandSouthernEurope) GrowthinAsianpresence,plusnewexpansionintoAustralia FurtherfocusonBRICmarkets Opportunisticexpansioninselectindustryverticals Healthcare NaturalResources/Oil&Gas Industrials
Globalizingmajorindustryverticals,includingFIG,ConsumerProducts
14
VI. Restructuring & Reorganization Advisory
A.
Restructuring Group Overview
2010 Blackstone Investor Day A. Restructuring Group Overview
RestructuringandReorganizationGroupataGlance TheRestructuringandReorganizationAdvisoryGroupisamongthe mostaccomplishedand experiencedinitsfield

EstablishedLeaderinRestructuringAdvisory
Groupformedin1991 GroupheadedbyTimColeman Grouphasreceivednumerousawardsandrecognitioninrecentyears
GlobalReach
NewYorkteamcomprisedof46professionals includes6SMDs,7MDsand4VPs Londonteamcomprisedof4professionals includes1SMDand3MDs,whoreportthroughBAP SMDsandMDscollectivelyhaveover130yearsofexperienceatBlackstoneandover215yearsinrestructuring
WideRangeofAdvisoryServicesandClients
TypeofService
Adviseonincourtreorganizations Adviseonoutofcourtrecapitalizations Adviseonexchangeoffers Raisedebtandequitycapital Adviseondistressedmergersandacquisitions Adviseonretireehealthcareissues Provideexpertwitnesstestimony
Company
X X X X X X X
Creditor
X X X X X
2
HighlyExperiencedTeam TheRestructuringGroupsSeniorManagingDirectorshave,onaverage,18yearsofindustry experience

SeniorManagingDirector TimColeman GroupHead StefanFeuerabendt YearsofRelevant Experience PriorExperience 24 Citibank LehmanBrothers HellmoldAssociates CreditSuisseFirstBoston MerrillLynch HellmoldAssociates SmithBarney,HarrisUpham&Co.,Inc. SalomonBrothers DrexelBurnhamLambert Ernst&Young Year JoinedBX 1992
16
1998
MichaelGenereux
2003
FlipHuffard
18
1995
NickLeone
20
1995
SteveZelin
22
1998
BlackstoneRestructuringRecognition Blackstonesrestructuringadvisoryeffortshavereceivedsubstantialpraiseoverrecentyears
ThomsonsInternationalFinancingReview
AwardedRestructuringDealoftheYear in2009fortheFordMotor
Companytenderofferanddeleveragingtransactions AwardedRestructuringoftheYear in2008fortherestructuringof CreditBasedAssetServicingandSecuritizationLLC(CBASS) NamedNorth AmericanRestructuringHouseoftheYear fortheyears 2004and2005 TurnaroundAtlasAwards

AwardedTurnaroundoftheYear ($5+billion)andAutomotiveIndustry
&ServicesDealoftheYear in2010fortherestructuringofFordMotor Company AwardedTurnaroundoftheYear ($1+billion)in2010fortheSemGroup Corporationreorganization AwardedCorporateTurnaroundDealoftheYear ($500+million)in2010 fortherestructuringofMerisantCompany AwardedBeverage,Food&ServiceDealoftheYear in2009forthe reorganizationofMrs.FieldsCompanies TurnaroundManagementAssociation
AwardedMegaCompanyTurnaroundoftheYear in2007forthe
WinnDixieStoresreorganization
4
RestructuringandReorganizationGroupRole Weprovideclientsawiderangeofadvisoryservicesincluding,butnotlimitedto,thefollowing:
Adviseonoutofcourtrecapitalizationsandincourtreorganizations Developstrategicbusinessplans,financialforecastsandliquidityforecasts Analyzecomplexlegalandcapitalstructures Performcomplexvaluationassignments Negotiateconsensualsolutionsincomplexandoftencontentiousdistressedsituations Adviseonexchangeoffers Adviseoncapitalmarketstransactions,includingraisingallformsofcapital Debtorinpossessionfinancing Securedfinancing Secondlien Othersubordinateddebtandequity Adviseonmergers,acquisitionsanddivestituresofassetsoroperations Divestbusinessesorotherassetsincourtandoutofcourt Adviseonmergersandothercombinations Advisebuyersofdistressedcompaniesanddistressedassets Adviseonpensionandretireehealthcareissues Provideexpertwitnesstestimony
5
SelectedRestructuringClients BlackstonesRestructuringGroupisknownforadvisingbothcompaniesandstakeholdersinthe largestandmostcomplexrestructurings

OutofCourtAssignments Chapter11Assignments CreditorAssignments
BroadIndustryExpertise 13TopIndustrySpecialties Healthcare/ MedicalProducts Retail/ Supermarkets
Automotive
ConsumerProducts
Infrastructure
RealEstate/ Casinos
Energy
Leisure/ Entertainment
Steel
FinancialServices
Manufacturing/ BasicIndustry
Transportation
Media/ Communications
B.
Restructuring Market Trends
2010 Blackstone Investor Day B. Restructuring Market Trends
CurrentEnvironmentOverview Thelevelofnewrestructuringactivityhasdecreasedinrecentmonthsduetotheresurgenceofthe creditmarkets

U.S.economyremainsinaroughpatch
Afterincreasingduringthelastfewquarters,GDPgrowthratedecreasedin2Q(1) Unemploymentrateseemstohavepeakedataround10%,butappearsstuckataround9.7%(1)
Newinitialjoblessclaimsshotupto500,000inmidAugust,defyingexpectations,andwhilecurrentlydecreasing,stillremain above450,000(1)
MonthlyhousingstartsincreasedearlierintheyearbuthavedecreasedsinceApril(1) CaseShillerhousingpriceindexhitalowinApril2009 andhasremainedrelativelystablethisyear(2)
Creditmarketsreboundedinthesecondhalfof2009andhavecontinuedatanacceleratedpacein2010(3)
WeekofAugust9,2010:Recordhighyieldweeklyvolumeof$22.1billion March2010:Recordhighyieldmonthlyvolumeof$40.5billion April2010:Secondhighesthighyieldmonthlyvolumeof$34.2billion 1Q2010:Recordquarterlyhighyieldvolumeof$76.8billion 2009:Recordyearlyhighyieldvolumeof$180.7billion
LTMhighyielddefaultratepeakedin2009
2009defaultrateof10.2%(4) JPMorganforecastsa2010defaultrateof2%(3)
________________________________________________
(1) (2) (3) (4)
Source:GlobalInsightviaBlackstoneResearch. Representsanindexofnominalresalepricesforsinglefamilyhouses,indexedto100inthefirstquarterof2000. Source:JPMorganCreditStrategyWeeklyUpdateasof8/27/10. Source:JPMorganDefaultMonitor.

9
U.S.Economy TheU.S.economyisstilltryingtorecover
RealGDPGrowth(1)
6% 4% 2% 0% (2%) (4%) Jan08 Jul08 Jan09 Jul09 Jan10 Aug10
UnemploymentRateandNewJoblessClaims(2)
(Claimsinthousands)
11% 10% 9% 8% 7% 6% 5% 4% Jan08
JoblessClaims
UnemploymentRate
700 600 500 400 300 200 100 0 Aug10
Jul08
Jan09
Jul09
Jan10
(Thousands) 1,200
1,000 800 600 400 Jan08
MonthlyHousingStarts
CaseShillerHousingPriceIndex(3)
190 175 160 145 130
Jul08
Jan09
Jul09
Jan10
Aug10
Jan08
Jul08
Jan09
Jul09
Jan10
Aug10
________________________________________________
Source:FREDandBloomberg,unlessotherwisenoted. (1) RealGDPgrowthincludesaBloombergestimateof2.5%for3Q10. (2) NewJoblessClaimsaremeasuredonaweeklybasis. (3) Representsanindexofnominalresalepricesforsinglefamilyhouses,indexedto100inthefirstquarterof2000.

10
CreditMarkets NewIssueVolume Thehighyieldmarkethasopenedupsince2Q2009andhasbecomeoneofthestrongesthighyield marketsever,creatingrefinancingopportunitiesformanycompaniesthatpreviouslycouldnot accessthismarket

NewIssueVolume LeveragedLoan(1)
($inbillions)
$200 186 188
NewIssueVolume HighYield(3)
($inbillions)
$80 77 61 57 55 52 60 $60 $40 39 44
$150 133 148
$100
118
81
84
78
31
67
47
55
44
43
22
$50
$20
31
36
17
26
12
16
16
11
$0 2006 2007 2008

(2)
$0 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 2006 2007 2008

(2)
(4)
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 2009 2010
7 1
13
2009
2010
(3Qasof 8/20/10)
________________________________________________
Source:S&PLCDandJPMorganCreditStrategyWeeklyUpdate(8/20/2010). (1) Includesbothtermloansandrevolvers. (2) 2008includes$29.5billionofblocksalesof2007overhang. (3) IncludesamountsunsoldbyunderwritersandonlyU.S.dollardenominatedsecurities. (4) 3Qtotalsareasof8/20/2010.
49
50
11
HighYieldIssuanceUsedtoRefinance 2010isonpacetohaveoneofthehighestpercentagesofhighyieldrefinancingvolumein15years
80% 70% 60% 50% 40% 30% 20% 10% 0% 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
13.5% 16.0% 32.9% 33.9% 26.3% 16.9% 17.5% 9.0% 33.8% 72.2% 71.7% 72.0% 70.5%
59.9% 54.4%
8.1%
2008
2009
2010
(Asof 9/01/10)
________________________________________________
Source:JPMorganDefaultMonitorasof9/01/2010.
12
UpcomingHighYieldandLeveragedLoanMaturities Whileapproximatelyonetrilliondollarsofhighyieldbondsandinstitutionalleveragedloansare expectedtomaturebetween2011and2015,anumberofcompanieshavebeenabletopushout theirmaturities

HighYieldBondandLeveragedLoanMaturitiesasof6/18/10
($inbillions)
$300 $200 $100 15 $0 2010 7 55 33 58 89 92 2013 153 131 274 156 77 2014 2015 138 64 2016 13 2017 1 2018orLater 250 133
2011
2012
HighYieldBonds
InstitutionalLoans
ChangeinMaturitySinceEndof2008
($inbillions)
$120 $80 $40 $0 ($40) ($80) 2010 2011 2012 2013 HighYieldBonds
________________________________________________
141 81 17 (25) (13) (38) (21) (28) (49) (16) (36) (52) (13) (42) (25) (70) (83) 2014 2015 Overall 2016 2017 30 13 43 40 41 71 12 83
141
2018orLater
InstitutionalLoans
Source:JPMorganCreditStrategyWeeklyUpdateasof6/18/10.
13
UpcomingHighYieldandLeveragedLoanMaturities(Contd) Ingeneral,smallercompanieswillexperiencematurityissuesfasterthanlargercompanies PercentofTotalOutstandingDebtMaturingasof4/9/10 byYearofMaturityandSizeofCapitalStructure

70% 60% 59.7% 50% 40% 30% 20% 10% 0% 20102012 $300mmorLess
________________________________________________
55.5% 53.8% 46.0% 33.8% 37.4%
27.4% 18.7% 12.4% 16.6% 13.0% 20132015 $301mmto$999mm $1bnto$3bn
23.8%
20162018 $3bnandGreater
Source:JPMorganCreditStrategyWeeklyUpdateasof4/9/10.
14
HighYieldDebtIssuanceandRestructuringCycles Newhighyielddebtfinancingandrefinancingmayonlyservetodeferratherthan preventrestructurings

Restructuringcyclesaredrivenlargelybythehighyieldandtheinstitutionalleveragedloanmarkets Improvingcreditmarketshaveallowedmanydistressedcompaniestodeferrestructuring
through refinancing
Whilethehighyieldmarketappearstobeamajorcontributortotherecovering capitalmarketsand
thereductioninnewrestructuringassignments,itismostlikelysettingthestageforthenext restructuringcycle
Whilematuritiesareimportant,ahighpercentageofdefaultsoccurbecauseofcovenantbreaches
andcashflowshortages
15
TimingofDefaults IssuanceofB andCCCrateddebtpeakedin2007 LowerRatedNewIssueVolume

($inbillions)
Year 2002 2003 2004 2005 2006 2007 2008 2009 2010(3)
________________________________________________
LeveragedLoans(1) Amount %ofTotal (B/CCCrated) Issuance $47.7 34.3% 37.7 22.7% 61.2 23.1% 90.3 30.6% 126.7 26.4% 165.9 31.0% 74.1 47.2% 44.2 58.9% 68.6 38.7%
HighYield(2) Amount %ofTotal (B/CCCrated) Issuance $2.3 3.4% 15.3 10.1% 32.6 20.6% 18.5 17.4% 31.1 20.9% 53.6 36.3% 13.7 26.0% 19.4 10.7% 26.1 14.9%
(1) (2) (3)
Source:S&PLCDLeveragedLendingReview2Q10.Includesissues ratedsplitB,CCCorNR(NotRated). Source:JPMorganDefaultMonitor.IncludesissuesratedSplitBorbelow. 2010LeveragedLoanamountisasof2QandHighYieldissuanceamountisYTD(9/01/10).

16
PercentofDefaults Lowerratedcreditshaveasignificantandpredictabledefaultcycle Cumulative%DefaultedDebtbyCreditRatingat Issuance(Corporatebonds19812009)

70% 60% %Defaulted(DollarWeighted) 50% 40% 30% 20% 10% 0% 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 YearsSinceIssuance BB
________________________________________________
Increaseddefaultratestypicallyfollow
CCCandWorse
peaksinhighyielddebtissuanceby approximatelythreetofiveyears
Historically,48%ofCCC/Crateddebt
defaultswithinfiveyearsof issuance
BB
CCC/C
Source:S&PDefault,Transition,andRecovery:2009AnnualGlobalCorporateDefaultStudyandRatingTransitions(3/27/10).Percentofissueswhichsubsequently defaultedinthestatedyearfollowingissuance.
17
InterestRates Alowinterestrateenvironmenthasenabledcompaniestomaintainhighleverage
8%
6%
4%
2%
0% 5/30/2000 9/10/2001 12/23/2002 4/4/2004 3MonthLIBOR

________________________________________________
7/17/2005
10/28/2006
2/9/2008
5/22/2009
9/3/2010
U.S.Treasury10Year
Source:CapitalIQ.
18
HighYieldDebtIssuanceandDefaultCycles
PeakIssuance,LowDefault LowIssuance,PeakDefault
$250
12%
$200 HighYieldIssuance(billions)
10%
8% $150 6% $100 4% $50 DefaultRate
2%
$0 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
(1)
0%
HighYieldIssuance
DefaultRate
________________________________________________
Source:Forhistoricaldata,JPMorganDefaultMonitor. (1) Estimated2010highyielddefaultrateof2%andgrossissuanceof$230billionreflectsestimatesinJPMorganCreditStrategyWeeklyUpdateas of8/13/10.

19
Observations
Highyieldnewissuevolumeincreasedsignificantlyin4Q2009andhascontinuedtoberobust Overthepastfewmonths,manylargecompanieswereabletoaccessthehighyielddebtmarket
inordertoextendtheirdebtmaturities
Smallercompanies,however,didnothavesimilaraccesstorefinancingsources Lowinterestrateshavehelpedcompaniesremainhighlylevered Theeconomyhascertainstructuralproblemsthatarelikelytopersistandpotentiallycreate
problemsforcompaniesexpectingeconomicmomentumtopickupmaterially
Highunemployment LacklusterGDPgrowthandretailsalesasconsumersdeleverage
20
C.
Conclusions
2010 Blackstone Investor Day C. Conclusions
Conclusions Whatdoesthismeanforthecurrentrestructuringcycle?
Thedichotomybetweenaweakeconomyandrobustcapitalmarketscouldleadtoafewdifferent
possiblescenarios:
Thecurrentcyclecouldbeonatemporaryhiatusandcouldcontinueforquiteawhile
Doubledipscenariosstillremainapossibility Consumerconfidencehasimprovedslightlybutisstilllow Highunemploymentratesmaypersistintothefuture Thehousingsectorcouldtakeyearstorecoverfromthecurrenteconomicdownturn

Thecurrentrestructuringcyclecouldbeover,butsignificanthighyieldofferingscouldsuggestthe
cyclewillbeginanewinapproximately3to5years(typicalpatternafterpeakhighyieldissuance) Lowinterestratesmayonlydelayinevitableliquidityissuesfacingstrugglingindustries
Thecurrentrestructuringcyclecouldbeoverandthenextcycle couldbeginashistoricalpatterns
wouldpredict(typicalrestructuringcycleis8to10years) Thestimulusplancouldturntheeconomyaround Refinancingdoneatreasonableratescouldprovidemanageableinterestpayments
22
Appendix: Select Case Studies
2010 Blackstone Investor Day Appendix: Select Case Studies
FordMotorCompany
CompanyOverview WorkPlan
FordMotorCompany(Ford orthecompany)designs,develops, manufacturesandservicescarsandtrucksworldwide
CompanyhassignificantinternationaloperationsthroughoutEurope, Asia,andSouthAmerica
FordMotorCreditCompany(FMCC)providesretailandwholesale automotivefinancingproductstodealers,customersandleasing companiesworldwide
BackgroundIssues

AsofMarch3,2009,Fordwashighlylevered,withover$35billionof debtandover$1.8billionofannualinterestexpense Fordsexistingdebttradedatseverelydiscountedpricesduetothebleak macroeconomicandautomotiveoutlookaswellasexpectationsof continuedcashburn.AsofMarch3,2009:

FordretainedBlackstoneinJanuary2009toadviseonvarious deleveragingtransactions Duringtheensuingmonths,Blackstone: AssistedFordonstructuringtwotenderoffersanda3(a)9exchange designedtoreduceunsecuredindebtednessandalleviatenearterm securedmaturities AnalyzedCreditAgreementandIndenturesanddeterminedlegal meansofexecutingtransactionsusingFMCCcash Builtcomprehensiverecapitalizationandfinancialmodelstoanalyze theimpactofthetransactionsonFordscapitalstructure,liquidity, creditprofileandequityvalue Assistedcompanyinevaluatingalternativestoequitizeclaimsunder VoluntaryEmployeeBeneficiaryAssociation Assistedthecompanyindevelopingandpresentingitsdebt restructuringplantotheUAW,governmentandkeystakeholders Assistedthecompanyindevelopingacomprehensive communicationsandpublicrelationsstrategies AssistedcompanyinexecutingtransactionsservingasRestructuring CoAdvisor,StructuringAgentandGlobalLeadDealerManagerfor theUnsecuredtenderofferandAuctionAgentfortheTermLoanB DutchAuction
SecuredTermLoantradedbetween$30.00$32.00 UnsecuredNotestradedbetween$18.00$20.00 ConvertibleNotestradedbetween$20.00$22.00
FinalOutcome
TheTreasurymandatedthatGeneralMotorsandChrysler,asaresultof acceptinggovernmentloans,reduceunsecuredindebtednessbyatleast twothirdsbyMarch31,2009
Forddecidedtoexecuteitsownbalancesheetrestructuringto remaincompetitivewithotherdomesticOEMsandimproveits financialprofiletoensurelongtermviability
Inadditiontohavingamultilayeredcapitalstructure,Fordhadanumber oflegalandpracticalrestrictionsontheuseofcash,incurrenceof indebtednessandabilitytograntadditionallienswhichcomplicatedits balancesheetrestructuring
OnApril3,2009,thecompanysuccessfullytenderedfor$2.2billionof SecuredTermLoanand$3.4billionofUnsecuredBondsand successfullyexchangedcashandstockfor$4.3billionofUnsecured ConvertibleNotes Asaresultofthiscomplexsetoftransactions,Fordreduceditstotal indebtednessby$9.9billionandeliminated$556millionofannual interestexpensewith$2.4billionofcashand468millionsharesof Ford stock Thecompanyremainstheonlydomesticautomakertoavoidaccepting governmentloansandhasbeenpraisedbytheWhiteHouseaswell as membersoftheHouseandSenateforexecutinganextremely successfulbalancesheetandoperationalrestructuringwithoutany governmentassistance
24
2010 Blackstone Investor Day Appendix: Select Case Studies
XeroxCorporation
CompanyOverview WorkPlan
BlackstoneadvisedonanoverallrestructuringofXeroxscapitalstructure. Thefinancingworkincluded: Extensiveduediligence,includingmeetingswithoperationaland finance groupsinEurope,SouthAmerica,andNorthAmerica Creationofdetailedfinancialforecastwithflexibilitytoanalyze: Impactsofvariousoperatingassumptionsandcashsourcesanduses bygeography Effectsofvariousfinancingandrestructuringproposals,including transitiontothirdpartycustomerfinancing IdentifiedadditionalfinancingtofundliquiditycrisisasXeroxundertook majorassetsalesandshutdownnegativecashflowoperations Developmentofvariousrestructuringalternativesincludinganalysisof legalandcorporatestructure Assistedinthenegotiationandstructuringofcapitalmarkettransactions consistentwithlegalandcorporatestructure
Xeroxisaleaderintheglobaldocumentmarket.Thecompanydevelops,
manufactures,markets,servicesandfinancesarangeofdocument equipment,software,solutionsandservices
Xeroxoperatesinover130countriesworldwide,anddistributesits
productsintheWesternHemispherethroughdivisions,whollyowned subsidiariesandthirdpartydistributors
BackgroundIssues
Xeroxfacedvariousissuesbeginninginmid1999including:
Executionissuesconsolidatingcustomeradministrationcenters Difficultexecutionofamajorsalesforcerealignment SECinvestigationintoaccountingissuesatMexicandivision
FinalOutcome
InJuly2002,Blackstonenegotiatedanew$4.2billioncreditagreement
satisfactorytoXeroxandcreditors,avoidingbankruptcy

InMay2000,Xeroxscreditratingwasdowngradedandsubsequentlylost
Obtained100%approvalofentire59memberbankgroup Achievedtermsthatpreservedadequateliquidity Implementedcreativesolutionthatallowedtherefinancingtoclose priortotheresolutionofanSECinvestigationandrestatement
accesstothecommercialpaperfinancingmarket aprimaryfinancing source ByOctober2000,Xeroxhad$5.4billionofcommercialpaper outstandingwhichwouldrapidlycomedueoverthecourseofthree months

Withthisbackdrop,XeroxhiredBlackstonetoassistinformulatinga
InFebruary2003,Blackstoneassistedinthenegotiationandexecution
of$3.6billionofnewfinancing,whichrefinancedtheoutstanding amountsunderthecreditagreement:

restructuringandfinancingplan
Securedcreditfacilityandseniornotes Mandatoryconvertiblepreferredstockandnewcommonstock
In2009,BlackstonesAdvisoryGroupadvisedXeroxonits$8.3billion
acquisitionofAffiliatedComputerServices
25
VII. GSO Credit Platform
GSOCapitalPartnersOverview
$28.6billion(1) intotalAUM
GlobalLeaderinCredit
Exclusivelyfocusedintheleveragedfinancemarketplace Diversifiedmixofinvestmentstrategies
Strongperformanceacrossstrategies
OutstandingTrackRecord
Proventrackrecordofachievingreturnswithlowervolatility GSO/Blackstoneplatformcreatesuniqueopportunities Seniorpartnershaveworkedtogetherforoveradecadeandtogether
WorldClassOrganization
havebuilttheleadingleveragedfinancefranchiseonWallStreet
Strongbrandrecognitiononglobalbasis Over160professionalsworldwide
Strongfundraisingmomentumacrossstrategies
StrongBusinessMomentumand HugeMarketOpportunity
OurInstitutionalLimitedPartnerbaseisastrategicasset Investorsareactivelyseekingcreditorientedstrategiesmanagedbya
marketleaderintodaysenvironment
________________________________________________
(1)
ExcludesAUMrelatedtotheBlackstoneDistressedDebtHedgeFund,whichBlackstonebeganliquidatingin2008.
1
GSOTotalAUMOrganizationChart Asof6/30/10 Globalfootprintwithapproximately160professionalsinNewYork,London,andHouston
GSOCapitalPartners
AUM$28.6billion(1)
PrivateMarketStrategies
Capital Opportunities / Blackstone Mezzanine
(MezzanineFunds)
PublicMarketStrategies
CustomizedCredit Strategies
(CLOs/Permanent CapitalVehicles/ SeparateAccounts)
CapitalSolutions
(RescueLendingFund)
SpecialSituations Fund
(CreditHedgeFund)
$2.8billion
________________________________________________
$3.3billion
$3.1billion(1)
$19.4billion
(1)
2
StrategicObjectives
Maintainourinvestmentexcellence Continueourstrongperformanceacrossfunds Createroadmapto$40billionAUMenterprise Aspirationalgoal,withacquisitions,couldgetto$50billion Developaretailbrand inthecreditspace BreakoutpotentialinnewPermanentCapitalVehiclesandourexistingproducts TransformourCLObusinessintoalongonlyplatform Industryleadingtrackrecord Diversearrayofnewproductstobelaunched Achievethefollowing: 30%GSONetFeeMargin $300millionofPreTax,EconomicNetIncome
GSOs CompetitiveAdvantage
Betteraccesstoinformationanddealflow BetterAccesstoInformationandDealFlow HighPriorityClienttoWallStreet HighpriorityclienttoWallStreet
Scale Scale
OneofFewPlayersthatcanCommitto$200million+inaTransaction Oneoffewplayersthatcancommitto$200+millioninatransaction AbilitytoLeverageBlackstonesIntellectualLibrary andPrivateEquity AbilitytoleverageBlackstonesintellectuallibrary andPrivateEquity Expertise expertise
Creditandduediligenceskills Deepindustry/sectorknowledge
UnparalleledExpertise
Uniqueoriginationcapability problemsolving approach Collectiveinvestmentexperienceresultsinatimetested,rigorous
investmentprocess
Trackrecordofgeneratingsuperiorriskadjustedreturnsthrough
TrackRecord
disciplinedcreditselection,structuringandriskmanagement
Achievedourreturnswithsignificantlylessvolatilitythanour benchmarks
PerformanceReview HedgeFund SuperiorriskadjustedReturn CumulativeSpecialSituationsReturnsSinceInception(1)(2) CumulativeNetReturnsSinceInception(1)(3)

35%
SharpeRatioSinceInception(1)(3)
0.45
30%
31.7% 0.36
0.41
25% 0.32 23.6% 20% 21.3% 0.27 0.24 15% 16.8% 0.18
10% 0.09 5% 0.07 0.00 GSOSpecial TremontEvent HFRIFund CreditComposite SituationsFund DrivenDistressed Weighted Index LP Index CompositeIndex GSOSpecial TremontEvent HFRIFund CreditComposite SituationsFund DrivenDistressed Weighted Index LP Index CompositeIndex
0%
GSOhasoutperformedourCreditCompositeIndexby 1,500bpssinceinception
________________________________________________
...withsuperiorriskadjustedreturns
Note: Pleaserefertothefootnotesonpage14.
5
PerformanceReview MezzanineFund GSOCapitalOpportunitiesFundIhasmeaningfullyoutperformedmarketindices AnnualizedNetReturns(July1,2007 June30,2010)

15% 14.5% 10% 5%
5.7% 1.6%
0%
(5%) (9.8%) (10%) (14.1%) (15%) GSOCapital OpportunitiesFundI CreditSuisse HighYieldIndex CreditSuisse LeveragedLoanIndex S&P500Index CreditSuisse LeveragedEquityIndex
________________________________________________
Note: Pleaserefertothedisclosuresonpage14.
6
PerformanceReview RescueLendingFund OurRescueLendingFundisofftoagreatstart.Thecurrentportfoliohasgeneratedtotalgainsof $106millionandismarkedat1.2xMOICasofJune30,2010
PortfolioPerformance(asof6/30/10)
FundInception: FundSize: NumberofInvestments: CapitalDeployed: Realized/UnrealizedValue: 9/30/09 $3.25billion 7 $589.6million $695.7million $300million
Backlog
Twoinvestmentspendingforapproximately
Broadsetofopportunitieswearecurrently
pursuingintheU.S.andEurope
Prospectiveinvestmentsareinavarietyof
industries(i.e.,Leisure,Manufacturing,Energy andHomebuilding)
Generally,investmenttargetsare:(1)Middle
MultipleofInvestedCapital:
1.2x
Marketcompanies;and(2)goodbusinesses facingliquidity/refinancingissues
________________________________________________
Note:Pastperformanceisnotnecessarilyindicativeoffutureresults,andtherecanbenoassurancethattheFundwillachievecomparableresultsorthattheFund willbeabletoimplementitsinvestmentstrategyorachieveits investmentobjectives.

7
PerformanceReview CLOBusiness 12YearU.S.TrackRecord ConsistentCLOOutperformance

June1998 March2010 TotalReturn
100% 75% 50% 25% 0% GSO/Blackstone S&PLevLoanIndex 90.75% 74.87% 2.0% 1.0% 0.96% 0.0% GSO/Blackstone S&PLCDUSLevLoan
AverageAnnualDefaultRate
4.0% 3.0% 3.55%
AverageRecoveryRate
72% 68% 64% 60% 56% GSO/Blackstone
________________________________________________
AverageAnnualPrincipalLossRate
1.5%
69.55%
1.31% 1.0% 62.98% 0.5% 0.29% 0.0% S&PLCDUSLevLoan GSO/Blackstone S&PLCDUSLevLoan
Source:Standard&PoorsLCD. Note:Pleaserefertothedisclosuresonpage14.
8
GSOAUMGrowthSinceInception(1)
($inbillions)
$30 $25 $20 $15 $10 $5 $0 $9.4 $8.7 $5.8 $1.4 $2.2 2005 $1.6 $3.4 2006 $13.7 $13.7 $19.7 $24.1 $21.9
$28.6
$19.4 $15.3 $16.6
$3.3 $1.9 $4.1 2007 $3.4 $3.2 2008 $3.2 $1.1 $3.1 2009 $2.8 $3.1 2Q'10
MultiStrategyHedgeFundAssets MezzanineFunds
________________________________________________
PrivateDistressedFunds CustomizedCreditStrategies
(1)
9
EvolutionoftheGSOFranchise
ComparisonofSelectedBusinessMetrics
#offundproducts #ofSMAs #ofCLOs #offundLPs$25million Top10LPsasa%oftotalAUM %ofcapitallockedup Assetsundermanagement($inbillions) Productsoffered 2005(1) 2 1 10 19 42% 41% $3.6 HedgeFunds,CLOs,SMAs 2010(Estimated) 12 7 25 100 18% 90%+ $28.6(2) HedgeFunds,CLOs, SMAs,MezzFunds, DistressedRescueFunds, BDCs,ClosedEndFunds, CoMingledLoanFunds
________________________________________________
(1) (2)
2005datareflectsonlythosebusinesseswhichweremanagedbyGSOatthetime,andisnotproformafortheBlackstoneTransaction. ExcludesAUMrelatedtotheBlackstoneDistressedDebtHedgeFund,whichBlackstonebeganliquidatingin2008.
10
EvolutionoftheGSOFranchise CrossFertilization ofLPBase

($inmillions)
Account
StatePension(A) StatePension(B) FinancialInstitution(A) InsuranceCompany(A) FundofFunds(A) StatePension(C) FundofFunds(B) SovereignWealth(A) Foundation(A) SovereignWealth(B) FinancialInstitution(B) Foundation(B) FamilyOffice(A) InsuranceCompany(B) FamilyOffice(B) FundofFunds(C) Endowment(A) FamilyOffice(C)
Hedge Fund
102 211 23 144 151 40
Mezzanine Fund
Liquidity Fund
250 62 100
Capital Solutions
100
Customized CreditStrategies

Total
702 550 473 383 369 350 236 225 190 190 182 169 138 116 99 89 88 85
600 200 260
200
52 75 50 16 25
225 33 15 75 65 5 75
100 135 75 161
250
144 63 66 69 77 23 50 10 30 20 35 75
75
12
10
11
TheCaseforJunk Credit GSOs productsofferinvestorsextremelyattractiveriskadjustedreturnsrelativetootherasset classesinthismarketenvironment CurrentConditions Economicuncertainty

Historicallylowinterestratesandlarge
WhyCredit? Abilitytoinvestmoreseniorinacapital structureprovidesdownsideprotection

Investorswillrotateoutofcashinfavor
cashbalances
Committedcapitalremainsscarce Marketvolatilitylikelytopersist
ofhigheryieldinginvestmentswithstrong currentincome
GSOs privatemarketstrategiesof
providingdebtcapitaltocompanies commandssignificantpremium
Long/Short,EventDrivencredit
strategieshelpmitigatevolatilityand drivevaluecreation
12
LookingForward
Highlyscalablebusinessmodel Topquartiletrackrecord Greatbrand Teamorientedculture Firstclassoperatingplatform BlueChiplistofLPs Weveearnedverygoodstandingwithadiversearrayofinstitutions ExcellentgrowthprospectswithinternationalLPs Industryconsolidationwillleadtopotentialopportunities GSOisaveryattractivepartner JunkCredit isemergingasastandaloneassetclass FixedIncomedepartmentsbeginningtomakespecificallocations Retailinvestorshaveinsatiableappetiteforyield BreakoutopportunityforGSO Inflectionpointofourgrowthcurve OurstrategicplancallsforsubstantialAUMgrowthandexpansionofourprofitabilityoverthe
next2 years
13
PerformanceReviewFootnotesandDisclosures
PerformanceReview:HedgeFund (1) NetperformancefromJanuary2006(firstfullyearoftheFund)throughJune2010. (2) The volatility of the indices reflected above and elsewhere in this report may be materially different from the performance of the Fund. In addition, these indices employ different investment guidelinesandcriteriathantheFund;asaresult,theholdings intheFundmaydiffersignificantlyfromthesecuritiesthatcomprisetheindices.Theperformanceoftheseindiceshasnotnecessarily beenselectedtorepresentanappropriatebenchmarktocomparetotheperformanceoftheFund,butratherisdisclosedtoallowforcomparisonoftheFundsperformancetothatofwellknown, relevantindices.Asummaryoftheinvestmentguidelinesfortheseindicesisavailableuponrequest. CreditCompositeIndexreflectstheaverageportfolioconstructionsinceinceptionwhichconsistsofthefollowingmixofindices:60%CSLeveragedLoanIndex,25%CSHighYieldIndexand15% CS LeveragedEquityIndexwhichwebelieveisgenerallyconsistentwiththemixoftheSpecialSituationsFund.
(3)
PerformanceReview:MezzanineFund CreditSuisseHighYieldIndexisanunmanagedmarketvalueweightedindexdesignedtomirrortheinvestableuniverseofthe U.S.dollardenominatedhighyielddebtmarket.Newissuesareaddedtothe indexuponissuanceiftheyqualifyaccordingtothefollowingcriteria:issuesmustbepubliclyregisteredintheUnitedStatesorissuedunderRule144Awithregistrationrights;issuesmustberatedB or lower; the minimum amount outstanding is $75 million; and issues must be U.S. dollardenominated straight corporate debt, including cashpay, zerocoupon, steppedrate and payinkind (PIK) bonds. Floatingrateandconvertiblebondsandpreferredstockarenotincluded; ifanissuerhasmorethantwoissuesoutstanding,onlythetwo mostliquidissuesareincludedintheindex. CreditSuisseLeveragedLoanIndexisanunmanagedmarketvalueweightedindexdesignedtomirrortheinvestableuniverseofthe U.S.dollardenominatedleveragedloanmarket.Newissuesareaddedto theindexontheireffectivedateiftheyqualifyaccordingtothefollowingcriteria:loanfacilitiesmustberatedB orlower;onlyfullyfundedtermloanfacilitiesareincluded;andissuersmustbedomiciledin developedcountries. Standard&Poors500Index(theS&P500)setsforththeperformanceofawellknownbroadbasedstockmarketindexassumingreinvestmentofdividends.TheS&P500containsonlypubliclytraded, seasonedequitysecurities. CreditSuisseLeveragedEquityIndexisanunmanagedmarketweightedindexdesignedtomirrortheinvestableuniverseofthe publicequityofissuersinthehighyielddebtmarket.Theindexincludesthe commonstockofeveryissuerintheCreditSuisseHighYieldIndexwhichhaspublicequity. TherearesignificantdifferencesbetweentheGSOCapitalOpportunitiesFundIs investmentsandtheindices.Forinstance,GSOCapitalOpportunitiesFundImayuseleverageandinvestininvestments thathaveagreaterdegreeofriskandvolatility,aswellaslessliquidity,thanthoseinvestmentscontainedintheindices.Moreover,theindicesdonotreflectthereinvestmentofincomeordividendsand theindicesarenotsubjecttoanymanagementfees,performancecompensationorexpenses.ItshouldnotbeassumedthatGSOCapitalOpportunitiesFundIwillinvestinanyspecificinvestments that comprisetheindices,norshoulditbeunderstoodtomeanthatthereisacorrelationbetweenGSOCapitalOpportunitiesFundIs returnsandtheperformanceoftheindices.Thestatisticaldataregarding theseindiceshasbeenobtainedfromsourcesbelievedtobereliable.Itisnotpossibletoinvestintheseindices.TheseindicesarebeingpresentedforcomparisonpurposesonlytoshowhowGSOCapital OpportunitiesFundIs performancecomparestothebroadglobalmarkets. PerformanceReview:CLOBusiness Past performance is not necessarily indicative of future results, and there can be no assurance that the Fund will achieve a comparable composition or that the Fund will be able to implement its investmentstrategyorachieveitsinvestmentobjectives. Unlessotherwiseindicated,allyieldsandratesofreturnarepresentedonagross basisanddonotreflectthemanagementfees,fundexpenses, organizationalexpenses,performancecompensation,taxesandotherrelatedexpensesthatarebornebyinvestorsintheportfoliosdescribedhereinwhich,intheaggregate,areexpectedtobesubstantial and may result in net returns being materially lower than those presented herein. Investors are encouraged to contact GSO representatives to discuss any questions they may have concerning the performanceinformationcontainedherein.Furtherinformationmaybemadeavailabletosuchinvestorsuponrequest.
14
VIII.
Real Estate
A.
Real Estate Overview
2010 Blackstone Investor Day A. Real Estate Overview
BlackstoneRealEstateOverview
GlobalLeaderinRealEstate PrivateEquity
$22billioninAUMfromOpportunisticfunds $2billioninAUMfromRealEstateDebtfunds GrossIRRof37.5%(28.3%net)onrealized/partiallyrealizedinvestments(1)
OutstandingTrackRecord
MultipleonInvestedCapital(MOIC)of2.2xonrealized/partiallyrealized
investments
Weprojectall20042007vintagefundswillbeprofitable
SignificantDryPowder
$11.2billionintotalavailablecapital($1.4billioninpendingtransactions) U.S.officeportfolioconcentratedinBoston,WestLosAngeles,Northern
California,andNewYork CurrentHoldings
Globalhotelowner/operator Europeanleisureparcs,hotels,studenthousing,andhealthcare ExistingPortfolio:76%NorthAmerica,16%Europe,and8%other
WorldClassOrganization
________________________________________________
Over120RealEstateprofessionalsacrosstheU.S.,Europe,andAsia PartnerswithanaveragetenureatBlackstoneof12years
AllfiguresareasofJune30,2010. Note: Pastperformanceisnotnecessarilyindicativeoffutureresults forBlackstoneRealEstatePartnersBREP funds.Therecanbenoassurancethatanyfundwill achieveitsobjectivesoravoidlosses. (1) GrossIRRforfullyinvestedBREPfundssinceinception,includingunrealizedinvestments,is29.7%;netis15.9%.

2
RealEstate ProjectedPerformance Weexpecttooutperformcompetitorswithsimilarvintagefunds

TotalExpected GrossMOIC(1) 2.0x2.5x 1.5x1.6x 2.0x2.5x 1.5x1.6x 1.5x1.7x 1.2x1.4x 2.0x2.5x
($inbillions)
Vintage 2007Present 20062007 2008Present 20042006 2008Present 20062007 2007Present
FundSize $11.0 $5.2 $4.1 $2.7 $2.0 $1.7 $1.1
BREPVI BREPV
Projected Performance
BREPEuropeIII BREPIV BREDS(2) BREPIntlII CoInvestment
________________________________________________
(1)
(2)
WhileBlackstonecurrentlybelievesthattheassumptionsonwhichtheseprojections arebasedarereasonableundercurrentcircumstances,thereisno guaranteethattheconditionsonwhichsuchassumptionsarebasedwillmaterializeorotherwisebeapplicabletothesefunds. Therecanbenoassurancethat anyfundmanagedbyBlackstonewillbeprofitableoravoidsubstantiallosses. Aboveprojectionsdonotincludeanyassumptionsregardinginvestmenttime horizon ortherateofreturnonfundsmanagedbyBlackstone.Ultimatereturnstoinvestorswillbereducedbymanagementfees,fundexpensesandcarried interest. BREDSincludesseveraldebtfundsandinvestmentvehiclesthathavesimilarinvestmentobjectives.
3
BREPStrategyHistorically Primaryreasonsforexpectedoutperformance
Sold$60billionofassets20052007
Focusedontopqualityassets
Avoideddebtcrosscollateralization/Fundlevelrecourse
Virtuallynocommercialdevelopment
Deployedlimitedcapital2H071H09
Purchasedorextended$24+billioninportfoliocompanydebt
Nomaterialrealizedlossestodate
ActiveOpportunisticFunds ValuationandInvestmentPace Existingportfoliohasbeguntoimprovewhileatthesametimetherehasbeenasignificantincrease ininvestmentpace

BREPVIandBREPEuropeIIIUnrealizedQuarterlyMOICs
1.2x 0.9x 0.6x 0.3x 0.0x 1Q2008 2Q2008 3Q2008 4Q2008 1Q2009 2Q2009 3Q2009 4Q2009 1Q2010 2Q2010 1.2x 1.2x 1.1x 0.9x 0.7x 0.6x 0.5x 0.5x 0.5x 0.7x
BREPVIandBREPEuropeIIICommittedCapitalbyQuarter(1)
($inmillions)
$1,500 $1,000 $500 $86 $0 1Q2008 2Q2008 3Q3008 4Q2008 1Q2009 2Q2009 $179 3Q2009 $435 4Q2009 $409 1Q2010 2Q2010 $1,219
________________________________________________
AllfiguresareasofJune30,2010. (1) Committedcapitalfiguresmayadjustattimeofactualclosingofaninvestmentduetoamultitudeoffactors.

5
RealEstateAssetsUnderManagement RealEstateAUMhasincreasedalmost30%overthepastyear
BlackstoneRealEstateTotalAUM
($inmillions)
$28,000 $2,300 $1,918 $21,000 $792

(1)
$14,000 $19,403 $7,000
$26,222 $20,195
$22,004
$0 June30,2009 BREP BREDS June30,2010 BankofAmerica(MerrillLynchAsia)Pending
________________________________________________
(1) IncludespendingBankofAmerica(MerrillLynch Asia)transactionexpectedtocloseinthe4thquarter2010.

6
InvestmentActivity BlackstoneRealEstatehasinvestedorcommittedtoinvestover$4billionoverthepastyear(1)
BroadgateEstate PremierLondonofficecomplex BuschEntertainmentCorporation SeaWorld/BuschGardensthemeparks GlimcherJV Twolargeregionalmalls Portfolioofindustrialassets Pending GeneralGrowthProperties Leadingregionalmallowner/operator Pending
LeveragedPublic Companies
Bankruptcy Situations
Sunwest Largeportfolioofassistedandindependentlivingfacilities ExtendedStayHotels Largestowner/operatorofmidscaleextendedstayhotelsinthe
U.S. Pending
HighlandHospitality Seniormezzanineloanonaportfolioof29hotels Montgomery/Washington NoteonSanFranciscoofficebuilding
DistressedDebt
JapaneseDistressedLoans Nonperformingrealestateloanportfolio VariousNotes Notesatsignificantdiscountstofacevalue
RealEstateDebt Strategies (BREDS)
BREDS hasinvestedapproximately$1.0billioninpublicandprivatedebtmarkets
________________________________________________
(1) Includesapproximately$500millionintransactionspostJune30,2010.
7
AvailableCapital $11.2billionindrypowderinafavorableinvestmentenvironment
($inmillions)
BREPVI
BREPEuropeIII
Reserves
BREDS
$1,404 Pending Transactions
BREPIntlI
BREPIntlII
BREPV
$5,718
$3,920
$1,135
$435
________________________________________________
AllfiguresareasofJune30,2010.
8
B.
Real Estate Market Overview
2010 Blackstone Investor Day B. Real Estate Market Overview
RealEstateDemand Employment,thekeydriverofrealestatedemand,hasturnedmodestlypositive
MonthlyChangeinU.S.Payrolls(1)
(inthousands)
300
100
(100)
(300)
(500)
(700)
(900) Feb07 May07 Aug07 Nov07 Feb08 May08 Aug08 Nov08 Feb09 May09 Aug09 Nov09 Feb10 May10 Aug10
________________________________________________
(1) BureauofLaborStatistics:September2010TotalPrivateNonFarmPayrolls(SeasonallyAdjusted).
10
RealEstateSupply Newsupplyofcommercialrealestateisatrecordlowlevels
U.S.AggregateConstructionStarts(1)
(Annualized)
4.5% 4.0% 3.5% 3.0% 2.5% 2.0% 1.5% 1.0% 0.5% 0.0% Mar84 Mar86 Mar88 Mar90 Mar92 Mar94 Mar96 Mar98 Mar00 Mar02 Mar04 Mar06 Mar08 Mar10
11
LongtermAverage=1.9%
________________________________________________
(1) Source:Citi,September10,2010.
RealEstateOccupancy Givensupply/demandfundamentals,occupancyinU.S.realestateisbeginningtoimprove
U.S.REITOccupancy(1)
94.5%
94.0%
93.5%
93.0%
92.5%
92.0%
91.5%
91.0%
90.5%
90.0% 1Q01 2Q01 3Q01 4Q01 1Q02 2Q02 3Q02 4Q02 1Q03 2Q03 3Q03 4Q03 1Q04 2Q04 3Q04 4Q04 1Q05 2Q05 3Q05 4Q05 1Q06 2Q06 3Q06 4Q06 1Q07 2Q07 3Q07 4Q07 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10
12
________________________________________________
(1) Source:Citi,September10,2010.
RealEstateCashFlows Improvingoccupancyandbottomingrentstranslateintostabilizingrealestatecashflows
U.S.REITChangeinSameStoreNOI(1)
7% 6% 5% 4% 3% 2% 1% 0% 1% 2% 3% 2Q99 2Q00 2Q01 2Q02 2Q03 2Q04 2Q05 2Q06 2Q07 2Q08 2Q09 2Q10
________________________________________________
(1) ISIGroup:September2010.
13
HotelMarketOverview Thehotelsectorhasbeguntoseeasharpuptickinrevenuewithnewsupplyatalltimelows
U.SHotelYoY%ChangeinOccupancy,ADR&RevPAR(1)
10% 0% 10% 20% 30% 6/06 11/06 4/07 9/07 2/08 Occupancy 7/08 ADR 12/08 RevPAR 5/09 10/09 3/10 8/10
U.S.HotelRoomsUnderConstruction(2)
(inthousands)
250 200 Rooms 150 100 50 0 6/06

(1) (2) PeaktoCurrent Decline:(72%)
11/06
4/07
9/07
2/08
7/08
12/08
5/09
10/09
3/10
8/10
________________________________________________
STRResearch:September4,2010. STRResearch:August31,2010.
14
OfficeMarketOverview NewU.S.Officesupplyremainswellbelowhistoricallevels,whileamodestlypositivetrendinnet absorptionisbeginningtoform

U.S.OfficeNetAbsorptionasa%ofInventory(1)
1.1% 0.8% 0.5% 0.2% 0.1% 0.4% 0.7% 1.0% 2Q2007 3Q2007 4Q2007 1Q2008 2Q2008 3Q2008 4Q2008 1Q2009 2Q2009 3Q2009 4Q2009 1Q2010 2Q2010
NewU.SOfficeSquareFootageUnderConstruction(2) (SFunderConstructioninthousands)
180,000 160,000 140,000 120,000 100,000 80,000 60,000 40,000 20,000 0 2Q1997 2Q1998 2Q1999 2Q2000 2Q2001
LongtermAverage=3.1% 0.7%
2Q2002
2Q2003
2Q2004
2Q2005
2Q2006
2Q2007
2Q2008
2Q2009
2Q2010
________________________________________________
(1) (2)
JonesLangLaSalle:June30,2010. ISIGroup:June30,2010.
15
RealEstateDebtMarkets CMBSspreadsandREITunsecuredspreadshavetighteneddramaticallyfromtheirlate2008 panic levels

AAACMBSSpreads(1)
(Spreadinbps)
REITUnsecuredDebtSpreadstoUnderlyingTreasuries(2)
(Spreadinbps)
1,400 1,200 1,000 800 600 400 200 0 Aug07 Aug08 Aug09 Aug10 Apr07 Dec07 Apr08 Dec08 Apr09 Dec09 Apr10
1,800 1,600 1,400 1,200 1,000 800 600 400 200 0 Apr07 Aug07 Dec07 Apr08 Aug08 Dec08 Apr09 Aug09 Dec09 Apr10 Aug10
16
10yearCMBS
________________________________________________
(1) (2)
BankofAmericaMerrillLynchGlobalResearch:August20,2010. Source:Citi,September10,2010.
PublicRealEstateValues Publicrealestateequitymarketshaverecoveredsharplyfromtheir2009troughs
Publicofficecompaniesintopmarketscurrentlytradebelowa6%caprate:
BostonProperties BrookfieldProperties DouglasEmmett SLGreen WeightedAverage
Total%Change inStockPrice Since3/31/09 147% 169% 131% 488% 209%
ImpliedPublic MarketCapRate(1) 5.2% 6.4% 6.1% 5.8% 5.6%
Leadingpublichotelcompaniescurrentlytradeataweightedaverageof17.0xmultiple:
HostHotels MarriottInternational StarwoodHotels WeightedAverage

________________________________________________
Total%Change inStockPrice Since3/31/09 271% 121% 306% 210%
TEV/2010E EBITDA(2) 17.5x 15.7x 17.7x 17.0x
Note:TheaboveisasampleofpublicREITSandreflectsBlackstonescurrentviewofthemarketplace. (1) GreenStreetResearch:September14,2010. (2) Source:Citi,September14,2010.

17
PrivateRealEstateValues Privaterealestatevalueshaverecoveredapproximately40%from their2009lows,aidedby extremelylowinterestrates

CommercialPropertyPriceIndex(1)
100 90 80 70 61.7 60 50 40 Dec97 Dec98 Jan00 Feb01 Mar02 Mar03 Apr04 May05 Jun06 Jun07 Jul08 Aug09 Aug10 77.2 100.0
________________________________________________
(1)
GreenStreetAdvisors:August2010UnleveragedCommercialPropertyPriceIndex.
18
U.S.RealEstateDebtMarkets Despitegenerallyimprovingconditions,significantopportunityexistsforinvestmentincommercial realestategiventhevolumeofproblemloansinthesystemcoupledwithlimitednewfinancing

TroubledCMBSLoansbyVintage(1)
45% 35% 25% 15% 5% 2003 2004 Watchlist 2005 2006 2007 30+DaysDelinquent&atSpecialServicer 21.5% 23.5% 29.4% 33.4% 41.0%
U.S.CMBSIssuance(2) ($inbillions)
$250 $200 $150 $100 $50 $0 2002 2003 2004 2005 2006 2007 2008 2009 2010YTD $52 $78 $93 $12 $2 $3 $202 $230
$169
________________________________________________
(1) Source:CSMarketWatch,August25,2010. (2) JPMorganCMBSWeeklyReport:August20,2010.

19
U.K.RealEstateDebtMarkets SimilartotheU.S.,thesharpincreaseinleveragepriorto2008presentsasignificantinvestment opportunityinEurope TotalStockofOutstandingU.K.CommercialRealEstateDebt

( inbillions)
250
200
Over2.5x
150
100
50
0 2002 2003 2004 2005 2006 2007 2008
________________________________________________
Source:TheUKCommercialPropertyLendingMarket,DeMonfort University.
20
C.
Blackstone Real Estate Outlook
2010 Blackstone Investor Day C. Blackstone Real Estate Outlook
NewBusinessInitiatives BREDS BREDSwasanaturalandsuccessfuladditiontotheRealEstateplatform

Strategy Overview
Opportunitytogenerateequitylikereturnswithdebtlikerisks HighlycomplementarytoOpportunisticbusiness Platformhasgreatpotentialforscalability $2billionofAUMintwoyears BSSFIIReturnSummary(1)

45% 40%
$70Value $17.5Equity
BREDSInvestmentTarget
$100 $90 $80 $70 $60 $50 $40 $30 $20 $10 $0
$100OriginalValue $25OriginalEquity
35% 30% 25%

BREDS Target
34.2%
$75OriginalDebt
$15.0Mezzor BNoteFinancing $37.5Senior Debt
20% 15% 10% 5% 0%
BSSFII Gross Returns
22.3%
BSSFII Net Returns
Peak
________________________________________________
Current
Gross
Net
InceptiontoDate(Cumulative)
(1) Thischartrepresentsthepreliminaryunauditedcumulativeinternalrateofreturn(IRR)ofBlackstoneRealEstateSpecialSituationsFundIIL.P.andBlackstone RealEstateSpecialSituationsEuropeFundLtd.(together,BSSFII).BSSFIs inceptiontodategrossreturnis40.3%(net30.7%).Pastperformanceisnot necessarilyindicativeoffutureresults.
22
NewBusinessInitiatives Asia BREPhastheopportunitytosignificantlyincreaseitspresenceinAsia

In2007BlackstoneRealEstateopenedofficesinMumbai,Tokyo,andHongKongstaffedwith
seasonedinvestmentprofessionalsfromNewYork,London,andthe region
Deployedlimitedcapitalbeforemarketdecline
Investedapproximately$500millionintheregionpostSeptember2008
Blackstonehasenteredintoanagreementtomanageapproximately $2billioninrealestateassets
fromBankofAmerica/MerrillLynchAsia Why:
Growsonthegroundpresence Expandslocalrelationships Providesbettermarketknowledge Widenslendercontacts IncreasesLimitedPartnerbase
23
BlackstoneRealEstateSummary Ourbusinessisextremelywellpositioned
WeexpecttooutperformcompetitorsandproducesolidreturnsforourLimitedPartners
CompetitivelandscapehasbeenalteredwithfewerGeneralPartnerscompetingfornew
investmentsandfundraisingdollarsbecauseoflegacyand/orparentcompanyissues
Thecurrentinvestmentenvironmentishighlyattractivewith$11+billionindrypowder;wehave
uniquepositionforlarge,complexrealestateinvestments
OpportunitytosubstantiallyincreaseBREDSplatformandAsianinvestmentbusiness
Stablelongtermmanagementfeebase
Significantcarriedinterestpotentialfromexistingfunds
24
IX. Blackstone Alternative Asset Management (BAAM)
WhereareHedgeFundsToday?
HedgeFundsintheCurrentMarketLandscape
Volatilityanduncertainty Long/shortinvestmentmandatestypicallybetterequippedtohandlemarketuncertaintythanlongonly Talentmigration Economicsandregulatorychangescontinuetoattracttoptalent totheindustry Institutionalacceptance Institutionsincreasinglyimplementinghedgefundsacrosstheinvestmentportfolio Growthpotential Hedgefundsstillmanageonlyasmallfractionofinvestableassets
ThePotentialforAttractiveRiskadjustedPerformanceHasLedto GrowthinHedgeFundAssetsOverTime
($inbillions)
$2,000 $1,600 $1,200 $1,105 $800 $400 $39 $0 1990 $186 1995 2000 2005 2007 2008 2009 June30, 2010 $491 $1,868 $1,600 $1,407 $1,648
HedgeFundsManageJusta FractionofFinancialAssetsandthe IndustryHasRoomtoGrow

($intrillions)
$200 $160 $120 $80 $40 $0 GlobalFinancial Assets (1) $12.9 AggregateAUM ofTop10Asset (2) Managers $1.6 HedgeFund Industry (3) $178.0
________________________________________________
(1) Globalfinancialassetsincludeequitysecurities,privatedebtsecurities,governmentdebtsecuritiesandbankdeposits;McKinseyGlobalInstitute, September2009. (2) Firmsinclude:BarclaysGlobal,AllianzGroup,StateStreet,FidelityInvestments,AXAGroup,BlackRock,DeutscheBank,Vanguard Group,J.P.MorganChase, CapitalGroup.AssetsareasofSeptember30,2009. (3) HFR.HFRGlobalHedgeFundIndustryReport.March31,2010.AssetsareasofDecember31,2009.

1
BAAMAUMandAssetFlowSummary
BAAM:SolidRelativePerformance,StrongClientFocus,ProperFundManagement
Positivenetinflows Netinflowsin2008,2009,1H2010 aperiodofsignificantoutflowsforfundofhedgefunds(1) Strongpipeline Visibilityintoadiversifiedrangeofattractiveprospectopportunitiesin20112012 Differentiatedbusinessmodel Assetretentionandgrowththroughcustomization,innovation,advice Diverseproductportfolio Broadarrayofoptionsforcrosssellingtoexistinginvestorsandattractingnewinvestors
AUM
($inmillions)
NetAssetFlow
($inmillions)
$30,000 $27,000 $24,000 $21,000 $18,000 $15,000 $12,000 $9,000 $6,000 $3,000 $0
KeyPoints:
Strongtrackrecordofattractiveriskadjusted
$10,000 $9,000 $8,000 $7,000 $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $0
returns(2) Balancedgrowthbetweenexistinginvestorsand newnames Avoidanceofsignificantfeecompressiondueto scopeofservicesandvalueaddtoLPs
2000
2001
2002
2003
2004 BAAMAUM
2005
2006
2007
2008
2009
2010
(1)
BAAMNetInflows
________________________________________________
(1) Dataisestimatedandunaudited.AsofJuly1,2010.BAAMnetinflowsexcludeinternal(firm/employee)investments. (2) PastperformanceisnotindicativeoffutureresultsandthereisnoassurancethatanyBAAMfundwillachieveitsobjectivesor avoidsignificantlosses.

2
BAAMPerformanceSummary
BAAMsInvestmentProcessHasProducedStrongRiskAdjustedReturns(1)
Portfolioconstruction Historicallyhasproducedstrongriskadjustedreturnsandcapitalpreservation Differentiatedexposure Abilitytomanufacture tailoredcapacityandexploitmarketopportunities Managerpartnerships Abilitytoleveragescaleandexpertisetonegotiatebenefitsforclients Expertise Wellresourced,experiencedteamsourcingnewideasandmonitoringinvestments
January2000 July2010
AnnualizedNetReturn 8% 6% 4% 2% 0% 2% 0%
________________________________________________
BAAMComposite
BarclaysAggBond HFRIFOFComposite
MSCIEmerging Markets GSCITotalReturn Index MSCIWorld S&P500TRIndex
4%
8%
12%
16%
20%
24%
28%
AnnualizedStandardDeviation
(1) BAAMCompositecoverstheperiodfromJanuary2000toJuly2010. BAAMs inceptiondateisSeptember1990(furtherhistoricalperformanceisavailableuponrequest).Pastperformanceisnot indicativeoffutureresultsandthereisnoassurancethatanyBAAMfundwillachieveitsobjectivesoravoidsignificantlosses.TheBAAMCompositeistheassetweightedperformanceofBAAMs investmentsnetofallfees(bothBAAMandunderlyingmanager).TheCompositedoesnotincludeBAAM's commoditiesplatform,seedfunds,andadvisoryrelationships(detailsoftheperformanceof allBAAMfundsareavailableuponrequest).Thevolatilityoftheindexespresentedmaybemateriallydifferentfromthatofthe performanceofanyparticularBAAMfundincludedintheComposite.In addition,theseindexesemploydifferentinvestmentguidelinesandcriteriathantheBAAMfunds;asaresult,theholdingsintheBAAMfundsmaydiffersignificantlyfromthesecuritiesthatcomprise theindexes.TheperformanceoftheseindexeshasnotbeenselectedtorepresentanappropriatebenchmarktocomparetotheperformanceoftheBAAMComposite,butratherisdisclosedtoallowfor comparisonoftheCompositetothatofwellknownandwidelyrecognizedindexes.Asummaryoftheinvestment guidelinesfortheseindexesisavailableuponrequest.Inthecaseofequityindices, performanceoftheindicesreflectsthereinvestmentofdividends.
InvestorAppetiteforHedgeFundExposure:DemandTodayvs.DemandintheFuture
BAAMHasMultipleOpportunitiestoIncreaseGeographicMarketPenetration
Institutionalfocus Industrygrowthdrivenbyinstitutionsseekingattractiveriskadjustedreturnsanddownsideprotection Growingdemandintraditionalmarkets U.S.andEuropeanpublicandcorporatepensions Significantpotentialinunderpenetratedmarkets MiddleEast,Japan,Australia,andCanada Sizeableuntappedopportunities LatinAmerica,China,andnonJapanAsia
BAAMsInvestorBaseIsIncreasinglyGlobalinNature
100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 35.2% 0.1% 1.7% 2006 AllOthers 3.8% 3.7% 4.6% 2007 Japan 10.1% 4.9% 3.8% 2008 MiddleEast 30.4% 26.9% 25.0% 23.7% 63.0% 57.4% 54.3% 50.6% 51.9%
OpportunitiesExisttoIncreaseMarket PenetrationandEnterNewGeographies
14.7% 4.2% 5.5% 2009 Europe
13.5% 5.4% 5.4% 2010

(1)
NorthAmerica
TraditionalFocus
DevelopingMarketOpportunity
________________________________________________
(1) Dataisestimatedandunauditedandexcludesinternalcapital.AsofJuly2010.
4
ProductInnovation:KeyDifferentiatoroftheBAAMModel
BAAMReverseEngineers NewSolutionstoClientProblems
BAAMengagesclientstoidentifykeyissuesininstitutionalportfoliomanagement BAAMhasatrackrecordofsuccessfullyaddressingclientconcerns(1): Longbiasedcommoditiesstrategy launchedMay2007;over$1billioninAUM(2) Hedgefundseedingplatform firstfundlaunchedin2007;over$1billioninAUMandcommitments(2) Longonlyequityreplacement strategies increasinginterestinhedgedexposure,alphageneration Customizedmandates abilitytoaccommodatespecificriskandreturntargets Solutionsresearch ongoingacrossemergingmarketsandlongonly substituteproductopportunities BAAMhasdevelopedanarrayofservicesforstrategicpartners,including: Advisoryservices AccesstoBAAMresearchandproprietarytechnologyplatform Proactiveknowledgetransferandtraining Transitioningandrebuildingtroubledclienthedgefundportfolios BAAMisathoughtful,valueaddedpartner Insightintokeyregulatorydevelopmentsandindustryresponses Perspectivesonapproachestotopdownassetallocationandotherkeyclientinvestmentprocesses Thoughtsregardingpotentialtacticalallocationsandmarketopportunities
________________________________________________
(1) Pastperformanceisnoguaranteeoffutureresults. (2) AUMisestimatedandunaudited.AsofAugust1,2010.

5
ProductInnovation:ImplicationsforBAAMsBusiness
ProductInnovation:KeytoDevelopingStrategic Relationships
37customizedclientvehicles nearly50%ofBAAM
AUMComposition(August2010)(1)
externalAUM(1)
Targetingspecificclientportfolioobjectives Customizedaccountshaveincreasedasaproportion
Commingled Assets 51% 49% Customized Vehicles
ofBAAMAUMinrecentyears
InnovationHasHelpedBAAMAvoidFeeCompression
BAAMhasavoidedsignificantfeecompression,
BAAMsFees(2)
120% 100% TotalFee 80% 60% 40% 20% 0% YE2006
(normalizedto2006level)
despitereportedtrendsamongcompetitors
Managementfeeshavelargelyheldstablesince
2006(2)
Incentivefees(2) significantamountofassets
alreadyaboveorapproachingtheirhighwatermark
YE2007
YE2008
YE2009 IncentiveFee
June30,2010
ManagementFee
________________________________________________
(1) AUMisestimatedandunaudited.AsofAugust1,2010. (2) ThefeeanalysisexcludesinternalassetsandnoncoreBAAMproducts(commoditiesplatform,seedfundsandadvisoryrelationships).

6
KeySuccessDriversofBAAMsBusiness BAAMhasevolvedbeyondthetraditionalFundofHedgeFund model

StableManagementTeamandDeepBenchofTalent
PortfolioteammemberswhohavetradedtheassetclassesandstrategiesinwhichBAAMinvests 140teammembers,overhalfofwhomareinvolvedintheinvestmentprocess(1)
GlobalFootprint
BAAMofficesinNewYork,London,andHongKong(investmentprofessionalsineachlocation) Increasinglyglobalinstitutionalinvestorbase
FocusonLiquidity
Properasset/liabilitymanagementacrossfundsandstrategies Providedliquiditytoinvestorswhenneeded
LeveragingtheBlackstoneLibrary(2)
AccesstoBlackstoneexpertsforindustryandmarketinsights AccesstoBlackstonesextensivenetworkofindustrycontacts
AlignmentofInterestandaCultureofRiskManagementandCompliance
Significantfirmandemployeecapitalinvestedalongsideclients Significantresourcesdedicatedtoreducingtheriskofinvestinginfundsthatdestroyclientcapitaland/orgeneratenegative
headlines
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(1) AsofJuly1,2010.TheStrategyFocusedResearchgroupincludesBAAMsBusinessAnalyst/TechnologyGroupwhichiscomprisedof18professionalswho supporttheinvestmentteam. (2) Subjecttoinformationwallpoliciesandprocedures.

7
KeySuccessDriversofBAAMsBusiness(Contd) BAAMhasevolvedbeyondthetraditionalFundofHedgeFund model

AbilitytoUseSizeandScaleAdvantageously
Usesizetobuildstrategichedgefundmanagerrelationshipsand negotiatebeneficialterms/exposuresforclients Leveragehumancapital,technologyinvestments,andglobalfootprinttofurtherseparateBAAMfromcompetition
ProductOfferingsthatTargetDifferentPoolsofInvestorCapital
Broadcommingledproductofferingsandcustomizedexposuresbasedonclientdemand Specializedfundsthatattractadifferentiatedinvestorbase
ProductInnovation
Abilitytocreatetailoredportfoliosandfundstructurestomeetclientneedsorcapitalizeonmarketdislocations PartnershipswithunderlyingmanagerswhereBAAMcanaccessandstructurecustomizedexposureforclients
EmphasisonTechnologyandTransparency
SignificantinvestmentinPortfolioManagement,RiskManagement, andDueDiligencetechnologytools Managerrelationshipsandmarketreputationthatfacilitatetransparencyneeds
StrategicClientRelationships
BAAMisatrustedadvisortomanyoftheworldsleadinginstitutionalinvestors AstrategicrelationshipwithBAAMcanencompassafullscopeof servicesbeyondaportfoliomandate
A.
Reconciliation of Non-GAAP Financial Measures
ReconciliationofGAAPIncome(Loss)BeforeTaxestoENItoNFRE toDEandNFREtoEBITDANFRE
($inthousands)
Revenues Expenses OtherIncome(Loss) Income(Loss)BeforeProvisionforTaxes EconomicNetIncomeAdjustments IPOandAcquisitionRelatedCharges AmortizationofIntangibles Income(Loss)AssociatedwithNonControllingInterestsin Income(Loss)ofConsolidatedEntities ManagementFeeRevenuesAssociatedwithConsolidatedCLOEntities EconomicNetIncome,BeforeTaxes NFREAdjustments PerformanceFeesandAllocationsAdjustment InvestmentIncome(Loss)Adjustment InvestmentIncome(Loss)CashManagementStrategies PerformanceFeeRelatedCompensationandBenefitsAdjustment TaxesPayable NetFeeRelatedEarnings DistributableEarningsAdjustments RealizedPerformanceFeesandAllocations RealizedInvestmentIncome(Loss) AdjustmentRelatedtoInvestmentIncomeCashManagementStrategies OtherPayablesIncludingPayableunderTaxReceivableAgreement DistributableEarnings NFREtoEBITDANFREReconciliation NetFeeRelatedEarnings TaxesPayable Interest,Depreciation&Amortization EarningsBeforeInterest,TaxesandDepreciationandAmortizationfromNFRE
________________________________________________
Sep30,2009 $597,023 1,097,794 73,812 ($426,959)
ThreeMonthsEnded Dec31,2009 Mar31,2010 June30,2010 $725,346 $701,239 $550,088 1,170,001 1,100,714 1,127,766 79,341 171,804 (59,250) ($365,314) ($227,671) ($636,928) 726,722 39,512 749,930 40,822
LTM(1) Ended June30,2010 $2,573,696 4,496,275 265,707 ($1,656,872) 2,947,711 159,358 (215,249) 15,827 $1,250,775 (593,580) (394,480) 21,095 215,447 (58,495) $440,762 114,702 64,338 (10,894) (300) $608,608 $440,762 58,495 47,589 $546,846
719,708 751,351 39,513 39,511
(53,905) (59,703) (159,935) 58,294 6,474 9,353 $278,357 $365,845 $385,102 $221,471 (166,770) (58,003) 57,357 (16,002) $94,939 (3,105) 7,669 $99,503 (214,960) (76,742) 12,368 73,762 (21,110) $139,163 48,172 35,641 (10,142) $212,834 (186,214) (156,828) 3,665 62,341 (9,321) $98,745 46,140 5,307 (1,264) (232) $148,696 $98,745 9,321 12,739 $120,805 (25,636) (102,907) 5,062 21,987 (12,062) $107,915 23,495 15,721 512 (68) $147,575 $107,915 12,062 12,889 $132,866
$94,939 $139,163 16,002 21,110 10,318 11,643 $121,259 $171,916
(1)
LastTwelveMonths.
1
ReconciliationofENIRevenuestoFeeRevenuesandTransaction& OtherFees Total Segments

($inthousands)
ENIRevenuesTotalSegments,AsReported
Dec31,2007 ManagementandAdvisoryFees BaseManagementFees AdvisoryFees TransactionandOtherFees,Net ManagementFeeOffsets TotalManagement&AdvisoryFees PerformanceFees&Allocations Realized Unrealized TotalPerformanceFees&Allocations InvestmentIncome(Loss) Realized Unrealized TotalInvestmentIncome(Loss) InterestIncomeandDividendRevenue Other TotalRevenues $804,252 360,284 478,810 (22,484) $1,620,862 1,054,816 106,032 $1,160,848 262,857 130,745 $393,602 14,686 528 $3,190,526 TwelveMonthsEnded Dec31,2008 Dec31,2009 $1,041,718 397,519 96,358 (16,437) $1,519,158 39,013 (1,286,262) ($1,247,249) (64,677) (691,934) ($756,611) 29,014 13,595 ($442,093) $999,829 390,718 115,040 (17,161) $1,488,426 74,264 165,867 $240,131 29,544 3,880 $33,424 22,492 7,096 $1,791,569 Sep30,2009 $255,848 94,566 22,493 (4,536) $368,371 (3,819) 170,589 $166,770 7,669 50,334 $58,003 6,767 3,893 $603,804 ThreeMonthsEnded Dec31,2009 Mar31,2010 $253,299 122,709 59,925 (2,368) $433,565 72,260 142,700 $214,960 35,641 41,101 $76,742 11,322 1,818 $738,407 $251,971 76,568 35,260 (1,178) $362,621 53,881 132,333 $186,214 5,307 151,521 $156,828 8,690 (3,250) $711,103 June30,2010 $262,914 134,099 20,617 (179) $417,451 46,374 (20,738) $25,636 15,721 87,186 $102,907 6,930 (644) $552,280 LTMEnded June30,2010 $1,024,032 427,942 138,295 (8,261) $1,582,008 168,696 424,884 $593,580 64,338 330,142 $394,480 33,709 1,817 $2,605,594
FeeRevenuesandTransaction&OtherFees,AsDisclosedinPresentation
Dec31,2007 FeeRevenues BaseManagementFees AdvisoryFees TransactionandOtherFees,Net ManagementFeeOffsets InterestIncomeandDividendRevenue Other FeeRevenues Transaction&OtherFees TransactionandOtherFees,Net ManagementFeeOffsets InterestIncomeandDividendRevenue Other Transaction&OtherFees $804,252 360,284 478,810 (22,484) 14,686 528 $1,636,076 $478,810 (22,484) 14,686 528 $471,540 TwelveMonthsEnded Dec31,2008 Dec31,2009 $1,041,718 397,519 96,358 (16,437) 29,014 13,595 $1,561,767 $96,358 (16,437) 29,014 13,595 $122,530 $999,829 390,718 115,040 (17,161) 22,492 7,096 $1,518,014 $115,040 (17,161) 22,492 7,096 $127,467 Sep30,2009 $255,848 94,566 22,493 (4,536) 6,767 3,893 $379,031 $22,493 (4,536) 6,767 3,893 $28,617 ThreeMonthsEnded Dec31,2009 Mar31,2010 $253,299 122,709 59,925 (2,368) 11,322 1,818 $446,705 $59,925 (2,368) 11,322 1,818 $70,697 $251,971 76,568 35,260 (1,178) 8,690 (3,250) $368,061 $35,260 (1,178) 8,690 (3,250) $39,522 June30,2010 $262,914 134,099 20,617 (179) 6,930 (644) $423,737 $20,617 (179) 6,930 (644) $26,724 LTMEnded June30,2010 $1,024,032 427,942 138,295 (8,261) 33,709 1,817 $1,617,534 $138,295 (8,261) 33,709 1,817 $165,560
ReconciliationofENIRevenuestoFeeRevenuesandTransaction& OtherFees Private Equity

($inthousands)
ENIRevenuesPrivateEquity,AsReported
Dec31,2007 ManagementandAdvisoryFees BaseManagementFees TransactionandOtherFees,Net ManagementFeeOffsets TotalManagement&AdvisoryFees PerformanceFees&Allocations Realized Unrealized TotalPerformanceFees&Allocations InvestmentIncome(Loss) Realized Unrealized TotalInvestmentIncome(Loss) InterestIncomeandDividendRevenue Other TotalRevenues $254,843 123,770 (10,734) $367,879 574,274 (194,357) $379,917 131,498 (16,166) $115,332 1,731 470 $865,329 TwelveMonthsEnded Dec31,2008 Dec31,2009 $268,961 51,796 (4,862) $315,895 (749) (429,736) ($430,485) 13,687 (196,200) ($182,513) 6,459 4,474 ($286,170) $270,509 86,336 $356,845 34,021 303,491 $337,512 36,968 33,269 $70,237 7,756 2,845 $775,195 Sep30,2009 $67,009 18,368 $85,377 110,867 $110,867 8,794 18,640 $27,434 2,553 677 $226,908 ThreeMonthsEnded Dec31,2009 Mar31,2010 $67,329 42,495 $109,824 34,021 90,621 $124,642 28,416 12,676 $41,092 4,531 1,516 $281,605 $65,432 31,972 $97,404 46,175 45,549 $91,724 (495) 84,684 $84,189 3,428 100 $276,845 June30,2010 $66,795 16,367 $83,162 1,106 (24,020) ($22,914) 3,141 17,275 $20,416 2,728 460 $83,852 LTMEnded June30,2010 $266,565 109,202 $375,767 81,302 223,017 $304,319 39,856 133,275 $173,131 13,240 2,753 $869,210
Dec31,2007 FeeRevenues BaseManagementFees TransactionandOtherFees,Net ManagementFeeOffsets InterestIncomeandDividendRevenue Other FeeRevenues Transaction&OtherFees TransactionandOtherFees,Net ManagementFeeOffsets InterestIncomeandDividendRevenue Other Transaction&OtherFees $254,843 123,770 (10,734) 1,731 470 $370,080 $123,770 (10,734) 1,731 470 $115,237 TwelveMonthsEnded Dec31,2008 Dec31,2009 $268,961 51,796 (4,862) 6,459 4,474 $326,828 $51,796 (4,862) 6,459 4,474 $57,867 $270,509 86,336 7,756 2,845 $367,446 $86,336 7,756 2,845 $96,937 Sep30,2009 $67,009 18,368 2,553 677 $88,607 $18,368 2,553 677 $21,598 ThreeMonthsEnded Dec31,2009 Mar31,2010 $67,329 42,495 4,531 1,516 $115,871 $42,495 4,531 1,516 $48,542 $65,432 31,972 3,428 100 $100,932 $31,972 3,428 100 $35,500 June30,2010 $66,795 16,367 2,728 460 $86,350 $16,367 2,728 460 $19,555 LTMEnded June30,2010 $266,565 109,202 13,240 2,753 $391,760 $109,202 13,240 2,753 $125,195
ReconciliationofENIRevenuestoFeeRevenuesandTransaction& OtherFees Real Estate

($inthousands)
ENIRevenuesRealEstate,AsReported
Dec31,2007 ManagementandAdvisoryFees BaseManagementFees TransactionandOtherFees,Net ManagementFeeOffsets TotalManagement&AdvisoryFees PerformanceFees&Allocations Realized Unrealized TotalPerformanceFees&Allocations InvestmentIncome(Loss) Realized Unrealized TotalInvestmentIncome(Loss) InterestIncomeandDividendRevenue Other TotalRevenues $233,072 348,410 (11,717) $569,765 326,514 297,437 $623,951 68,996 65,472 $134,468 1,321 38 $1,329,543 TwelveMonthsEnded Dec31,2008 Dec31,2009 $295,921 36,046 (4,969) $326,998 24,681 (843,704) ($819,023) 3,778 (238,650) ($234,872) 5,880 3,008 ($718,009) $328,447 25,838 (2,467) $351,818 (3,039) (252,180) ($255,219) 6,164 (125,624) ($119,460) 6,030 3,261 ($13,570) Sep30,2009 $83,409 3,347 (415) $86,341 (11,441) 23,608 $12,167 (3,078) 1,242 ($1,836) 2,035 1,450 $100,157 ThreeMonthsEnded Dec31,2009 Mar31,2010 $83,323 16,472 (373) $99,422 3,166 5,391 $8,557 6,500 (219) $6,281 3,414 75 $117,749 $83,060 1,942 (489) $84,513 5,948 11,391 $17,339 2,632 46,892 $49,524 2,718 (1,876) $152,218 June30,2010 $82,916 2,979 (110) $85,785 16,319 21,117 $37,436 3,900 79,543 $83,443 2,178 (390) $208,452 LTMEnded June30,2010 $332,708 24,740 (1,387) $356,061 13,992 61,507 $75,499 9,954 127,458 $137,412 10,345 (741) $578,576
Dec31,2007 FeeRevenues BaseManagementFees TransactionandOtherFees,Net ManagementFeeOffsets InterestIncomeandDividendRevenue Other FeeRevenues Transaction&OtherFees TransactionandOtherFees,Net ManagementFeeOffsets InterestIncomeandDividendRevenue Other Transaction&OtherFees $233,072 348,410 (11,717) 1,321 38 $571,124 $348,410 (11,717) 1,321 38 $338,052 TwelveMonthsEnded Dec31,2008 Dec31,2009 $295,921 36,046 (4,969) 5,880 3,008 $335,886 $36,046 (4,969) 5,880 3,008 $39,965 $328,447 25,838 (2,467) 6,030 3,261 $361,109 $25,838 (2,467) 6,030 3,261 $32,662 Sep30,2009 $83,409 3,347 (415) 2,035 1,450 $89,826 $3,347 (415) 2,035 1,450 $6,417 ThreeMonthsEnded Dec31,2009 Mar31,2010 $83,323 16,472 (373) 3,414 75 $102,911 $16,472 (373) 3,414 75 $19,588 $83,060 1,942 (489) 2,718 (1,876) $85,355 $1,942 (489) 2,718 (1,876) $2,295 June30,2010 $82,916 2,979 (110) 2,178 (390) $87,573 $2,979 (110) 2,178 (390) $4,657 LTMEnded June30,2010 $332,708 24,740 (1,387) 10,345 (741) $365,665 $24,740 (1,387) 10,345 (741) $32,957
4
ReconciliationofENIRevenuestoFeeRevenuesandTransaction& OtherFees CAMA

($inthousands)
ENIRevenuesCreditandMarketableAlternatives,AsReported
TwelveMonthsEnded Dec31,2007 Dec31,2008 Dec31,2009 ManagementandAdvisoryFees BaseManagementFees TransactionandOtherFees,Net ManagementFeeOffsets TotalManagement&AdvisoryFees PerformanceFees&Allocations Realized Unrealized TotalPerformanceFees&Allocations InvestmentIncome(Loss) Realized Unrealized TotalInvestmentIncome(Loss) InterestIncomeandDividendRevenue Other TotalRevenues $316,337 6,630 (33) $322,934 154,028 2,952 $156,980 62,363 81,439 $143,802 4,249 31 $627,996 $476,836 8,516 (6,606) $478,746 $400,873 2,866 (14,694) $389,045 Sep30,2009 $105,430 778 (4,121) $102,087 ThreeMonthsEnded Dec31,2009 Mar31,2010 June30,2010 $102,647 958 (1,995) $101,610 $103,479 1,345 (689) $104,135 1,758 75,393 $77,151 2,983 19,715 $22,698 1,148 (542) $204,590 $113,203 1,169 (69) $114,303 28,949 (17,835) $11,114 8,729 (10,193) ($1,464) 756 (372) $124,337 LTMEnded June30,2010 $424,759 4,250 (6,874) $422,135 73,402 140,360 $213,762 12,947 68,399 $81,346 4,368 49 $721,660
15,081 43,282 (12,822) 114,556 $2,259 $157,838 (82,142) (257,084) ($339,226) 8,527 1,214 $151,520 (15,031) 96,016 $80,985 3,452 1,025 $632,345
7,622 35,073 36,114 46,688 $43,736 $81,761 1,953 29,976 $31,929 929 715 $179,396 (718) 28,901 $28,183 1,535 248 $213,337
FeeRevenues,AsDisclosedinPresentation
TwelveMonthsEnded Dec31,2007 Dec31,2008 Dec31,2009 FeeRevenues BaseManagementFees TransactionandOtherFees,Net ManagementFeeOffsets InterestIncomeandDividendRevenue Other FeeRevenues $316,337 6,630 (33) 4,249 31 $327,214 $476,836 8,516 (6,606) 8,527 1,214 $488,487 $400,873 2,866 (14,694) 3,452 1,025 $393,522 Sep30,2009 $105,430 778 (4,121) 929 715 $103,731 ThreeMonthsEnded Dec31,2009 Mar31,2010 June30,2010 $102,647 958 (1,995) 1,535 248 $103,393 $103,479 1,345 (689) 1,148 (542) $104,741 $113,203 1,169 (69) 756 (372) $114,687 LTMEnded June30,2010 $424,759 4,250 (6,874) 4,368 49 $426,552
ReconciliationofENIRevenuestoFeeRevenuesandTransaction& OtherFeesandENIto NFRE FinancialAdvisory

($inthousands)
ENIRecapFinancialAdvisory,AsReported
Dec31,2007 ManagementandAdvisoryFees AdvisoryFees TransactionandOtherFees,Net TotalManagement&AdvisoryFees InvestmentIncome(Loss) Realized Unrealized TotalInvestmentIncome(Loss) InterestIncomeandDividendRevenue Other TotalRevenues Expenses CompensationandBenefitsBaseCompensation OtherOperatingExpenses TotalExpenses EconomicNetIncome $360,284 $360,284 7,385 (11) $367,658 TwelveMonthsEnded Dec31,2008 $397,519 $397,519 8,148 4,899 $410,566 Dec31,2009 $390,718 $390,718 1,443 219 $1,662 5,254 (35) $397,599 Sep30,2009 $94,566 94,566 476 $476 1,250 1,051 $97,343 ThreeMonthsEnded Dec31,2009 Mar31,2010 $122,709 122,709 1,443 (257) $1,186 1,842 (21) $125,716 $76,568 1 76,569 187 230 $417 1,396 (932) $77,450 June30,2010 $134,099 102 134,201 (49) 561 $512 1,268 (342) $135,639 LTMEnded June30,2010 $427,942 103 $428,045 1,581 1,010 $2,591 5,756 (244) $436,148 257,812 76,905 $334,717 $101,431
$132,633 234,755 232,359 39,037 67,277 79,572 $171,670 $302,032 $311,931 $195,988 $108,534 $85,668
57,686 69,482 54,492 76,152 22,666 22,196 14,727 17,316 $80,352 $91,678 $69,219 $93,468 $16,991 $34,038 $8,231 $42,171
FeeRevenuesandNetFeeRelatedEarnings,AsDisclosedinPresentation
Dec31,2007 FeeRevenues AdvisoryFees TransactionandOtherFees,Net InterestIncomeandDividendRevenue Other FeeRevenues ENItoNFREReconciliation EconomicNetIncome ProFormaCompensationAdjustment(1) ProFormaInterestExpense(2) InvestmentIncome(Loss)Adjustment InvestmentIncome(Loss)Blackstone's TreasuryCashManagementStrategies TaxesPayable NetFeeRelatedEarnings(3) $360,284 7,385 (11) $367,658 $195,988 (57,530) 1,122 (68,140) $71,440 TwelveMonthsEnded Dec31,2008 $397,519 8,148 4,899 $410,566 $108,534 (13,356) $95,178 Dec31,2009 $390,718 5,254 (35) $395,937 $85,668 (1,662) 1,220 (7,475) $77,751 Sep30,2009 $94,566 1,250 1,051 $96,867 $16,991 (476) (110) $16,405 ThreeMonthsEnded Dec31,2009 Mar31,2010 $122,709 1,842 (21) $124,530 $34,038 (1,186) 1,220 (2,294) $31,778 $76,568 1 1,396 (932) $77,033 $8,231 (417) 350 (2,092) $6,072 June30,2010 $134,099 102 1,268 (342) $135,127 $42,171 (512) 484 (4,987) $37,156 LTMEnded June30,2010 $427,942 103 5,756 (244) $433,557 $101,431 (2,591) 2,054 (9,483) $91,411
________________________________________________
(1) (2) (3)
Representsadjustmentsforexpensesrelatedtoemployeecompensationandprofitsharingarrangementsthatwerenoteffectivepriortothereorganization. Representsadjustmentstoaddbackinterestexpensebasedonthe assumptionthattherevolvingcreditfacilitywasrepaidinfullfromtheproceedsoftheofferingasofJanuary1,2007. ProFormaforTwelveMonthsEndedDecember31,2007. 6
B.
SpeakerBiographies
PresenterBiographies
StephenA.Schwarzman isChairman,CEOandCoFounderofBlackstoneandtheChairmanoftheboardofdirectors ofitsgeneralpartner, BlackstoneGroupManagementL.L.C.Hehasbeeninvolvedinallphasesofthefirmsdevelopmentsinceitsfoundingin1985. Mr.SchwarzmanbeganhiscareeratLehmanBrothers,wherehewas electedManagingDirectorin1978attheageof31.Hewasengaged principallyinthefirmsmergersandacquisitionsbusinessfrom1977to1984,andservedasChairmanofthefirmsMergers&Acquisitions Committeein1983and1984. Mr.SchwarzmanisamemberofTheCouncilonForeignRelationsandTheBusinessCouncil.HeisontheboardofTheNewYorkPublicLibrary, andTheAsiaSociety.HeservesonTheJPMorganChaseNational AdvisoryBoard,TheNewYorkCityPartnershipBoardofDirectorsandThe AdvisoryBoardoftheSchoolofEconomicsandManagement,Tsinghua University,Beijing.Mr.SchwarzmanisaTrusteeofTheFrickCollection inNewYorkCityandChairmanEmeritusoftheBoardofTheJohnF.KennedyCenterforthePerformingArts.HealsowasawardedtheLgion dhonneur byPresidentJacquesChirac. Mr.SchwarzmanholdsaBAfromYaleUniversityandanMBAfromHarvardBusinessSchool.HehasservedasanadjunctprofessorattheYale SchoolofManagementandontheHarvardBusinessSchoolBoardof DeansAdvisors. Hamilton(Tony)E.James isPresident,ChiefOperatingOfficerofBlackstone,andamemberoftheboardofdirectorsofourgeneralpartner, BlackstoneGroupManagementL.L.C.HeisalsoamemberofBlackstonesManagementandExecutiveCommitteesandsitsoneachofthe firmsinvestmentcommittees. PriortojoiningBlackstoneMr.JameswasChairmanofGlobalInvestmentBankingandPrivateEquityatCreditSuisseFirstBoston anda memberoftheExecutiveBoard.PriortotheacquisitionofDonaldson,Lufkin&JenrettebyCreditSuisseFirstBostonin2000,Mr.Jameswas theChairmanofDLJs BankingGroup,responsibleforallthefirmsinvestmentbankingandmerchantbankingactivities.Mr.James joinedDLJ in1975asanInvestmentBankingassociate.HebecameheadofDLJs globalM&Agroupin1982,foundedDLJMerchantBanking,Inc.in 1985, andwasnamedChairmanoftheBankingGroupin1995.HeisaDirectorofCostcoWholesaleCorporationandSwiftRiverInvestments,Inc., andhasservedonanumberofothercorporateBoards. Mr.JamesisViceChairmanofTheKennedyCenterCorporateFundBoard,TrusteeandmemberofTheExecutiveCommitteeofTheSecond StageTheatre,TrusteeofTheMetropolitanMuseumofArt,ViceChairmanofTroutUnlimiteds ColdwaterConservationFund,Trusteeof WoodsHoleOceanographic,TrusteeofWildlifeConservationSociety,AdvisoryBoardmemberofTheMontanaLandReliance,andChairman EmeritusoftheBoardofTrusteesofAmericanBalletTheatre.HeisalsoaformermemberofthePresidentsExportCouncil Subcommittee onTechnology&Competitiveness. Mr.Jamesgraduatedmagnacumlaude withaBAfromHarvardCollegein1973andwasaJohnHarvardScholar.HeearnedanMBAwithhigh distinctionfromtheHarvardBusinessSchoolandgraduatedasaBakerScholarin1975.
TimothyColeman isaSeniorManagingDirectorandHeadoftheRestructuring&ReorganizationGroup.Mr.Colemanalsoservesasamember ofBlackstonesExecutiveCommittee. SincejoiningBlackstonein1992,Mr.Colemanhasworkedonavarietyofrestructuringandreorganizationassignmentsforcompanies,creditor groups,specialcommitteesofcorporateboards,corporateparentsoftroubledcompaniesandacquirersofdistressedassets.Mr. Colemans mostnotableassignmentsincludeAdelphia,AT&T(intherestructuringsofAT&TCanada,Alestra,AT&TBroadbandandExcite@Home),Bear StearnsAssetManagement,Bidermann IndustriesUSA,Inc.,Cable&WirelessHoldings,CamelotMusic, Inc.,CellNet DataSystemsInc.,Credit BasedAssetServicingandSecuritizationLLC(CBASS),Criimi Mae,DeltaAirLines,EdisonBrothersStores,Inc.,Ermis MaritimeShipping, FinancialGuarantyInsuranceCompany(FGIC),FLAGTelecom,GenevaSteelCompany,GuangdongEnterprises,HarnischfegerIndustries, HarrahsJazzCompany,JPSTextileGroup,Inc.,KollRealEstate,MirantCorp.,MoltenMetalTechnology,Inc.,RCN,R.H.Macy&Co., StratosphereCorporation,Supercanal Holding,S.A.,Vencor,Inc.,WilliamsCommunications,XeroxCorporationandXLCapital. TheInternationalFinancingReviewrecognizedMr.ColemanseffortsintherestructuringofCBASSbynamingthetransactionthe RestructuringoftheYearin2008. BeforejoiningBlackstone,Mr.ColemanwasaVicePresidentatCitibankN.A.fortwelveyears,wherehedividedhistimebetween corporate restructuring,realestaterestructuring,andloansyndications. Mr.ColemanisafrequentguestlectureratColumbiaUniversityandNewYorkUniversity.HeisamemberoftheinMotion BoardofDirectors andtheBoardofLeadersoftheMarshallSchoolofBusinessattheUniversityofSouthernCalifornia. Mr.ColemanreceivedaBAfromtheUniversityofCaliforniaatSantaBarbaraandanMBAfromtheUniversityofSouthernCalifornia. BennettJ.Goodman,SeniorManagingDirectorofTheBlackstoneGroupandaMemberoftheBlackstoneGroupExecutiveCommittee,isa FounderofGSOCapitalPartners. BeforecofoundingGSOCapitalPartnersin2005,Mr.GoodmanwasChairman, FounderandManagingPartneroftheAlternativeCapital DivisionofCreditSuisseFirstBoston.Hewasresponsibleforoverseeing$33billionofassetsundermanagement,includinginvestment partnershipsforprivateequityinvestments,mezzaninesecurities,realestateinvestmentsandseveralcreditorientedinvestmentstrategies. Mr.GoodmanwasamemberoftheExecutiveBoardandtheManagementCouncilofCSFB.Additionally,Mr.GoodmanservedastheChairman oftheCorporateBank,overseeingCSFBs $35billionofglobalcorporatelendingactivities. Mr.GoodmanjoinedCSFBin2000whenitacquiredDonaldson,Lufkin&Jenrette(DLJ)wherehewasGlobalHeadofLeveragedFinance.Mr. GoodmanjoinedDLJin1988asthefounderoftheHighYieldCapitalMarketsGroup.In1993,DLJbecamethe#1globalissuerofhighyield bondsandMr.Goodmansteamretainedthatcovetedmarketpositionforthenext11consecutiveyears.PriortojoiningDLJ,Mr.Goodman workedinthehighyieldbusinessatDrexelBurnhamLambertfrom 1984to1988. Mr.GoodmangraduatedfromLafayetteCollegeandtheHarvardBusinessSchool.HeisontheBoardofDirectorsoftheFilmSocietyofLincoln Center,theCancerResearchInstituteandtheAmericanJewishCommittee(WestchesterChapter).HealsoservesontheDeansCouncilofMt. SinaiSchoolofMedicineandtheinvestmentcommitteeoftheLafayetteCollegeendowment.Mr.Goodmanreceivedthe2004Lifetime AchievementAwardfromEuromoney Magazineforhiscareerachievementsintheglobalcapitalmarkets.
JonathanD.Gray isSeniorManagingDirectorandCoHeadofRealEstate.HeisalsoamemberofBlackstonesManagementandExecutive Committees. SincejoiningBlackstonein1992,Mr.Grayhasledtheprivatizationofelevenpublicrealestatecompaniesvaluedatmorethan$100billion includingExtendedStayAmerica,CarrAmerica,EquityOfficePropertiesandHiltonHotels.Mr.GraypreviouslyworkedintheAdvisoryGroup andthePrivateEquityGroupatBlackstone. Mr.GrayreceivedaBSinEconomicsfromtheWhartonSchool,aswellasaBAinEnglishfromtheCollegeofArtsandSciencesof theUniversity ofPennsylvania,wherehegraduatedmagnacumlaude andwaselectedtoPhiBetaKappa.Hecurrentlyservesasaboardmemberofthe PensionRealEstateAssociation,NAREIT,HarlemVillageAcademiesandTrinitySchool. J.Tomilson Hill isPresidentandChiefExecutiveOfficeroftheFundsofHedgeFundsgroup,aViceChairmanofBlackstoneandamemberofthe boardofdirectorsofourgeneralpartner,BlackstoneGroupManagementL.L.C. Mr.HillpreviouslyservedasCoHeadoftheCorporateandMergersandAcquisitionsAdvisorygroupbeforeassuminghisroleintheFundsof HedgeFundsgroup.Inhiscurrentcapacity,Mr.Hillisresponsibleforoverseeingthedaytodayactivitiesofthegroup,includinginvestment management,clientrelationships,marketing,operationsandadministration.HealsoservesasamemberofBlackstonesManagementand ExecutiveCommittees. BeforejoiningBlackstonein1993,Mr.HillbeganhiscareeratFirstBoston,laterbecomingoneoftheCoFoundersofitsMergers&Acquisitions Department.AfterrunningtheMergers&AcquisitionsDepartmentatSmithBarney,hejoinedLehmanBrothersasapartnerin1982, servingas CoHeadandsubsequentlyHeadofInvestmentBanking.Later,heservedasCoChiefExecutiveOfficerofLehmanBrothersandCoPresident andCoCOOofShearsonLehmanBrothersHoldingInc. Mr.HillisagraduateofHarvardCollegeandtheHarvardBusinessSchool.HeisamemberoftheCouncilonForeignRelationswherehechairs theInvestmentCommitteeandservesontheCouncilsBoardofDirectors,andisamemberoftheBoardofDirectorsofLincolnCenterTheater, whereheservesasPresident.Mr.HillservesasChairmanoftheBoardofTrusteesoftheSmithsoniansHirshhorn MuseumandSculpture Garden.HeisamemberoftheAdvisoryBoardofChristiesandamemberoftheBoardofDirectorsofOpenPeak Inc.
GarrettM.Moran isaSeniorManagingDirectorandChiefOperatingOfficerofthePrivateEquityGroup.HeisamemberofBlackstones ExecutiveCommittee,aswellasallinvestmentcommitteesforthePrivateEquityGroup. PriortojoiningBlackstonein2005,Mr.MoranwasaSeniorPrincipalandthePresidentofMMCCapital.BeforejoiningMMCCapitalin2002, Mr.MoranhadalongcareeratDonaldson,Lufkin&Jenrette.His lastpositiontherewasViceChairmanandcoheadoftheBankingGroup.He joinedDLJin1982asaninvestmentbankingassociateandsubsequentlyheadedthefirmsHighYieldBondDepartmentandservedasChief OperatingOfficerofDLJSTaxableFixedIncomeDivision.HewasViceChairmanandcoheadoftheBankingGroupofDLJatthetimeofthe firmsacquisitionbyCreditSuisseFirstBostonCorporation.Followingthatacquisition,Mr.MoranservedCSFBascoheadoftheinvestment bankingintegrationeffortandsubsequentlywastheheadofCSFBs PrivateEquityDivision. Mr.MoranisaboardmemberofthePosseFoundation,formerChairmanoftheBoardofTrusteesoftheBrunswickSchoolandformer Vice ChairmanoftheboardofMiddleburyCollege.HereceivedaBAfromMiddleburyCollegeandanMBAfromtheWhartonSchoolofthe UniversityofPennsylvania. JamesA.Quella isaSeniorManagingDirectorandSeniorOperatingPartnerinthePrivateEquityGroup. Mr.QuellaisresponsibleformonitoringthestrategyandoperationalperformanceofBlackstoneportfoliocompaniesandprovidingdirect assistanceintheoversightoflargeinvestments.HeisalsoamemberofthefirmsPrivateEquityInvestmentCommittee. PriortojoiningBlackstonein2004,Mr.QuellawasaManagingDirectorandSeniorOperatingPartnerwithDLJMerchantBankingPartners CSFBPrivateEquity.Priortothat,Mr.QuellaworkedatMercerManagementConsultingandStrategicPlanningAssociates,itspredecessorfirm, whereheservedasaseniorconsultanttoCEOsandseniormanagementteams,andwasCoViceChairmanwithsharedresponsibilityfor overallmanagementofthefirm. Mr.QuellareceivedaBAinInternationalStudiesfromtheUniversityofChicago/UniversityofWisconsinMadisonandanMBAwithdeans honorsfromtheUniversityofChicago.HeisalsothecoauthorofProfitPatterns:30WaystoAnticipateandProfitfrom theStrategicForces ReshapingYourBusiness.Mr.Quellahasbeenamemberofvarious PrivateEquitycompanyboardsandcurrentlyservesasaDirectorof Catalent,Freescale Semiconductor,GrahamPackaging,MichaelsStores,Inc.,andVanguardHealthSystems. VikrantSawhney isaSeniorManagingDirectorinthePrivateEquityGroupandisbasedinNewYork.Mr.Sawhney leadsthePrivateEquity GroupscapitalmarketsactivitiesandalsoworkscloselywithGSO,Advisory&RestructuringGroupandvariousotherpartsofthefirm on creditrelatedmatters. BeforejoiningBlackstonein2007,Mr.Sawhney workedasaManagingDirectorintheFinancialSponsorsGroupatDeutscheBank,wherehe wasresponsibleformanagingthefirmsrelationshipswithBlackstoneandseveralotherlargeprivateequityfirms.PriortojoiningDeutsche Bank,Mr.Sawhney wasanAssociateatthelawfirmofSimpsonThacher &Bartlett. Mr.Sawhney receivedaBA,magnacumlaude,fromDartmouthCollege,wherehewaselectedtoPhiBetaKappa.HealsoreceivedaJ.D.,cum laude,fromHarvardLawSchool.
JohnStudzinski CBE isaSeniorManagingDirectorandglobalheadofBlackstoneAdvisoryPartnersLP.Mr.Studzinski isbasedinbothNew YorkandLondon. Mr.Studzinskis primaryroleistooverseeBlackstonesglobaladvisorybusiness.HeisamemberofthefirmsExecutiveCommittee. BeforejoiningBlackstonein2006,Mr.Studzinski wasamemberoftheGroupManagementBoardandcoheadofinvestmentbankingatHSBC basedinLondonfrom2003to2006.PriortothathewasatMorganStanleyfrom1980to2003,whereheservedasheadoftheEuropean InvestmentBankingDivisionandDeputyChairmanofMorganStanleyInternational. HisrecenttransactionexperienceincludesadvisingtheBoardof AIGonitsglobalrestructuring,theMinistersoftheGovernmentofthe Ukraine,theBoardofReutersonthemergerwithThomson,ChinaDevelopmentBankonitsinvestmentinBarclaysPLC,theBoardof Northern Rockonitsrestructuring,theBoardofSuezontheproposedmergerwithGaz deFrance,theBoardofUnileverontheDualHeadStructure,the BATseniormanagementoncertainmaterialstrategicoptionsandtheBoardofPetrochina onapossibleacquisitionofUnocal. Mr.Studzinski graduatedfromBowdoinCollegein1978withadoubleBADegreemagnacumlaude inBiology&Sociology.Hereceivedan MBAfromtheUniversityofChicagoin1980inFinanceandMarketing.HeisViceChairandDirectorofHumanRightsWatchwhereheserves ontheExecutiveCommitteeaswellasChairmanoftheInvestment Committee.HealsoservesasaTrusteeofBowdoinCollege,the Tate Foundation,ThePassageDayCentrefortheHomelessandTheRoyalParksFoundation.HeisamemberoftheCouncilofTheRoyalCollegeof ArtandisChairoftheEmmausRevivesLivescampaign.Inmid2007,Mr.Studzinski steppeddownasatrusteeoftheTateandbecame ChairmanofBenjaminFranklinHouse.In2001,heestablishedtheGenesisFoundationwhichsupportsandnurturesemergingcomposers, directors,writersandactorsintosustainedcareersinthearts. Mr.Studzinski wasmadeaKnightoftheOrderofSt.Gregoryforhishumanitarianworkforthehomeless.HewasalsomadeaKnight CommanderofSaintSylvester.HereceivedthePrinceofWalesAmbassadorsAwardinrecognitionofhiscontributiontothehomeless.He receivedtheBeaconPrizein2004forservicestophilanthropyandinOctober2007wasvotedBankeroftheYearbytheVarietyClubUK.In 2008,hewasnamedintheQueensNewYearHonours ListasaCommanderoftheBritishEmpire(CBE)forhisservicestotheArtsandto Charity. LaurenceTosi,aSeniorManagingDirector,isthefirmsChiefFinancialOfficer.HealsoservesonthefirmsExecutiveCommittee. BeforejoiningBlackstonein2008,LaurenceTosiwastheChiefOperatingOfficerfortheGlobalMarketsandInvestmentBankingGroupof MerrillLynch&Co.Priortothat,hewasSeniorVicePresident andFinanceDirectorresponsibleforMerrillLynchsglobalfinanceorganization, includingworldwideaccounting,regulatoryreporting,budgetingandcorporatedevelopment. LaurenceTosireceivedaBA,aJDandanMBAfromGeorgetownUniversity.
JoanSolotar isaSeniorManagingDirectorintheExternalRelationsandStrategyGroupofTheBlackstoneGroupandamemberofthefirms ExecutiveCommittee.Ms.Solotarhasmanagementresponsibilityforshareholderrelationsandpublicaffairsandalsoguidesthefirmon analyzingstrategicdevelopmentopportunities. BeforejoiningBlackstonein2007,Ms.SolotarwaswithBancofAmericaSecuritieswhereshewasaManagingDirectorandHeadof Equity Research.ShestartedhercareerinequityresearchatTheFirst BostonCorporationandpriortojoiningBankofAmericawaspartofthe financialservicesteamatDonaldson,Lufkin&JenretteandlaterwithCSFBasaManagingDirector.Ms.Solotarwasrankedeachyearfrom 1995to2002intheBrokersandAssetManagementcategoryonthe InstitutionalInvestorAllAmericaResearchTeam,andconsistentlyranked highlyintheGreenwichSurveyofportfoliomanagers.ShealsoservedasChairpersonoftheResearchCommitteefortheSecuritiesIndustry Association. Ms.SolotarreceivedaBSinManagementInformationSystemsattheStateUniversityofNewYorkatAlbanyandanMBAinFinanceatNYU. SheiscurrentlyontheBoardofDirectorsoftheEastHarlemTutorialProgram. WestonTucker isaVicePresidentintheExternalRelationsandStrategyGroup. SincejoiningBlackstone,Mr.TuckerhasbeeninvolvedinBlackstonesdealingswiththeinvestmentcommunity. BeforejoiningBlackstonein2007,Mr.TuckerworkedasanassociateinJPMorgansequityresearchdepartment,coveringtelecomandcable. HebeganhiscareeratAT&T,whereheworkedinavarietyoffinancerolesincludinginvestorrelationsandcommunications,aswellas corporatedevelopment. Mr.Tuckergraduatedsummacumlaude withaBSinBusinessAdministration(Finance)fromOhioStateUniversity.
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2010 Black Stone Investor Day

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2010 Blackstone Investor Day

September 23, 2010

Hilton New York New York, NY