All numbers in Lit, billions unless otherwise noted

General Assumptions
Sources & Uses

General Assumptions

Sources

Tax Rate

Texas Pacific Group Equity

161.1

Subordinated Debt

177.1

7.0x

151.8

6.0x

Senior Debt
Total Sources

Debt/LTM EBITDA

6.5x

% Equity Value to Management

490.0

Uses
Purchase Price
Working Capital Funding
Transaction Costs
Total Uses

53.5%

Enterprise Value / EBITDA Exit Multiple

10.0%

Debt Assumptions

400.0
50.0
40.0
490.0

Subordinated Debt Assumptions
Total Subordinated Debt Facility
Cash Interest Rate
PIK Interest Rate
Warrants (as a % of Equity Value)

151.8
7.0%
6.0%
5.0%

Senior Debt
Total Senior Debt Facility
Interest Rate
Amortization Period

177.1
0.1
5.0

Income Statement Calculations
LTM
1996

Last Twelve Months (Projected)
1997

1998

1999

2000

2001

Motorcycle Revenue
Apparel Revenue
Total Revenue

199.5
0.0
199.5

260.0
0.0
260.0

343.1
0.0
343.1

426.2
0.0
426.2

509.3
0.0
509.3

614.9
0.0
614.9

Material Costs
Direct Labor & Other Direct Expenses
Variable Sales Expense

109.1
13.1
6.0

137.9
16.0
7.4

166.6
18.9
8.8

195.4
21.7
10.1

224.1
24.6
11.5

252.9
27.5
12.9

Gross Profit

71.3

98.8

148.9

198.9

249.0

321.7

S,G&A (excluding D&A)

46.0

54.2

62.4

70.6

78.8

87.0

EBITDA

25.3

44.6

86.5

128.3

170.2

234.7

Depreciation
Amortization

6.0
24.7

8.3
27.0

10.7
27.0

13.0
27.0

15.3
27.0

17.6
27.0

EBIT

(5.4)

9.3

48.8

88.3

127.9

190.0

Interest Expense (Including Non-Cash Interest)

11.0

33.6

32.8

32.0

31.3

30.7

(16.4)

(24.4)

16.0

56.4

96.6

159.3

0.0

16.9

51.7

85.2

(24.4)

16.0

39.5

44.9

74.1

30.3%
38.0%
17.1%

32.0%
43.4%
25.2%

24.2%
46.7%
30.1%

19.5%
48.9%
33.4%

20.8%
52.3%
38.2%

23.0

23.0

23.0

23.0

23.0

4.0

4.0

4.0

4.0

4.0

27.0

27.0

27.0

27.0

27.0

Taxable Income
Current Period Increase in Net Operating Loss Balance
Net Operating Loss Balance Available Before Current Period use of NOLs
Net Operating Loss Used for Tax Shield in Current Period
Net Operating Loss Balance Available After Current Period use of NOLs

(24.4)
(24.4)
16.4
0.0
40.8

16.0
0.0
40.8
16.0
24.8

56.4
0.0
24.8
24.8
0.0

96.6
0.0
0.0
0.0
0.0

159.3
0.0
0.0
0.0
0.0

Taxable Income Adjusted for Use of Net Operating Loss
Tax Rate
Taxes Paid

(24.4)
53.5%
0.0

0.0
53.5%
0.0

31.6
53.5%
16.9

96.6
53.5%
51.7

159.3
53.5%
85.2

Taxable Income
Taxes

0.0

Net Income

(16.4)

0.0

Operating Metrics
YoY Revenue Growth %
Gross Margin %
EBITDA Margin %
Amortization Schedule
Purchase Price
Net Asset Value
Goodwill
Amortization Period (Years)
Goodwill Amortization

400.0
170.0
230.0
10.0

Transaction Costs
Amortization Period (Years)
Transaction Costs Amortization

40.0
10.0

Total Amortization
Tax Schedule

Page 1 of 9

0 230.4 55.6 110.3 618.5 277.0 0.7 38.4 207.0 334.4) (30.9) Cash Flow from Financing Activities Page 2 of 9 .0 0.1 47.9) (16.3 68.0 229.0) 19.7) (22.0 553.6 13.0 0.0 0.3 Total Shareholder's Equity* 160.8 0.4 127.8 30.0 61.8 8.6 184.9) 320.3 50.0 293.4 200.7 121.9 63.5 OK 152.3 110.9 488.9 102.0 (30.0 84.2 52.5 26.0 151.0 520.8 0.6 60.7 (22.1 138.0 251.0 64.3 39.9 187.6 119.3 12.6 83.0 32.7) (22.1 210.0 91. Post-Deal 1997 1998 1999 2000 2001 11.9 488.5 106.8 230.0 270.9 518.9 518.8 80.1 71.3 19.4 39.4 115.0 112.9) Subordinated Debt (Principal Payments) Senior Debt (Principal Payments) Total Cash Flow from Financing Activities 0.2 109.9 OK 129.0 272.2 7.4 309.4) 0.1 151.6 30.9) (22.0 11.0 314.2 123.9) (18.0 Working Capital Calculation Balance Check: 84.4) (30.0 483.4) 0.0 0.3 9.3 618.0 0.3 14.7 77.4) (30.5 64.8 47.8 115.0 483.8 OK 197.4) (30.1 290.7 11.0 36.9 44.9 154.6 223.0 320.0 118.2 199.4) (30.0 30.0 (30.1 94.0 237.4 Cash Flow from Investing Capital Expenditures Total Cash Flow from Investing (12.4 126.4) 0.9 7.0 40.2 123.7) (22.0 37.0 0.4 111.9) (20.9 237.6 16.0 28.5 520.7 55.1 151.7) (22.6 84.5 30.8 104.9) (22.7 103.3 136.0 182.0 (8.5 37.4 63.0 64.8 55.0 177.9 101.9 44.3 10.3 9.0 40.4 253.9) (18.5 37.2 OK *Equals prior period's shareholder's equity plus current period's net income Working Capital Statistics Days Receivable Days Inventory Days Payable Cash Flow Statement Last Twelve Months (Projected) 1996 1997 1998 1999 2000 2001 Cash Flow from Operations Net Income Depreciation & Amortization Non Cash Interest Expense Owed On Subordinated Debt (Increase) / Decrease in Working Capital Change (24.0 56.0 143.2 216.0 0.2 2.1 153.5 89.1 117.3 75.6 13.9 72.0 0.9 177.7 271.5 227.5 40.2 2.7 9.3 Total Liabilities & Equity 200.0 20.7 0.5 (14.8 246.P&E Goodwill Capitalized Transaction Costs Total Long-Term Assets Total Assets Accounts Payable Other Current Liabilities Total Current Liabilities New Subordinated Debt New Senior Debt Total Debt Adjustments As of December 31.0 553.1 8.0 (30.5 161.0 24.8 328.0 0.2 OK 174.4) 0.9 0.4 39.8 328.1) 74.Balance Sheet Calculations Closing Balance Sheet as of 12/31/96 Pre-Deal Cash Accounts Receivable Inventory Other Current Assets Total Current Assets (Excl Cash) P.0 24.2 Total Cash Flow From Operations (1.4) Net Cash Flow (46.9) (20.0 29.9) (14.4) 35.0 101.5 OK 143.7 109.4 301.0 (30.0 (30.9 42.5 185.3 103.4 104.9) (16.1 44.4 77.5 8.9 10.4) (5.9 68.8 71.8 171.7) 42.9 60.

0% 10.408.7 223.5 24.6 % Total Equity Value to Management Team 10.0x 6.189.4 30.4 125.6 0.5 151.6 6.8% 46.6x 12.9 210.1 Credit Statistics Debt / EBITDA EBITDA / Cash Interest Expense (EBITDA-CAPEX) / Cash Interest Expense (EBITDA-CAPEX) / (Mandatory Principal Payments + Cash Interest Expense) 6.3x 2.6 12.4 Cash Interest Rate Cash Interest (Payable on Average Balance) 7.7 234.9x 1.4 125.0 151.525.1 161.7 15.760.047.8% 43.3 1.1 161.0% 5.4 121.0% 11.399.0 1.4 1.2 7.0% 16.2% 51.751.4 237.7 234.4x IRR Calculations @ Various Exit Multiples (Assuming Exit in 2001) EV/EBITDA Exit Multiple 5.3 7.4 91.173.7 6.2 7.0x 3.0% 10.1x 6.289.0 11.0% Equity Value to Warrants attached to Subordinated Debt 52.3 125.634.1 161.0x 234.8x 7.9 0.5x 2.7 163.9 1.3x 4.517.5x 6.1 29.5 1.1 0.1x 6.4 1.9 % Total Equity Value to Warrants attached to Subordinated Debt 5.6 1.0% TPG ROI 5.0% 10.0x 2001 EBITDA Enterprise Value @ Exit Net Debt Total Equity Value @ Exit 5.3 1.1x 8.0 1.5x 8.5% 1.0 75.6x 3.2 Remaining Equity Value Leftover For TPG 890.4x 4.8 11.7 0.6% 53.4x 8.3 64.8 990.9 1.9% 56.7 60.4 125.0% 11.3 6.4 16.290.0% 10.5x 6.4 125.6 223.3 13.0% 5.0% 12.0 199.0 PIK Interest Rate PIK Interest (Payable on Opening Balance for Simplicity) 6.1 91.4 30.3 26.1 TPG IRR 40.9x 1.7 234.0 13.0x 8.090.7 1.8 7.5 7.0% 5.0x 13.0% 14.0x 7.9 210.1 161.165.642.1 161.7 87.5 175.6 1.4 7.4 11.4 30.5% 5.2x Initial TPG Equity Investment Page 3 of 9 .0 Senior Debt Facility Opening Balance Principal Paydown Closing Balance Senior Debt Interest Rate Cash Interest Owed on Senior Debt (Payable on Average Balance) 7.2 27.8 30.1 70.5 128.3 12.3 1.0% 13.6 1.1 30.1 Total Non-Cash Interest Owed On Subordinated Debt Total Cash Interest Owed On Subordinated Debt Total Interest Owed On Subordinated Debt 10.7 30.6x 9.9 6.9 13.0% 13.3 1.3x 0.489.7 187.4x 5.0 0.0% 5.6 1.5x 9.6% 49.0% 5.4 58.5% 3.4 30.0x 1.282.0% 10.3 140.0 12.9 1.7 234.1 161.0% Equity Value to Management Team 104.Debt Schedule Last Twelve Months (Projected) 1997 1998 1999 2000 2001 Subordinated Debt Facility Opening Balance Principal Paydown PIK Interest (See Below) Closing Balance 177.7 7.0% 10.0% 12.4 0.2 1.2x 1.7 1.877.1 161.0% 15.7 234.389.0x 3.0 7.4 125.6 187.0 10.4 125.9 14.2x 1.8 116.0% 10.0 11.7 234.3 199.5x 7.4 121.8 23.4 60.5% 10.0% 5.9 81.5% 8.

50% 5. Assume fees are identical for all three. All-Star Finance.00% 10.00% 1.00% 4.00% 10.5 8.0x ITL 202. Inc.0x ITL 101.0x ITL 126.Financing Packages These financing packages are complete and final.1 7.00% 6.2 6.00% 8.7 8.00% 9.4 4. LLC Big-Time Capital Group Capital Capital.00% 6.50% Mandatory Amortization Period 5 years 7 years 10 years 6. They cannot be mix-and-matched.0x ITL 227.0x ITL 151. Total Senior Debt Facility / 1996 LTM EBITDA Amount Interest Rate 7.8 7.00% Senior Debt Subordinated Debt Assumptions Total Subordinated Debt Facility / 1996 LTM EBITDA Amount Cash Interest Rate PIK Interest Rate Warrants (as a % of Equity Value) .0x ITL 177.00% 5.

.

.

.

76 billion for 2001 Capital Expenditures ITL 22.76 billion for 2001 ITL 30. no growth 41.27 billion for 2001 ITL 75.10% of revenue 14.23 billion for 2001 ITL 7.87% of revenue Balance Sheet Accounts Receivable Inventory Other Current Assets ITL 171.12% of revenue 4.G&A (excluding D&A) Depreciation ITL 614.47 billion for 2001 Accounts Payable Other Current Liabilities ITL 72.47% of revenue 2.86 billion for 2001 .15% of revenue 2.94 billion for 2001 No sales.Operational Improvements Comparables Income Statement Model Assumptions Revenue Apparel Revenue Material Costs Direct Labor & Other Direct Expenses Variable Sales Expense S.

00% 41.47% 2.15% 2.76 30.94 0.10% 14.87% $171.76 $22.27 75.12% 4.Assumption Numbers $614.47 $72.23 7.86 .