2014 Capital Markets Review by Piper Jaffray

2014 Capital Markets Review Piper Jaffray Capital Markets

Piper Jaffray & Co., Member NYSE and SIPC

Table of Contents Section I

2014 Year in Review

Section II

IPO Market Review

Section III

Follow-on Offering Market Review

Section IV

Confidentially Marketed Follow-on (URD), Registered Direct & PIPE Market Review

Section V

Convertible Market Review

Appendix A

Piper Jaffray Credentials

Section I

2014 Year in Review

2014 Year in Review 2014 Global Index Performance

Prior Decade of Global Index Performance (2004 – 2013) 53%

China (Shanghai)

132%

Brazil (Bovespa)

13%

U.S. (Nasdaq)

154%

Russia (RTS)

30%

India (Sensex)

263%

India (Sensex)

U.S. (Russell 2000)

109%

U.S. (Nasdaq)

108%

Canada (Toronto)

Hong Kong (Hang Seng)

Japan (Nikkei)

11%

U.S. (S&P 500) U.S. (Dow Jones)

U.S. (Russell 2000) Hong Kong (Hang Seng)

Australia (ASX)

61%

U.S. (Dow Jones)

59% 53%

-3%

U.K. (FTSE)

-45%

China (Shanghai)

Brazil (Bovespa) Russia (RTS) -20%

66%

51%

-3%

-40%

U.S. (S&P 500) Canada (Toronto)

Japan (Nikkei)

U.K. (FTSE)

-60%

85% 66%

20%

40%

60%

2014 S&P 500 Subsector Performance

41% 100%

200%

Prior Decade of S&P 500 Subsector Performance (2004 – 2013)

Utilities

Energy

24%

Health Care Info Tech

191%

Cons. Disc

23%

113%

Cons. Staples

18%

98%

Financials

13%

Health Care

84%

Cons. Staples

13%

Info Tech

81%

Industrials

81%

S&P 500

11%

Cons. Disc

63%

Financials

-10% -5%

66%

Utilities

Energy

76%

S&P 500

Materials

-10%

Materials

Industrials

10%

300%

15%

20%

25%

30%

-50%

-22% 0%

50%

100%

150%

200%

Source: Capital IQ Returns stated in each country’s local currency

250%

2014 Year in Review U.S. Indices grew 9% on

U.S. Historical Index Performance by Year

average in 2014

50% 37%

40%

Over the last 5 years, major indices are up 89% on average led by the NASDAQ and Russell 2000, which are up 109% and 93%, respectively

Average % Return by Year of Major U.S. Indices

33% 28%

30% 20%

17%

14%

13%

10%

2% 0%

-10% -20%

-10% -15% -23%

-30% -40%

-37%

-50% 2000

2001

2002

2003

2004

2006

2007

2008

2009

2010

2011

2012

2013

2014

(6%)

(7%)

(17%)

25%

(1%)

16%

(34%)

19%

11%

26%

Nasdaq

(39%)

(21%)

(32%)

50%

10%

(41%)

44%

17%

(2%)

16%

38%

13%

S&P 500

(10%)

(13%)

(23%)

26%

14%

(38%)

23%

13%

(0%)

13%

30%

11%

Dow Jones

Russell 2000 Average

2005

(4%)

(22%)

45%

17%

(3%)

(35%)

25%

(5%)

15%

37%

(15%)

(10%)

(23%)

37%

14%

(37%)

28%

17%

(0%)

13%

33%

Source: Capital IQ

2014 Year in Review The VIX is a measure of

CBOE Market Volatility Index (VIX) since 1990

Russian Financial Crisis

9/11 Terrorist Attack

Iraq War

Arthur Andersen / WorldCom Accounting Scandals

2008 Global Financial Crisis

Flash Crash / U.S. & European Debt Concerns

2012

Asian Financial Crisis

First Gulf War

volatility within the S&P 100 500 over the next 30 days

2009

expectations for

80 VIX Averages:

2013 – 2014: ~14

2010 – 2012: ~22

2008 – 2009: ~32 2004 – 2007: ~15

40 30 20 10

Source: Capital IQ & Piper Jaffray ECM

2014

2013

2011

2010

2008

2007

2006

2005

2004

2003

2002

2001

2000

1999

1998

1997

1996

1995

1994

1993

1992

1991

1990

2014 Year in Review Unemployment Rate

Since peaking in Q4 12%

2009, the unemployment rate has continued to 6% for the first time since 2008

Unemployment Rate

improve, falling below

10.0%

10%

9.6% 8.7%

Average = 7.5%

7.8% 7.0%

7.0% 5.7%

4.8%

4% 2% 0%

Consumer Confidence

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 '07 '08 '09 '10 '11 '12 '13 '14

Consumer Confidence

ISM Manufacturing Index

120

100

continued its upward swing in 2014 on the heels of a strong 2013

Median = 56 55

Median = 65 50

60 45 40 40 20

Jan '07

Jul

Jan '08

Jul

Jan '09

Jul

Jan '10

Jul

Jan '11

Jul

Jan '12

Jul

Jan '13

Jul

Jan '14

Jul

Jan '07

Jul

Jan '08

Jul

Jan '09

Jul

Jan '10

Jul

Jan '11

Jul

Jan '12

Jul

Jan '13

Jul

Source: Thomson Baseline & Bloomberg

Jan '14

Jul

2014 Year in Review U.S. quarterly GDP continued its steady growth in 2014, realizing a 3.3% year-over-year growth rate, the highest

U.S. Real GDP YoY Growth 4% 2%

1.9%

3.3%

3.1%

2.7%

2.4%

1.7%

1.6%

2011

2012

0% (0.2%)

annual growth since 2003

-2%

Current forecasts are

-4%

(2.8%)

targeting a slower growth rate in 2015, +2.4%

-6% 2007

2008

2009

2010

2013

2014

2015

S&P 500 YoY Revenue Growth 40%

15%

but year-over-year revenue growth slowed versus 2013

9.0%

7.8% 5.0%

20% 4.3%

4.7% 2.8%

2.0%

1.9%

0% -20% -5% S&P 500 YoY Revenue Growth

-10%

S&P 500 YoY Index Return

-12.7%

-15% 2007

2008

2009

-40%

-60% 2010

2011

2012

2013

2014

2015

Source: Capital IQ & Bloomberg Denotes Forecast

S&P 500 Return

finished 2014 +11.4%

10%

S&P 500 Revenue Growth

The S&P 500 index

2014 Year in Review 2014 equity fund flows

Equity Fund Flows Since 2006

continued to build on

FY = $210B

$250

record 2013 inflows as investors maintained $200

confidence in the equity

FY = $143B

markets $150

FY = $116B

CY 2014: +$143 billion CY 2013: +$210 billion CY 2012: +$40 billion

($ in Billions)

Fund Flows: $100

FY = $58B

$50

FY = $40B

FY = $24B

FY = $5B

FY = ($6B) -$50

1/4/06

1/4/07

2006

1/4/08

2007

1/4/09

2008

FY =1/4/10 ($3B) 2009

1/4/11

2010

1/4/12

2011

1/4/13

2012

1/4/14

2013

2014

Source: Thomson Reuters â&#x20AC;&#x201C; Lipper U.S. Fund Flows

Section II

IPO Market Review

IPO Market Review There have been three

Historical Volume

up-cycles in the IPO

IPO Activity by Year Since 1995

market since 1995

600 531

1995-2000 Mean = 398

500

The 262 IPOs done in than the number priced

# of IPOs

2014 were 25% greater

400

453

409

372

372 2004-2007 Mean = 209

300

252

194

200

in 2013

262

233

100

197

213

2010-2013 Mean = 155

76 30

153

125

130

2010

2011

2012

210

0 1995

2014 saw the most IPO $100

56% increase from 2013

$90

Capital Raised ($B)

year with $93B priced, a

Alibaba IPO, the $68.4B

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2013

2014

IPO Capital Raised Year Since 1995

capital ever raised in a

Excluding the $25B

1996

$93.4

$80 $70 $60

$69.4

$30

raised would have been

$20

the most since 2000

$10

2004-2007 Mean = $47.8B

1995-2000 Mean = $50.4B $46.9 $34.6

$42.6

$37.8

$39.0

$59.9

$53.1

$51.5

$50 $40

$70.9

2010-2013 Mean = $46.7B $43.7 $40.7 $42.6

$46.4 $40.2

$24.8

$26.8 $17.7

$19.5

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Source: Dealogic & Piper Jaffray ECM Includes deals greater than $20 million in deal size Excludes CEFs, BCC/SPACs

IPO Market Review Pricing and aftermarket

Performance by Sector

performance were each

2014 IPO Activity Number 2 4 16 25 27 105 14 2 2 7 51 7 262

Capital Raised ($B) $1.1 $1.1 $3.3 $13.1 $15.4 $10.7 $3.4 $0.7 $0.2 $3.7 $39.3 $1.5 $93.4

% Chg Price File to Offer -6% -4% -2% 1% -7% -12% -16% -11% -8% -4% 2% -12% -7%

% Chg Offer / 1-Day 9% 16% 22% 11% 4% 15% 5% -1% 6% 0% 23% 7% 14%

% Chg Offer / 30-Day 24% 6% 34% 19% 6% 21% 11% 5% -3% 1% 19% 9% 18%

% Chg Offer / YE'14 38% 21% 39% -7% 12% 37% 10% 9% -9% -1% 23% -3% 23%

Number 4 3 16 25 28 54 13 2 3 14 43 5 210

Capital Raised ($B) $1.0 $0.2 $8.9 $12.4 $6.8 $10.2 $4.2 $0.6 $0.4 $4.9 $9.0 $1.2 $59.9

% Chg Price File to Offer -11% -20% 9% 0% -1% -9% -6% 2% -14% -5% 6% -4% -2%

% Chg Offer / 1-Day 13% 9% 44% 6% 6% 22% 7% -2% 12% 3% 32% 4% 18%

% Chg Offer / 30-Day 10% 3% 49% 10% 8% 33% 14% -15% 15% 4% 46% 13% 27%

% Chg Offer / YE'13 24% 16% 54% 30% 28% 51% 25% 3% 32% 7% 65% 25% 41%

softer in 2014 in comparison to 2013

On average, 2014 IPOs priced below the midpoint of the range, but traded up 23%

Sector Business Services Clean Technology Consumer Energy & Mining Financial Health Care Industrials Media Real Estate REIT Technology Transportation Total

2013 IPO Activity Sector Business Services Clean Technology Consumer Energy & Mining Financial Health Care Industrials Media Real Estate REIT Technology Transportation Total Source: Dealogic & Piper Jaffray ECM Includes deals greater than $20 million in deal size Excludes CEFs, BCC/SPACs

IPO Market Review Top Performing Growth IPOs Since 2012 â&#x20AC;&#x201C; Through Year-End

10 of the top 20 growth since 2012 priced this year as the IPO market consistently outperformed

The average 1-day and

400% % Return Through Year-End of Pricing Year

sector IPO performers

384% 386%

2012

337%

2013

320%

2014

240%

160%

171% 172% 174% 154% 157% 159% 163% 164%

198% 204% 185% 191%

218% 218% 222%

236% 239%

80%

Average Growth IPO Returns Returns by Year: & 30-Day Average IPO by1-Day Year: 1-Day & 30-Day

30-day returns for

45% 40%

growth IPOs were each

1-Day 30-Day

40%

35%

the 3rd highest since 2003 % Return

30%

25%

25% 20%

16%

20%

18% 13%

15%

14% 14% 13% 14%

16% 15% 12%

13%

14%

16%

27% 22%

19%

17%

12%

10% 5%

-1%

0% -5%

2003

2004

2005

Source: Dealogic & Piper Jaffray ECM Includes deals greater than $20 million in deal size Includes Growth Sectors: Business Services, Clean Tech, Consumer, Health Care, TMT Excludes CEFs, BCC/SPACs

2006

2007

2008

2009

2010

2011

2012

2013

2014

IPO Market Review Only 46% of IPOs priced in 2014 priced at

Pricing & Aftermarket Performance IPO Pricing Performance - Pricing vs. Midpoint of the Range 60%

the midpoint of the

Below Midpoint

range, or above, versus

50%

60% in 2013

47%

Above Midpoint 39%

40%

% of IPOs

53%

At Midpoint 42%

40%

n = 140

n = 85 30%

n = 88

20%

n = 85

18% 15%

14%

10%

n = 37

2013

2014

68% of the IPOs priced in 2014 traded above

32%

2003-2012

IPO Aftermarket Performance - 1-Day Return vs. Offer Price 80%

offer price after 1-day,

Below Offer Price 70%

consistent with

66%

% of IPOs

68%

Above Offer Price

60%

historical norms

69%

Flat Offer Price

n = 144

n = 177

50% 40% 30%

26%

25%

24%

20% 10%

10%

0% 2003-2012

Source: Dealogic & Piper Jaffray ECM Includes deals greater than $20 million in deal size Excludes CEFs, BCC/SPACs NOTE: Due to rounding, not all percentages add to exactly 100%

n = 52

n = 68 7%

n = 14

n = 17

2013

2014

IPO Market Review Given the increase in IPO issuance versus

Pricing Pressure on IPOs Percentage of IPOs Priced Below the Range from 2003-2014 45%

enhanced pressure on

40%

price with nearly 40% pricing below the range

% IPOs Below Range

prior years, 2014 saw

41.8%

40.0% 35.6%

35%

34.5%

34.4%

31.4%

30%

39.3%

40.0%

27.6%

26.8%

27.1%

25% 20% 15%

10.5%

10% 5% 0% 2003

The discount from the

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2010

2011

2012

2013

2014

(26.6%)

(26.4%)

(26.7%)

FTO Discount of IPOs Priced Below the Range from 2003-2014 2003

midpoint for IPOs

2004

2005

2006

2007

2008

2009

priced below the range (5%)

recent years

% FTO Discount

remained consistent with

(10%) (15%) (18.6%)

(20%) (20.4%)

(22.9%)

(25%) (25.5%) (30%)

(24.7%)

(24.3%)

(25.8%)

(24.7%) (27.0%)

Source: Dealogic & Piper Jaffray ECM Includes deals greater than $20 million in deal size Excludes CEFs, BCC/SPACs

IPO Market Review in 2014 raised between $50 and $200 million,

IPO Deal Value, Market Cap, and Financial Overview IPO Frequency by Deal Size 40%

consistent with 58% from 2010-13

involved issuers with

2010-2013 28%

30%

% of IPOs

53% of the IPO market

IPO Frequency by Market Cap

market caps less than

29%

14% 11%

11% 8%

10% 5%

$50 million and 51%

$100200M

had negative operating,

both greater than

historical averages

17% 14%

15% 9%

4% 4%

$200$300- $500M$300M $500M $1B

$1B+

<$150M

16%

13%15%

13%

$500$1B

$1B$5B

$5B+

2010-2013

51%

2014

40%

8% 7%

% of IPOs

15%

$300500M

60%

2014

18% 16%16%

$150$300M

IPO Frequency by Operating Income (LTM)

50%

20%

15% 10%

23%

25%

% of IPOs

LTM revenues less than

22% 20%

2010-2013

20%

40% of 2014 IPOs had

$50$100M

30%

going public

21% 22% 20%

20%

10%

IPO Frequency by Revenue (LTM)

of early-stage companies

2014

<$50M

increase in the number

25%

2014 saw a steep

2010-2013

30%

20%

10%

$500 million in 2014

31% 30%

35%

2014

% of IPOs

60% of the IPOs issued

32% 30%

26%

20%

16%

14% 9%

10%

11% 12%

9% 8%

7% 6%

$100M$300M

$300M+

Pre$0Revenue $50M

$50100M

$100- $200M- $500M$200M $500M $1B

$1B+

Negative

$0$10M

$1050M

$50$100M

Source: Dealogic & Piper Jaffray ECM Includes deals greater than $20 million in deal size Excludes CEFs, BCC/SPACs

IPO Market Review Alongside the increase in issuance, 2014 also saw an uptick in the number

Current IPO Backlog 360-Day Backlog by Quarter 180

of IPOs filed publicly, signaling a strong

broader market

116

120

# of IPOs

tailwinds from the

152

147

139

140

outlook for the 2015 IPO market, assuming solid

162

160

106

107

100

113

111 92

120

136

123

118 107

88 81

74 66

73 60

103

40 20

84% of the IPOs priced

in 2014 were EGCâ&#x20AC;&#x2122;s and approximately the same percentage of the yearend filed backlog are also EGC companies

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 '07 '08 '09 '10 '11 '12 '13 '14

IPO Backlog by Sector (# of Deals) 40

30 20 10

34% of the IPOs in backlog at year-end were

13 8

Consumer

3 Clean Tech

Energy / Mining

Financial

Health Care

Industrials

REIT

TMT

Transports

in the health care space Source: Company Filings, Dealogic and Piper Jaffray ECM as of 12/31/14 Excludes CEFs, BCC/SPACs

Section III

Follow-on Offering Market Review

Follow-on Offering Market Review 2014 saw the second most follow-ons priced

Historical Volume Follow-on Activity by Year – Number of Deals

in 20 years

800

697

700

616

# of Follow-ons

600 500

632

Average = 500 491

488

603 542

460

469

458 395

400

536 463

368

477

531 442

436

300

645

251

200 100 0

However, the number of

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

follow-ons decreased by 8% from 2013, while

Follow-on Activity by Year – Capital Raised ($B) $240

by 17%

$200 Capital Raised ($B)

capital raised decreased

$222 $177

$194

$185 $166

$160

Average = $132B $116 $118

$120 $80

$69

$88

$93

$197 $169

$141 $136

$109 $101 $105 $104 $79

$75

$40 $0 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Source: Dealogic & Piper Jaffray ECM Includes deals greater than $20 million in deal size and CMFOs (URDs) Excludes CEFs, BCC/SPACs, PIPEs/RDs

Follow-on Offering Market Review Average follow-on performance through year-end fell when compared with 2013, driven largely by poor performance in the Energy & Mining sector

Performance by Sector 2014 Follow-on Activity Sector Business Services Clean Technology Consumer Energy & Mining Financial Health Care Industrials Media Real Estate REIT Technology Transportation Total

Number 13 17 43 101 100 146 38 3 2 77 75 30 645

Capital Raised ($B) $3.9 $1.0 $18.6 $39.6 $27.2 $21.0 $12.6 $0.3 $0.3 $18.7 $18.7 $7.0 $168.9

% Chg Price File to Offer -8.0% -15.0% -6.0% -4.0% -5.0% -8.0% -5.0% -3.0% -3.0% -4.0% -9.0% -4.0% -6.3%

% Chg Offer / 1-Day 0.0% 2.0% 2.0% 0.0% 1.0% 4.0% 1.0% 0.0% 1.0% 1.0% 2.0% 2.0% 1.7%

% Chg Offer / 30-Day 2.0% 2.0% 1.0% -1.0% 1.0% 3.0% 1.0% 2.0% 5.0% 3.0% 1.0% 6.0% 1.7%

% Chg Offer / YE'14 13.0% -32.0% 8.0% -18.0% -4.0% 22.0% 5.0% 17.0% -2.0% 10.0% -3.0% -9.0% 2.3%

Capital Raised ($B) $12.3 $2.0 $16.6 $38.6 $24.4 $18.9 $20.3 $3.4 $4.4 $24.3 $24.8 $7.5 $197.5

% Chg Price File to Offer -4.7% 0.3% -3.6% -5.2% -3.6% -8.4% -4.4% -10.7% -3.5% -3.6% -7.5% -7.4% -5.5%

% Chg Offer / 1-Day 1.4% 5.8% 1.3% 0.6% 1.2% 3.4% 2.3% 1.8% 1.9% 1.1% 2.9% 0.4% 1.8%

% Chg Offer / 30-Day 4.8% 8.6% 2.9% 2.3% 3.0% 7.5% 5.5% 9.3% 3.1% 0.8% 5.6% 1.0% 4.3%

% Chg Offer / YE'13 18.8% 18.1% 9.3% 9.0% 13.8% 37.7% 23.3% 49.9% 26.1% -3.7% 29.3% 18.8% 18.5%

2013 Follow-on Activity Sector Business Services Clean Technology Consumer Energy & Mining Financial Health Care Industrials Media Real Estate REIT Technology Transportation Total

Number 28 12 43 115 109 125 47 14 9 87 73 35 697

Source: Dealogic & Piper Jaffray ECM Includes deals greater than $20 million in deal size and CMFOs (URDs) Excludes CEFs, BCC/SPACs, PIPEs/RDs

Follow-on Offering Market Review The follow-on pricing environment was slightly

Follow-on Pricing Performance â&#x20AC;&#x201C; File-to-Offer Discounts % Change File-to-Offer by Year

more challenging in 2014

For the first time since 2009, follow-ons

% Chg File/Offer

than it was in 2013

registered a

-2% -4%

-2.7% -3.0%

-3.2% -4.3%

-3.3% -3.5% -4.0% -4.2%

-6%

-3.9% -5.3%

-4.0% -5.5% -5.9%

-4.0%

-6.1%

-5.5% -6.3%

-7.0%

-8% -8.3%

-10%

Mean

year-over-year increase

-3.9%

-4.9%

-8.4%

-7.8%

-9.9%

Median

-12%

in average FTO discount

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

% Change File-to-Offer by Month

Median % Change File/Offer

0% -2% -4%

-3.3% -3.8%

-2.8%

-3.0% -4.1%

-4.0%

-7.2%

-7.3%

-8%

-4.4%

-4.2%

-5.3%

-5.4%

-6%

-3.6%

-8.0%

-4.2% -4.5%

-5.2% -5.6% -5.4% -5.5%-5.7%-5.8%

-7.7%

-10% -12%

2013

2014

-12.2%

-14% Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Source: Dealogic & Piper Jaffray ECM Includes deals greater than $20 million in deal size and CMFOs (URDs) Excludes CEFs, BCC/SPACs, PIPEs/RDs

Follow-on Offering Market Review Follow-on Offering Recap by Type, Market Value and Style Follow-on Type Breakdown (All)

significant execution

100%

vehicle in 2014, driven in part by first time (S-1) market post-IPO

15%

14%

26%

80%

% of Offerings

filers coming back to

Follow-on Type Breakdown (Sub $2B Market Cap)

60% 13%

18%

23%

27%

24%

27%

19%

25%

40% 20%

Sub $2B follow-on

14%

46%

41%

42%

43%

40%

2010

2011

2012

2013

2014

Accelerated

declined of late as a

Bought

Marketed

Follow-on Activity by Market Cap (# of Offerings)

transactions

80%

73% 67%

66%

64% % of Offerings

21%

31%

32%

14%

21%

29%

32%

20%

15%

10%

21%

80% 60% 40%

11%

13%

38%

35%

38%

42%

43%

2010

2011

2012

2013

2014

20%

62%

60%

48% 32% 17%

19%

11%

15%

18% 16%

23% 14%

24% 17%

0% 2003-2010

Source: Dealogic & Piper Jaffray ECM Includes deals greater than $20 million in deal size and CMFOs (URDs) Excludes CEFs, BCC/SPACs, PIPEs/RDs Marketed Follow-ons defined as 2 or more days of public marketing

2011

2012

< $2B

$2B - $5B

Accelerated

CMFO (URD)

percentage of overall

16%

19%

issuance has steadily

100%

2013 > $5B

2014

Bought

Marketed

CMFO (URD)

Follow-ons w/ Selling Shareholders % Follow-ons w/ Selling Shareholders

continued to be a more

% of Offerings

Marketed follow-ons

100% 80%

31%

30%

29%

69%

70%

71%

36%

35%

64%

65%

60% 40% 20% 0% 2003-2010

2011

2012

2013

2014

Yes

Follow-on Offering Market Review Capital raised through

Growth Sector Marketed Follow-on Issuance: Capital Raised

significantly increased

$10

from 2012 to 2014 in Consumer and Health Care

Total Capital Raised ($B)

$12

$10.84

$8.92

40 $7.58

$6.05

$6.47 $6

$5.42

$2 $0

$1.15 $0.47 n=11 n=5

$1.81 n=6

n=16 n=1

n=3

n=2

$0.23 $0.34 $0.07

$2.24

n=25

n=17

n=22

n=11

$1.96 n=13

$1.04

$2.40

$2.35

n=29

n=19

$1.44 $1.38

n=12

n=18

n=15

n=33

n=36 n=23

35 30 25

n=28

n=14

$5.24

n=47

$4.84

$6.84 $6.64

$6.76

n=38

20 15 10 5

Number of Marketd Follow-ons

marketed follow-ons

2009 2010 2011 2012 2013 2014 2009 2010 2011 2012 2013 2014 2009 2010 2011 2012 2013 2014 2009 2010 2011 2012 2013 2014 Clean Tech

Consumer

Health Care

TMT/BS

Growth Sector Marketed Follow-on Issuance: Number of Transactions by Sector Health Care saw the

100%

marketed follow-ons in 2014 as the percentage of CMFOs (URDs) decreased

% of Growth Sector URDs

increase in number of

80% 60% 40% 20% 0%

36% 49%

41% $1,418

25%

$1,144

$1,043

18%

30%

16%

9% 2009

16% 2010 Clean Tech

Source: Dealogic & Piper Jaffray ECM Includes fully marketed follow-ons greater than $20 million in deal size Excludes CEFs & BCC/SPACs Marketed Follow-ons defined as 2 or more days of public marketing

$1,952 43%

40% $1,215

28%

31%

26%

2011

2012

2013

26% 25%

Consumer

Health Care

$2,000

34%

TMT/BS

$1,500 44%

$1,000 $500

21% 2% 2014

Avg Mkt Cap

Average Issuer Market Cap ($MM)

largest percentage

$2,500

$2,231

Follow-on Offering Market Review Growth Sector Marketed Follow-on Trends: Market Capitalization

In terms of average marketed follow-ons, the Consumer, Health Care, and TMT/BS sectors all gapped up in value

$4,200

$4,500

Average Issuer Mkt Cap ($MM)

issuer market cap for

$3,565

$3,600

$3,210

$2,700 $1,800 $900 $0

$1,549

$1,637

$1,921

$1,913

$1,861 $671

$1,153

$1,365 $788

$1,343

$2,217 $2,533 $1,541 $1,167

$422

$1,111

$557

$551

$411

2009

2010 Clean Tech

2011 Consumer

$453 2012 Health Care

2013

$142 2014

TMT/BS

Growth Sector Marketed Follow-on Trends: Deal Value Average deal sizes in Consumer and Health Care spiked in 2014

) M M $( e u la V la e D re u ss I eg ar ev A

$500 $400

$493

$462 $357

$339

$302

$300 $203 $200 $100

$151 $124

$285

$228

$241

$225

$183

$180 $113

$105

$95

$87

$80

$92

$83

2009

2010

2011

2012

2013

$185 $161 $36

$0 Clean Tech Source: Dealogic & Piper Jaffray ECM Includes fully marketed follow-ons greater than $20 million in deal size Excludes CEFs & BCC/SPACs Marketed Follow-ons defined as 2 or more days of public marketing

Consumer

Health Care

2014

TMT/BS

Follow-on Offering Market Review Follow-ons continue to represent the majority of

Equity Issuance Breakdown Number of Deals by Type (IPOs & Follow-ons)

equity issuance activity

# IPOs

# of FOs

100%

% of Deals

80% 60%

70%

last 12 years, due in large part to the $25 billion Alibaba IPO

89%

91%

11%

2008

2009

78%

80%

77%

71%

30%

29%

33%

22%

20%

23%

29%

2004

2005

2006

2007

2010

2011

2012

2013

2014

Capital Raised by Type (IPOs & Follow-ons) Capital Raised: IPOs

Capital Raised: FOs

100% Capital Raised

capital raised over the

67%

14%

2003

largest percentage of

71%

40% 20%

IPOs accounted for the

70%

86%

80%

81%

66%

72%

69%

67%

86%

92%

76%

77%

60%

81%

77%

19%

23%

2012

2013

64%

40% 20%

34%

28%

31%

33%

19%

14%

0% 2003

2004

2005

2006

2007

2008

24%

23%

2010

2011

2009

36%

2014

Source: Dealogic & Piper Jaffray ECM Includes deals greater than $20 million in deal size and CMFOs (URDs) Excludes CEFs, BCC/SPACs, PIPEs/RDs

Follow-on Offering Market Review Small cap issuers

Follow-on Deal Value and Market Cap Overview

typically approximately

Median Follow-on Raise (All Deals)

15% – 20% of their pre-

20%

% Deal Value / Pre-Deal Market Cap

deal market caps

Median Follow-on Raise (Sub $2B)

15%

18.2% 15.1%

14.5%

14.1%

18.0%

18.1%

17.9%

2011

2012

2013

16.8%

12.8%

10%

0% 2003-2010

2011

2012

2013

2014

2003-2010

2014

Follow-on Frequency by Pre-Deal Market Cap 175

has been dominated by

150

issuers with market

125

values between $1 – $5B at the time of the offering

# of Follow-ons

Activity in recent years

124

100 75 50

74 53

56 38 42

65 64 50

66 59 71

152147

142

110

110 89 79

74 77 56

96 101

25 0 <$150M

$150-$300M

$300-$500M 2010

$500M-$1B 2011

2012

$1-$2B 2013

$2-$5B

$5B+

2014

Source: Dealogic & Piper Jaffray ECM Includes deals greater than $20 million in deal size and CMFOs (URDs) Excludes CEFs, BCC/SPACs, PIPEs/RDs

Follow-on Offering Market Review back to market for a first follow-on in 2014 more

IPOs Back-to-Market(1) # First Follow-ons

# of First Follow-ons

First follow-ons in 2014

50 40

18 9

20%

12%

16%

11%

5% 2006 2007 100% Primary

200

74%

67% 47%

63%

58%

60%

77%

51%

40% 20% 0% 2006 2007 2008 2009 2010 2011 2012 2013 2014

Source: Dealogic & Piper Jaffray ECM Includes deals greater than $20 million in deal size (1) First follow-ons classified as those that returned to market within 365 days of IPO Excludes CEFs, BCC/SPACs, PIPEs/RDs

Median # Days from IPO to FO Filing

80%

Median % Return

months

27% 25%

34% 33% 33%

2008 2009 2010 2011 Primary / Secondary Mix

2012 2013 2014 100% Secondary

Days Back-to-Market from IPO

Assuming strong

to market within 4-7

32%

30%

100%

average IPO comes back

33%

48%

44% 41%38%

39%40%

40%

2006 2007 2008 2009 2010 2011 2012 2013 2014

Performance from IPO to Follow-on Filing

performance, the

44%

follow-on filing

54%

50%

10%

64%

60%

56% 55%

50%

63% from IPO to

60%

were up a median of

70%

times than any year on record

First Follow-on Primary / Secondary Mix

% of Offerings

Recent IPO issuers came

160

181

176

170

165 149

171

165

166

132 120 80 40 0 2006 2007 2008 2009 2010 2011 2012 2013 2014

Follow-on Offering Market Review EDPs continue to be a popular capital raising method in 2014

Equity Distribution Programs (EDPs) Number of Announced EDPs since 2006

Total Value of EDPs Announced since 2006 ($MM)* 190

200

183

180 140

concentrated in the Health Care, REIT, and Energy & Mining sectors

106

$25,000

115

$15,000

$21,173

$12,380

2006

2007

$5,000

$14,812

$9,126

$10,000 $2,122 $2,052

0 2008

2009

2010

2011

2012

2013

88 of the 183 (48%) EDP

2006

2014

2014 EDPs by Sector

2007

2008

2009

2010

2011

2012

2013

2014 EDPs by Market Capitalization 60

Health Care 30%

programs were for

issuers of less than

40 Real Estate / Property 30%

# of EDPs

$500MM of market

$22,715

$20,000

100

$28,711

$30,000

129

120

$35,407

$35,000

160

Activity was

$40,000

value

38 31

20 Energy & Mining 22% Other 4% TMT / BS 3%

10 0

Financial 11%

<$200

$200 - $500

$500 - $2B

$2B - $5B

>$5B

Source: Piper Jaffray ECM and Dealogic *Excludes Citigroup’s 2010 $37.4B EDP & Bank of America’s 2009 $16.9B Excludes CEFs, BCC/SPACs

2014

Section IV

Confidentially Marketed Follow-on (URD), Registered Direct & PIPE Market Review

Confidentially Marketed Follow-on (URD), Registered Direct & PIPE Market Review Historical Volume

PIPE/RD/CMFO (URD) historical

PIPE/RD/CMFO (URD) Number of Deals by Year

herein

600

$35

583

$29.6

$30

500

410

394

400

313

308

300

273

298

277

200 100

Capital Raised ($B)

700

# of PIPEs/RDs/CMFOs (URDs)

issuance is outlined

PIPE/RD/CMFO (URD) Capital Raised by Year

$25

$23.8

$22.9

$22.6

$20

$15.4

$15

$13.3

$15.4 $12.2

$10 $5

0 2007

2008

2009

2010

2011

2012

2013

2014

$0 2007

2008

2009

2010

2011

2012

2013

2014

Quarterly PIPE/RD/CMFO (URD) Activity 250

$12.0 205

$8.0 $6.0

200 158 121 118

102 118 79

$4.0

103

150 113 112

77 54

110 110 105 75

73 46 47

79 79

100

80 52

$2.0 $0.0

$5.8 $8.1 $3.7 $5.3 $4.4 $5.0 $9.6$10.6$3.0$10.5$5.5 $4.8 $5.1 $5.8 $6.1 $5.6 $5.3 $5.4 $2.2 $2.4 $4.5 $2.8 $2.9 $3.1 $6.2 $2.6 $3.3 $3.3 $3.9 $3.6 $2.3 $2.4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 '07 '07 '07 '07 '08 '08 '08 '08 '09 '09 '09 '09 '10 '10 '10 '10 '11 '11 '11 '11 '12 '12 '12 '12 '13 '13 '13 '13 '14 '14 '14 '14 Capital Raised ($B)

# of PIPEs/RDs/CMFOs (URDs)

Source: PlacementTracker.com as of December 31, 2014. Includes all common stock, convertible preferred and convertible debt PIPEs/RDs/CMFOs (URDs) with proceeds greater than $10 million. Excludes strategic transactions over $200 million.

50 0

# of PIPEs/RDs/CMFOs (URDs)

Capital Raised ($B)

$10.0

Confidentially Marketed Follow-on (URD), Registered Direct & PIPE Market Review (Check Data With Tim) Registered shelf takedown offerings

Trends in Deal Size and Issuer Size Median PIPE Deal Size and Mkt Cap

Median RD/CMFO (URD) Deal Size and Mkt Cap

Deal Size Mkt Cap ($MM) ($MM) 100 $300 $262 $244 90 $250 $224 80 $215 $204 $197 $186 70 $185 $200 60 $150 $40 $40 $40 $40 $44 $45 50 $38 $39 40 $100 30 20 $50 10 $0 0 2007 2008 2009 2010 2011 2012 2013 2014

continued to be a favored source of equity capital financing for small cap issuers

Mkt Cap ($MM) $400

Deal Size ($MM) 100 90 $319 $287 $291 $285 80 $256 $251 70 $238 60 $204 $44 $46 $46 $44 50 $40 $33 $34 40 $30 30 20 10 0 2007 2008 2009 2010 2011 2012 2013 2014

$350 $300 $250 $200 $150 $100 $50 $0

Median Issuer Market Cap Median PIPE Deal Size

Median Issuer Market Cap Median RD/CMFO(URD) Deal Size

Number of PIPEs

Number of RDs/CMFOs (URDs) 150

# of PIPEs

223

200 147

127

110

100

# of RDs/CMFOs (URDs)

300

125

108

112 96

100

2013

2014

75 50

25 0

2007

2008

2009

2010

2011

2012

2013

2014

2007

2008

2009

2010

2011

2012

Confidentially Marketed Follow-on (URD), Registered Direct & PIPE Market Review Historical PIPE/RD/CMFO (URD) Volume by Piper Jaffray Covered Sector Health Care

Technology, Media & Telecom

150

131 131

125

113

100

103

116

75 50 25 0

$4.6

$2.1

$3.1

$3.2

$3.1

$5.3

$4.6

$4.0

175 150 125 100 75 50 25 0

2007 2008 2009 2010 2011 2012 2013 2014

175 150 125 100 75 46 20

25 0

$4.6

$2.9

$2.0

42 24

$2.7

$1.7

$3.0

$0.6

$3.0

33 $0.8

Financial

200

$2.1

23 $3.1

$3.2

14 $0.7

15 $1.7

18 $0.5

21 $0.5

2007 2008 2009 2010 2011 2012 2013 2014

175 150 125 100 75 50 25 0

2007 2008 2009 2010 2011 2012 2013 2014

# of PIPEs/RDs/CMFOs (URDs)

Consumer

# of PIPEs/RDs/CMFOs (URDs)

163

175 150 125

104

100 50

25 0

$2.9

$1.1

$7.0

70 48 $3.1

$2.4

39 $2.7

30 $1.4

$2.4

41 $2.2

China Growth

200

2007 2008 2009 2010 2011 2012 2013 2014

$2.0

$2.7

$1.7

$3.5

$1.4

$1.8

$1.5

2007 2008 2009 2010 2011 2012 2013 2014

# of PIPEs/RDs/CMFOs (URDs)

175

200

200 # of PIPEs/RDs/CMFOs (URDs)

# of PIPEs/RDs/CMFOs (URDs)

200

Clean Tech & Industrials

200 175 150 125 100 75 45

50 25 0

21 $1.1

25 $7.0

14 $3.1

$2.4

$0.6

2 $0.4

$3.2

2 $0.1

2007 2008 2009 2010 2011 2012 2013 2014

Confidentially Marketed Follow-on (URD), Registered Direct & PIPE Market Review Issuers with market caps below $500MM accounted for 92% of

Historical Volume by Issuer Market Cap Capital Raised ($B) by Issuer Market Cap $9.0

PIPE/RD/CMFO (URD) transactions in

$8.0

$17.8

(a)

$7.0

Capital Raised ($B)

2014

$8.5

$6.0

$5.5

$5.4

$5.2

$4.8

$5.0 $4.4

$4.0

$6.6

$10.5

$3.7

$4.5

$4.3 $3.9

$3.9

$3.9 $3.5

$6.5

$3.5

$3.1

$3.0

$2.6

$2.8

$2.6

$2.3

$3.3

$2.7 $2.3

$2.2 $1.8

$3.1

$2.9

$2.6

$2.4

$2.0

$3.1

$1.8

$1.9

$1.7

$2.0

$1.4

$1.0 $0.0 2007

2008

2009

2010

2011

2012

2013

2014

Market Cap of PIPE/RD/CMFO (URD) Issuers Under $100MM

$100MM - $249MM

$250MM - $499MM

$500MM - $1B

Over $1B

Section V

Convertible Market Review

Convertible Market Review $51B of capital was

Capital Raised ($B) by Issuer Market Value

raised in the convertible

$51

$25

market in 2014

$23

representing a 3% increase vs. 2013

$49 $20

Historically, this

$19

$32

represents the highest convertible capital raised since 2008 Average annual issuance over the last 10 years was

Capital Raised ($B)

annual amount of

$27

$15

$14

$22

$13

$12 $10

$10

$9 $7

$49.4B The convertible new

$15

issue market in 2014 was $0

overweight in large caps

75% of 2014 new issue

2010

2011

market cap

2013

2014

Market Cap of Convertible Issuers

dollars came from issuers with $2B+

2012

Under $300MM

$300MM - $2B

$2B - $10B

Over $10B

Source: Dealogic & Piper Jaffray ECM Excludes GMâ&#x20AC;&#x2122;s 2010 mandatory convertible issued concurrently with its IPO

Convertible Market Review: Sizing Trends Market Cap < $2B:

Trends in Deal Size and Issuer Size ($ in millions)

Deal Size as a Percent of Market Cap: • 2012: 22.7% • 2013: 21.2% • 2014: 19.7%

Market Cap < $2B: Median Convertible Deal Size and Issuer Market Cap $900

$7,000

$700

Deal Size as a Percent of

$818

$780

$800

Market Cap >$2B:

Market Cap >$2B: Median Convertible Deal Size and Issuer Market Cap

$662 $5,000

Market Cap:

$600

• 2012: 9.9%

$500

$5,957

$6,000 $5,098

$5,046

$4,000

• 2013: 7.8% • 2014: 8.5%

$400

$3,000

$300 $2,000 $200

$150

$165

$161 $1,000

$100 $0

$500

$400

$509

$0 2012

2013

2014

2012

2013

Median Issuer Market Cap

Median Convertible Deal Size

2014

Source: Dealogic & Piper Jaffray ECM

Convertible Market Review: PJC’s Target Market PJC’s target market is

Capital Raised by Sector ($B)

defined as those companies

Sector

2012

2013

2014

with < $2B of market

Health Care

$2.0

$2.5

$4.4

capitalization within the

TMT

$0.5

$3.1

$1.9

following key sectors:

Clean Tech

$0.7

$0.9

$1.0

• Health Care

PJC Addressable Market Overview ($B)

Consumer

$0.2

$1.1

$0.1

• TMT

Financial

$2.1

$4.1

$1.9

• Clean Technology

Real Estate

$0.8

$0.6

$1.0

Industrial

$0.7

$0.8

$0.5

Energy

$1.7

$2.0

$1.0

Other

$0.9

$0.6

$0.8

Total

$9.6

$15.8

$12.4

• Consumer Issuers meeting our target market cap raised $12.4B in 2014 versus $15.8B in 2013 (decrease of 22%)

2013 Convertible Issuance ($ Volume)

Average annual issuance

Energy & Mining 13%

over the last 10 years for <$2B market cap issuers was $12.3B PJC’s overall 2014 addressable target market

Other 4%

decreased about 3% to

PJC Addressable Market All Others

$15 $12.4 $12

$9.6

$8.2 $5.0

$9 $6

$6.2

$7.6

$7.4

2013

2014

$3.4 $0 2012

Energy & Mining 8%

Health Care 16%

Other 6%

Industrials 4%

Health Care 35%

Real Estate 8% Technology 20%

$7.4B vs. $7.6B in 2013 Legend

$15.8

2014 Convertible Issuance ($ Volume)

Industrials 5% Real Estate 4%

$18

Financial 15% Financial 26%

Clean Tech 6% Consumer 7%

Consumer Clean Tech 1% 8%

Technology 15%

Source: Dealogic & Piper Jaffray ECM

Convertible Market Review: PJC’s Target Market Since 2013, the PJC

PJC Addressable Market

addressable market

$6.0

sectors have constituted more than 53% of all $5.1

sub-$2B issuance

sector as a percent of addressable market issuance is: • Health Care = 46% • TMT = 33%

Capital Raised ($B)

The breakdown of each

$5.0

$4.7

$4.0

$3.9 $2.7

$2.4

$3.4 $3.0

$3.0

$2.0 $2.6

• Clean Tech = 13% • Consumer = 8%

$3.5

$0.5

$1.8

$2.2

$2.1

$0.9

$2.0

$0.8 $2.4

$2.5

$2.3

$1.0

$1.7

$1.6

$1.9 $1.3

$1.2 Legend PJC Addressable Market All Others

$0.0 Q1 '13

Q2 '13

Q3 '13

Q4 '13

Q1 '14

Q2 '14

Q3 '14

Q4 '14

Source: Dealogic & Piper Jaffray ECM

Convertible Market Review: PJC’s Target Market convertible issuance in

Historical Convertible Volume Convertible Issues by Year

2014 was driven by large

160

cap issuers

140

Convertible Capital Raised by Year 128

25% ($12B) of volume was generated by issuers with a sub-$2B market cap compared with the

# of Convertibles

120 100

62 89

80 41

22 82

10 year average of 27%

$60

144

2012

2013

9 20

Sub-$2B Issuers All Others

32 17

29 11

14 13 28

24 9

Capital Raised ($B)

# of Convertibles Legend

25 30

$16

$12

2013

2014

$22

$23

$19

$12

$10

2010

2011

2012

$19

$20

$27

$25

$38

$32

Convertible Capital Raised by Quarter

$30

2014

Convertible Issues by Quarter 60

$33

$40

$0 2011

$51

$10

0 2010

$49

$50 Capital Raised ($B)

Like previous years,

$16 $15 $11 $6

$12

$11

$12

$4 $5

$0 Q1 '13 Q2 '13 Q3 '13 Q4 '13 Q1 '14 Q2 '14 Q3 '14 Q4 '14

$15

$10

$11

$9 $2

Q1 '13 Q2 '13 Q3 '13 Q4 '13 Q1 '14 Q2 '14 Q3 '14 Q4 '14

Source: Dealogic & Piper Jaffray ECM Excludes GM’s 2010 mandatory convertible issued concurrently with its IPO

Convertible Market Review: Sub-$2B Issuers decreased issuance

Historical Convertible Volume by Sector Consumer

volume by about 22%

Sectors strategic to Piper among sub-$2B issuers comprised 14% ($7.4B) of total issuance volume

# of Convertibles

versus 2013

TMT

40 $4.6

9 $1.7 6 3

by all issuers 0

$2.1 3

2 $0.9

# of Convertibles

Sub-$2B issuers

$0.7

1 1

2010

2011

2012

1 2013

Sub-$2B Issuers All Others

23 $3.3 5

11 2011

7 2012

2013

2014

$4.4

12 $5.7

$4.6 $5.3 6 6 6

9 $4.9 23

4 15

2011

2012

# of Convertibles

# of Convertibles Legend

2010

$7.9

$7.5

Clean Tech

27 $6.5

2014

Health Care

$17.4

$21.4

$2.1

10 8 6 4 2

0 4

0 2010

2013

2014

$0.9 $0.7

2010

$0.7 3

2 2011

3 2012

2013

2014

Source: Dealogic & Piper Jaffray ECM Excludes GMâ&#x20AC;&#x2122;s 2010 mandatory convertible issued concurrently with its IPO Dollar amounts denote total capital raised in billions by all issuers

Appendix A

Piper Jaffray Credentials

Piper Jaffray U.S. Equity Capital Markets Review Piper Jaffray was a top sub $2B growth sector bookrunner in 2014,

Most Active Sub $2B Growth Sector Bookrunners in 2014 (# of Deals) IPOs & FOs/CMFOs – Sub $2B Growth

completing 40 bookrun IPOs & Followons/CMFOs, including 22 IPOs

Rank Manager

IPOs – Sub $2B Growth

Bookrun Bookrun Market Deal Value Number Share ($B) 67

Rank Manager

Bookrun Bookrun Market Deal Value ($B) Number Share

$7.0

Credit Suisse

17.4%

$8.7

Jefferies

19.7%

$3.7

16.0%

$8.0

JPMorgan

19.7%

$4.1

$8.9

Morgan Stanley

19.1%

$4.9

12.4%

$5.8

Goldman Sachs

16.6%

$3.9

11.8%

$7.5

Piper Jaffray & Co

14.0%

$2.6

11.8%

$6.6

Stifel Nicolaus & Co

11.5%

$3.7

11.0%

$6.2

Leerink Swann & Co

11.5%

$2.7

$5.1

Citigroup

11.5%

$2.4 $2.5

Jefferies

18.5%

JPMorgan

Credit Suisse

Morgan Stanley

16.0%

BofA Merrill Lynch

Cowen & Co

Goldman Sachs

Piper Jaffray & Co

Citigroup

10.2%

22.9%

$5.2

Deutsche Bank

9.6%

$5.7

BofA Merrill Lynch

11.5%

Leerink Swann & Co

9.1%

$4.8

Barclays Bank

10.8%

$2.3

Stifel Nicolaus & Co

8.8%

$6.9

Cowen & Co

9.6%

$2.6

Barclays Bank

8.8%

$4.2

RBC Capital Markets

9.6%

$2.3

William Blair & Co

6.3%

$8.0

Deutsche Bank

8.9%

$2.7

RBC Capital Markets

6.3%

$3.4

Wells Fargo Securities

7.6%

$2.4

Wells Fargo Securities

5.5%

$4.4

UBS Securities Inc

7.6%

$2.1

BMO Capital Markets

5.5%

$3.9

BMO Capital Markets

5.7%

$1.5

Robert W Baird & Co

4.1%

$3.7

William Blair & Co

5.1%

$4.4

UBS Securities Inc

4.1%

$2.3

Robert W Baird & Co

5.1%

$2.2

Raymond James & Associates Inc

3.9%

$3.7

JMP Securities LLC

3.8%

$2.4

Canaccord Genuity

2.8%

$4.6

Raymond James & Associates Inc

3.2%

$2.0

Roth Capital Partners

2.8%

$2.1

Roth Capital Partners

1.9%

$0.3

Needham & Co Inc

2.2%

$3.6

Guggenheim Securities LLC

1.9%

$0.7

JMP Securities LLC

1.9%

$4.6

Aegis Capital Corp

1.9%

$0.1

Guggenheim Securities LLC

1.9%

$1.5

Canaccord Genuity

1.3%

$2.7

Source: Dealogic & Piper Jaffray ECM Includes deals greater than $10 million in deal size with sub $2B post-deal market value Growth Sectors Include: Business Services, Clean Tech, Consumer, Healthcare, TMT Excludes CEFs, BCC/SPACs, PIPE/RDs, EDPs, Block Trades & Reg D / Reg S

Piper Jaffray U.S. Equity Capital Markets Review 2014 Piper Jaffray Bookrun Offerings

Source: Dealogic & Piper Jaffray ECM Includes deals greater than $10 million in deal size Includes PIPEs; Excludes Block Trades

PJC Provides Unparalleled Aftermarket Support % of IPOs for which Bookrunner is a Top 3 Trader

Piper Jaffray provides unparalleled aftermarket support for its bookrun clients

100%

97% 87%

86%

75%

85%

81% 65%

64%

63%

56%

50%

52%

50% 39%

25%

0% Piper UBS / Jaffray Schwab

RBC

BAML Jefferies Morgan Goldman JP Deutsche Stanley Sachs Morgan Bank

Citi

Baird

Barclays Cowen

Wells Fargo

Supporting Our Clients in the Aftermarket Commitment to Aftermarket Trading Support

Corporate and Venture Services

Piper Jaffray Conferences and Corporate Events

Commitment to Research Coverage

Non-Deal Roadshows

Consistent Capital Markets Dialogue

M&A Idea Generation and Execution

Customer and Partner Introductions

International Support

Source: Autex Blockdata; Data as of December 31, 2014 Includes IPOs since 2006 Trading data is based on the first 12 months of trading Excludes passive bookrunner roles denoted by economics of less than 20% UBS/Schwab rankings included only on UBS bookrun transactions

Strong Track Record of Successful Bookrun IPOs Bookrun IPO Aftermarket Performance â&#x20AC;&#x201C; 30-Day(1)

Consistent Bookrun IPO Success $103,500,000

$92,000,000

$60,183,000

$63,250,000

Initial Public Offering

PJC BAIRD WELLS

JPM

36% Cowen & Co

35%

Morgan Stanley

25%

November 19, 2014

Robert W Baird & Co

24%

Citigroup

24%

Leerink Swann & Co

24%

23%

Jefferies

23%

Raymond James & Associates Inc

PJC

October 29, 2014

STFL

JPM

PJC

July 25, 2014

July 23, 2014

$78,571,438

$86,250,000

$110,400,000

$147,375,000

Initial Public Offering

JPM

PJC

Initial Public Offering PJC

BARC WF

June 25, 2014

June 24, 2014

May 7, 2014

$100,624,980

$49,301,936

$73,968,000

$138,000,000

23%

JPMorgan

Credit Suisse

JEFF

25%

Stifel Nicolaus & Co

Goldman Sachs

PJC

22%

Initial Public Offering JEFF

PJC

BAIRD

Initial Public Offering CS

PJC

Initial Public Offering JPM

PJC

Initial Public Offering BAML

PJC

April 10, 2014

April 9, 2014

November 21, 2013

November 13, 2013

$97,180,000

$86,250,000

$41,400,000

$96,600,000

21%

BofA Merrill Lynch

20%

BMO Capital Markets

20%

Wells Fargo Securities

20%

Initial Public Offering PJC

CITI

October 17, 2013

Source: Piper Jaffray ECM & Dealogic Data is through 12/31/2014 (1) Includes IPOs greater than $20 million since 2013 (Excludes BCC/SPACs & CEFs); Includes managers with at least 15 bookrun IPOs since 2013

Initial Public Offering PJC

BLAIR WELLS

October 8, 2013

Initial Public Offering RAYJ

PJC

September 25, 2013

Initial Public Offering DB

PJC

April 11, 2013

2014 Financial Sponsor Equity Transactions $157,142,850

A portfolio company of Wayzata Investment Partners

$103,500,000

A portfolio company of KarpReilly

$893,593,125

$139,840,000

A portfolio company of Foxteq Holdings

A portfolio company of Brentwood Associates

A portfolio company of Capital Southwest Corporation

A portfolio company of Freeman Spogli & Co.

$85,166,230

$92,000,000

Initial Public Offering Bookrunner November 2014

Follow On Offering Bookrunner November 2014

Initial Public Offering Bookrunner October 2014

$108,235,280

$366,850,000

$185,610,000

$156,543,750

$1,001,937,500

$109,900,560

A portfolio company of Great Hill Partners

A portfolio company of Ares Management

A portfolio company of Brentwood Associates

A portfolio company of The Blackstone Group

A portfolio company of The Goldman Sachs Group

Initial Public Offering

Follow On Offering

Initial Public Offering Co-Manager

Follow On Offering

A portfolio company of Oak Hill Capital Partners Initial Public Offering Bookrunner October 2014

Co-Manager October 2014

Bookrunner September 2014

Co-Manager August 2014

$42,200,000

$89,125,000

$86,300,000

$472,222,226

A portfolio company of KPCB Holdings Initial Public Offering

A portfolio company of The Compass Group Follow On Offering Bookrunner July 2014

Bookrunner July 2014

A portfolio company of Clayton Dubilier & Rice Follow On Offering Bookrunner October 2013

July 2014 $491,280,000

$701,845,000

A portfolio company of The Blackstone Group

A portfolio company of Foxteq Holdings

A portfolio company of Clayton Dubilier & Rice

Initial Public Offering Co-Manager June 2014

$123,970,000

$147,375,000

$111,913,599

$132,050,000

A portfolio company of Sterling Partners

A portfolio company of Welsh Carson Anderson & Stowe

A portfolio company of Austin Ventures

A portfolio company of Seidler Equity Partners

A portfolio company of Brentwood Associates

Initial Public Offering Co-Manager June 2014 $517,500,000

A portfolio company of The Blackstone Group

Follow On Offering Co-Manager April 2014

Co-Manager July 2014

$100,624,980

Initial Public Offering Co-Manager June 2014 $1,495,000,000

A portfolio company of TPG Capital

Follow-On Offering

Initial Public Offering

Bookrunner May 2014

Co-Manager April 2014

Bookrunner April 2014

Co-Manager April 2014

$495,500,000

$897,000,000

$964,562,500

$91,800,000

A portfolio company of Clayton Dubilier & Rice

A portfolio company of Forbion Capital Partners

Initial Public Offering

A portfolio company of Apax Partners

A portfolio company of 3i Group/TPG Capital

Initial Public Offering Co-Manager March 2014

Follow On Offering Co-Manager March 2014

$94,084,375

A portfolio company of Camden Partners Holdings Follow On Offering Bookrunner

February 2014

Follow On Offering Co-Manager February 2014

Initial Public Offering

Initial Public Offering Bookrunner February 2014