Bear Stearns Merchant Banking and GlobeSecNine, Inc. Announce Strategic Alliance; $1.5 Billion Private Equity Fund to Pursue Opportunities in Homeland Defense and Security Sectors

Business Wire, Sept 13, 2004

WASHINGTON -- Bear Stearns Merchant Banking and GlobeSecNine, Inc., a private investment firm, ("BSMB/GS9 Alliance") have formed a strategic alliance to pursue private equity investment opportunities in the homeland defense and security sectors. Investments will be funded from the $1.5 billion Bear Stearns Merchant Banking fund, of which $300 million has been previously designated by BSMB for investments in the homeland defense and security sectors. In 2003, BSMB announced an alliance with Giuliani Partners to invest in homeland defense and security.

Rick Perkal, Bear Stearns Merchant Banking Senior Managing Director and head of the security and defense team, said, "We believe that our work with GlobeSecNine, who bring a unique set of experiences in special forces, classified operations, transportation security and military operations complements our work with Giuliani Partners. GlobeSecNine and Giuliani Partners both offer valuable insights and unique skills to companies in this highly fragmented but dynamic sector."

Anthony D. Padgett, chief executive officer of GlobeSecNine, added, "We will identify candidates here in the United States and internationally. Our view is that there are good opportunities now including a number of undercapitalized companies poised for growth and, if appropriate, consolidation. By leveraging the expertise of BSMB and GlobeSecNine, we hope to create a profitable union."

In addition to its business professionals, GlobeSecNine counts among its investors and active participants General Al Gray, 29th Commandant of the Marine Corps, and former member of the Joint Chiefs of Staff; Jack Lawn, former head of the Drug Enforcement Administration under both Presidents Reagan and George H.W. Bush, and former COO of the New York Yankees; Lt. General Greg Newbold, former Director of Operations, Joint Chiefs of Staff; and Ambassador David C. Miller, Jr., responsible for counter-terrorism at the National Security Council under President George H.W. Bush. General Brent Scowcroft is Chairman of the GlobeSecNine Advisory Board, a group that also includes Bob Damon, President of Korn/Ferry North America; and Fred Turco, one of the founders of the Counter-Terrorism Center at the CIA and a highly-decorated senior intelligence officer.

In each investment, GlobeSecNine will bring to bear its experience and relationships to accelerate growth and profitability in the business. Bear Stearns Merchant Banking will leverage Bear Stearns' proprietary network of professional relationships, in-depth industry knowledge and capital markets expertise to structure the transactions and enhance the value of the investments. Transaction structures could include traditional leveraged buyouts, recapitalizations, monetization of corporate divisions/subsidiaries to provide existing owners/managers with partial liquidity, and co-investments with reputable strategic or financial buyers.

Greg Newbold, GlobeSecNine's COO, commented, "BSMB and GlobeSecNine will play an active role on the Boards of Directors of our companies by providing strategic and financial support, as well as access to our extensive network of private and public sector resources."

About Bear Stearns Merchant Banking

Bear Stearns Merchant Banking, the private equity arm of Bear, Stearns & Co. Inc., invests private equity capital in compelling leverage buyouts, recapitalizations and growth capital opportunities alongside superior management teams. Founded in 1997, with partners who have been active in the buyout business since the 1980s, Bear Stearns Merchant Banking currently is investing its $1.5 billion institutional private equity fund, Bear Stearns Merchant Banking Partners II, L.P. and affiliated entities. The first portfolio of investments by Bear Stearns Merchant Banking, which commenced in 1997, achieved industry-leading private equity returns. Other recent acquisitions by Bear Stearns Merchant Banking include Aearo, CamelBak, Cavalry, New York & Company, Reddy Ice, Sutton Place and Vitamin Shoppe. More information about Bear Stearns Merchant Banking can be found at www.bsmb.com.

About GlobeSecNine

GlobeSecNine, a private investment firm, concentrates its investment focus on sectors in which it has built recognized expertise: security, defense and counter-terrorism. The company's mission is to be a leading private equity firm in the security sector, leveraging the insight of GlobeSecNine's executive team and board of advisors to generate extraordinary returns across a range of investment choices, while maintaining its focus on improving the security of the USA, its allies and their citizens and businesses. GlobeSecNine is affiliated with the Potomac Institute for Policy Studies, one of America's preeminent technology and public policy research institutions, whose clients include the most renowned government laboratories and numerous university and private labs. For more information on GlobeSecNine, visit www.GlobeSecNine.com.

About Giuliani Partners LLC

Giuliani Partners is a management consulting firm founded by former New York City Mayor Rudolph W. Giuliani and a number of senior executives from his administration. The founding team includes New York City's former Police Commissioner Bernard Kerik, former Fire Commissioner Thomas Von Essen and former Office of Emergency Management Commissioner Richard Sheirer. In addition, Mr. Giuliani has supplemented the team with executives from the business and financial communities. With Mr. Giuliani as Chairman and CEO, the firm draws upon its experiences and expertise in security, public safety, emergency preparedness, business continuity, and leadership during crises and innovative financial management to advise and assist its clients. For more information on Giuliani Partners, visit www.giulianipartners.com.