<PAGE> 1
Project Safari
[BLC LOGO]
Presentation to the BLC Financial
Services, Inc. Board of Directors
October 27
2000
<PAGE> 2
Presentation
Overview
[BLC LOGO]
Presented By:
Josephthal & Co.
<PAGE> 3
PRESENTATION OVERVIEW
-------------------------------------------------------------------------------
Table of Contents
I. Deal Summary
II. Overview of Allied Capital
III. Allied Financial Summary
IV. Overview of Allied Express
V. Allied Express/BLC Combination
VI. Deal Highlights
VII. Transaction Structure
VIII. Fairness Opinion
IX. Definitive Agreement
X. Timing
Appendix:
Q&A
[BLC LOGO] [JOSEPHTHAL LOGO]
<PAGE> 4
DISCLAIMER
--------------------------------------------------------------------------------
In our review and analyses, we have assumed and relied upon the accuracy and
completeness of all of the financial and other information provided to us by
the Company or publicly available and have neither attempted independently to
verify nor assumed responsibility for verifying any of this information. We
have not conducted a physical inspection of Allied's properties or facilities,
nor have we made or obtained or assumed any responsibility for making or
obtaining any independent evaluations or appraisals of any of the related
properties, facilities or business segments. We have assumed that management's
financial analyses have been prepared on a good faith reasonable basis
reflecting the best currently available estimates and judgments of Allied's
management and/or financial consultants or advisors to Allied.
[BLC LOGO] [JOSEPHTHAL LOGO]
<PAGE> 5
Deal
Summary
[BLC LOGO]
Presented By:
Josephthal & Co.
<PAGE> 6
DEAL SUMMARY
--------------------------------------------------------------------------------
- Allied Financial (TCKR: ALLC) will end up with 94.9% of the shares of BLC
Financial Services, Inc. (TCKR: BCL) at a purchase price of $3.50 per share
in return for equal value of Allied Stock.
- The remaining 5.1% will be retained by a group consisting of current BLC
shareholders.
- Prior to the transaction, ALLC will acquire Futuronics.
- Upon acquiring BLC, Allied will merge the operation with Allied Express to
form a combined portfolio company.
- Vested Warrants and Options will be exercised prior to acquisition. Loans
will be provided to shareholders to finance exercise.
- Unvested options will be converted to shares of Allied stock with a vesting
schedule equal to current BLC vesting.
[BLC LOGO] [JOSEPHTHAL LOGO]
<PAGE> 7
DEAL SUMMARY
--------------------------------------------------------------------------------
[DIAGRAM OF TRANSACTION]
<TABLE>
<S> <C>
[1] ALLC contributes ACE assets to SBLC. SBLC [4] ALLC merges with BLC into portfolio company / BLC is
establishes separate BOD, Mgt, & Op Systems. survivor.
[2] ALLC exchanges cash for F stock in merger of F [5] BLC recapitalizes again
with FACQ. Class B exchange for Class A common
[3] BLC recapitalizes & establishes class A & B [6] SBLC merges with BLC on 1/1/01 / BLC is survivor
stock with identical rights
Class A (shares to exchange with ALLC)
Class B (5.1% + F's BLC shares)
NOTE: STEPS 3,4 AND 5 ARE SIMULTANEOUS.
</TABLE>
[BLC LOGO] [JOSEPHTHAL LOGO]
<PAGE> 8
OVERVIEW OF
ALLIED CAPITAL
[BLC LOGO]
Presented By:
Josephthal & Co.
<PAGE> 9
OVERVIEW OF ALLIED CAPITAL
-------------------------------------------------------------------------------
- Allied Capital is a publicly traded ("ALLC") private equity firm providing
debt, mezzanine and equity financing in transactions for privately-held
businesses in a variety of industries and in diverse geographic locations
nationwide.
- Allied has a 41 year record of sustained growth and profitability.
- Earnings through the first 9 months of 2000 were $100.8 million, as compared
to $67.6 million for the first 9 months of 1999.
- Because ALLC is a Business Investment Company, it is required to distribute
yearly dividends of at least 90% of earnings.
- ALLC recently announced a quarterly dividend of $0.46. This will result in a
2000 yearly dividend total of $1.82. This represents a 13.8% increase over
1999.
- Investment portfolio is $1.6 billion (95% of which is Grade 3 or above)
- During Q3, Net-Tel, an ALLC portfolio company filed for bankruptcy.
[BLC LOGO] [JOSEPHTHAL LOGO]
<PAGE> 10
OVERVIEW OF ALLIED CAPITAL
-------------------------------------------------------------------------------
Allied's investment activity is focused on:
- Private Finance
- Commercial Real Estate Finance, including the purchase of CMBS; and
- Allied Capital Express
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------
Allied's Investment Strategy
--------------------------------------------------------------------------------------------------------------
Types of Investments Industries Invested In Criteria
-------------------- ---------------------- -----------------------------------------------------
<S> <C> <C>
Buyouts Business Services Market Leaders
Acquisitions Telecommunications Non-cyclical Industries
Growth Consumer Products Critical Mass and Longevity
Recapitalizations Light Industrial Products High Cash Flow Margins
Speciality Retail High Return on Invested Capital
Education Sound Balance Sheet
Seasoned Management with Meaningful Equity Ownership
--------------------------------------------------------------------------------------------------------------
</TABLE>
[BLC LOGO] [JOSEPHTHAL LOGO]
<PAGE> 11
OVERVIEW OF ALLIED CAPITAL
-------------------------------------------------------------------------------
Portfolio Assets at June 30, 2000
[PIE CHART INDICATING 2 PIECES]
<TABLE>
<CAPTION>
Debt Securities Equity Securities
--------------- -----------------
<S> <C>
$1.4 billion $127.1 million
91% 9%
Average yield=13.6% Total Return: 25%-40%
Total Return:
- Long-term loans with
contractual yields - 12%-18%
- Warrants - 2%-10%
</TABLE>
-> DEBT SECURITIES PROVIDE CURRENT RETURN AND STABLE DIVIDEND GROWTH
-> EQUITY SECURITIES SUPPLY INVESTMENT UPSIDE AND CAPITAL FOR GROWTH
-> TARGET TOTAL PORTFOLIO RETURN OF 25%
[BLC LOGO] [JOSEPHTHAL LOGO]
<PAGE> 12
OVERVIEW OF ALLIED CAPITAL
-------------------------------------------------------------------------------
Leverage others' networks and capital
PRIVATE SPONSORS FOR RECENT INVESTMENTS:
- Bank of America Capital Investors - Greenwich Street Capital
- Behrman Capital LP - Horizon Partners, Ltd.
- Cloud Nine Capital - Indosuez Capital
- Code Hennessey & Simmons LLC - Paribas Principal Partners
- Cravey Green & Wahlen - TA Associates
- Fidelco Capital Group - Three Cities Research, Inc.
- Friend Skoler & Co. - Westar Capital
- Fleet Equity Partners - William Blair Capital Partners
- Gold + Appel - Wind Point Partners
[BLC LOGO] [JOSEPHTHAL LOGO]
<PAGE> 13
RECENT TRANSACTIONS
-------------------------------------------------------------------------------
<TABLE>
<CAPTION>
----------------------------------------------------------- -------------------------------------------------------------------
1999 2000
Portfolio Companies Business Portfolio Companies Business
----------------------------------------------------------- -------------------------------------------------------------------
<S> <C> <C> <C>
Allied Office Supplies, Inc. Office products distributor Component Hardware Group, Inc. Hardware component mfg.
Aurora Communications, Inc. Radio stations HealthAspex, Inc. Third party administrator
Camgroup, Inc. Recreational camps HMT, Inc. Above ground storage tanks
E-Talk Call center software Intellirisk Management Corporation Accts. receivables collections
Executive Greetings, Inc. Custom business products International Filler Corporation Cellulose/fiber producer
FTI Consulting, Inc. Litigation support Isolve Incorporated B2B e-commerce
Garden Ridge Corporation Home decor retailer Morton Grove Pharmaceuticals Specialty pharmaceuticals
Global Communications, LLC Muzak franchises Oriental Trading Company, Inc. Toy/novelty marketer
Icon International, Inc. Corporate barter services Packaging Advantage Corp. Liquid/paste product mfg.
Impact Innovations IT services provider PFNet Communications, Inc. Fiber optic network
Jakel Holdings Corporation Sub-fractional motor mfg. Startec Global Communications, Inc. Integrated communications
Masterplan, Inc. Healthcare outsourcing Warn Industries, Inc. Off-road equipment mfg.
MVL Group Market research services Wilmar Industries, Inc. Repair product distributor
Net-Tel Communications, Inc. Integrated communications Wilshire Restaurant Group, Inc. Marie Callender restaurants
Opinion Research Corporation Corporate marketing research
Outsource Partners, Inc. Facilities services provider
Physician Speciality Physician mgmt services
Polaris Pool Systems, Inc. Pool cleaner manufacturer
Powell Plant Farms Bedding plants mfg. AVERAGE PROJECTED PORTFOLIO
SoffCut International Concrete sawing equipment ANNUAL REVENUE = $115 MILLION
Southwest PCS, LP Sprint PCS affiliate
Sure-Tel, Inc. Telephone services
Tubbs Snowshoe Co., LLC Snowshoe manufacturer
United Pet Group, Inc. Pet supply products
</TABLE>
[BLC LOGO] [JOSEPHTHAL LOGO]
<PAGE> 14
Allied Financial
Summary
[BLC LOGO]
PRESENTED BY;
JOSEPHTHAL & CO.
<PAGE> 15
STRONG, STABLE AND WELL CAPITALIZED
-------------------------------------------------------------------------------
SOLID PERFORMER - $1.5 BILLION IN MARKET CAPITALIZATION
<TABLE>
<CAPTION>
YEAR ENDED NINE MONTHS ENDED
12/31/99 09/30/00
-------- --------
($ in millions, except per share data)
<S> <C> <C>
TOTAL ASSETS $1,290 $1,732
TOTAL EQUITY $668 $933
NET INCOME $99 $101
DIVIDENDS PER SHARE $1.60 $1.36
NET INCOME PER SHARE $1.64 $1.42
</TABLE>
[BLC LOGO] [JOSEPHTHAL LOGO]
<PAGE> 16
STRONG HISTORICAL FINANCIAL PERFORMANCE
------------------------------------------------------------------------------
[Bar Charts indicating financial data below]
<TABLE>
<S> <C>
1995 1996 1997 1998 1999 9 months 2000 9 months 1999
Net Income $60 $55 $61 $78 $99 $101 $68
1995 1996 1997 1998 1999 9 months 2000 9 months 1999
Earnings Per Share $1.37 $1.17 $1.24 $1.50 $1.64 $1.43 $1.14
1995 1996 1997* 1998* 1999*
Return on Equity 17.00% 14.00% 16.00% 18.00% 18.00%
1997 1998 1999 6 months 2000
Net Interest Margin 4.40% 5.00% 5.10% 5.50%
</TABLE>
* Excludes merger-related expenses
[BLC LOGO] [JOSEPHTHAL LOGO]
<PAGE> 17
DIVIDEND HISTORY AND PERFORMANCE
------------------------------------------------------------------------------
[ANNUAL DIVIDENDS
PER SHARE BAR CHART]
<TABLE>
<CAPTION>
1995 1996 1997* 1998 1999 2000
---- ---- ----- ---- ---- ----
<S> <C> <C> <C> <C> <C>
$1.09 $1.23 $1.20 $1.43 $1.60 $1.82
</TABLE>
* excludes certain merger-related dividends
[BLC LOGO] [JOSEPHTHAL LOGO]
<PAGE> 18
ANALYST COVERAGE
--------------------------------------------------------------------------------
- There are currently 13 analysts providing coverage for ALLC
- Consensus EPS Estimates:
- 1999A: $1.64
- 2000E: $1.94
- 2001P: $2.24
ANALYST ESTIMATES:
<TABLE>
<CAPTION>
--------------------------------------------------------------
Firm Date 12 Month Target
--------------------------------------------------------------
<S> <C> <C>
AG Edwards & Sons 10/00 $30
US Bancorp Piper Jaffray 10/00 25
First Union Securities, Inc. 10/00 24
Merrill Lynch 9/00 26
BB&T Capital Markets 7/00 26
JJB Hilliard WL Lyons 8/00 22
--------------------------------------------------------------
</TABLE>
[BLC LOGO] [JOSEPHTHAL LOGO]
<PAGE> 19
ANALYST COVERAGE
-------------------------------------------------------------------------------
<TABLE>
<CAPTION>
--------------------------------------------------------------------------
Firm Opinion 2000 EPS Est. 2001 EPS Est.
--------------------------------------------------------------------------
<S> <C> <C> <C>
AG Edwards & Sons Buy $1.95 $2.25
Banc of America Securities Buy/Hold 1.94 2.26
BB&T Capital Markets Buy 1.93 2.25
Bluestone Capital Buy 1.89 2.12
Davenport & Company LLC Buy/Hold 1.95 2.20
Ferris Baker Watts Buy/Hold 1.94 2.24
First Security Van Kasper Buy 1.94
First Union Securities, Inc. Buy 1.96 2.30
Friedman, Billings, Ramsey Buy/Hold 1.95 2.25
JJB Hilliard WL Lyons Buy 1.90 2.10
Merrill Lynch Buy 1.96 2.30
US Bancorp Piper Jaffray Buy 1.96 2.25
William Blair & Company Buy/Hold 1.96 2.30
--------------------------------------------------------------------------
</TABLE>
[BLC LOGO] [JOSEPHTHAL LOGO]
<PAGE> 20
STOCK HISTORY AND PERFORMANCE
-------------------------------------------------------------------------------
Stock Snapshot (As of 10/25/00):
-Shares outstanding: 75.77 million
-Trading Float: 72.70 million
-Market Capitalization: $1,463.32 million
-September Trading Volume: 10.8 million
-Last 3 month average daily trading Volume: 454.2 thousand
-P/E: 10.06x
<TABLE>
<S> <C>
[BLC LOGO] [JOSEPHTHAL LOGO]
</TABLE>
<PAGE> 21
STOCK HISTORY AND PERFORMANCE
--------------------------------------------------------------------------------
[ALLC DAILY PRICING-HIGH-LOW-CLOSE LINE GRAPH - OCT 25, 1999 - OCT 25, 2000 WITH
DAILY VOLUME LINE GRAPH ON SAME CHART]
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------
DATE HIGH LOW CLOSE VOLUME
--------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
25-Oct-00 19.5625 19.1875 19.3125 226,700
--------------------------------------------------------------------------------------------
24-Oct-00 19.7500 18.9375 19.1250 457,700
--------------------------------------------------------------------------------------------
23-Oct-00 19.5000 18.8750 18.9375 198,300
--------------------------------------------------------------------------------------------
20-Oct-00 19.5000 19.1250 19.5000 217,600
--------------------------------------------------------------------------------------------
19-Oct-00 19.6250 19.0000 19.3125 247,300
--------------------------------------------------------------------------------------------
18-Oct-00 19.3125 18.7500 19.0625 341,300
--------------------------------------------------------------------------------------------
17-Oct-00 19.6875 19.0625 19.3750 530,000
--------------------------------------------------------------------------------------------
16-Oct-00 19.8750 19.3750 19.5000 315,400
--------------------------------------------------------------------------------------------
13-Oct-00 19.5000 18.8750 19.4375 256,200
--------------------------------------------------------------------------------------------
12-Oct-00 20.0000 18.7500 18.8125 550,400
--------------------------------------------------------------------------------------------
11-Oct-00 19.7500 19.2500 19.7500 312,900
--------------------------------------------------------------------------------------------
10-Oct-00 19.8750 19.5000 19.5625 694,100
--------------------------------------------------------------------------------------------
9-Oct-00 20.0625 19.2500 19.8750 794,500
--------------------------------------------------------------------------------------------
6-Oct-00 19.7500 19.4375 19.6875 1,068,200
--------------------------------------------------------------------------------------------
5-Oct-00 19.7500 18.9375 19.5625 958,000
--------------------------------------------------------------------------------------------
4-Oct-00 19.1250 18.3750 19.0000 933,200
--------------------------------------------------------------------------------------------
3-Oct-00 20.7500 18.5000 18.5000 1,449,600
--------------------------------------------------------------------------------------------
2-Oct-00 21.0000 20.5625 20.6875 440,600
--------------------------------------------------------------------------------------------
29-Sep-00 20.9375 20.2500 20.7500 396,700
--------------------------------------------------------------------------------------------
28-Sep-00 20.8750 20.4375 20.7500 594,300
--------------------------------------------------------------------------------------------
27-Sep-00 20.5000 20.0625 20.4375 743,000
--------------------------------------------------------------------------------------------
26-Sep-00 20.5000 19.8750 20.0625 596,900
--------------------------------------------------------------------------------------------
25-Sep-00 20.5625 19.8906 20.1875 769,900
--------------------------------------------------------------------------------------------
22-Sep-00 20.1875 19.1875 20.1250 766,000
--------------------------------------------------------------------------------------------
21-Sep-00 19.9375 19.1250 19.7500 2,717,500
--------------------------------------------------------------------------------------------
20-Sep-00 20.6875 18.8750 19.2500 529,100
--------------------------------------------------------------------------------------------
19-Sep-00 20.5000 19.5625 20.3750 258,900
--------------------------------------------------------------------------------------------
18-Sep-00 20.4375 19.4375 19.6875 380,800
--------------------------------------------------------------------------------------------
15-Sep-00 20.5000 20.1250 20.5000 316,200
--------------------------------------------------------------------------------------------
14-Sep-00 21.1250 20.2500 20.6875 299,800
--------------------------------------------------------------------------------------------
13-Sep-00 21.3125 20.6562 21.0000 651,400
--------------------------------------------------------------------------------------------
12-Sep-00 21.2500 20.4375 21.1250 381,600
--------------------------------------------------------------------------------------------
11-Sep-00 20.5000 20.2500 20.3750 256,100
--------------------------------------------------------------------------------------------
8-Sep-00 20.3750 20.2500 20.3750 183,800
--------------------------------------------------------------------------------------------
7-Sep-00 20.3750 20.0625 20.2500 229,200
--------------------------------------------------------------------------------------------
6-Sep-00 20.3125 20.0000 20.2500 226,900
--------------------------------------------------------------------------------------------
5-Sep-00 20.1875 20.0000 20.0000 238,100
--------------------------------------------------------------------------------------------
1-Sep-00 20.3125 20.0000 20.0625 252,100
--------------------------------------------------------------------------------------------
31-Aug-00 20.3125 20.1250 20.2500 225,700
--------------------------------------------------------------------------------------------
30-Aug-00 20.1250 20.0000 20.0625 235,300
--------------------------------------------------------------------------------------------
29-Aug-00 20.3750 19.8750 19.9375 250,500
--------------------------------------------------------------------------------------------
28-Aug-00 20.1875 20.0000 20.1250 219,400
--------------------------------------------------------------------------------------------
25-Aug-00 20.0625 19.9375 20.0000 264,600
--------------------------------------------------------------------------------------------
24-Aug-00 20.0625 19.9375 20.0000 268,000
--------------------------------------------------------------------------------------------
23-Aug-00 20.1250 20.0000 20.0625 174,600
--------------------------------------------------------------------------------------------
22-Aug-00 20.6250 19.9375 20.1250 473,500
--------------------------------------------------------------------------------------------
21-Aug-00 20.1875 19.4375 20.0625 258,000
--------------------------------------------------------------------------------------------
18-Aug-00 19.9375 19.4375 19.5000 252,300
--------------------------------------------------------------------------------------------
17-Aug-00 20.0625 19.7500 19.8125 315,500
--------------------------------------------------------------------------------------------
16-Aug-00 20.0625 19.9375 20.0000 188,600
--------------------------------------------------------------------------------------------
15-Aug-00 20.2500 19.9375 19.9375 381,700
--------------------------------------------------------------------------------------------
14-Aug-00 20.1250 19.8750 20.0625 253,100
--------------------------------------------------------------------------------------------
11-Aug-00 20.0625 19.7500 20.0000 337,300
--------------------------------------------------------------------------------------------
10-Aug-00 19.8750 19.6250 19.7500 256,300
--------------------------------------------------------------------------------------------
9-Aug-00 19.8750 19.2500 19.6250 454,400
--------------------------------------------------------------------------------------------
8-Aug-00 19.9375 19.5625 19.8750 223,500
--------------------------------------------------------------------------------------------
7-Aug-00 19.6875 19.4375 19.6875 198,600
--------------------------------------------------------------------------------------------
4-Aug-00 19.8125 19.3750 19.6250 482,700
--------------------------------------------------------------------------------------------
3-Aug-00 19.7500 19.1875 19.6250 468,700
--------------------------------------------------------------------------------------------
2-Aug-00 19.3125 18.8750 19.1875 416,200
--------------------------------------------------------------------------------------------
1-Aug-00 19.6875 18.9375 19.0000 432,200
--------------------------------------------------------------------------------------------
31-Jul-00 19.0625 18.1875 18.9375 622,600
--------------------------------------------------------------------------------------------
28-Jul-00 18.1875 17.8750 18.1875 494,400
--------------------------------------------------------------------------------------------
27-Jul-00 18.1875 17.8125 18.0000 323,600
--------------------------------------------------------------------------------------------
26-Jul-00 18.0625 17.7500 18.0625 342,400
--------------------------------------------------------------------------------------------
25-Jul-00 18.0000 17.8125 18.0000 385,700
--------------------------------------------------------------------------------------------
24-Jul-00 17.8750 17.5625 17.6875 248,900
--------------------------------------------------------------------------------------------
21-Jul-00 17.8125 17.5625 17.6250 249,000
--------------------------------------------------------------------------------------------
20-Jul-00 17.6250 17.5000 17.6250 239,100
--------------------------------------------------------------------------------------------
19-Jul-00 17.6875 17.5000 17.5625 267,600
--------------------------------------------------------------------------------------------
18-Jul-00 17.6875 17.4375 17.6250 326,200
--------------------------------------------------------------------------------------------
17-Jul-00 17.6875 17.5000 17.5625 266,700
--------------------------------------------------------------------------------------------
14-Jul-00 17.6875 17.4375 17.5625 208,900
--------------------------------------------------------------------------------------------
13-Jul-00 17.7500 17.5000 17.6875 265,400
--------------------------------------------------------------------------------------------
12-Jul-00 17.6875 17.5000 17.6875 231,500
--------------------------------------------------------------------------------------------
11-Jul-00 17.6875 17.3750 17.5625 371,300
--------------------------------------------------------------------------------------------
10-Jul-00 17.8125 17.3750 17.5625 341,300
--------------------------------------------------------------------------------------------
7-Jul-00 18.0000 17.4375 17.6250 383,900
--------------------------------------------------------------------------------------------
6-Jul-00 17.7500 17.5000 17.7500 244,100
--------------------------------------------------------------------------------------------
5-Jul-00 17.7500 17.3750 17.4375 235,700
--------------------------------------------------------------------------------------------
3-Jul-00 17.9375 17.0000 17.7500 424,900
--------------------------------------------------------------------------------------------
30-Jun-00 17.1875 16.9375 17.0000 595,500
--------------------------------------------------------------------------------------------
29-Jun-00 17.5000 17.0625 17.1250 370,700
--------------------------------------------------------------------------------------------
28-Jun-00 17.3750 17.0625 17.2500 344,500
--------------------------------------------------------------------------------------------
27-Jun-00 17.2500 16.9375 17.2500 331,600
--------------------------------------------------------------------------------------------
26-Jun-00 17.1875 16.9375 17.0000 249,500
--------------------------------------------------------------------------------------------
23-Jun-00 17.1250 16.9375 17.1250 290,400
--------------------------------------------------------------------------------------------
22-Jun-00 17.1875 16.9375 17.0000 345,400
--------------------------------------------------------------------------------------------
21-Jun-00 17.1250 16.5625 17.1250 304,800
--------------------------------------------------------------------------------------------
20-Jun-00 17.3125 17.0000 17.1250 390,000
--------------------------------------------------------------------------------------------
19-Jun-00 17.3750 17.1875 17.3125 396,700
--------------------------------------------------------------------------------------------
16-Jun-00 17.4375 17.0625 17.3125 574,000
--------------------------------------------------------------------------------------------
15-Jun-00 17.5000 16.9375 17.1875 452,300
--------------------------------------------------------------------------------------------
14-Jun-00 17.5625 17.2500 17.4375 569,800
--------------------------------------------------------------------------------------------
13-Jun-00 17.5625 17.1250 17.5625 640,800
--------------------------------------------------------------------------------------------
12-Jun-00 17.2500 17.0000 17.2500 451,400
--------------------------------------------------------------------------------------------
9-Jun-00 17.2500 17.0000 17.0000 509,800
--------------------------------------------------------------------------------------------
8-Jun-00 17.1250 16.9375 17.0625 1,393,100
--------------------------------------------------------------------------------------------
7-Jun-00 17.3125 17.0000 17.0625 855,600
--------------------------------------------------------------------------------------------
6-Jun-00 17.4375 17.1875 17.2500 574,400
--------------------------------------------------------------------------------------------
5-Jun-00 17.7500 17.1250 17.1875 914,700
--------------------------------------------------------------------------------------------
2-Jun-00 17.7500 17.5000 17.6250 673,400
--------------------------------------------------------------------------------------------
1-Jun-00 17.6250 17.0938 17.5625 300,100
--------------------------------------------------------------------------------------------
31-May-00 17.1250 16.8125 17.0625 337,700
--------------------------------------------------------------------------------------------
30-May-00 17.0625 16.4688 17.0000 562,000
--------------------------------------------------------------------------------------------
26-May-00 17.1250 16.8125 16.8125 401,800
--------------------------------------------------------------------------------------------
25-May-00 17.3125 17.0000 17.0000 432,700
--------------------------------------------------------------------------------------------
24-May-00 17.5625 17.0625 17.3125 426,700
--------------------------------------------------------------------------------------------
23-May-00 17.5000 17.1250 17.1875 357,200
--------------------------------------------------------------------------------------------
22-May-00 17.4375 17.0000 17.3750 559,700
--------------------------------------------------------------------------------------------
19-May-00 17.5625 17.1250 17.3125 379,600
--------------------------------------------------------------------------------------------
18-May-00 17.8750 17.3750 17.5000 426,100
--------------------------------------------------------------------------------------------
17-May-00 17.8750 17.4375 17.5000 455,800
--------------------------------------------------------------------------------------------
16-May-00 18.2500 17.6250 17.8125 334,000
--------------------------------------------------------------------------------------------
15-May-00 17.8125 17.3125 17.8125 373,300
--------------------------------------------------------------------------------------------
12-May-00 18.1250 17.5000 17.6250 305,300
--------------------------------------------------------------------------------------------
11-May-00 17.5625 17.1250 17.5000 400,900
--------------------------------------------------------------------------------------------
10-May-00 17.7500 17.0625 17.3125 616,500
--------------------------------------------------------------------------------------------
9-May-00 18.3750 17.3750 17.5000 412,700
--------------------------------------------------------------------------------------------
8-May-00 18.6250 18.1875 18.3125 251,800
--------------------------------------------------------------------------------------------
5-May-00 18.7500 18.2500 18.5000 219,700
--------------------------------------------------------------------------------------------
4-May-00 18.4844 17.5000 17.5000 423,500
--------------------------------------------------------------------------------------------
3-May-00 18.5625 18.0000 18.0625 345,600
--------------------------------------------------------------------------------------------
2-May-00 18.7500 18.0625 18.5000 306,500
--------------------------------------------------------------------------------------------
1-May-00 19.0000 18.1250 18.5625 451,300
--------------------------------------------------------------------------------------------
28-Apr-00 18.7500 17.8750 18.6875 209,700
--------------------------------------------------------------------------------------------
27-Apr-00 19.0000 17.5000 18.1250 482,600
--------------------------------------------------------------------------------------------
26-Apr-00 17.8125 17.3750 17.8125 424,200
--------------------------------------------------------------------------------------------
25-Apr-00 17.5625 17.1250 17.5000 342,100
--------------------------------------------------------------------------------------------
24-Apr-00 17.5625 17.0000 17.0625 213,900
--------------------------------------------------------------------------------------------
20-Apr-00 17.6250 17.1250 17.4375 298,900
--------------------------------------------------------------------------------------------
19-Apr-00 17.5625 17.0000 17.1250 256,000
--------------------------------------------------------------------------------------------
18-Apr-00 17.5625 16.7500 17.5625 382,300
--------------------------------------------------------------------------------------------
17-Apr-00 17.1250 15.5000 17.0000 390,100
--------------------------------------------------------------------------------------------
14-Apr-00 17.5000 16.5000 16.5625 425,700
--------------------------------------------------------------------------------------------
13-Apr-00 17.5625 17.2500 17.5625 381,100
--------------------------------------------------------------------------------------------
12-Apr-00 17.5000 17.0625 17.3750 412,400
--------------------------------------------------------------------------------------------
11-Apr-00 17.5000 17.0000 17.4375 339,600
--------------------------------------------------------------------------------------------
10-Apr-00 17.5625 17.1250 17.1875 344,300
--------------------------------------------------------------------------------------------
7-Apr-00 17.7500 17.3750 17.5625 221,500
--------------------------------------------------------------------------------------------
6-Apr-00 17.6875 17.3750 17.6250 247,500
--------------------------------------------------------------------------------------------
5-Apr-00 17.7500 16.9375 17.5625 544,800
--------------------------------------------------------------------------------------------
4-Apr-00 18.0000 17.1250 17.9375 535,500
--------------------------------------------------------------------------------------------
3-Apr-00 18.3750 17.3750 17.6875 791,100
--------------------------------------------------------------------------------------------
31-Mar-00 17.6250 16.9375 17.4375 314,500
--------------------------------------------------------------------------------------------
30-Mar-00 17.3125 17.0000 17.0000 277,700
--------------------------------------------------------------------------------------------
29-Mar-00 18.0000 17.1875 17.1875 393,700
--------------------------------------------------------------------------------------------
28-Mar-00 17.8750 17.5000 17.6250 241,400
--------------------------------------------------------------------------------------------
27-Mar-00 18.0000 17.3750 17.3750 153,200
--------------------------------------------------------------------------------------------
24-Mar-00 18.1875 17.6250 17.8750 327,200
--------------------------------------------------------------------------------------------
23-Mar-00 18.2500 17.5000 18.0625 267,800
--------------------------------------------------------------------------------------------
22-Mar-00 17.9375 17.4375 17.9375 239,700
--------------------------------------------------------------------------------------------
21-Mar-00 17.5625 16.8750 17.5625 263,800
--------------------------------------------------------------------------------------------
20-Mar-00 17.9375 16.8125 17.0625 197,600
--------------------------------------------------------------------------------------------
17-Mar-00 17.9375 17.5000 17.9375 356,200
--------------------------------------------------------------------------------------------
16-Mar-00 18.5000 16.8750 17.9375 647,700
--------------------------------------------------------------------------------------------
15-Mar-00 16.8125 16.5625 16.8125 272,700
--------------------------------------------------------------------------------------------
14-Mar-00 17.0000 16.6250 16.7500 508,000
--------------------------------------------------------------------------------------------
13-Mar-00 16.9375 16.5000 16.5625 309,400
--------------------------------------------------------------------------------------------
10-Mar-00 17.6250 16.7500 16.8125 421,300
--------------------------------------------------------------------------------------------
9-Mar-00 17.3125 16.6250 17.0625 495,400
--------------------------------------------------------------------------------------------
8-Mar-00 16.8125 16.3750 16.6875 1,315,800
--------------------------------------------------------------------------------------------
7-Mar-00 18.0000 16.7500 16.8125 523,800
--------------------------------------------------------------------------------------------
6-Mar-00 17.7500 17.1250 17.2500 408,300
--------------------------------------------------------------------------------------------
3-Mar-00 18.1250 17.5000 17.6250 263,200
--------------------------------------------------------------------------------------------
2-Mar-00 17.9375 17.2500 17.5000 224,700
--------------------------------------------------------------------------------------------
1-Mar-00 18.0625 17.2500 17.9375 257,700
--------------------------------------------------------------------------------------------
29-Feb-00 18.2500 17.1875 17.3750 456,900
--------------------------------------------------------------------------------------------
28-Feb-00 18.3750 17.7500 17.7500 311,300
--------------------------------------------------------------------------------------------
25-Feb-00 17.8750 17.3750 17.8750 302,400
--------------------------------------------------------------------------------------------
24-Feb-00 18.3750 17.5000 17.8750 232,900
--------------------------------------------------------------------------------------------
23-Feb-00 18.7500 17.7500 18.1250 227,100
--------------------------------------------------------------------------------------------
22-Feb-00 19.0000 18.1875 18.4375 357,200
--------------------------------------------------------------------------------------------
18-Feb-00 18.6250 17.9375 18.1875 268,200
--------------------------------------------------------------------------------------------
17-Feb-00 18.5625 17.6250 18.4062 504,600
--------------------------------------------------------------------------------------------
16-Feb-00 18.5000 17.9375 18.5000 328,200
--------------------------------------------------------------------------------------------
15-Feb-00 18.5000 17.5000 17.8750 376,000
--------------------------------------------------------------------------------------------
14-Feb-00 17.9375 16.9375 17.5625 482,600
--------------------------------------------------------------------------------------------
11-Feb-00 18.5000 16.8750 17.6875 601,000
--------------------------------------------------------------------------------------------
10-Feb-00 19.0625 18.0000 18.1250 357,500
--------------------------------------------------------------------------------------------
9-Feb-00 19.9375 18.3750 18.8125 590,900
--------------------------------------------------------------------------------------------
8-Feb-00 19.8750 19.3750 19.6875 445,400
--------------------------------------------------------------------------------------------
7-Feb-00 19.7500 19.3750 19.5625 423,000
--------------------------------------------------------------------------------------------
4-Feb-00 19.8750 19.2500 19.6250 519,000
--------------------------------------------------------------------------------------------
3-Feb-00 19.3125 18.6250 19.3125 520,700
--------------------------------------------------------------------------------------------
2-Feb-00 18.9375 18.5625 18.6250 216,000
--------------------------------------------------------------------------------------------
1-Feb-00 19.1875 17.6250 18.9375 498,500
--------------------------------------------------------------------------------------------
31-Jan-00 18.8750 17.6875 18.5000 425,700
--------------------------------------------------------------------------------------------
28-Jan-00 17.8750 17.3750 17.8750 329,700
--------------------------------------------------------------------------------------------
27-Jan-00 17.8750 17.2500 17.6875 435,400
--------------------------------------------------------------------------------------------
26-Jan-00 17.3750 16.9375 17.3125 363,100
--------------------------------------------------------------------------------------------
25-Jan-00 17.1875 16.6250 17.0625 217,200
--------------------------------------------------------------------------------------------
24-Jan-00 17.3750 16.7500 16.9375 254,800
--------------------------------------------------------------------------------------------
21-Jan-00 17.2500 17.0000 17.1250 291,000
--------------------------------------------------------------------------------------------
20-Jan-00 17.6875 16.8125 17.1250 495,800
--------------------------------------------------------------------------------------------
19-Jan-00 18.0000 17.4375 17.4375 381,800
--------------------------------------------------------------------------------------------
18-Jan-00 18.1250 17.2500 17.7500 604,300
--------------------------------------------------------------------------------------------
14-Jan-00 18.0000 17.1250 17.1250 518,000
--------------------------------------------------------------------------------------------
13-Jan-00 17.9062 16.9375 17.6250 866,900
--------------------------------------------------------------------------------------------
12-Jan-00 16.6250 16.2500 16.3750 532,800
--------------------------------------------------------------------------------------------
11-Jan-00 16.9062 16.0000 16.0625 598,100
--------------------------------------------------------------------------------------------
10-Jan-00 16.7500 16.3750 16.6875 617,200
--------------------------------------------------------------------------------------------
7-Jan-00 16.8125 16.3750 16.4375 841,000
--------------------------------------------------------------------------------------------
6-Jan-00 17.1250 16.4375 16.7500 367,300
--------------------------------------------------------------------------------------------
5-Jan-00 17.2500 16.5625 16.7500 693,800
--------------------------------------------------------------------------------------------
4-Jan-00 17.5625 16.7500 16.7500 346,200
--------------------------------------------------------------------------------------------
3-Jan-00 18.3750 16.8750 17.6250 450,600
--------------------------------------------------------------------------------------------
31-Dec-99 18.6250 17.8125 18.3125 281,900
--------------------------------------------------------------------------------------------
30-Dec-99 18.4375 17.7500 17.7500 347,900
--------------------------------------------------------------------------------------------
29-Dec-99 18.1875 17.1250 18.0000 325,400
--------------------------------------------------------------------------------------------
28-Dec-99 17.8750 16.8125 17.1250 345,800
--------------------------------------------------------------------------------------------
27-Dec-99 18.2500 17.2500 17.4375 294,200
--------------------------------------------------------------------------------------------
23-Dec-99 18.0000 17.1875 17.6250 433,700
--------------------------------------------------------------------------------------------
22-Dec-99 18.0000 17.1250 17.7500 517,200
--------------------------------------------------------------------------------------------
21-Dec-99 18.5625 17.3750 18.5625 289,700
--------------------------------------------------------------------------------------------
20-Dec-99 19.4375 17.1875 17.4375 262,500
--------------------------------------------------------------------------------------------
17-Dec-99 18.7500 16.8750 18.1250 558,400
--------------------------------------------------------------------------------------------
16-Dec-99 18.5000 16.7500 17.3750 390,100
--------------------------------------------------------------------------------------------
15-Dec-99 18.5625 16.7500 18.2500 557,000
--------------------------------------------------------------------------------------------
14-Dec-99 19.1250 18.1250 18.2500 404,900
--------------------------------------------------------------------------------------------
13-Dec-99 19.5625 18.8125 18.8125 338,800
--------------------------------------------------------------------------------------------
10-Dec-99 19.5625 19.1250 19.5000 560,600
--------------------------------------------------------------------------------------------
9-Dec-99 19.6875 19.2500 19.2500 548,900
--------------------------------------------------------------------------------------------
8-Dec-99 19.6875 19.3750 19.6875 974,500
--------------------------------------------------------------------------------------------
7-Dec-99 19.7500 19.4375 19.7500 148,800
--------------------------------------------------------------------------------------------
6-Dec-99 20.2500 19.2500 19.4375 198,000
--------------------------------------------------------------------------------------------
3-Dec-99 20.2500 19.7500 20.1250 136,700
--------------------------------------------------------------------------------------------
2-Dec-99 20.3125 19.8750 20.0625 157,500
--------------------------------------------------------------------------------------------
1-Dec-99 20.2500 19.9375 20.1562 208,800
--------------------------------------------------------------------------------------------
30-Nov-99 20.2500 20.0625 20.2500 218,000
--------------------------------------------------------------------------------------------
29-Nov-99 20.1875 19.8750 20.1250 152,100
--------------------------------------------------------------------------------------------
26-Nov-99 20.1875 19.8750 19.9375 26,200
--------------------------------------------------------------------------------------------
24-Nov-99 20.2500 19.7500 20.1875 147,500
--------------------------------------------------------------------------------------------
23-Nov-99 20.3750 19.7500 19.9375 146,600
--------------------------------------------------------------------------------------------
22-Nov-99 20.6875 20.1250 20.3750 113,100
--------------------------------------------------------------------------------------------
19-Nov-99 20.7500 20.4375 20.5000 159,800
--------------------------------------------------------------------------------------------
18-Nov-99 21.0000 20.6875 20.6875 142,200
--------------------------------------------------------------------------------------------
17-Nov-99 21.0000 20.8750 20.9375 233,700
--------------------------------------------------------------------------------------------
16-Nov-99 21.1250 20.8750 21.0000 193,500
--------------------------------------------------------------------------------------------
15-Nov-99 21.1250 20.8125 20.8750 157,100
--------------------------------------------------------------------------------------------
12-Nov-99 21.1875 20.8125 20.8750 118,400
--------------------------------------------------------------------------------------------
11-Nov-99 20.9375 20.5000 20.8125 202,200
--------------------------------------------------------------------------------------------
10-Nov-99 20.7500 20.3750 20.6875 148,800
--------------------------------------------------------------------------------------------
9-Nov-99 20.9375 20.3750 20.6875 198,500
--------------------------------------------------------------------------------------------
8-Nov-99 21.0000 20.3750 20.3750 294,000
--------------------------------------------------------------------------------------------
5-Nov-99 21.1875 20.7500 20.8125 388,500
--------------------------------------------------------------------------------------------
4-Nov-99 21.8750 20.8750 20.8750 628,100
--------------------------------------------------------------------------------------------
3-Nov-99 21.3750 20.8125 21.2500 334,600
--------------------------------------------------------------------------------------------
2-Nov-99 21.1250 19.8750 20.9375 219,200
--------------------------------------------------------------------------------------------
1-Nov-99 20.1250 19.6250 19.9375 237,300
--------------------------------------------------------------------------------------------
29-Oct-99 20.7500 19.9375 20.0625 206,300
--------------------------------------------------------------------------------------------
28-Oct-99 20.9375 19.6875 20.6250 386,400
--------------------------------------------------------------------------------------------
27-Oct-99 19.6875 19.3750 19.5625 395,500
--------------------------------------------------------------------------------------------
26-Oct-99 19.6250 19.3750 19.5000 438,000
--------------------------------------------------------------------------------------------
25-Oct-99 19.8750 19.2500 19.5000 428,600
--------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<S> <C>
[BLC LOGO] [JOSEPHTHAL LOGO]
</TABLE>
<PAGE> 22
STOCK HISTORY AND PERFORMANCE
--------------------------------------------------------------------------------
---------------------------------
18% Average Annual Total Return
since IPO*
---------------------------------
* Assumes reinvestment of all dividends
[depiction of ALLC average annual total return showing a $10,000 investment
at 1960 IPO, with all dividends reinvested, would have been worth $8.5
million at 8/31/00. During the same period, a $10,000 investment in the S & P
500 would have been worth $1.8 million at 8/31/00]
<TABLE>
<S> <C>
[BLC LOGO] [JOSEPHTHAL LOGO]
</TABLE>
<PAGE> 23
OVERVIEW OF
ALLIED EXPRESS [BLC LOGO]
PRESENTED BY:
JOSEPHTHAL & CO.
<PAGE> 24
BE INNOVATIVE: ALLIED CAPITAL EXPRESS
--------------------------------------------------------------------------------
Senior secured lending to "Mom and Pop" businesses
- Loans up to $3 million
- Often use SBA 7(a) government guaranteed loan program
- Secured by commercial real estate
Ideal for Internet expansion
- Developed proprietary web-based application and rules-based credit
approval process
- Employ web technology to streamline process
Expected to grow to 15% - 20% of annual revenue
UNIQUE OPPORTUNITY TO EXPAND MARGIN AND VOLUME
<TABLE>
<S> <C>
[BLC LOGO] [JOSEPHTHAL LOGO]
</TABLE>
<PAGE> 25
BE INNOVATIVE: ALLIED CAPITAL EXPRESS
--------------------------------------------------------------------------------
[depiction of Allied Capital Express business model]
<TABLE>
<CAPTION>
Internet Driven Traffic Internet Loan Purchasers
<S> <C> <C>
----------------------- ALLIEDCAPITALEXPRESS.COM ---------------------------
AGGREGATORS BANKS
----------------------- ---------------------------
ONLINE
-----------------------
SMALL BUSINESS BUSINESS
PORTALS
----------------------- LENDER
----------------------- ---------------------------
VERTICAL MARKETS 7(a) SECONDARY
MARKET
----------------------- ---------------------------
Structure, Underwrite,
----------------------- Close and Sell Loans
SMALL BUSINESS
ADMINISTRATION
----------------------- SOURCES OF REVENUE
-----------------
LOAN SALE PREMIUMS
INTEREST INCOME
</TABLE>
<TABLE>
<S> <C>
[BLC LOGO] [JOSEPHTHAL LOGO]
</TABLE>
<PAGE> 26
ALLIED EXPRESS/
BLC COMBINATION [BLC LOGO]
PRESENTED BY:
BLC
<PAGE> 27
ALLIED EXPRESS/BLC COMBINATION
--------------------------------------------------------------------------------
NATIONWIDE LOAN ORIGINATION NETWORK
- Combined projected loan origination levels:
- FY 12/01: $425 million
- FY 12/02: $660 million
- Potential to be the largest SBA lender
- Additional nationwide coverage, especially in the Great Lakes Region
Allied has offices in:
- Washington DC
- Detroit, Michigan
- Coeur d'Alene, Idaho
- Indianapolis, Indiana
- Nashua, New Hampshire
- Philadelphia, Pennsylvania
- Greenville, South Carolina
- Atlanta, Georgia
- Chicago, Illinois
- Additional PLP status
<TABLE>
<S> <C>
[BLC LOGO] [JOSEPHTHAL LOGO]
</TABLE>
<PAGE> 28
ALLIED EXPRESS/BLC COMBINATION
--------------------------------------------------------------------------------
LOAN PORTFOLIO
As of September 30, 2000, the Allied Capital Express SBA loan portfolio had the
following characteristics/stratifications:
<TABLE>
<S> <C>
- Loan Size:
------------
Average loan size $600,000
% of loans over $1M 24%
% of loans between $750K and $1M 39%
% of loans between $500K and $750K 15%
- SIC Concentrations:
---------------------
Hotels 25%
Restaurants 12%
Gas Stations and C-stores 19%
No other SIC code accounted for more than 5% of the portfolio
</TABLE>
<TABLE>
<S> <C>
[BLC LOGO] [JOSEPHTHAL LOGO]
</TABLE>
<PAGE> 29
ALLIED EXPRESS/BLC COMBINATION
--------------------------------------------------------------------------------
LOAN PORTFOLIO
<TABLE>
<S> <C>
- State Concentrations:
-----------------------
Michigan 20%
New York 11%
Pennsylvania 11%
Texas 5%
No other state accounted for more than 5% of the portfolio
</TABLE>
- Overall, Allied's portfolio is very similar to BLC's with respect to size,
type of loan (SIC code), term, and collateral focus (primarily real estate)
- In general, Allied's pricing above the prime rate is lower than BLC's, however
it appears that Allied's commission structure is also slightly lower than BLC's
- Combined service portfolio of $670 million
<TABLE>
<S> <C>
[BLC LOGO] [JOSEPHTHAL LOGO]
</TABLE>
<PAGE> 30
ALLIED EXPRESS/BLC COMBINATION
--------------------------------------------------------------------------------
ORGANIZATION
<TABLE>
<S> <C>
- Number of Allied Employees 37
- Number of BLC Employees 79
- Number of Immediate Additional Staffing Needs 13
- Total Prospective Number of Employees 129
- Number of Additional Long-Term Growth Staffing 12
</TABLE>
<TABLE>
<S> <C>
[BLC LOGO] [JOSEPHTHAL LOGO]
</TABLE>
<PAGE> 31
DEAL
HIGHLIGHTS [BLC LOGO]
PRESENTED BY:
JOSEPHTHAL & CO.
<PAGE> 32
DEAL HIGHLIGHTS
--------------------------------------------------------------------------------
- $3.50 per share represents a 51% premium over $2.31 trading price
(as of closing 10/26/00)
- Opportunity to exchange illiquidity BLC security (Daily Average Volume =
9,045) with this more liquid ALLC security. (Daily Average Volume = 454,200)
- Combined entity greater than sum of its parts
- Greater access to capital
- Speed of growth potential
- Internet offering of express
- ALLC as currency is a strong security
- Analyst community looks favorably upon ALLC future performance
<TABLE>
<S> <C>
[BLC LOGO] [JOSEPHTHAL LOGO]
</TABLE>
<PAGE> 33
TRANSACTION
STRUCTURE [BLC LOGO]
PRESENTED BY:
WEIL, GOTSHAL & MANGES LLP
<PAGE> 34
TRANSACTION STRUCTURE
-------------------------------------------------------------------------------
[DIAGRAM OF TRANSACTION]
<TABLE>
<S> <C>
[1] ALLC contributes ACE assets to SBLC. SBLC [4] ALLC merges with BLC into portfolio company /
establishes separate BOD, Mgt, & Op Systems BLC is survivor
[2] ALLC exchanges cash for F stock in merger of F [5] BLC recapitalizes again
with FACQ. Class B exchange for Class A common
[3] BLC recapitalizes & establishes class A & B stock [6] SBLC merges with BLC on 1/1/01 / BLC is survivor
with identical rights
Class A (shares to exchange with ALLC)
Class B (5.1% + F's BLC shares) NOTE: STEPS 3, 4 AND 5 ARE SIMULTANEOUS.
</TABLE>
<TABLE>
<S> <C>
[BLC LOGO] [JOSEPHTHAL LOGO]
</TABLE>
<PAGE> 35
FAIRNESS
OPINION [BLC LOGO]
PRESENTED BY;
RYAN, BECK & CO., INC.
<PAGE> 36
DEFINITIVE
AGREEMENT [BLC LOGO]
PRESENTED BY;
WEIL, GOTSHAL & MANGES LLP
<PAGE> 37
TIMING [BLC LOGO]
PRESENTED BY;
WEIL, GOTSHAL & MANGES LLP
<PAGE> 38
Q & A [BLC LOGO]
