Glenn Youngkin of CG discusses market outlook and infrastructure fund amid pro‑business political climate

ane Group (CG), C-2-8, Neutral Glenn Youngkin, President and Chief Operating Officer, presented for CG. Overall, Mr. Youngkin is positive on the economic/market backdrop and on CG’s ability to generate cash carry relatively consistently over time given the firm’s diversity of funds. e When asked “What would get you more interested in investing in CG stock?” most investors would like to see an increased float and reduced complexity (40%), followed closely by rising fee related earnings (30%). Investors are also interested in seeing increased visibility on the distribution (15%) and increased contribution from RA and GMS segments (15%). Chart 62: What would get you more interested in investing in CG stock? 45% 40% 35% 30% 29% 20% 15% 10% 5% 0% Rising fee related — Increased visibilityon Increased contribution Increased float and earnings the distribution from RA and GMS _ reduced complexity segments Source: BofA Merrill Lynch Global Research « — If comprehensive tax reform includes an elimination of carried interest tax, potentially moving to an ordinary income rate, it could have some impact to after tax unitholder returns. However, Glenn thinks it is very early to speculate on any changes and expects tax changes to likely be comprehensive. « Glenn sees the potential for a strong push in infrastructure, along with tax change, defense spending, and the border will get a lot of attention along with international trade. Three main conclusions: 1) First time in a long time that there is a universal pro-business outlook across congress and the presidential office; 2) Unclear today what is going to be enacted, there is optimism but uncertainty; and 3) CG is not going to make meaningful changes one way or another based on speculation. CG launched its latest infrastructure fund in September, and the election results are more wind in the sails. « CGhas multiple funds, each with its own economic engine. That makes the cash flow profile more stable than other firms. Management believes that a discounted valuation in the stock is driven more by fear of a recession vs. lower FRE. Glenn thinks that outlook has changed with the election. The economy may be going into extra innings now. e The investment environment hasn’t changed materially in last few weeks - continues to be tough. Global growth will continue to be muted, and despite the Bankof America a 2016 Future of Financials Conference | 17 November 2016 43 Merrill Lynch HOUSE_OVERSIGHT_014357