CONSOLIDATING GUARANTOR AND NON-GUARANTOR FINANCIAL INFORMATION

Griffon’s Senior Notes are fully and unconditionally guaranteed, jointly and severally, on a senior secured basis by the domestic assets of Clopay Building Products Company, Inc., Clopay Plastic Products Company, Inc., Telephonics Corporation, The AMES Companies, Inc., ATT Southern, Inc., and Clopay Ames True Temper Holding, Corp., all of which are indirectly 100% owned by Griffon. In accordance with Rule 3-10 of Regulation S-X promulgated under the Securities Act of 1933, presented below are condensed consolidating financial information as of September 30, 2015 and 2014, and for the years ended September 30, 2015, 2014 and 2013. The financial information may not necessarily be indicative of results of operations or financial position had the guarantor companies or non-guarantor companies operated as independent entities. The guarantor companies and the non-guarantor companies include the consolidated financial results of their wholly owned subsidiaries accounted for under the equity method.

The indenture relating to the Senior Notes (the “Indenture”) contains terms providing that, under certain limited circumstances, a guarantor will be released from its obligations to guarantee the Senior Notes. These circumstances include (i) a sale of at least a majority of the stock, or all or substantially all the assets, of the subsidiary guarantor as permitted by the Indenture; (ii) a public equity offering of a subsidiary guarantor that qualifies as a “Minority Business” as defined in the Indenture (generally, a business the EBITDA of which constitutes less than 50% of the segment adjusted EBITDA of the Company for the most recently ended four fiscal quarters), and that meets certain other specified conditions as set forth in the Indenture; (iii) the designation of a guarantor as an “unrestricted subsidiary” as defined in the Indenture, in compliance with the terms of the Indenture; (iv) Griffon exercising its right to defease the Senior Notes, or to otherwise discharge its obligations under the Indenture, in each case in accordance with the terms of the Indenture; and (v) upon obtaining the requisite consent of the holders of the Senior Notes.

CONDENSED CONSOLIDATING BALANCE SHEETS

At September 30, 2015



	Parent Company		Guarantor Companies		Non-Guarantor Companies		Elimination			Consolidation
CURRENT ASSETS
Cash and equivalents	$	2,440	$	10,671	$	38,890	$	—		$	52,001
Accounts receivable, net of allowances	—		178,830		61,772		(21,847		)	218,755
Contract costs and recognized income not yet billed, net of progress payments	—		103,879		16		—			103,895
Inventories, net	—		257,929		67,880		—			325,809
Prepaid and other current assets	23,493		27,584		12,488		(8,479		)	55,086
Assets of discontinued operations	—		—		1,316		—			1,316
Total Current Assets	25,933		578,893		182,362		(30,326		)	756,862
PROPERTY, PLANT AND EQUIPMENT, net	1,108		286,854		92,010		—			379,972
GOODWILL	—		284,875		71,366		—			356,241
INTANGIBLE ASSETS, net	—		152,412		61,425		—			213,837
INTERCOMPANY RECEIVABLE	542,297		904,840		263,480		(1,710,617		)	—
EQUITY INVESTMENTS IN SUBSIDIARIES	745,262		644,577		1,740,889		(3,130,728		)	—
OTHER ASSETS	41,774		30,203		9,959		(59,590		)	22,346
ASSETS OF DISCONTINUED OPERATIONS	—		—		2,175		—			2,175
Total Assets	$	1,356,374	$	2,882,654	$	2,423,666	$	(4,931,261	)	$	1,731,433

CURRENT LIABILITIES
Notes payable and current portion of long-term debt	$	2,202	$	3,842	$	10,549	$	—		$	16,593
Accounts payable and accrued liabilities	30,158		222,758		72,843		(20,951		)	304,808
Liabilities of discontinued operations	—		—		2,229		—			2,229
Total Current Liabilities	32,360		226,600		85,621		(20,951		)	323,630
LONG-TERM DEBT, net	752,839		17,116		57,021		—			826,976
INTERCOMPANY PAYABLES	76,477		831,345		775,120		(1,682,942		)	—
OTHER LIABILITIES	64,173		126,956		28,428		(72,634		)	146,923
LIABILITIES OF DISCONTINUED OPERATIONS	—		—		3,379		—			3,379
Total Liabilities	925,849		1,202,017		949,569		(1,776,527		)	1,300,908
SHAREHOLDERS’ EQUITY	430,525		1,680,637		1,474,097		(3,154,734		)	430,525
Total Liabilities and Shareholders’ Equity	$	1,356,374	$	2,882,654	$	2,423,666	$	(4,931,261	)	$	1,731,433

CONDENSED CONSOLIDATING BALANCE SHEETS

At September 30, 2014



	Parent Company	Guarantor Companies	Non-Guarantor Companies	Elimination		Consolidation
CURRENT ASSETS
Cash and equivalents	6,813	31,522	54,070	—		92,405
Accounts receivable, net of allowances	—	213,922	77,218	(32,704	)	258,436
Contract costs and recognized income not yet billed, net of progress payments	—	109,804	126	—		109,930
Inventories, net	—	219,326	70,537	272		290,135
Prepaid and other current assets	4,366	26,319	17,101	14,783		62,569
Assets of discontinued operations	—	—	1,624	—		1,624
Total Current Assets	11,179	600,893	220,676	(17,649	)	815,099
PROPERTY, PLANT AND EQUIPMENT, net	1,327	270,519	98,643	76		370,565
GOODWILL	—	283,692	90,419	—		374,111
INTANGIBLE ASSETS, net	—	156,772	76,851	—		233,623
INTERCOMPANY RECEIVABLE	540,080	892,433	213,733	(1,646,246	)	—
EQUITY INVESTMENTS IN SUBSIDIARIES	780,600	662,403	1,782,406	(3,225,409	)	—
OTHER ASSETS	27,880	53,896	6,739	(75,213	)	13,302
ASSETS OF DISCONTINUED OPERATIONS	—	—	2,126	—		2,126
Total Assets	1,361,066	2,920,608	2,491,593	(4,964,441	)	1,808,826

CURRENT LIABILITIES
Notes payable and current portion of long-term debt	2,202	1,144	4,540	—		7,886
Accounts payable and accrued liabilities	25,703	226,236	91,132	(20,811	)	322,260
Liabilities of discontinued operations	—	—	3,282	—		3,282
Total Current Liabilities	27,905	227,380	98,954	(20,811	)	333,428
LONG-TERM DEBT, net	738,360	7,806	45,135	—		791,301
INTERCOMPANY PAYABLES	21,573	815,094	762,192	(1,598,859	)	—
OTHER LIABILITIES	41,201	151,674	26,949	(71,584	)	148,240
LIABILITIES OF DISCONTINUED OPERATIONS	—	—	3,830	—		3,830
Total Liabilities	829,039	1,201,954	937,060	(1,691,254	)	1,276,799
SHAREHOLDERS’ EQUITY	532,027	1,718,654	1,554,533	(3,273,187	)	532,027
Total Liabilities and Shareholders’ Equity	1,361,066	2,920,608	2,491,593	(4,964,441	)	1,808,826

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

For the Year Ended September 30, 2015



	Parent Company			Guarantor Companies			Non-Guarantor Companies			Elimination			Consolidation
Revenue	$	—		$	1,581,295		$	475,380		$	(40,643	)	$	2,016,032
Cost of goods and services	—			1,204,872			377,348			(41,966		)	1,540,254
Gross profit	—			376,423			98,032			1,323			475,778

Selling, general and administrative expenses	22,637			272,421			80,073			(370		)	374,761
Restructuring and other related charges	—			—			—			—			—
Total operating expenses	22,637			272,421			80,073			(370		)	374,761

Income (loss) from operations	(22,637		)	104,002			17,959			1,693			101,017

Other income (expense)
Interest income (expense), net	(8,741		)	(30,547		)	(8,584		)	—			(47,872		)
Other, net	438			10,521			(8,775		)	(1,693		)	491
Total other income (expense)	(8,303		)	(20,026		)	(17,359		)	(1,693		)	(47,381		)

Income (loss) before taxes	(30,940		)	83,976			600			—			53,636
Provision (benefit) for income taxes	(11,041		)	31,100			(712		)	—			19,347
Income (loss) before equity in net income of subsidiaries	(19,899		)	52,876			1,312			—			34,289
Equity in net income (loss) of subsidiaries	54,188			3,062			52,876			(110,126		)	—
Income (loss) from continuing operations	$	34,289		$	55,938		$	54,188		$	(110,126	)	$	34,289
Loss from operations of discontinued businesses	—			—			—			—			—
Benefit from income taxes	—			—			—			—			—
Loss from discontinued operations	—			—			—			—			—
Net income (loss)	$	34,289		$	55,938		$	54,188		$	(110,126	)	$	34,289

Comprehensive income (loss)	$	(26,835	)	$	34,318		$	15,080		$	(49,398	)	$	(26,835	)

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

For the Year Ended September 30, 2014



	Parent Company			Guarantor Companies			Non-Guarantor Companies			Elimination			Consolidation
Revenue	$	—		$	1,526,678		$	519,349		$	(54,216	)	$	1,991,811
Cost of goods and services	—			1,156,268			424,568			(48,424		)	1,532,412
Gross profit	—			370,410			94,781			(5,792		)	459,399
Selling, general and administrative expenses	24,084			281,930			75,551			(6,466		)	375,099
Restructuring and other related charges	—			4,234			1,902			—			6,136
Total operating expenses	24,084			286,164			77,453			(6,466		)	381,235
Income (loss) from operations	(24,084		)	84,246			17,328			674			78,164
Other income (expense)
Interest income (expense), net	(10,079		)	(28,630		)	(9,435		)	—			(48,144		)
Extinguishment of debt	(38,890		)										(38,890		)
Other, net	111			7,945			(4,228		)	(674		)	3,154
Total other income (expense)	(48,858		)	(20,685		)	(13,663		)	(674		)	(83,880		)
Income (loss) before taxes	(72,942		)	63,561			3,665			—			(5,716		)
Provision (benefit) for income taxes	(32,044		)	26,480			25			—			(5,539		)
Income (loss) before equity in net income of subsidiaries	(40,898		)	37,081			3,640			—			(177		)
Equity in net income (loss) of subsidiaries	40,721			3,531			37,081			(81,333		)	—
Income (loss) from continuing operations	(177		)	40,612			40,721			(81,333		)	(177		)
Loss from operations of discontinued businesses	—			—			—			—			—
Benefit from income taxes	—			—			—			—			—
Loss from discontinued operations	—			—			—			—			—
Net Income (loss)	$	(177	)	$	40,612		$	40,721		$	(81,333	)	$	(177	)

Comprehensive income (loss)	$	(26,902	)	$	28,355		$	25,704		$	(54,059	)	$	(26,902	)

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

For the Year Ended September 30, 2013



	Parent Company			Guarantor Companies			Non-Guarantor Companies			Elimination			Consolidation
Revenue	$	—		$	1,459,705		$	463,767		$	(52,145	)	$	1,871,327
Cost of goods and services	—			1,107,440			392,588			(46,286		)	1,453,742
Gross profit	—			352,265			71,179			(5,859		)	417,585
Selling, general and administrative expenses	24,248			269,654			52,819			(6,252		)	340,469
Restructuring and other related charges	—			9,236			4,026			—			13,262
Total operating expenses	24,248			278,890			56,845			(6,252		)	353,731
Income (loss) from operations	(24,248		)	73,375			14,334			393			63,854
Other income (expense)
Interest income (expense), net	(14,381		)	(27,660		)	(10,126		)	—			(52,167		)
Other, net	569			9,656			(7,233		)	(346		)	2,646
Total other income (expense)	(13,812		)	(18,004		)	(17,359		)	(346		)	(49,521		)
Income (loss) before taxes	(38,060		)	55,371			(3,025		)	47			14,333
Provision (benefit) for income taxes	(14,888		)	20,603			1,781			47			7,543
Income (loss) before equity in net income of subsidiaries	(23,172		)	34,768			(4,806		)	—			6,790
Equity in net income (loss) of subsidiaries	26,939			(1,467		)	34,768			(60,240		)	—
Income (loss) from continuing operations	3,767			33,301			29,962			(60,240		)	6,790
Loss from operations of discontinued businesses	—			—			(4,651		)	—			(4,651		)
Benefit from income taxes	—			—			1,628			—			1,628
Loss from discontinued operations	—			—			(3,023		)	—			(3,023		)
Net Income (loss)	$	3,767		$	33,301		$	26,939		$	(60,240	)	$	3,767

Comprehensive income (loss)	$	19,987		$	10,903		$	64,671		$	(75,574	)	$	19,987

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

For the Year Ended September 30, 2015



	Parent Company			Guarantor Companies			Non-Guarantor Companies			Elimination			Consolidation
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	34,289		$	55,938		$	54,188		$	(110,126	)	$	34,289
Net cash provided by (used in) operating activities	58,760			27,130			(9,753		)	—			76,137
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of property, plant and equipment	(274		)	(54,196		)	(19,150		)	—			(73,620		)
Acquired business, net of cash acquired	—			(2,225		)	—			—			(2,225		)
Intercompany distributions	10,000			(10,000		)	—			—			—
Investment sales	8,891			—			—			—			8,891
Proceeds from sale of property, plant and equipment	—			142			192			—			334
Net cash provided by (used in) investing activities	18,617			(66,279		)	(18,958		)	—			(66,620		)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock	371			—			—			—			371
Purchase of shares for treasury	(82,343		)	—			—			—			(82,343		)
Proceeds from long-term debt	124,500			13,596			95,395			—			233,491
Payments of long-term debt	(116,702		)	(1,263		)	(69,770		)	—			(187,735		)
Change in short-term borrowings	—			—			(365		)	—			(365		)
Financing costs	(614		)	(196		)	(498		)	—			(1,308		)
Tax effect from exercise/vesting of equity awards, net	345			—			—			—			345
Dividends paid	(7,654		)	—			—			—			(7,654		)
Other, net	347			6,161			(6,161		)	—			347
Net cash provided by (used in) financing activities	(81,750		)	18,298			18,601			—			(44,851		)
CASH FLOWS FROM DISCONTINUED OPERATIONS:
Net cash used in discontinued operations	—			—			(918		)	—			(918		)
Effect of exchange rate changes on cash and equivalents	—			—			(4,152		)	—			(4,152		)
NET INCREASE (DECREASE) IN CASH AND EQUIVALENTS	(4,373		)	(20,851		)	(15,180		)	—			(40,404		)
CASH AND EQUIVALENTS AT BEGINNING OF PERIOD	6,813			31,522			54,070			—			92,405
CASH AND EQUIVALENTS AT END OF PERIOD	$	2,440		$	10,671		$	38,890		$	—		$	52,001

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

For the Year Ended September 30, 2014



	Parent Company			Guarantor Companies			Non-Guarantor Companies			Elimination			Consolidation
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	(177	)	$	40,612		$	40,721		$	(81,333	)	$	(177	)
Net cash provided by operating activities	(3,902		)	17,168			80,035			—			93,301
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of property, plant and equipment	(700		)	(64,320		)	(12,074		)	—			(77,094		)
Acquired business, net of cash acquired	—			2,675			(64,981		)	—			(62,306		)
Intercompany distributions	10,000			(10,000		)	—			—			—
Purchase of securities	(8,402		)	—			—			—			(8,402		)
Proceeds from sale of property, plant and equipment	—			360			192			—			552
Net cash used in investing activities	898			(71,285		)	(76,863		)	—			(147,250		)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock	584			—			—			—			584
Purchase of shares for treasury	(79,614		)	—			—			—			(79,614		)
Proceeds from long-term debt	659,568			(102		)	32,477			—			691,943
Payments of long-term debt	(598,250		)	(1,135		)	(3,709		)	—			(603,094		)
Change in short-term borrowings	—			—			(749		)	—			(749		)
Financing costs	(10,763		)	—			(535		)	—			(11,298		)
Purchase of ESOP shares	(20,000		)	—			—			—			(20,000		)
Tax effect from exercise/vesting of equity awards, net	273			—			—			—			273
Dividends paid	(11,273		)	5,000			—			—			(6,273		)
Other, net	298			56,533			(56,533		)	—			298
Net cash used in financing activities	(59,177		)	60,296			(29,049		)	—			(27,930		)
CASH FLOWS FROM DISCONTINUED OPERATIONS:
Net cash used in discontinued operations	—			—			(1,528		)	—			(1,528		)
Effect of exchange rate changes on cash and equivalents	—			—			(2,318		)	—			(2,318		)
NET INCREASE (DECREASE) IN CASH AND EQUIVALENTS	(62,181		)	6,179			(29,723		)	—			(85,725		)
CASH AND EQUIVALENTS AT BEGINNING OF PERIOD	68,994			25,343			83,793			—			178,130
CASH AND EQUIVALENTS AT END OF PERIOD	$	6,813		$	31,522		$	54,070		$	—		$	92,405

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

For the Year Ended September 30, 2013



	Parent Company			Guarantor Companies			Non-Guarantor Companies			Elimination			Consolidation
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	3,767		$	33,301		$	26,939		$	(60,240	)	$	3,767
Net cash provided by (used in) operating activities	(25,184		)	83,177			27,690			—			85,683
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of property, plant and equipment	(123		)	(56,617		)	(7,701		)	—			(64,441		)
Intercompany distributions	10,000			(10,000		)	—			—			—
Proceeds from sale of property, plant and equipment	—			1,404			169			—			1,573
Net cash provided by (used in) investing activities	9,877			(65,213		)	(7,532		)	—			(62,868		)
CASH FLOWS FROM FINANCING ACTIVITIES:
Purchase of shares for treasury	(32,521		)	—			—			—			(32,521		)
Proceeds from long-term debt	—			303			—			—			303
Payments of long-term debt	(2,157		)	(1,032		)	(13,678		)	—			(16,867		)
Change in short-term borrowings	—			—			2,950			—			2,950
Financing costs	(833		)	—			—			—			(833		)
Tax effect from exercise/vesting of equity awards, net	150			—			—			—			150
Dividends paid	(5,825		)	—			—			—			(5,825		)
Other, net	394			(26,674		)	26,674			—			394
Net cash provided by (used in) financing activities	(40,792		)	(27,403		)	15,946			—			(52,249		)
CASH FLOWS FROM DISCONTINUED OPERATIONS:
Net cash used in discontinued operations	—			—			(2,090		)	—			(2,090		)
Effect of exchange rate changes on cash and equivalents	—			—			—			—			—
NET DECREASE IN CASH AND EQUIVALENTS	(56,099		)	(9,439		)	34,014			—			(31,524		)
CASH AND EQUIVALENTS AT BEGINNING OF PERIOD	125,093			34,782			49,779			—			209,654
CASH AND EQUIVALENTS AT END OF PERIOD	$	68,994		$	25,343		$	83,793		$	—		$	178,130