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, 2016 and 2015, and for the years ended September 30, 2016, 2015 and 2014. 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, 2016



	Parent Company	Guarantor Companies	Non-Guarantor Companies	Elimination		Consolidation
CURRENT ASSETS
Cash and equivalents	6,517	27,692	38,344	—		72,553
Accounts receivable, net of allowances	—	175,583	63,810	(5,642	)	233,751
Contract costs and recognized income not yet billed, net of progress payments	—	126,961	—	—		126,961
Inventories, net	—	239,325	69,544	—		308,869
Prepaid and other current assets	39,763	31,191	16,447	(48,796	)	38,605
Assets of discontinued operations	—	—	219	—		219
Total Current Assets	46,280	600,752	188,364	(54,438	)	780,958
PROPERTY, PLANT AND EQUIPMENT, net	956	303,735	100,713	—		405,404
GOODWILL	—	284,875	76,310	—		361,185
INTANGIBLE ASSETS, net	—	147,960	62,639	—		210,599
INTERCOMPANY RECEIVABLE	539,938	713,118	307,081	(1,560,137	)	—
EQUITY INVESTMENTS IN SUBSIDIARIES	824,887	866,595	1,916,622	(3,608,104	)	—
OTHER ASSETS	6,529	12,151	12,675	(9,373	)	21,982
ASSETS OF DISCONTINUED OPERATIONS	—	—	1,968	—		1,968
Total Assets	1,418,590	2,929,186	2,666,372	(5,232,052	)	1,782,096

CURRENT LIABILITIES
Notes payable and current portion of long-term debt	3,153	2,307	17,184	—		22,644
Accounts payable and accrued liabilities	65,751	202,657	65,213	(39,686	)	293,935
Liabilities of discontinued operations	—	—	1,684	—		1,684
Total Current Liabilities	68,904	204,964	84,081	(39,686	)	318,263
LONG-TERM DEBT, net	848,589	18,872	46,453	—		913,914
INTERCOMPANY PAYABLES	57,648	737,980	735,053	(1,530,681	)	—
OTHER LIABILITIES	32,502	114,491	26,574	(36,301	)	137,266
LIABILITIES OF DISCONTINUED OPERATIONS	—	—	1,706	—		1,706
Total Liabilities	1,007,643	1,076,307	893,867	(1,606,668	)	1,371,149
SHAREHOLDERS’ EQUITY	410,947	1,852,879	1,772,505	(3,625,384	)	410,947
Total Liabilities and Shareholders’ Equity	1,418,590	2,929,186	2,666,372	(5,232,052	)	1,782,096

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	8,665		27,584		12,488		(8,479		)	40,258
Assets of discontinued operations	—		—		236		—			236
Total Current Assets	11,105		578,893		181,282		(30,326		)	740,954
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	37,982		30,203		9,959		(59,590		)	18,554
ASSETS OF DISCONTINUED OPERATIONS	—		—		3,255		—			3,255
Total Assets	$	1,337,754	$	2,882,654	$	2,423,666	$	(4,931,261	)	$	1,712,813

CURRENT LIABILITIES
Notes payable and current portion of long-term debt	$	2,202	$	3,842	$	10,549	$	—		$	16,593
Accounts payable and accrued liabilities	26,365		222,758		72,843		(20,951		)	301,015
Liabilities of discontinued operations	—		—		2,229		—			2,229
Total Current Liabilities	28,567		226,600		85,621		(20,951		)	319,837
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	49,346		126,956		28,428		(72,634		)	132,096
LIABILITIES OF DISCONTINUED OPERATIONS	—		—		3,379		—			3,379
Total Liabilities	907,229		1,202,017		949,569		(1,776,527		)	1,282,288
SHAREHOLDERS’ EQUITY	430,525		1,680,637		1,474,097		(3,154,734		)	430,525
Total Liabilities and Shareholders’ Equity	$	1,337,754	$	2,882,654	$	2,423,666	$	(4,931,261	)	$	1,712,813

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

For the Year Ended September 30, 2016



	Parent Company			Guarantor Companies			Non-Guarantor Companies			Elimination			Consolidation
Revenue	$	—		$	1,560,535		$	425,182		$	(28,556	)	$	1,957,161
Cost of goods and services	—			1,173,928			339,934			(30,135		)	1,483,727
Gross profit	—			386,607			85,248			1,579			473,434
Selling, general and administrative expenses	26,427			263,357			74,613			(370		)	364,027
Restructuring and other related charges	—			1,299			4,601			—			5,900
Total operating expenses	26,427			264,656			79,214			(370		)	369,927
Income (loss) from operations	(26,427		)	121,951			6,034			1,949			103,507
Other income (expense)
Interest income (expense), net	(12,549		)	(34,588		)	(3,974		)	—			(51,111		)
Other, net	337			3,471			(1,091		)	(1,949		)	768
Total other income (expense)	(12,212		)	(31,117		)	(5,065		)	(1,949		)	(50,343		)
Income (loss) before taxes	(38,639		)	90,834			969			—			53,164
Provision (benefit) for income taxes	(16,333		)	34,535			4,952			—			23,154
Income (loss) before equity in net income of subsidiaries	(22,306		)	56,299			(3,983		)	—			30,010
Equity in net income (loss) of subsidiaries	52,316			(5,728		)	56,299			(102,887		)	—
Net Income (loss)	$	30,010		$	50,571		$	52,316		$	(102,887	)	$	30,010

Comprehensive income (loss)	$	39,957		$	44,265		$	68,970		$	(113,235	)	$	39,957

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		)	—
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		)	—
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 CASH FLOWS

For the Year Ended September 30, 2016



	Parent Company			Guarantor Companies			Non-Guarantor Companies			Elimination			Consolidation
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	30,010		$	50,571		$	52,316		$	(102,887	)	$	30,010
Net cash provided by (used in) operating activities	(11,879		)	98,891			18,925			—			105,937
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of property, plant and equipment	(259		)	(78,159		)	(12,341		)	—			(90,759		)
Intercompany distributions	—			(2,726		)	(1,744		)	—			(4,470		)
Proceeds from sale of property, plant and equipment	—			765			144			—			909
Investment purchases	715			—			—			—			715
Net cash provided by (used in) investing activities	456			(80,120		)	(13,941		)	—			(93,605		)
CASH FLOWS FROM FINANCING ACTIVITIES:
Purchase of shares for treasury	(65,307		)	—			—			—			(65,307		)
Proceeds from long-term debt	271,340			2,311			28,711			—			302,362
Payments of long-term debt	(177,513		)	(2,135		)	(35,338		)	—			(214,986		)
Change in short-term borrowings	—			—			(54		)	—			(54		)
Financing costs	(4,277		)	—			(107		)	—			(4,384		)
Tax effect from exercise/vesting of equity awards, net	—			—			—			—			—
Dividends paid	(8,798		)	—			—			—			(8,798		)
Other, net	55			(1,926		)	1,926			—			55
Net cash provided by (used in) financing activities	15,500			(1,750		)	(4,862		)	—			8,888
CASH FLOWS FROM DISCONTINUED OPERATIONS:
Net cash used in discontinued operations	—			—			(1,554		)	—			(1,554		)
Effect of exchange rate changes on cash and equivalents	—			—			886			—			886
NET DECREASE IN CASH AND EQUIVALENTS	4,077			17,021			(546		)	—			20,552
CASH AND EQUIVALENTS AT BEGINNING OF PERIOD	2,440			10,671			38,890			—			52,001
CASH AND EQUIVALENTS AT END OF PERIOD	$	6,517		$	27,692		$	38,344		$	—		$	72,553

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