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, each of which are 100%, indirectly, 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 June 30, 2014 and September 30, 2013 and for the quarter and nine months ended June 30, 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 June 30, 2014



	Parent Company		Guarantor Companies		Non-Guarantor Companies		Elimination			Consolidation
CURRENT ASSETS
Cash and equivalents	$	9,208	$	19,500	$	58,729	$	—		$	87,437
Accounts receivable, net of allowances	—		222,754		78,918		(32,003		)	269,669
Contract costs and recognized income not yet billed, net of progress payments	—		104,518		359		—			104,877
Inventories, net	—		200,772		77,550		140			278,462
Prepaid and other current assets	21,180		23,835		18,714		10,561			74,290
Assets of discontinued operations	—		—		1,209		—			1,209
Total Current Assets	30,388		571,379		235,479		(21,302		)	815,944
PROPERTY, PLANT AND EQUIPMENT, net	1,392		261,632		102,352		—			365,376
GOODWILL	—		288,147		93,168		—			381,315
INTANGIBLE ASSETS, net	—		157,861		77,231		—			235,092
INTERCOMPANY RECEIVABLE	547,665		877,793		122,932		(1,548,390		)	—
EQUITY INVESTMENTS IN SUBSIDIARIES	802,548		682,810		1,916,521		(3,401,879		)	—
OTHER ASSETS	46,687		51,205		7,812		(75,213		)	30,491
ASSETS OF DISCONTINUED OPERATIONS	—		—		3,032		—			3,032
Total Assets	$	1,428,680	$	2,890,827	$	2,558,527	$	(5,046,784	)	$	1,831,250
CURRENT LIABILITIES
Notes payable and current portion of long-term debt	$	1,762	$	1,129	$	8,995	$	—		$	11,886
Accounts payable and accrued liabilities	33,353		187,496		84,571		(20,647		)	284,773
Liabilities of discontinued operations	—		—		2,959		—			2,959
Total Current Liabilities	35,115		188,625		96,525		(20,647		)	299,618

LONG-TERM DEBT, net of debt discounts	742,289		8,096		46,795		—			797,180
INTERCOMPANY PAYABLES	21,450		746,378		733,551		(1,501,379		)	—
OTHER LIABILITIES	61,485		149,029		25,921		(74,332		)	162,103
LIABILITIES OF DISCONTINUED OPERATIONS	—		—		4,008		—			4,008
Total Liabilities	860,339		1,092,128		906,800		(1,596,358		)	1,262,909
SHAREHOLDERS’ EQUITY	568,341		1,798,699		1,651,727		(3,450,426		)	568,341
Total Liabilities and Shareholders’ Equity	$	1,428,680	$	2,890,827	$	2,558,527	$	(5,046,784	)	$	1,831,250

CONDENSED CONSOLIDATING BALANCE SHEETS

At September 30, 2013



	Parent Company			Guarantor Companies		Non-Guarantor Companies		Elimination			Consolidation
CURRENT ASSETS
Cash and equivalents	$	68,994		$	25,343	$	83,793	$	—		$	178,130
Accounts receivable, net of allowances	—			213,506		76,241		(33,532		)	256,215
Contract costs and recognized income not yet billed, net of progress payments	—			109,683		145		—			109,828
Inventories, net	—			173,406		56,723		(9		)	230,120
Prepaid and other current assets	(712		)	21,854		17,330		10,431			48,903
Assets of discontinued operations	—			—		1,214		—			1,214
Total Current Assets	68,282			543,792		235,446		(23,110		)	824,410

PROPERTY, PLANT AND EQUIPMENT, net	972			248,973		103,648		—			353,593
GOODWILL	—			288,146		69,584		—			357,730
INTANGIBLE ASSETS, net	—			160,349		61,042		—			221,391
INTERCOMPANY RECEIVABLE	547,903			911,632		573,269		(2,032,804		)	—
EQUITY INVESTMENTS IN SUBSIDIARIES	772,374			533,742		2,718,956		(4,025,072		)	—
OTHER ASSETS	45,968			50,423		7,423		(75,234		)	28,580
ASSETS OF DISCONTINUED OPERATIONS	—			—		3,075		—			3,075
Total Assets	$	1,435,499		$	2,737,057	$	3,772,443	$	(6,156,220	)	$	1,788,779
CURRENT LIABILITIES
Notes payable and current portion of long-term debt	$	1,000		$	1,079	$	8,689	$	—		$	10,768
Accounts payable and accrued liabilities	41,121			183,665		70,427		(24,860		)	270,353
Liabilities of discontinued operations	—			—		3,288		—			3,288
Total Current Liabilities	42,121			184,744		82,404		(24,860		)	284,409
LONG-TERM DEBT, net of debt discounts	656,852			9,006		12,629		—			678,487
INTERCOMPANY PAYABLES	20,607			796,741		1,188,017		(2,005,365		)	—
OTHER LIABILITIES	65,455			153,970		25,578		(74,328		)	170,675
LIABILITIES OF DISCONTINUED OPERATIONS	—			—		4,744		—			4,744
Total Liabilities	785,035			1,144,461		1,313,372		(2,104,553		)	1,138,315
SHAREHOLDERS’ EQUITY	650,464			1,592,596		2,459,071		(4,051,667		)	650,464
Total Liabilities and Shareholders’ Equity	$	1,435,499		$	2,737,057	$	3,772,443	$	(6,156,220	)	$	1,788,779

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

For the Three Months Ended June 30, 2014



($ in thousands)	Parent Company			Guarantor Companies			Non-Guarantor Companies			Elimination			Consolidation
Revenue	$	—		$	392,361		$	126,343		$	(13,665	)	$	505,039
Cost of goods and services	—			295,148			103,938			(12,354		)	386,732
Gross profit	—			97,213			22,405			(1,311		)	118,307
Selling, general and administrative expenses	7,034			71,110			19,617			(1,626		)	96,135
Restructuring and other related charges	—			349			9			—			358
Total operating expenses	7,034			71,459			19,626			(1,626		)	96,493

Income (loss) from operations	(7,034		)	25,754			2,779			315			21,814

Other income (expense)
Interest income (expense), net	(1,750		)	(7,367		)	(2,424		)	—			(11,541		)
Loss from debt extinguishment, net	—			—			—			—			—
Other, net	1,436			2,497			(997		)	(315		)	2,621
Total other income (expense)	(314		)	(4,870		)	(3,421		)	(315		)	(8,920		)
Income (loss) before taxes	(7,348		)	20,884			(642		)	—			12,894
Provision (benefit) for income taxes	(9,322		)	7,322			430			—			(1,570		)
Income (loss) before equity in net income of subsidiaries	1,974			13,562			(1,072		)	—			14,464
Equity in net income (loss) of subsidiaries	12,490			(1,161		)	13,562			(24,891		)	—
Net income (loss)	$	14,464		$	12,401		$	12,490		$	(24,891	)	$	14,464

Net Income (loss)	$	14,464		$	12,401		$	12,490		$	(24,891	)	$	14,464
Other comprehensive income (loss), net of taxes	171			(592		)	3,547			—			3,126
Comprehensive income (loss)	$	14,635		$	11,809		$	16,037		$	(24,891	)	$	17,590

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

For the Three Months Ended June 30, 2013



($ in thousands)	Parent Company			Guarantor Companies			Non-Guarantor Companies			Elimination			Consolidation
Revenue	$	—		$	408,371		$	114,004		$	(12,549	)	$	509,826
Cost of goods and services	—			317,156			95,461			(11,102		)	401,515
Gross profit	—			91,215			18,543			(1,447		)	108,311
Selling, general and administrative expenses	4,141			69,015			14,793			(1,604		)	86,345
Restructuring and other related charges	—			1,565			39			—			1,604
Total operating expenses	4,141			70,580			14,832			(1,604		)	87,949
Income (loss) from operations	(4,141		)	20,635			3,711			157			20,362
Other income (expense)
Interest income (expense), net	(3,559		)	(6,982		)	(2,596		)	—			(13,137		)
Other, net	12			2,462			(1,710		)	(157		)	607
Total other income (expense)	(3,547		)	(4,520		)	(4,306		)	(157		)	(12,530		)
Income (loss) before taxes	(7,688		)	16,115			(595		)	—			7,832
Provision (benefit) for income taxes	(2,913		)	6,745			397			—			4,229
Income (loss) before equity in net income of subsidiaries	(4,775		)	9,370			(992		)	—			3,603
Equity in net income (loss) of subsidiaries	8,378			(969		)	9,370			(16,779		)	—
Net income (loss)	$	3,603		$	8,401		$	8,378		$	(16,779	)	$	3,603
Net Income (loss)	$	3,603		$	8,401		$	8,378		$	(16,779	)	$	3,603
Other comprehensive income (loss), net of taxes	211			836			(8,599		)	—			(7,552		)
Comprehensive income (loss)	$	3,814		$	9,237		$	(221	)	$	(16,779	)	$	(3,949	)

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

For the Nine Months Ended June 30, 2014



	Parent Company			Guarantor Companies			Non-Guarantor Companies			Elimination			Consolidation
Revenue	$	—		$	1,133,510		$	375,877		$	(43,203	)	$	1,466,184
Cost of goods and services	—			860,322			310,887			(38,822		)	1,132,387
Gross profit	—			273,188			64,990			(4,381		)	333,797
Selling, general and administrative expenses	20,525			207,725			50,025			(4,838		)	273,437
Restructuring and other related charges	—			1,841			51			—			1,892
Total operating expenses	20,525			209,566			50,076			(4,838		)	275,329
Income (loss) from operations	(20,525		)	63,622			14,914			457			58,468
Other income (expense)
Interest income (expense), net	(8,240		)	(21,946		)	(6,817		)	—			(37,003		)
Loss from debt extinguishment, net	(38,890		)	—			—			—			(38,890		)
Other, net	1,563			5,569			(2,365		)	(457		)	4,310
Total other income (expense)	(45,567		)	(16,377		)	(9,182		)	(457		)	(71,583		)
Income (loss) before taxes	(66,092		)	47,245			5,732			—			(13,115		)
Provision (benefit) for income taxes	(24,901		)	19,014			897			—			(4,990		)
Income (loss) before equity in net income of subsidiaries	(41,191		)	28,231			4,835			—			(8,125		)
Equity in net income (loss) of subsidiaries	33,066			4,587			28,231			(65,884		)	—
Net income (loss)	$	(8,125	)	$	32,818		$	33,066		$	(65,884	)	$	(8,125	)
Net Income (loss)	$	(8,125	)	$	32,818		$	33,066		$	(65,884	)	$	(8,125	)
Other comprehensive income (loss), net of taxes	511			1,277			840			—			2,628
Comprehensive income (loss)	$	(7,614	)	$	34,095		$	33,906		$	(65,884	)	$	(5,497	)

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

For the Nine Months Ended June 30, 2013



	Parent Company			Guarantor Companies			Non-Guarantor Companies			Elimination			Consolidation
Revenue	$	—		$	1,109,275		$	352,514		$	(39,471	)	$	1,422,318
Cost of goods and services	—			848,342			297,826			(35,328		)	1,110,840
Gross profit	—			260,933			54,688			(4,143		)	311,478
Selling, general and administrative expenses	15,419			198,601			45,327			(4,724		)	254,623
Restructuring and other related charges	—			8,045			4,003			—			12,048
Total operating expenses	15,419			206,646			49,330			(4,724		)	266,671
Income (loss) from operations	(15,419		)	54,287			5,358			581			44,807
Other income (expense)
Interest income (expense), net	(10,781		)	(20,685		)	(7,659		)	—			(39,125		)
Other, net	367			6,227			(4,498		)	(581		)	1,515
Total other income (expense)	(10,414		)	(14,458		)	(12,157		)	(581		)	(37,610		)
Income (loss) before taxes	(25,833		)	39,829			(6,799		)	—			7,197
Provision (benefit) for income taxes	(12,672		)	15,693			834			—			3,855
Income (loss) before equity in net income of subsidiaries	(13,161		)	24,136			(7,633		)	—			3,342
Equity in net income (loss) of subsidiaries	16,503			(7,565		)	24,136			(33,074		)	—
Net income (loss)	$	3,342		$	16,571		$	16,503		$	(33,074	)	$	3,342
Net Income (loss)	$	3,342		$	16,571		$	16,503		$	(33,074	)	$	3,342
Foreign currency translation adjustments	—			330			(11,135		)	—			(10,805		)
Other comprehensive income (loss), net of taxes	633			3,963			256			—			4,852
Comprehensive income (loss)	$	3,975		$	20,864		$	5,624		$	(33,074	)	$	(2,611	)

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

For the Nine Months Ended June 30, 2014



	Parent Company			Guarantor Companies			Non-Guarantor Companies			Elimination			Consolidation
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	(8,125	)	$	32,818		$	33,066		$	(65,884	)	$	(8,125	)
Net cash provided by (used in) operating activities	(10,966		)	(8,300		)	69,122			—			49,856
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of property, plant and equipment	(672		)	(45,749		)	(8,438		)	—			(54,859		)
Acquired businesses, net of cash acquired	—			(1,000		)	(61,306		)	—			(62,306		)
Intercompany distributions	10,000			(10,000		)	—			—			—
Investment purchases	(8,402		)	—			—			—			(8,402		)
Proceeds from sale of assets	—			298			193			—			491
Net cash provided by (used in) investing activities	926			(56,451		)	(69,551		)	—			(125,076		)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock	584			—			—			—			584
Purchase of shares for treasury	(72,518		)	—			—			—			(72,518		)
Proceeds from long-term debt	649,568			(253		)	33,598			—			682,913
Payments of long-term debt	(597,613		)	(708		)	(3,813		)	—			(602,134		)
Change in short-term borrowings	—			—			3,138			—			3,138
Financing costs	(10,393		)	—			(535		)	—			(10,928		)
Purchase of ESOP shares	(10,000		)	—			—			—			(10,000		)
Tax effect from exercise/vesting of equity awards, net	273			—			—			—			273
Dividend	(9,841		)	5,000			—			—			(4,841		)
Other, net	194			54,869			(54,869		)	—			194
Net cash provided by (used in) financing activities	(49,746		)	58,908			(22,481		)	—			(13,319		)
CASH FLOWS FROM DISCONTINUED OPERATIONS:
Net cash used in discontinued operations	—			—			(1,018		)	—			(1,018		)
Effect of exchange rate changes on cash and equivalents	—			—			(1,136		)	—			(1,136		)
NET DECREASE IN CASH AND EQUIVALENTS	(59,786		)	(5,843		)	(25,064		)	—			(90,693		)
CASH AND EQUIVALENTS AT BEGINNING OF PERIOD	68,994			25,343			83,793			—			178,130
CASH AND EQUIVALENTS AT END OF PERIOD	$	9,208		$	19,500		$	58,729		$	—		$	87,437

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

For the Nine Months Ended June 30, 2013



	Parent Company			Guarantor Companies			Non-Guarantor Companies			Elimination			Consolidation
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	3,342		$	16,571		$	16,503		$	(33,074	)	$	3,342
Net cash provided by (used in) operating activities	(67,628		)	23,214			46,968			—			2,554
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of property, plant and equipment	(33		)	(40,324		)	(5,529		)	—			(45,886		)
Intercompany distributions	10,000			(10,000		)	—			—			—
Proceeds from sale of assets	—			1,172			154			—			1,326
Net cash provided by (used in) investing activities	9,967			(49,152		)	(5,375		)	—			(44,560		)
CASH FLOWS FROM FINANCING ACTIVITIES:
Purchase of shares for treasury	(25,689		)	—			—			—			(25,689		)
Proceeds from long-term debt	—			303			—			—			303
Payments of long-term debt	(1,751		)	(772		)	(10,319		)	—			(12,842		)
Change in short-term borrowings	—			—			2,408			—			2,408
Financing costs	(759		)	—			—			—			(759		)
Tax effect from exercise/vesting of equity awards, net	150			—			—			—			150
Dividend	(4,384		)	—			—			—			(4,384		)
Other, net	261			14,661			(14,661		)	—			261
Net cash provided by (used in) financing activities	(32,172		)	14,192			(22,572		)	—			(40,552		)
CASH FLOWS FROM DISCONTINUED OPERATIONS:
Net cash used in discontinued operations	—			—			(486		)	—			(486		)
Effect of exchange rate changes on cash and equivalents	—			—			(506		)	—			(506		)
NET INCREASE (DECREASE) IN CASH AND EQUIVALENTS	(89,833		)	(11,746		)	18,029			—			(83,550		)
CASH AND EQUIVALENTS AT BEGINNING OF PERIOD	125,093			34,782			49,779			—			209,654
CASH AND EQUIVALENTS AT END OF PERIOD	$	35,260		$	23,036		$	67,808		$	—		$	126,104