Atenga, Inc Pricing = leverage Summary Specific Results Who Responded - Demographics ExpertCEO & Atenga CEO relationship with Board of Directors Survey (June 2009) Atenga, Inc Pricing = leverage 2 Key Takeaways On average, CEOs tend to hold a bit more control in the board room The interaction between the board and the CEO is overwhelmingly positive, with only 5% of respondents stating the interaction is adversarial Communication in the board room tends to be open, with CEOs noting that their boards are usually helpful in running the business The focus of board meetings is usually a mix of tactical and strategic issues Media/Internet firms have a greater prevalence of board control compared to other industrial sectors Boardrooms in more tech-savvy companies (Technology, Media/Internet) show a higher, though still small, frequency of adversarial relationships Smaller companies (Less than $1M in revenue) tend to see a more controlling CEO in the boardroom Larger companies see more adversarial relationships with their board, with less open communication as well The level of control in the boardrooms of Private companies tends to favor the CEO Public boardrooms have more open lines of communication, and unsurprisingly are seen as less helpful than the Private and Non-Profit segments Non-Profit boards are focused on strategic issues, while Public boards have a greater focus on tactical processes Atenga, Inc Pricing = leverage How would you describe the shared level of control between you and the board? According to the CEOs in the survey, executives tend to hold a bit more sway than their boards with 50% of respondents describing their level of control as favoring the CEO n = 100 0% 10% 20% 30% 40% CEO controls everything 2 Evenly share control 4 Board controls everything Atenga, Inc Pricing = leverage How would you describe the interaction between you and the board? 0% 10% 20% 30% 40% 50% 60% Positive relationship 2 So-so relationship 4 Adversarial relationship Greater than 50% of respondents see the interaction between themselves and the board to be uniformly positive 5% of respondents would describe their interactions as adversarial n = 100 Atenga, Inc Pricing = leverage How would you describe the level of communication between you and the board? 0% 10% 20% 30% 40% 50% 60% Extremely open 2 Somewhat open 4 Guarded and closed Respondents tend to describe their level of communication as Extremely Open, with the size of segments decreasing as communication becomes more closed n = 100 Atenga, Inc Pricing = leverage How would you rate how helpful the board is to you in running your business? 0% 5% 10% 15% 20% 25% 30% Extremely helpful 2 Somewhat helpful 4 Not helpful at all Boards are generally seen by CEOs to be helpful, though the amount of help they provide could increase on average n = 100 Atenga, Inc Pricing = leverage How would you describe your board’s focus on tactical or strategic issues? 0% 10% 20% 30% 40% Extremely tactical 2 Tactical and strategic 4 Extremely strategic The largest percentage of boards (35%) have a focus on both Tactical and Strategic issues Overall, around twice as many respondents see their focus as Extremely Tactical compared to those that describe it as Extremely Strategic n = 100 Atenga, Inc Pricing = leverage Excluding you, how would you describe the composition of your board? 0% 5% 10% 15% 20% 25% 30% All internal advisors 2 Even mix of int. and ext. advisors 4 All external advisors There is no significant trend when looking at the composition of the board, though one consisting of All External Advisors is slightly more prevalent than the rest of the segments, with 26% of respondents n = 100 Atenga, Inc Pricing = leverage 0% 25% 50% 75% 100% Ownership Revenue Industry Demographic Data Public 9% Private 81% Non-profit 10% < $1m 25% $1m - $10m 35% $10m -$50m 22% $50m - $100m 6% > $100m 12% Business Services 10% Technology 53% Media/Internet 11% Financial Service 6% Other 21% Atenga, Inc Pricing = leverage Commentary It is my experience that too many CEOs do not take advantage of the know-how of its board members. Ego plays a big role in this. I am a CEO and I serve on boards. I have learned a lot as a board member on how to effectively use a board to create value and advance the business. My board acts too much in the best interest of their investment and not in the best interest of the company. We have unusual VC backing in that all investors are common share holders, rather than preferred share holders. This creates a more "aligned" approach to Board decisions compared to companies with Directors "representing" preferred share holders and Directors "representing" common shareholders. Our Board is very helpful in our fund raising activities, since we are pre-revenue. We all get along great There is controversy in identifying what constitutes management responsibilities vs. being advisory to management. The Board often goes beyond their role into management's domain. There is generally no harm but often no benefit. Working out these roles has been difficult 10