Text

Analysis

Planning

Execution

Market capitalization impacted by

GOOD investor relations10%

Market capitalization impacted by POOR

investor relations15%

Management historically not in sync with investors

& analysts65%

a disservice to your shareholders.

Multi-tasking the IR role is...

Why Cockrell Group

We are...Strategic, Focused, Direct

STRATEGICAlign the right company with the right investors

FOCUSEDSmall-to-mid cap

companies

DIRECTAccess to analysts and

investors in your industry

Other Firms

Experience

Attentiveness

Proactive

Accessibility

Responsive

Healthcare focused IR

PoorExcellent Good

What we do...Analysis, Planning, Execution

THE PROCESS

Planning: IR Audit, Message Alignment

Analysis: Current/Prospective shareholders

Execution: Market-the-Market - Buy/Sell-Side

Improve VisibilityEnhance Credibility

OUR GOAL

transparency

management access

analyst coverage

institutional investorsguidance

responsiveness

industry knowledge

investor conferences

non-deal roadshows

analyst meetings

ANALYSIS

• Gaps in view

•Disparate shareholder composition

• Volatility risk

• Credibility risk

Company’s View vs. Street’s View

Income GARP

Momentum Growth

Value

Industry Fundamentals

Com

pany

Val

uatio

n

PLANNING

• Perception study

• IR Audit

•Message refinement

•Marketing plan

Preliminary Valuation & Analysis

EBITDA compared with EV/EBITDA• CSU is currently trading at a multiple only slightly above its peers, however it should command a slightly higher multiple

given the EBITDA margin it generates. This would be the same when using EBITDAR; the company also trades at a

premium to its peer group. Nonetheless, the EBITDA margin relative to its EV multiple is quite narrow suggesting that

the company may have additional upside.

2010 EBITDA MarginEV/2010 EBITDA

0

5

10

15

20

CSU ESC SUNH ENSG SKH ODSY

10.113.7

5.9 5.5 5.9 6.2

15.817.8

8.8

13.5 14.6 14.2

Cockrell Group Valuation Matrix• Solid industry fundamentals combined with a high trading multiple suggests that CSU shares should attract more

GROWTH oriented investors.

Income GARP

Momentum Growth

Value

Industry Fundamentals

Com

pany

Val

uatio

n

CSU Assessment!

5

CSU Historical Shareholder composition

• It is always good to have some Momentum money in the stock. This creates volatility, which propagates trading

activity and opportunities to attract new investors to the stock.

3/09

6/09

9/09

12/09

YTD 2010

0%

10%

20%

30%

40%

Momentum GrowthGARP

Value Income

SpecialtyIndex

CSU Turnover• Low turnover likely due to low liquidity of share price, which stagnates share price performance. Introducing new

investors to the story will create an opportunity for legacy shareholders to exit the position.

3/09

6/09

9/09

12/09

YTD 2010

0%

20%

40%

60%

80%

Low

Moderate

HighCSU Assessment!

8

Capital Senior Living

Assessment

Prepared for: ! Larry Cohen, Vice Chairman & CEO

!!

Ralph Beattie, CFO

Prepared by: ! Rich Cockrell, President of The Cockrell Group

Friday, February 19, 2010

Proposal number: CSU - 1.0

Cockrell Group 1230 Peachtree Street 18th Floor Atlanta, GA 30309 T 404.942.3369 F 866.880.1512 W cockrellgroup.com

Investor introductions are facilitated through the sell-side.

70%

73%

Conflict of interest when equity sales teams arrange non-deal roadshows...

EXECUTIONMarket-the-Market: Meeting investors in the right markets

1

2 3 4

5

6

GARP concentration Mixed asset pools

Next ConsiderationHow will this impact my budget?

Small-to-mid cap companies has budget of less than $1 million

47%

80%

Reported IR budget between $250k and $1million

$120k IRO with at least 5 years experience

50% Benefits & Bonus Compensation

$50k IR Services and Administration

50%

STRATEGIC FOCUSED DIRECT

Art Blakey, legendary jazz musician

“If you’re not appearing....you’re disappearing”

Analysis

Planning

Execution

Text