Goldsmith Agio Helms Announces
the Sale of its Client, Performance Bicycle

NEW YORK, NY – July 12, 2007: 
Goldsmith Agio Helms is pleased to announce the recapitalization of its client, Performance, Inc. (“Performance Bicycle” or the “Company”), through a controlling equity investment by North Castle Partners (“North Castle”), and significant equity participation from the Company’s management team.  Performance Bicycle is the largest independent bicycle dealer and direct marketer of bicycles and cycling accessories in the United States.  With the sale of Performance Bicycle, Goldsmith Agio Helms has successfully completed over 50 direct marketing transactions with 19 in the last two years alone.

TRANSACTION HIGHLIGHTS
Founded more than 25 years ago, Performance Bicycle has become the overwhelming market leader in each of its three channels – retail, catalog, and internet.  Performance Bicycle operates 74 modern retail stores in 14 states, as well as two catalogs and two e-commerce websites.   The Company plans to open more than 90 additional retail stores over the next four years.  Performance Bicycle has capitalized on a highly fragmented market and its market-leading position by developing a venerable roster of 15 distinct proprietary product brands.  The Performance Bicycle brand represents high quality, value-engineered cycling apparel and accessories, providing more features and functionality for less.  The Company’s Bike Nashbar brand has a distinct reputation for selling name-brand merchandise at opportunistic pricing.  In addition to name-brand merchandise, Performance Bicycle sells a range of respected proprietary brands including high-end bicycles such as Scattante and Tirreno, components such as E3 Cycling and Forte, and accessories such as Spin Doctor and Ascent. All of these brands present outstanding value propositions — loaded with popular features at competitive prices — and hold significant market share.

Performance Bicycle’s unique position, strong brands, and compelling growth opportunities resulted in significant interest from potential investors.

Chip Baird, North Castle’s Founder and Chairman said “We are very excited about our investment in Performance, which we believe is the leader in the independent bicycle dealer market and is poised for significant growth. Performance is similar to other successful North Castle investments in that it operates in a highly fragmented industry that is benefiting from burgeoning consumer interest in health and fitness.  The combination of a strong management team, the involvement of North Castle’s Operating Advisors, and our general knowledge and experience that has come from building other successful retail businesses, such as Equinox and Red Door, provides the foundation for Performance to continue its success as the retail leader in the cycling industry.”

“We look forward to a great partnership with North Castle and believe they can add tremendous value to our company,” said Mr. Snook, CEO and Co-founder. “By leveraging their expertise and resources in building other retail businesses and multi-channel retailing in general, we believe we will be able to accelerate our growth into new markets and increase average annual spend per household.”

Mr. Snook has maintained a significant portion of his investment in the Company, and he and other members of senior management will continue in their current positions.

David Solomon, Co-CEO at Goldsmith Agio Helms and head of its Specialty Retail and Direct Marketing Group, said “Performance Bicycle is an outstanding example of the power of a multi-channel retail strategy.  Each of the Company’s integrated retail, catalog and internet channels supports the other in a very sophisticated, data-rich manner.”

“Performance Bicycle is a perfect fit with North Castle’s focus on ‘Healthy Living and Aging’ trends,” said Steve Tipler, Vice President at Goldsmith Agio Helms.  “Not only is Performance Bicycle an extremely well-run company with a strong management team, but the Company is also poised for significant growth through compelling industry demographics and an aggressive retail store growth plan.”

THE COMPANY
Since 1982, Performance Bicycle (www.performancebike.com and www.nashbar.com) has grown to become America’s largest and most popular cycling specialty retailer and bicycle shop with 74 stores, national catalogs and internet sites.  Based out of Chapel Hill, North Carolina, the Company sells cycling apparel, sports nutrition products, bicycle-related electronics and, of course, recreational- to enthusiast-level bicycles.

THE BUYER
North Castle Partners (www.northcastlepartners.com) is a leading private equity firm focused exclusively on investments in consumer-driven product and service businesses that benefit from “Healthy Living and Aging” trends.  North Castle is a hands-on, value-added investor in high-growth, middle market companies in the (i) aesthetics & personal care, (ii) consumer health, (iii) fitness & recreation, (iv) home & leisure and (v) nutrition industries.

North Castle’s current portfolio includes such well-known brands as glominerals, Red Door Spas, Enzymatic Therapy and Octane Fitness.  Prior portfolio company holdings include Equinox Fitness, EAS, CRC Health Group, Doctor’s Dermatologic Formula, Naked Juice Company and Avalon Natural Products.

North Castle is led by a seasoned group of partners and enhanced by 12 proactive operating advisors who bring a wide range of operational and investment capabilities as well as an extensive knowledge base and network.  The strength of the North Castle team, combined with its focus and network, is creating significant competitive advantages in building world-class companies.  North Castle is headquartered in Greenwich, CT.

ABOUT GOLDSMITH AGIO HELMS
Goldsmith Agio Helms (www.agio.com) is one of the nation's leading independent investment banking firms providing sophisticated corporate finance advisory services to middle-market businesses.  The firm's services include mergers and acquisitions, private placements of debt and equity, distressed advisory and restructuring, and financial advisory and opinion services.  The firm operates internationally from its offices in Minneapolis, New York, Chicago, Los Angeles, and Shanghai and through Agio International, a proprietary partnership of leading independent investment banks with offices in London, Edinburgh, Madrid, Milan, and Zurich. 

If you would like more information about this transaction, contact David J. Solomon  (dsolomon@agio.com) at 212-758-8575 or Steven R. Tipler (stipler@agio.com) at 612-339-0500.