First Farmers and Merchants SC 13E3/A Going private transaction (amended) | FFMH 25 Mar 16

Valuation Discussionfor the
Board ofDirectorsof

FirstFarmersand Merchants
Corporation

Columbia, Tennessee

February 16, 2016

Executive Summary

	Sheshunoff & Co. Investment Banking was engaged by First Farmers and Merchants Corporation (the “FFMH”) to determine the fair value of the FFMH’s common stock as of December 31, 2015 for the purpose of assisting the Board of Directors in:
		Determining the fair value merger consideration per share to be paid in connection with a proposed “going private,” SEC de- registration reorganization transaction.

Fair Value information provided by General Counsel is defined inSection 48-23-101(4) of the Tennessee Code as:

“The fair value, with respect to a dissenter’s shares, means the value of the shares immediately before the effectuation of the corporate action to which the dissenter objects, excluding any appreciation or depreciation in anticipation of the corporate action. ”

Page 2

Executive Summary

General Counselalsoadvised Sheshunoffthat theSupremeCourt ofTennesseehas relied on the“DelawareBlockMethod”todeterminefair value whichrequiresthe use of threedifferent methodswith appropriate weightgiven to eachmethodbased on thecircumstances specificto thecorporation.Thesemethods include:

Earnings Value Method;

Market Value Method; and

Asset Value Method

Page 3

Demographic Overview

Page 4

Page 5

Market Demographics


							Projected	Median	Projected
		Deposit	Percent of	Total	Population		Population	HH	HH Income
		Market	State	Population	Change		Change	Income	Change
	Number of	Share	Franchise	2016	2010-2016		2016-2021	2016	2016-2021
County	Branches	(%)	(%)	(Actual)	(%)		(%)	($)	(%)
Maury	8	49.14	57.97	87,820	8.48		6.71	48,303	12.26
Lawrence	3	28.79	16.13	42,482	1.46		2.37	42,416	9.41
Marshall	1	20.15	9.03	31,502	2.89		3.10	45,382	7.73
Hickman	2	34.84	6.92	24,471	(0.89	)	1.45	39,363	5.51
Williamson	2	0.73	4.65	213,927	16.78		9.53	95,167	9.96
Dickson	1	2.96	2.30	50,964	2.61		3.05	45,640	6.97
Giles	1	3.59	2.25	28,747	(2.50	)	0.02	41,718	9.85
Davidson	1	0.03	0.75	683,236	9.02		6.30	49,502	11.87
TN *Totals*	19		*100*	*1,163,149*
*Weighted* *Average:* *Tennessee* *Franchise*					*6.20*		*5.22*	*48,447*	*10.64*
*Aggregate:* *Entire* *State* of *Tennessee*				*6,623,654*	*4.37*		*3.82*	*46,781*	*7.13*
*Aggregate:* *National*				*322,431,073*	*4.43*		*3.69*	*55,551*	*7.77*

Page 6


Market Unemployment Data

	Unemployment Rate
County	Mar-12		Jun-12		Sep-12		Dec-12		Mar-13		Jun-13		Sep-13		Dec-13
Maury	8.2	%	8.3	%	7.4	%	7.6	%	7.7	%	7.9	%	7.1	%	5.9	%
Lawrence	9.6	%	10.5	%	8.8	%	10.0	%	10.5	%	10.6	%	9.5	%	8.3	%
Marshall	9.9	%	9.9	%	8.6	%	9.0	%	8.7	%	8.8	%	7.8	%	6.4	%
Hickman	9.4	%	9.6	%	8.1	%	8.5	%	8.9	%	9.0	%	7.7	%	6.6	%
Williamson	4.7	%	5.6	%	4.7	%	4.7	%	4.9	%	5.9	%	5.1	%	4.1	%
Dickson	8.7	%	8.9	%	7.6	%	7.8	%	8.1	%	8.4	%	7.2	%	6.0	%
Giles	8.4	%	9.1	%	8.0	%	8.6	%	8.9	%	9.1	%	7.8	%	6.5	%
Davidson	6.3	%	6.7	%	5.9	%	5.7	%	6.0	%	6.5	%	5.9	%	4.7	%

*Deposit Weighted Average*	*8.5*	%	*8.8*	%	*7.7*	%	*8.1*	%	*8.2*	%	*8.4*	%	*7.5*	%	*6.3*	%
*State of Tennessee*	*7.9*	%	*8.4*	%	*7.3*	%	*7.6*	%	*8.0*	%	*8.5*	%	*7.5*	%	*6.5*	%
*U.S.*	*8.4*	%	*8.4*	%	*7.6*	%	*7.6*	%	*7.6*	%	*7.8*	%	*7.0*	%	*6.5*	%

	Unemployment Rate
County	Mar-15		Jun-14		Sep-14		Dec-14		Mar-15		Jun-15		Sep-15		Dec-15
Maury	5.3	%	6.4	%	6.0	%	5.5	%	5.3	%	5.5	%	5.2	%	5.1	%
Lawrence	7.1	%	8.5	%	7.8	%	7.7	%	7.1	%	7.4	%	6.5	%	6.5	%
Marshall	5.5	%	6.8	%	6.3	%	5.9	%	5.5	%	6.3	%	5.9	%	5.7	%
Hickman	6.0	%	7.1	%	6.3	%	6.1	%	6.0	%	6.3	%	5.6	%	5.5	%
Williamson	3.9	%	5.2	%	4.6	%	4.1	%	3.9	%	4.6	%	4.1	%	3.6	%
Dickson	5.7	%	6.7	%	6.0	%	5.6	%	5.7	%	6.0	%	5.5	%	4.8	%
Giles	5.3	%	6.8	%	6.0	%	5.7	%	5.3	%	5.7	%	5.2	%	4.8	%
Davidson	4.4	%	5.4	%	5.1	%	4.7	%	4.4	%	4.9	%	4.6	%	4.0	%

*Deposit Weighted Average*	*5.6*	%	*6.8*	%	*6.3*	%	*5.9*	%	*5.6*	%	*5.9*	%	*5.5*	%	*5.3*	%
*State of Tennessee*	*5.8*	%	*7.1*	%	*6.5*	%	*6.1*	%	*5.8*	%	*6.3*	%	*5.7*	%	*5.3*	%
*U.S.*	*5.6*	%	*6.3*	%	*5.7*	%	*5.4*	%	*5.6*	%	*5.5*	%	*4.9*	%	*4.8*	%

Page 7

Performance Overview

Page 8


FFMH Financial Summary


Balance Sheet

																		Changes 2014 2015					CAGR
			2011			2012			2013			2014			2015			Dollar		Percent			2011-2015
Interest Bearing Deposits	$		38,594		$	31,953		$	25,166		$	10,087		$	18,299		$	8,212		81.4	%		-17.0	%
Fed Funds Sold			16,500			15,000			9,850			1,700			24,476			22,776		1339.8	%		10.4	%
Securities			349,501			377,490			357,570			419,888			399,095			(20,793	)	-5.0	%		3.4	%
Loans & Leases			520,307			569,615			606,605			652,406			731,266			78,860		12.1	%		8.9	%
TOTAL EARNING ASSETS	$	924,902			$	994,058		$	999,191		$	1,084,081		$	1,173,136		$	89,055		8.2	%		6.1	%
Allowance for Loan Losses	($		9,200	)	($	8,809	)	($	8,595	)	($	7,934	)	($	8,634	)	($	700	)	8.8	%		NA
Cash & Equivalents			17,926			23,443			20,391			18,510			19,453			943		5.1	%		2.1	%
Fixed Assets			25,537			26,418			24,868			25,774			25,518			(256	)	-1.0	%		0.0	%
Other Real Estate Owned (OREO)			8,827			5,678			1,438			5			62			57		1140.0	%		-71.1	%
Goodwill			9,018			9,018			9,018			9,018			9,018			0		0.0	%		0.0	%
Other Intangible Assets			0			0			0			0			0			0		0.0	%		NA
Other Assets			40,798			41,682			46,075			41,542			41,757			215		0.5	%		0.6	%
TOTAL ASSETS	$	1,017,808			$	1,091,488		$	1,092,386		$	1,170,996		$	1,260,310		$	89,314		7.6	%		5.5	%

Demand Deposits	$		85,789		$	106,488		$	110,019		$	125,336		$	144,119		$	18,783		15.0	%		13.8	%
NOW & Interest Bearing Deposits			96,615			99,230			55,035			102,272			136,005			33,733		33.0	%		8.9	%
Money Market & Other Savings			432,375			478,933			553,450			566,028			612,382			46,354		8.2	%		9.1	%
Certificate of Deposits < $100M			133,149			128,040			116,056			105,072			99,288			(5,784	)	-5.5	%		-7.1	%
Certificate of Deposits > $100M			108,507			120,161			122,777			121,246			112,007			(9,239	)	-7.6	%		0.8	%
TOTAL DEPOSITS	$	856,435			$	932,852		$	957,337		$	1,019,954		$	1,103,801		$	83,847		8.2	%		6.5	%
Fed Funds & Repos	$		16,347		$	17,069		$	18,095		$	22,834		$	24,177		$	1,343		5.9	%		10.3	%
Short Term Borrowings			7,000			10,100			0			0			0			0		0.0	%		NA
Long Term Borrowings			10,100			0			0			0			0			0		0.0	%		NA
Other Liabilities			15,777			18,672			12,750			13,623			14,542			919		6.7	%		-2.0	%
TOTAL LIABILITIES	$	905,659			$	978,693		$	988,182		$	1,056,411		$	1,142,520		$	86,109		8.2	%		6.0	%
Trust Preferred			0			0			₀			0			0		$	0		_0.0	_%	NA
Minority Interest			95			95			95			95			95			0		0.0	%		0.0	%
Preferred Stock			0			0			0			0			0			0		0.0	%		NA
Other Comprehensive Income	$		3,208		$	1,738		($	9,001	)	($	2,125	)	($	1,283	)	$	842		-39.6	%		NA
Common Equity			108,846			110,962			113,110			116,615			118,978			2,363		2.0	%		2.3	%
TOTAL COMMON EQUITY	$	112,054			$	112,700		$	104,109		$	114,490		$	117,695		$	3,205		2.8	%		1.2	%
TOTAL EQUITY	$	112,149			$	112,795		$	104,204		$	114,585		$	117,790		$	3,205		2.8	%		1.2	%
TOTAL LIABS & EQUITY	$	1,017,808			$	1,091,488		$	1,092,386		$	1,170,996		$	1,260,310		$	89,314		7.6	%		5.5	%

Page 9

FFMH Financial Summary

Common Sized Balance Sheet



	2011		2012		2013		2014		2015			Average
Interest Bearing Deposits	3.8	%	2.9	%	2.3	%	0.9	%	1.5	%		2.3	%
Fed Funds Sold	1.6	%	1.4	%	0.9	%	0.1	%	1.9	%		1.2	%
Securities	34.3	%	34.6	%	32.7	%	35.9	%	31.7	%		33.8	%
Loans & Leases	51.1	%	52.2	%	55.5	%	55.7	%	58.0	%		54.5	%
TOTAL EARNING ASSETS	90.9	%	91.1	%	91.5	%	92.6	%	93.1	%		91.8	%
Allowance for Loan Losses	-0.9	%	-0.8	%	-0.8	%	-0.7	%	-0.7	%		-0.8	%
Cash & Equivalents	1.8	%	2.1	%	1.9	%	1.6	%	1.5	%		1.8	%
Fixed Assets	2.5	%	2.4	%	2.3	%	2.2	%	2.0	%		2.3	%
Other Real Estate Owned (OREO)	0.9	%	0.5	%	0.1	%	0.0	%	0.0	%		0.3	%
Goodwill	0.9	%	0.8	%	0.8	%	0.8	%	0.7	%		0.8	%
Other Intangible Assets	0.0	%	0.0	%	0.0	%	0.0	%	0.0	%		0.0	%
Other Assets	4.0	%	3.8	%	4.2	%	3.5	%	3.3	%		3.8	%
TOTAL ASSETS	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%		100.0	%

Demand Deposits	8.4	%	9.8	%	10.1	%	10.7	%	11.4	%		10.1	%
NOW & Interest Bearing Deposits	9.5	%	9.1	%	5.0	%	8.7	%	10.8	%		8.6	%
Money Market & Other Sav. Accts	42.5	%	43.9	%	50.7	%	48.3	%	48.6	%		46.8	%
Certificate of Deposits < $100M	13.1	%	11.7	%	10.6	%	9.0	%	7.9	%		10.5	%
Certificate of Deposits > $100M	10.7	%	11.0	%	11.2	%	10.4	%	8.9	%		10.4	%
TOTAL DEPOSITS	84.1	%	85.5	%	87.6	%	87.1	%	87.6	%		86.4	%
Fed Funds & Repos	1.6	%	1.6	%	1.7	%	1.9	%	1.9	%		1.7	%
Short Term Borrowings	0.7	%	0.9	%	0.0	%	0.0	%	0.0	%		0.3	%
Long Term Borrowings	1.0	%	0.0	%	0.0	%	0.0	%	0.0	%		0.2	%
Other Liabilities	1.6	%	1.7	%	1.2	%	1.2	%	1.2	%		1.3	%
TOTAL LIABILITIES	89.0	%	89.7	%	90.5	%	90.2	%	90.7	%		90.0	%
Trust Preferred	0.0	%	0.0	%	0.0	%	0.0	%	0.0	%	0.0		%
Minority Interest	0.0	%	0.0	%	0.0	%	0.0	%	0.0	%		0.0	%
Preferred Stock	0.0	%	0.0	%	0.0	%	0.0	%	0.0	%		0.0	%
Other Comprehensive Income	0.3	%	0.2	%	-0.8	%	-0.2	%	-0.1	%		-0.1	%
Common Equity	10.7	%	10.2	%	10.4	%	10.0	%	9.4	%		10.1	%
TOTAL COMMON EQUITY	11.0	%	10.3	%	9.5	%	9.8	%	9.3	%		10.0	%
TOTAL EQUITY	11.0	%	10.3	%	9.5	%	9.8	%	9.3	%		10.0	%
TOTAL LIABS & EQUITY	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%		100.0	%

Page 10


FFMH Financial Summary


Income Statement

															Changes 2014 2015					CAGR
		2011			2012			2013			2014		2015		Dollar		Percent			2011-2015
Interest Income Tax Equivalent	$	40,631		$	38,738		$	39,403		$	38,624	$	40,731	$	2,107		5.5	%		0.1	%
Interest Expense		4,942			3,841			2,907			2,405		2,225		(180	)	-7.5	%		-18.1	%
NET INTEREST INCOME	$	35,689		$	34,897		$	36,496		$	36,219	$	38,506	$	2,287		6.3	%		1.9	%
Provision for Loan Losses	$	3,125		$	1,120		$	0		$	0	$	30	$	30		0.0	%		-68.7	%
Service Charges	$	3,678		$	3,366		$	3,096		$	3,006	$	3,270	$	264		8.8	%		-2.9	%
Fiduciary Fees		1,999			2,119			2,298			2,490		2,530		40		1.6	%		6.1	%
Insurance Commissions and Fees		171			162			84			97		49		(48	)	-49.5	%		-26.8	%
Net Gain on Sale of OREO/Other Assets		(994	)		(1,414	)		(323	)		516		33		(483	)	-93.6	%		NA
Net Servicing Fees		0			0			0			0		0		0		0.0	%		NA
Net Gain on Sale of Loans/Leases		469			510			467			324		270		(54	)	-16.7	%		-12.9	%
Other Fee Income		36			231			361			410		540		130		31.7	%		96.8	%
Other Non Interest Income		3,659			3,824			3,749			3,694		3,860		166		4.5	%		1.3	%
NON INTEREST INCOME	$	9,018		$	8,798		$	9,732		$	10,537	$	10,552	$	15		0.1	%		4.0	%
Securities Gains (Losses)	$	1,458		$	2,294		$	829		$	651	$	534	($	117	)	-18.0	%		-22.2	%
Salaries & Benefits	$	18,836		$	16,485		$	18,331		$	17,557	$	18,896	$	1,339		7.6	%		0.1	%
Fixed Assets		3,711			3,861			3,977			3,924		4,159		235		6.0	%		2.9	%
Other Expense		10,569			10,247			10,935			10,805		11,143		338		3.1	%		1.3	%
NON INTEREST EXPENSE	$	33,116		$	30,593		$	33,243		$	32,286	$	34,198	$	1,912		5.9	%		0.8	%
PRE TAX INCOME	$	9,924		$	14,276		$	13,814		$	15,121	$	15,364	$	243		1.6	%		11.5	%
Income Taxes	$	744		$	3,040		$	2,700		$	3,556	$	3,349	($	207	)	-5.8	%		45.7	%
Tax Exempt Adjustment		2,168			1,816			1,487			1,307		1,693		386		29.5	%		-6.0	%
INCOME BEFORE EXTRAS	$	7,012		$	9,420		$	9,627		$	10,258	$	10,322	$	450		0.6	%		10.1	%
Net Income:Noncontrolling Interests		16			16			16			16		16		0		0.0	%		0.0	%
Extraordinary Items		0			0			0			0		0		0		0.0	%	NA
NET INCOME	$	6,996		$	9,404		$	9,611		$	10,242	$	10,306	$	450		0.6	%		10.2	%

Preferred Dividends	$	0		$	0		$	0		$	0	$	0
Common Dividends	$	3,964		$	3,888		$	3,741		$	3,640	$	3,535

Page 11

FFMH Financial Summary


Common Sized Income Statement


			2011			2012			2013			2014			2015			Average
Interest Income Tax Equivalent			4.13	%		3.71	%		3.62	%		3.46	%		3.35	%		3.65	%
Interest Expense			0.50	%		0.37	%		0.27	%		0.22	%		0.18	%		0.31	%
NET INTEREST INCOME			3.63	%		3.34	%		3.35	%		3.24	%		3.17	%		3.35	%
Provision for Loan Losses			0.32	%		0.11	%		0.00	%		0.00	%		0.00	%		0.09	%
Service Charges			0.37	%		0.32	%		0.28	%		0.27	%		0.27	%		0.30	%
Fiduciary Fees			0.20	%		0.20	%		0.21	%		0.22	%		0.21	%		0.21	%
Insurance Commissions and Fees			0.02	%		0.02	%		0.01	%		0.01	%		0.00	%		0.01	%
Net Gain on Sale of OREO/Other Assets			-0.10	%		-0.14	%		-0.03	%		0.05	%		0.00	%		-0.04	%
Net Servicing Fees			0.00	%		0.00	%		0.00	%		0.00	%		0.00	%		0.00	%
Net Gain on Sale of Loans/Leases			0.05	%		0.05	%		0.04	%		0.03	%		0.02	%		0.04	%
Other Fee Income			0.00	%		0.02	%		0.03	%		0.04	%		0.04	%		0.03	%
Other NonInterest Income			0.37	%		0.37	%		0.34	%		0.33	%		0.32	%		0.35	%
NONINTEREST INCOME			0.92	%		0.84	%		0.89	%		0.94	%		0.87	%		0.89	%
Security Gains (Losses)			0.15	%		0.22	%		0.08	%		0.06	%		0.04	%		0.11	%
Salaries & Benefits			1.91	%		1.58	%		1.68	%		1.57	%		1.55	%		1.66	%
Fixed Assets			0.38	%		0.37	%		0.37	%		0.35	%		0.34	%		0.36	%
Other Expense			1.07	%		0.98	%		1.00	%		0.97	%		0.92	%		0.99	%
NONINTEREST EXPENSE			3.37	%		2.93	%		3.05	%		2.89	%		2.81	%		3.01	%
PRETAX INCOME			1.01	%		1.37	%		1.27	%		1.35	%		1.26	%		1.25	%
Income Taxes			0.08	%		0.29	%		0.25	%		0.32	%		0.28	%		0.24	%
TaxExempt Adjustment			0.22	%		0.17	%		0.14	%		0.12	%		0.14	%		0.16	%
INCOME BEFORE EXTRAS			0.71	%		0.90	%		0.88	%		0.92	%		0.85	%		0.85	%
Net Income:Noncontrolling Interests			0.00	%		0.00	%		0.00	%		0.00	%		0.00	%		0.00	%
Extraordinary Items			^0.00	^%		0.00	%		0.00	%		0.00	%		^0.00	^%	0.00		%
NET INCOME			0.71	%		0.90	%		0.88	%		0.92	%		0.85	%		0.85	%

Average Total Assets	$	983,764			$	1,044,583		$	1,088,411		$	1,117,829		$	1,216,071

Page 12


FFMH Financial Summary


Loan Portfolio

																		Changes 2014 2015				CAGR
		2011			2012			2013			2014			2015				Dollar		Percent		2011	15
Construction & Development	$	33,270		$	41,848		$	35,066		$	58,210		$	60,323			$	2,113		3.6	%	16.0	%
Commercial Real Estate		143,966			171,867			185,901			172,599			168,341				(4,258	)	-2.5	%	4.0	%
Commercial & Industrial		57,762			82,857			93,658			98,964			127,096				28,132		28.4	%	21.8	%
Farmland		27,940			27,401			29,637			31,688			31,535				(153	)	-0.5	%	3.1	%
Agricultural		365			332			348			1,490			898				(592	)	-39.7	%	25.2	%
Residential Real Estate		209,798			204,715			218,879			233,116			264,042				30,926		13.3	%	5.9	%
Consumer		15,445			15,648			16,240			15,749			18,606				2,857		18.1	%	4.8	%
Other Balances		31,761			24,947			26,876			40,590			60,425				19,835		48.9	%	17.4	%
TOTAL LOANS	$	520,307		$	569,615		$	606,605		$	652,406		$	731,266			$	78,860		12.1	%	8.9	%

(% of Total Loans)
		2011			2012			2013			2014			2015		Average
Construction & Development		6.4	%		7.3	%		5.8	%		8.9	%		8.2	%			7.3	%
Commercial Real Estate		27.7	%		30.2	%		30.6	%		26.5	%		23.0	%			27.6	%
Commercial & Industrial		11.1	%		14.5	%		15.4	%		15.2	%		17.4	%			14.7	%
Farmland		5.4	%		4.8	%		4.9	%		4.9	%		4.3	%			4.8	%
Agricultural		0.1	%		0.1	%		0.1	%		0.2	%		0.1	%			0.1	%
Residential Real Estate		40.3	%		35.9	%		36.1	%		35.7	%		36.1	%			36.8	%
Consumer		3.0	%		2.7	%		2.7	%		2.4	%		2.5	%			2.7	%
Other Balances		6.1	%		4.4	%		4.4	%		6.2	%		8.3	%			5.9	%
TOTAL LOANS		100.0	%		100.0	%		100.0	%		100.0	%		100.0	%			100.0	%

Concentrations in Commercial RE Lending

		2011			2012			2013			2014			2015
Total Construction & Development	$	33,270		$	41,848		$	35,066		$	58,210		$	60,323
Total Risk Based Capital	$	107,852		$	110,719		$	111,807		$	115,532		$	118,594
% of Total Risk Based Capital		30.8	%		37.8	%		31.4	%		50.4	%		50.9	%

Const. & Develop and Comm Real Estate	$	94,626		$	132,872		$	146,351		$	161,631		$	161,120
% of Total Risk Based Capital		87.7	%		120.0	%		130.9	%		139.9	%		135.9	%

Page 13


FFMH Financial Summary


Credit Quality
																	Changes 20142015
Asset Quality		2011			2012			2013			2014			2015			Dollar		Percent
Loans 90+ Past Due	$	0		$	28		$	0		$	97		$	0		($	97	)	NA
NonAccrual Loans		11,469			8,074			5,396			5,380			2,197		($	3,183	)	-59.2	%
NONPERFORMING LOANS	$	11,469		$	8,102		$	5,396		$	5,477		$	2,197		($	3,280	)	-59.9	%
Other Real Estate Owned (OREO)	$	8,827		$	5,678		$	1,438		$	5		$	62		$	57		1140.0	%
Other Assets 90+ Past Due		0			0			0			0			0		$	0		NA
Other NonAccrual Assets		0			0			0			0			0		$	0		NA
NONPERFORMING ASSETS	$	20,296		$	13,780		$	6,834		$	5,482		$	2,259		($	3,223	)	-58.8	%

Asset Quality Ratios																Averages
Loans 90+ Past Due, % of Loans		0.00	%		0.00	%		0.00	%		0.01	%		0.00	%		0.00	%
NonAccrual Loans, % of Loans		2.20	%		1.42	%		0.89	%		0.82	%		0.30	%		1.13	%
NPL's, % OF TOTAL LOANS		2.20	%		1.42	%		0.89	%		0.84	%		0.30	%		1.13	%
NPAs, % of Loans and OREO		3.84	%		2.40	%		1.12	%		0.84	%		0.31	%		1.70	%
NPAs, % of Assets		1.99	%		1.26	%		0.63	%		0.47	%		0.18	%		0.91	%
Texas Ratio (1)		18.07	%		12.24	%		6.59	%		4.83	%		1.92	%		8.73	%

Loan Loss Allowance
Periodend	$	9,200		$	8,809		$	8,595		$	7,934		$	8,634		$	8,634
% of NonPerforming Assets		45.33	%		63.93	%		125.77	%		144.73	%		382.20	%		152.39	%
% of NonPerforming Loans		80.22	%		108.73	%		159.28	%		144.86	%		392.99	%		177.22	%
% of Loans		1.77	%		1.55	%		1.42	%		1.22	%		1.18	%		1.43	%

Net ChargeOffs
Total ChargeOffs	$	3,552		$	1,885		$	298		$	790		$	47		$	1,314
Total Recoveries		207			374			84			129			717		$	302
NET CHARGEOFFS	$	3,345		$	1,511		$	214		$	661		($	670	)	$	1,012
Net Charge Offs / Average Loans		0.61	%		0.29	%		0.04	%		0.11	%		-0.10	%		0.19	%

(1) Texas Ratio defined as (Total NPAs)/(Tangible Equity Plus the Loan Loss Reserve)

Page 14


FFMH Financial Summary


Financial Ratios


Balance Sheet		2011			2012			2013			2014			2015			Averages
FullTime Equivalent Employee		260			259			245			239			234			247
Assets / FTE	$	3,915		$	4,214		$	4,459		$	4,900		$	5,386				$	4,575
Total Equity / Assets		11.02	%		10.33	%		9.54	%		9.79	%		9.35	%				10.00	%
Common Equity / Assets		11.01	%		10.33	%		9.53	%		9.78	%		9.34	%				10.00	%
Tangible Common Equity / Tang. Assets *		10.21	%		9.58	%		8.78	%		9.08	%		8.69	%				9.27	%
Tier 1 Capital Ratio		15.67	%		14.58	%		14.35	%		13.67	%		13.28	%				14.31	%
Total Risk Based Capital Ratio		16.91	%		15.82	%		15.55	%		14.67	%		14.32	%				15.46	%
*Includes Mortgage Servicing Rights
Loans / Deposits		60.8	%		61.1	%		63.4	%		64.0	%		66.2	%				63.1	%
Liquidity Ratio		22.5	%		21.5	%		17.2	%		18.8	%		15.5	%				19.1	%
Jumbo CDs / Total Deposits		12.7	%		12.9	%		12.8	%		11.9	%		10.1	%				12.1	%
Borrowings / Total Assets		3.3	%		2.5	%		1.7	%		1.9	%		1.9	%				2.3	%
NPAs, % of Loans and OREO		3.84	%		2.40	%		1.12	%		0.84	%		0.31	%				1.70	%
NPAs, % of Assets		1.99	%		1.26	%		0.63	%		0.47	%		0.18	%				0.91	%

Income Statement
Yield on Earning Assets		4.57	%		4.01	%		3.88	%		3.69	%		3.51	%				3.93	%
Cost of Interest Bearing Liabilities		0.64	%		0.46	%		0.33	%		0.27	%		0.23	%				0.38	%
YIELD / COST SPREAD		3.93	%		3.55	%		3.55	%		3.42	%		3.28	%				3.55	%
Net Interest Margin (Tax Equivalent)		4.01	%		3.61	%		3.60	%		3.46	%		3.32	%				3.60	%
Efficiency Ratio		74.1	%		70.0	%		71.9	%		69.1	%		69.7	%				71.0	%
Effective Tax Rate		7.5	%		21.3	%		19.5	%		23.5	%		21.8	%				18.7	%
ROAA		0.71	%		0.90	%		0.88	%		0.92	%		0.85	%				0.85	%
^ROACE		^6.61	^%		8.37	%		8.69	%		9.79	%		^8.59		^%			8.41	%
ROAE		6.61	%		8.37	%		8.69	%		9.79	%		8.59	%				8.41	%
Dividend Payout Ratio		56.7	%		41.3	%		38.9	%		35.5	%		34.3	%				41.4	%

Page 15

FFMH Market Performance

Page 16

FFMH Market Performance

Page 17

FFMH Valuation –Going Concern

Page 18

Levels of Value


	Fair Value: pro rata going concern value

Page 19

Going Concern Fair Value: Assumptions

Income Approach:

Long Term Growth Rate of 5% (after year five) into perpetuity. The FFMH posted a five-year compound annual growth rate on assets of 5.5%. The FFMH’s markets are expected to realize deposit weighted average population growth of 5.2% between 2016 and 2021. Additionally, the Congressional Budget Office projects an average nominal GDP estimates for 2020 through 2025 of 4.1%.

Discount Rate of 12.25% - The projections provided by management indicate the FFMH’s ROAA will range from 0.88% or $11 million in Year 1 to 0.94% or $12.7 million in Year 5. Between 2011 and 2015, the FFMH’s ROAA averaged 0.85% ($9.3 million), ranging 0.71% to 0.92% with sizable securities gains in 2011 and 2012. The FFMH’s ROAA in 2013 through 2015 was impacted by negligible provision for loan losses.

Page 20

Going Concern Fair Value: Assumptions


Discount Rate Calculation - December 31, 2015

Risk-free rate (20yr Treasury Constant)	2.61	%
Equity Risk Premium (Duff & Phelps) * Beta¹(7% * 0.777)	5.44	%
Size Premium (Duff & Phelps)	3.74	%
Company Specific Risk Premium	0.50	%
CALCULATED ROR	12.29	%
SELECTED ROR	12.25	%

¹BetacalculatedasMedianof banksbetween$1B and $2B in assets from 2013through2015

Page 21

Going Concern Fair Value:Income Approach


		Base
Projected Assets, Net Income, Dividends		12/31/15			2016			2017			2018			2019			2020
Asset Growth					-1.00	%		2.86	%		0.96	%		2.37	%		2.49	%
Target Total Assets	$	1,260,310		$	1,247,726		$	1,283,419		$	1,295,678		$	1,326,404		$	1,359,460
Average Assets	$	1,216,071		$	1,254,018		$	1,265,573		$	1,289,549		$	1,311,041		$	1,342,932
Return on Assets (ROAA)		0.85	%		0.88	%		0.93	%		0.95	%		0.94	%		0.94	%
NET INCOME	$	10,306		$	11,038		$	11,713		$	12,197		$	12,317		$	12,680
Preferred Dividends	$	0		$	0		$	0		$	0		$	0		$	0
AVAILABLE TO COMMON	$	10,306		$	11,038		$	11,713		$	12,197		$	12,317		$	12,680
Retained Earnings				$	7,605		$	8,354		$	8,912		$	9,106		$	9,543
AVAILABLE FOR COMMON DIVIDENDS				$	3,433		$	3,359		$	3,285		$	3,211		$	3,137

		Base
Projected Changes in Equity		12/31/15			2016			2017			2018			2019			2020
Beginning Common Equity				$	117,695		$	122,345		$	127,744		$	133,700		$	139,851
Net Income, Available to Common					11,038			11,713			12,197			12,317			12,680
Common Stock Issued					0			0			0			0			0
Treasury Purchases					(2,955	)		(2,955	)		(2,955	)		(2,955	)		(2,955	)
Dividends Paid to Common					(3,433	)		(3,359	)		(3,285	)		(3,211	)		(3,137	)
ENDING COMMON EQUITY	$	117,695		$	122,345		$	127,744		$	133,700		$	139,851		$	146,439
Goodwill	($	9,018	)	($	9,018	)	($	9,018	)	($	9,018	)	($	9,018	)	($	9,018	)
Other Intangibles		0			0			0			0			0			0
TANGIBLE COMMON EQUITY	$	108,677		$	113,327		$	118,726		$	124,682		$	130,833		$	137,421

Ratios
Common Payout Ratio		NA			31.10	%		28.68	%		26.93	%		26.07	%		24.74	%
Tangible Common/Tangible Assets		8.69	%		9.15	%		9.32	%		9.69	%		9.93	%		10.18	%

Page 22

Going Concern Fair Value:Income Approach


(Thousands)												Terminal
		2016		2017		2018		2019		2020		Value
Optimum Dividends	$	10,851	$	11,320	$	8,541	$	6,278	$	6,358	$	173,172
Discount Factors @ 12.25%		0.9439		0.8409		0.7491		0.6673		0.5945		0.5611
ANNUAL PRESENT VALUE	$	10,242	$	9,519	$	6,398	$	4,190	$	3,780	$	97,173

TOTAL PRESENT VALUE	$	131,301

Page 23

Going Concern Fair Value: Assumptions

	Market Approach: Regional Guideline Companies
		Sheshunoff reviewed regional publicly traded banks on either the NYSE, NYSE-AMEX, or NASDAQ exchange;
		Headquartered in Tennessee, Kentucky, Alabama, or Mississippi; and
		Total assets less than $5 billion.
	Sheshunoff focused on Publicly Traded companies that had performance similar to the FFMH with:
		Tangible Equity to Assets Between 7% and 10% (FFMH 8.69%)
		NPAs/Assets between 0.10% and 0.50% (FFMH 0.18%)
		LTM Core ROAA between 0.75% and 0.95% (FFMH 0.82%)
		Loan to Deposits between 55% and 75% (FFMH 66%)

Page 24

Going Concern Fair Value:Market Approach

							Pricing Multiples								Four Year Growth Rates
			Number		Stock	Change				Core
			of		Price as of	Since		Tangible	8% Tg.	LTM											Core
Company	City	ST	Branches	Ticker	12/31/15	2015Q3	Book	Book	Book	EPS	Assets		Deposits		Asset		Loan		Deposit		Income

Auburn National Bancorp.	Auburn	AL	9	AUBN	29.62	11.9%	1.35	1.35	1.43	14.2	13.2	%	14.9	%	1.3	%	NM		4.0	%	NM
Citizens First Corp.	Bowling Green	KY	8	CZFC	13.74	8.5%	0.85	0.98	0.99	9.4	6.3	%	7.3	%	1.7	%	2.9	%	2.7	%	9.2	%
Citizens Holding Co.	Philadelphia	MS	23	CIZN	23.72	6.6%	1.34	1.39	1.42	15.3	11.9	%	15.3	%	3.3	%	2.5	%	7.1	%	NM
Commerce Union Bancshares Inc.	Brentwood	TN	7	CUBN	13.71	3.1%	1.03	1.20	1.24	14.7	11.4	%	15.6	%	43.1	%	44.0	%	41.8	%	51.4	%
Community Trust Bancorp Inc.	Pikeville	KY	81	CTBI	34.96	-1.5%	1.29	1.50	1.66	13.1	15.7	%	20.6	%	2.1	%	3.0	%	0.9	%	4.6	%
Farmers Capital Bank Corp.	Frankfort	KY	34	FFKT	27.11	9.1%	1.16	1.16	1.19	13.7	11.4	%	14.8	%	-1.5	%	-2.7	%	-1.2	%	49.3	%
First Bancshares Inc.	Hattiesburg	MS	28	FBMS	18.34	5.0%	1.14	1.40	1.31	11.6	8.6	%	10.8	%	13.9	%	18.9	%	12.4	%	27.6	%
Franklin Financial Network Inc	Franklin	TN	12	FSB	31.38	40.4%	1.86	1.98	1.95	20.3	15.3	%	18.3	%	46.9	%	53.9	%	45.4	%	75.2	%
HopFed Bancorp Inc.	Hopkinsville	KY	18	HFBC	12.00	0.4%	0.94	0.94	0.93	38.4	9.1	%	11.1	%	-3.5	%	-0.1	%	-2.0	%	8.6	%
National Commerce Corp.	Birmingham	AL	18	NCOM	25.05	4.5%	1.30	1.74	1.84	28.2	15.4	%	17.9	%	42.6	%	44.3	%	47.0	%	113.7	%
Peoples Financial Corp.	Biloxi	MS	19	PFBX	9.00	-7.2%	0.50	0.50	0.11	NM	7.2	%	9.0	%	-5.5	%	-6.0	%	2.3	%	NM
Porter Bancorp Inc.	Louisville	KY	17	PBIB	1.43	2.1%	1.32	1.34	1.13	NM	4.1	%	4.4	%	-10.1	%	-14.1	%	-9.8	%	NM
Republic Bancorp Inc.	Louisville	KY	40	RBCAA	26.41	7.6%	0.96	0.97	0.96	15.6	13.0	%	22.2	%	5.5	%	9.8	%	9.4	%	-21.3	%
SmartFinancial Inc.	Knoxville	TN	12	SMBK	16.09	6.9%	1.06	1.15	1.15	37.0	9.1	%	10.9	%	24.8	%	28.4	%	28.6	%	26.3	%
Stock Yards Bancorp Inc.	Louisville	KY	37	SYBT	37.79	4.0%	1.97	1.98	2.24	15.2	20.0	%	23.8	%	8.2	%	7.1	%	10.0	%	12.1	%
United Security Bancshares	Thomasville	AL	21	USBI	8.92	9.7%	0.71	0.71	0.51	21.1	9.4	%	11.2	%	-1.9	%	-10.5	%	-2.3	%	NM

Note: Regional defined as headquartered in Tennessee, Kentucky, Alabama, or Mississippi

			Maximum		37.79	40.4%	1.97	1.98	2.24	38.4	20.0	%	23.8	%	46.9	%	53.9	%	47.0	%	113.7	%
			Minimum		1.43	-7.2%	0.50	0.50	0.11	9.4	4.1	%	4.4	%	-10.1	%	-14.1	%	-9.8	%	-21.3	%
			Average		20.58	6.9%	1.17	1.27	1.25	19.1	11.3	%	14.3	%	10.7	%	12.1	%	12.3	%	32.4	%
			Median		21.03	5.8%	1.15	1.27	1.22	15.2	11.4	%	14.9	%	2.7	%	3.0	%	5.5	%	26.3	%

First Farmers And Merchants Corporation			19	FFMH	22.35	20.0%	0.90	0.97	0.97	10.9	8.4	%	9.6	%	5.5	%	8.9	%	6.5	%	10.2	%

Page 25

Going Concern Fair Value:Market Approach


	Balance Sheet Ratios															Profitability Ratios
																Core		Core
		Total	Common		T. Com		Total Risk									Return		Return				Net
		Assets	Equity/		Equity/		Based		Loans/			Jumbos/		Borrs/		on Avg		Avg Com		Efficiency		Interest
Company		($000's)	Assets		T. Assets		Capital		Deposits		Deposits			Assets		Assets		Equity		Ratio		Margin

Auburn National Bancorp.		817,189	9.78	%	9.78	%	17.33	%	58.2	%		17.5	%	1.3	%	0.95	%	9.69	%	57.6	%	3.17	%
Citizens First Corp.		432,181	7.37	%	6.43	%	13.10	%	88.0	%		3.2	%	4.6	%	0.88	%	12.14	%	69.9	%	3.77	%
Citizens Holding Co.		973,505	8.88	%	8.58	%	17.07	%	56.2	%		5.7	%	12.3	%	0.80	%	8.99	%	70.7	%	3.23	%
Commerce Union Bancshares Inc.		876,404	11.04	%	9.66	%	NA		103.7	%		NA		15.5	%	0.93	%	8.15	%	76.4	%	4.14	%
Community Trust Bancorp Inc.		3,903,934	12.18	%	10.68	%	17.88	%	95.2	%		20.4	%	10.7	%	1.23	%	9.98	%	56.2	%	3.81	%
Farmers Capital Bank Corp.		1,775,950	9.89	%	9.89	%	20.12	%	69.3	%		8.2	%	11.5	%	0.85	%	8.96	%	74.8	%	3.29	%
First Bancshares Inc.		1,145,131	7.54	%	6.24	%	12.08	%	84.0	%		11.1	%	10.5	%	0.80	%	11.03	%	69.9	%	3.74	%
Franklin Financial Network Inc		2,167,282	8.25	%	7.78	%	12.18	%	72.0	%		27.5	%	7.3	%	0.92	%	9.82	%	56.4	%	3.62	%
HopFed Bancorp Inc.		903,154	9.70	%	9.70	%	16.84	%	75.6	%		10.1	%	7.9	%	0.22	%	2.18	%	84.9	%	3.35	%
National Commerce Corp.		1,764,607	11.86	%	9.10	%	13.66	%	87.5	%		14.8	%	1.2	%	0.79	%	6.22	%	66.4	%	4.07	%
Peoples Financial Corp.		641,004	14.33	%	14.31	%	20.14	%	64.3	%		4.4	%	2.8	%	-1.96	%	-14.22	%	110.9	%	3.18	%
Porter Bancorp Inc.		948,722	3.08	%	3.04	%	10.40	%	69.1	%		27.6	%	3.0	%	-0.48	%	-16.19	%	93.4	%	3.22	%
Republic Bancorp Inc.		4,230,289	13.63	%	13.42	%	20.77	%	132.8	%		5.4	%	26.9	%	0.88	%	6.11	%	65.4	%	3.27	%
SmartFinancial Inc.		1,023,963	8.61	%	7.99	%	12.25	%	84.3	%		25.2	%	6.1	%	0.36	%	4.05	%	79.4	%	4.00	%
Stock Yards Bancorp Inc.		2,817,038	10.17	%	10.09	%	13.68	%	85.1	%		4.8	%	4.6	%	1.45	%	13.60	%	56.5	%	3.67	%
United Security Bancshares		575,782	13.26	%	13.26	%	25.02	%	53.3	%		3.5	%	2.1	%	0.47	%	3.48	%	85.1	%	5.34	%



Maximum		4,230,289	14.33	%	14.31	%	25.02	%	132.8	%		27.6	%	26.9	%	1.45	%	13.60	%	110.9	%	5.34	%
Minimum		432,181	3.08	%	3.04	%	10.40	%	53.3	%		3.2	%	1.2	%	-1.96	%	-16.19	%	56.2	%	3.17	%
Average		1,562,258	9.97	%	9.37	%	16.17	%	79.9	%		12.6	%	8.0	%	0.57	%	5.25	%	73.4	%	3.68	%
Median		998,734	9.84	%	9.68	%	16.84	%	79.8	%		10.1	%	6.7	%	0.83	%	8.56	%	70.3	%	3.65	%

First Farmers And Merchants Corporation		1,260,310	9.34	%	8.69	%	14.32	%	66.2	%		10.1	%	1.9	%	0.82	%	8.41	%	69.7	%	3.33	%

Page 26

Going Concern Fair Value:Market Approach


	Loan Composition (% of Total Loans)																	Asset Quality

	Constr &			Commercial	Commercial			Farm		Agricultural Residential Consumer Other								NPAs /		NPLs/		LLR/		LLR/
Company	Development		Real Estate		& Industrial			Loans		Loans		Real Estate		Loans		Loans		Assets		Loans		NPLs		Loans

Auburn National Bancorp.	9.5	%		43.7	%	11.1	%	0.5	%	0.1	%	28.4	%	3.4	%	3.3	%	0.49	%	0.66	%	152	%	1.01	%
Citizens First Corp.	7.5	%		44.5	%	12.1	%	8.4	%	2.3	%	24.0	%	1.3	%	0.0	%	0.24	%	0.24	%	610	%	1.49	%
Citizens Holding Co.	7.7	%		42.0	%	9.9	%	5.4	%	0.3	%	24.2	%	6.0	%	4.5	%	1.86	%	3.37	%	45	%	1.51	%
Commerce Union Bancshares Inc.	NA			NA		NA		NA		NA		NA		NA		NA		0.56	%	0.64	%	183	%	1.16	%
Community Trust Bancorp Inc.	5.9	%		26.8	%	9.0	%	2.0	%	0.5	%	33.4	%	19.3	%	3.1	%	1.78	%	1.00	%	126	%	1.26	%
Farmers Capital Bank Corp.	11.5	%		37.1	%	5.5	%	2.4	%	0.4	%	38.0	%	1.3	%	3.9	%	1.70	%	0.87	%	123	%	1.08	%
First Bancshares Inc.	11.5	%		37.1	%	16.6	%	1.7	%	0.0	%	30.5	%	2.2	%	0.5	%	0.95	%	0.95	%	91	%	0.87	%
Franklin Financial Network Inc	29.9	%		26.9	%	19.4	%	0.1	%	0.3	%	23.1	%	0.3	%	0.0	%	0.05	%	0.06	%	1388	%	0.88	%
HopFed Bancorp Inc.	9.7	%		31.5	%	11.7	%	7.1	%	4.2	%	32.6	%	3.2	%	0.0	%	1.01	%	1.31	%	77	%	1.01	%
National Commerce Corp.	10.8	%		39.0	%	19.6	%	0.1	%	0.0	%	26.7	%	1.6	%	2.3	%	0.45	%	0.30	%	249	%	0.74	%
Peoples Financial Corp.	11.3	%		50.8	%	15.1	%	0.1	%	0.0	%	19.1	%	1.7	%	1.9	%	3.94	%	4.54	%	53	%	2.39	%
Porter Bancorp Inc.	5.0	%		29.7	%	13.6	%	12.3	%	4.9	%	32.7	%	1.7	%	0.1	%	3.51	%	2.28	%	85	%	1.95	%
Republic Bancorp Inc.	1.7	%		26.0	%	5.6	%	0.1	%	0.0	%	52.3	%	1.1	%	13.3	%	0.55	%	0.66	%	125	%	0.83	%
SmartFinancial Inc.	13.7	%		50.9	%	11.3	%	0.5	%	0.0	%	22.8	%	0.7	%	0.3	%	1.17	%	0.38	%	157	%	0.60	%
Stock Yards Bancorp Inc.	6.5	%		41.9	%	27.7	%	0.1	%	0.0	%	17.4	%	1.6	%	4.9	%	0.44	%	0.39	%	285	%	1.10	%
United Security Bancshares	4.7	%		35.3	%	6.0	%	0.1	%	0.0	%	19.9	%	32.5	%	1.5	%	1.98	%	1.63	%	90	%	1.46	%



Maximum	29.9	%		50.9	%	27.7	%	12.3	%	4.9	%	52.3	%	32.5	%	13.3	%	3.94	%	4.54	%	1388	%	2.39	%
Minimum	1.7	%		26.0	%	5.5	%	0.1	%	0.0	%	17.4	%��	0.3	%	0.0	%	0.05	%	0.06	%	45	%	0.60	%
Average	9.8	%		37.6	%	12.9	%	2.7	%	0.9	%	28.3	%	5.2	%	2.6	%	1.29	%	1.21	%	240	%	1.21	%
Median	9.5	%		37.1	%	11.7	%	0.5	%	0.1	%	26.7	%	1.7	%	1.9	%	0.98	%	0.77	%	126	%	1.09	%

First Farmers And Merchants Corporation	8.2	%		23.0	%	17.4	%	4.3	%	0.1	%	36.1	%	2.5	%	8.3	%	0.18	%	0.30	%	393	%	1.18	%

Page 27

Going Concern Fair Value: Market Approach


	Tg. Equity/		NPAs/		Core
	Tg. Assets		Assets		ROAA
Financial Criteria	7-10%		0.10-0.50%		0.75-0.95%

			Price to:
	Tg. Book		8% Tg. Book		LTM Earnings
More than one similar financial criteria
Average	1.47	x	1.42	x	16.5	x
Median	1.37	x	1.43	x	14.7	x

Headquarted in Tennessee with similar financial criteria
Average	1.44	x			17.5	x
Median	1.20	x			17.5	x

Loans to Deposits between 55%-75% with similar financial criteria
Average	1.47	x	1.43	x	15.9	x
Median	1.37	x	1.43	x	14.7	x


Median Guideline Company Multiples	1.27	x	1.22	x	15.2	x

Selected Multiple	1.40	x	1.45	x	15.5	x

Page 28

Going Concern Fair Value: Summary


SUMMARY FINANCIALS AS OF DECEMBER 31, 2015		(Thousands)
Total Assets	$	1,260,310
Tangible Assets	$	1,251,292
Common Equity	$	117,695
Tangible Common Equity	$	108,677
8.0% Tangible Common Equity	$	100,103
LTM Core Net Income as of December 31, 2015	$	9,962
VALUATION APPROACHES
Income Approach
Discounted Cash Flow Method (Discount Rate of 12.25%)
Optimum Equity Flows	$	131,301
Market Approach
Price/Earnings Valuation at Estimated Price/Earnings Ratio
LTM Core Net Income as of December 31, 2015 of $10.0 MM x P/E of 15.50x	$	154,405
Price/Tangible Book Valuation at Estimated Price/Tangible Book Ratio:
Tangible Book Value of $108.7 MM x Price/Book Multiple of 1.40x	$	152,148
8.0% Tang. Equity of $100.1 MM x Multiple of 1.45x + Excess Equity of $8.6 MM	$	153,724
FFMH Market Capitalization (Grey Market)	$	105,928
Note: Not considered in Average Market Value
Average Market Value	$	153,425
Net Asset Value Approach
Book Value	$	117,695
Off Balance Sheet Assets	$	1,867
Net Asset Value	$	119,562

Page 29*

Going Concern Fair Value: Per Share Value Range


December 31, 2015				Value			Weight
Income Approach			$	131,301			40	%	$	52,520
Market Approach			$	153,425			40	%	$	61,370
Net Asset Value Approach			$	119,562			20	%	$	23,912

Estimated Fair Value									$	137,803

Estimated Fair Value Range						$	135,000		-$	145,000

							Resulting			Resulting
	FFMH			Market			Value			Value
	Market			Median			Multiples @			Multiples @
COMPARATIVE MULTIPLES	Multiples			Multiples			$135,000			$145,000
Common Book	0.90	x		1.15	x		1.15	x		1.23	x
Tangible Common Book	0.97	x		1.27	x		1.24	x		1.33	x
8.00% Tangible Book	0.97	x		1.22	x		1.26	x		1.36	x
LTM Core Net Income as of December 31, 2015	10.9	x		15.2	x		13.6	x		14.6	x
2016 Projected Net Income	NA			NA			12.2	x		13.1	x
Total Assets	8.4	%		11.4	%		10.8	%		11.6	%
Total Deposits	9.6	%		14.9	%		12.2	%		13.1	%

PER SHARE CALCULATIONS AND ADJUSTMENTS
Estimated Fair Value						$	135,000,000		$	145,000,000
Shares Outstanding							4,739,502			4,739,502
PRO RATA FAIR VALUE						$	28.48		$	30.59
ROUNDED TO:						$	28.50		$	30.60