Note 23 – Evercore Partners Inc. (Parent Company Only) Financial Statements

EVERCORE PARTNERS INC.

(parent company only)

CONDENSED STATEMENTS OF FINANCIAL CONDITION


	December 31,
	2011			2010
ASSETS
Equity Investment in Subsidiary	$	452,027		$	362,888
Deferred Tax Asset		188,256			134,893
Other Assets		14,310			4,516

TOTAL ASSETS	$	654,593		$	502,297

LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Payable to Related Party	$	6,217		$	3,983
Amounts Due Pursuant to Tax Receivable Agreement		137,448			97,427
Long-term Debt—Notes Payable		99,664			98,082
Other Liabilities		3,600			2,106

TOTAL LIABILITIES		246,929			201,598
Stockholders' Equity
Common Stock
Class A, par value $0.01 per share (1,000,000,000 shares authorized, 31,014,265 and 21,497,691 issued at December 31, 2011 and 2010, respectively, and 27,941,307 and 19,983,646 outstanding at December 31, 2011 and 2010, respectively)		310			215
Class B, par value $0.01 per share (1,000,000 shares authorized, 47 and 48 issued and outstanding at December 31, 2011 and 2010, respectively)		—			—
Additional Paid-In-Capital		575,122			400,719
Accumulated Other Comprehensive Income (Loss)		(12,058	)		(4,193	)
Retained Earnings (Deficit)		(76,703	)		(61,504	)
Treasury Stock at Cost (3,072,958 and 1,514,045 shares at December 31, 2011 and 2010, respectively)		(79,007	)		(34,538	)

TOTAL STOCKHOLDERS' EQUITY		407,664			300,699

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	654,593		$	502,297

See notes A to F to parent company only financial statements.

EVERCORE PARTNERS INC.

(parent company only)

CONDENSED STATEMENTS OF OPERATIONS


	For the Years Ended December 31,
	2011		2010		2009
REVENUES
Interest Income	$	7,817	$	7,693	$	7,594

TOTAL REVENUES		7,817		7,693		7,594
Interest Expense		7,817		7,693		7,594

NET REVENUES		—		—		—

EXPENSES
TOTAL EXPENSES		—		—		—

OPERATING INCOME		—		—		—

Equity in Income of Subsidiary		21,083		20,618		9,212
Provision for Income Taxes		14,131		11,664		10,782

NET INCOME (LOSS)	$	6,952	$	8,954	$	(1,570	)

See notes A to F to parent company only financial statements.

EVERCORE PARTNERS INC.

(parent company only)

CONDENSED STATEMENTS OF CASH FLOWS


	For the Years Ended December 31,
	2011			2010			2009
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income (Loss)	$	6,952		$	8,954		$	(1,570	)
Undistributed Income of Subsidiary		(21,083	)		(20,618	)		(9,729	)
Accretion on Long-term Debt		1,582			1,464			1,355
(Increase) Decrease in Operating Assets:
Other Assets		12,105			(1,324	)		2,138
Increase (Decrease) in Operating Liabilities:
Payable to Uncombined Affiliates		957			—			—
Taxes Payable		—			—			—
Other Long-term Liabilities		(574	)		—			—

Net Cash Used in Operating Activities		(61	)		(11,524	)		(7,806	)
CASH FLOWS FROM INVESTING ACTIVITIES
Cash Paid for Acquisitions, net of cash acquired		(30,397	)		—			—
Investment in Subsidiary		(22,994	)		23,760			13,263

Net Cash Provided by (Used in) Investing Activities		(53,391	)		23,760			13,263
CASH FLOWS FROM FINANCING ACTIVITIES
Net Proceeds from Follow-On Offerings		—			—			4,683
Proceeds from Equity Offering		168,140			77,185			70,761
Purchase of Evercore LP Units		(95,342	)		(76,763	)		(70,761	)
Foreign Currency Translation		—			(300	)		(446	)
Dividends		(19,346	)		(12,358	)		(8,217	)
ASC 740 Adjustment		—			—			(1,477	)

Net Cash (Used in) Provided by Financing Activities		53,452			(12,236	)		(5,457	)

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		—			—			—
CASH AND CASH EQUIVALENTS—Beginning of Year		—			—			—

CASH AND CASH EQUIVALENTS—End of Year	$	—		$	—		$	—

See notes A to F to parent company only financial statements.

EVERCORE PARTNERS INC.

(parent company only)

NOTES TO CONDENSED FINANCIAL STATEMENTS

Note A – Organization

Evercore Partners Inc. (the "Company") was incorporated as a Delaware corporation on July 21, 2005. The Company did not begin meaningful operations until the reorganization discussed below. Pursuant to a reorganization into a holding company structure, the Company became a holding company and its sole asset is a controlling equity interest in Evercore LP. As the sole general partner of Evercore LP, the Company operates and controls all of the business and affairs of Evercore LP and, through Evercore LP and its subsidiaries, continues to conduct the business now conducted by these subsidiaries.

Note B – Significant Accounting Policies

Basis of Presentation. The Statements of Financial Condition, Operations and Cash Flows have been prepared in accordance with U.S. GAAP.

Equity in Income of Subsidiary. The Equity in Income of Subsidiary represents the Company's share of income from Evercore LP.

Note C – Stockholders' Equity

The Company is authorized to issue 1,000,000 Class A Shares, par value $0.01 per share, and 1,000 shares of Class B common stock, par value $0.01 per share. All Class A Shares and shares of Class B common stock vote together as a single class. At December 31, 2011, the Company has issued 31,014 Class A Shares. The Company cancelled one share of Class B common stock in exchange for $1.00, which was held by a limited partner of Evercore LP during the twelve months ended December 31, 2011. During 2011, the Company purchased 1,587 Class A Shares from employees at market values ranging from $15.76 to $36.41 per share primarily for the net settlement of share-based compensation awards. The result of these purchases was an increase in Treasury Stock of $45,105 on the Company's Consolidated Statement of Financial Condition as of December 31, 2011. During 2011, the Company issued 28 Class A Shares from treasury stock in conjunction with the Company's acquisition of Lexicon. The result of this issuance was a decrease in Treasury stock of $636 on the Company's Consolidated Statement of Financial Condition as of December 31, 2011. During 2011, the Company had an offering of 5,365 Class A Shares. See Note 14 to the consolidated financial statements for a further discussion. During the year ended December 31, 2011, the Company declared and paid dividends of $0.74 per share, totaling $19,346, which were wholly funded by the Company's sole subsidiary, Evercore LP.

As discussed in Note 17 to the consolidated financial statements, both the LP Units and RSUs are exchangeable into Class A Shares on a one-for-one basis once vested.

Note D – Issuance of Notes Payable and Warrants

On August 21, 2008, the Company entered into a Purchase Agreement with Mizuho pursuant to which Mizuho purchased from the Company Senior Notes and Warrants expiring 2020. See Note 12 to the consolidated financial statements.

Note E – Commitments and Contingencies

As of December 31, 2011, as discussed in Note 12 to the consolidated financial statements, the Company estimates the contractual obligations related to the Senior Notes to be $176,160. Pursuant to the Senior Notes, we expect to make payments to the notes' holder of $6,240 within one year or less, $12,480 in one to three years, $12,480 in three to five years and $144,960 after five years.

As of December 31, 2011, as discussed in Note 18 to the consolidated financial statements, the Company estimates the contractual obligations related to the Tax Receivable Agreements to be $143,660. The Company expects to pay to the counterparties to the Tax Receivable Agreement $6,217 within one year or less, $21,650 in one to three years, $24,078 in three to five years and $91,715 after five years.

Note F—Business Changes and Developments

On August 19, 2011, the Company completed its acquisition of all of the outstanding partnership interests of Lexicon. See Note 4 to the consolidated financial statements.