Edgar Filing: SIGNATURE GROUP HOLDINGS, INC.

Free Writing Prospectus

Investor Presentation

February 2015

Unlocking Shareholder Value in Industrial and Commercial Companies

OTCQX: SGGHU

ISSUER FREE-WRITING PROSPECTUS

Filed Pursuant to Rule 433

Relating to Prospectus Supplement dated

January 29, 2015

Registration Statement No. 333-191020

Dated February 9, 2015

Cautions about Forward-Looking

Statements and Other Notices

OTCQX: SGGHU

Signature Group Holdings, Inc. (the “Company”) has filed a registration statement (including a prospectus and a prospectus supplement) with the Securities

and Exchange Commission (“SEC”) for the rights offering to which this communication relates. Before you invest, you should read the prospectus supplement

and the base prospectus (collectively, the “prospectus”) included in the Company’s registration statement and other documents we have filed with the SEC for

more complete information about us and this offering. The prospectus and the registration statement may be accessed through the SEC’s website at

www.sec.gov. Alternatively, we will arrange to send you the prospectus if you request it from: Georgeson Inc., 480 Washington Blvd., 26th Floor, Jersey City,

NJ 07310, (866) 300-8594.

This prospectus is not an offer to sell and we are not soliciting an offer to buy in any state or other jurisdiction in which the offer or sale is not permitted. Our

application for qualification with the Department of Business Oversight of the State of California related to this rights offering is not effective at this time, and

unless and until it becomes effective prior to the expiration date for this rights offering, we will not be permitted to offer or sell the subscription rights or

common stock issuable upon the exercise of such rights in the State of California or communicate to a stockholder located in the State of California that we are

accepting their subscription to purchase shares in this rights offering.

This presentation contains forward-looking statements, which are based on the Company’s current expectations, estimates, and projections about the

Company's and Aleris Corporation’s Global Recycling and Specification Alloys (“GRSA” or “Real Alloy,” as defined below) businesses and prospects, as well as

management's beliefs and certain assumptions made by management. Words such as “anticipates,” “expects,” “intends,” “plans,” “believes,” “seeks,”

“estimates,” “may,” “should,” “will,” “positioned,” “outlook” and variations of these words are intended to identify forward-looking statements. These

statements include, but are not limited to, statements about the Company’s and GRSA’s expansion and business strategies; the Company’s ability to satisfy the

conditions to the acquisition of GRSA and the related financings, and to ultimately consummate the GRSA acquisition; anticipated growth opportunities; the

amount of capital-raising necessary to achieve those strategies, as well as future performance, growth, operating results, financial condition and prospects.

Such statements are not guarantees of future performance and are subject to certain risks, uncertainties, and assumptions that are difficult to predict.

Accordingly, actual results could differ materially and adversely from those expressed in any forward-looking statements as a result of various factors.

Important factors that may cause such a difference include, but are not limited to the Company’s ability to successfully identify, consummate and integrate the

acquisitions of GRSA and/or other businesses; the acceptance of the Company’s stock for listing on NASDAQ, or another exchange; changes in business or other

market conditions; the difficulty of keeping expense growth at modest levels while increasing revenues; the Company’s ability to successfully defend against

current and new litigation matters, as well as demands by investment banks for defense, indemnity, and contribution claims; obtaining the expected benefits

of the reincorporation; the Company’s ability to access and realize value from its federal net operating loss tax carryforwards; and other risks detailed from

time to time in the Company’s SEC filings, including but not limited to the prospectus and our most recently filed Annual Report on Form 10-K and subsequent

reports filed on Forms 10-Q and 8-K.

The statements contained herein speak only as of the date of this presentation and are subject to change. The Company undertakes no obligation to revise or

update publicly any forward-looking statements for any reason.

The industry, market data and other statistical information in this presentation are based on independent industry and government publications, reports by

market research firms or other published independent sources. Some data is also based on the Company’s good faith estimates. Although the Company

believes these sources are reliable, the Company has not independently verified the information and cannot guarantee its accuracy and completeness.

OTCQX: SGGHU

Craig Bouchard, Chairman & CEO

@Signature

Craig

Bouchard

has

served

chairman

and

CEO

Signature

Group

Holdings

since

June

2013,

after leading

a proxy campaign to replace the company’s board. This represented his second successful proxy action

against a company.

M&A and

Metals

Experience

In 2010, founded Shale-Inland, the leading master distributor of stainless steel pipe, valves, fittings,

stamped and fabricated parts for the U.S. Energy industry, with revenues approaching $1 billion.

In 2004, co-founded Esmark Inc. at 25 cents per share, an enterprise value of $2 million and revenue of $4

million. Esmark

acquired nine steel companies, including Wheeling Pittsburgh Corporation in Wall Street’s

first-ever hostile reverse tender merger,

enroute to becoming America’s 4th largest steel company with

revenues of $3.5 billion. Prior to the being acquired by Severstal for $1.3 billion, or $19.25 per share, in

2008, Esmark shares represented the highest appreciating NASDAQ

stock. Esmark’s success is chronicled in

“America for Sale, How the Foreign Pack Circled and Devoured Esmark.”

Background

Craig is the author of the New York Times Best-Selling book, “The Caterpillar Way. Lessons in Leadership,

Growth and Shareholder Value,”

released in October 2013. The book reached #1 on the Barnes & Noble

Best Seller List and #8 on the New York Times Best Seller List in the Business category.

1998-2003, President and CEO of New York-based NumeriX, a risk management software company, which

commanded a leading market share on Wall Street.

Prior to NumeriX, served at First National Bank of Chicago (now JP Morgan Chase) in a number of roles

spanning 19 years, including head of Asia Pacific (based in Hong

Kong and Tokyo), and later global head

Derivative

Trading

and

Quantitative

Research,

and

then

lastly

senior

vice

president.

Holds a Bachelor’s degree from Illinois State University (1975), Master’s Degree in Economics from Illinois

State University (1977), and MBA from the University of Chicago (1981).

Former member of the Board of Trustees of Boston University and of the University of Montana, and

current Board member of the Department of Athletics at Duke University.

Signature Group Holdings Overview

Publicly traded, NOL-rich holding company seeking

well-managed and consistently profitable businesses

Signature management and board are seasoned

professionals with extensive experience in acquiring,

building and managing successful businesses

Oct. 2014, agreed to acquire Aleris Corporation’s

aluminum recycling business (to be renamed Real

Alloy Holding or “Real Alloy”) for

$525M or 6.25x

EBITDA

Signature intends to uplist to NASDAQ following the

close of the Real Alloy acquisition

At Dec. 31, 2013, Signature had federal and California

NOLs totaling $933M and $994M, respectively.

(Federal NOLs do not begin to expire until 2027)

Source: Company filings

1) TTM at Sept. 2014

Real Alloy Holding

Adjusted EBITDA: $84.1M

OTCQX: SGGHU

OTCQX: SGGHU

Former Operations Provides Acquisition

Platform & NOLs for Strategic Transformation

2004:

Reached

$7B in

annual

revenue

1973: Changed

name to Fremont

General Corp.

Strategic Transition

1963:

Founded as

an insurance

company

2005: Wholly

owned subsidiary,

Fremont

Investment &

Loan, achieved

top five subprime

mortgage

originator

position

June 2008:

Voluntarily

filed for

Chapter 11

bankruptcy

2009: Initiated

reorganization

process

June 2010: Reorganized

as Signature Group

Holdings; NOLs remain

intact

2010: Private

investment from

Signature Group

Holdings, LLC with

Signatures’

Plan of

Reorganization

becoming effective

on June 11

Jul. 2011:

Acquired

NABCO for

$36.9M

Sept. 2012: Zell

Credit

Opportunity

Fund 7.0% stake

June 2013:

Bouchard and

Maheshwari

lead proxy

fight; Bouchard

appointed

chairman &

CEO

Oct. 2014:

Entered into

definitive

purchase

agreement

to acquire

GRSA from

Aleris for

$525M

Dec. 2014:

Completed

$28M Primary

Equity

offering

Jan. 2015:

Closed sale of

NABCO for net

cash proceeds

of $55.7M

Jan. 2015:

Closed $305M

Senior

Secured Notes

offering

pending GRSA

acquisition

$7 Billion

2010

| 1963

| 2015

NOLs

OTCQX: SGGHU

Real Alloy Holding Overview

Note: All tonnage information is presented in metric tons

1) TTM at Sept. 2014

Recycling & Specification Alloys Volume by

Region

(TTM

@9/30/14,

1,204kt)

2013 Volume Invoiced by End Use

(1,222kt)

North

America

69%

Europe

31%

Automotive

62%

Consumer

Packaging 21%

Other 5%

Steel 4%

Building &

Construction 4%

Aerospace 4%

Global leader in third-party aluminum recycling

Converts aluminum scrap and dross into

recycled metal and specification alloys

30+ year operating history

24 facilities in North America (18) & Europe (6)

300+ customers worldwide

~2/3 of production volume protected from

commodity price swings under tolling or

hedging arrangements

Summary financials

Volume invoiced: 1,204kt

Revenues: $1.53B

Adj. EBITDA: $84.1M

Aleris to provide a range of transition services

for up to 24 months, as well as continue as a

significant customer and supplier to Real Alloy

OTCQX: SGGHU

Real Alloy vs. Top 11 Regional

Competitors Market Share

Third-Party Aluminum Recycling

Production Capacity

North America

and Europe Combined

Global Leader in Third-Party

Aluminum Recycling

Real Alloy is the largest third-party

aluminum recycling manufacturer in the

world, providing significant competitive

advantages and ability to scale

Leader in both North America and

Europe

Highest production capacity (1.9mtpa)

within the fragmented third-party

aluminum recycling industry

1) Illustrates Real Alloy production capacity measured by melting capacity, versus selected regional competitors. Capacity of competitors based on Management

estimates. Pie chart does not represent the total market in North America and Europe.

Real Alloy

(1.9mt)

OTCQX: SGGHU

Real Alloy Acquisition Rationale

Acquisition of Real Alloy makes Signature the

global leader in third-party aluminum recycling

Significant market opportunities driving growth

Experienced and proven management team

successful through multiple business cycles

Stable cash flow through tolling, hedging and

contractual cost pass-through arrangements

Increased operational flexibility provides ability to

optimize performance through market cycles

Integration with customers through closed-loop

operations

High-quality and diversified customer base

OTCQX: SGGHU

Real Alloy Supported by

Major Industry Tailwinds

Market

Growth

Global secondary aluminum demand expected to grow at ~7% per annum

Automotive aluminum body sheet content per vehicle expected to grow ~14%

per annum through 2025

Share Gains and

New End Markets

Additional automotive applications

Aerospace applications

Customer Growth

Pursue growth with existing customers and new relationships brought by

Signature and shift in competitive landscape

Highly competitive business model capable of operating in emerging

economies

Incremental volume opportunities post-separation from Aleris

Acquisition and

JV Opportunities

Opportunities for acquisitions in North America and Europe

Greenfield and joint venture opportunities

Source: Freedonia Group, CRU, Ducker Worldwide

Secular Tailwinds Across Automotive, Consumer Packaging, Aerospace, and

Building and Construction End Markets Driving Industry Growth

Anticipated 18% automotive market growth in N.A. and Europe

62% of End Use Volume

OTCQX: SGGHU

Automotive (kt)

Consumer Packaging (kt)

Aerospace (kt)

Building and Construction (kt)

Strong Growth Across End Markets:

Aluminum Consumption by Segment

(1) Based on 2013 volume Source: Freedonia Group, CRU

185

240

176

203

361

443

2012

2017

N. America

Europe

2,070

2,270

1,552

1,700

3,622

3,970

2012

2017

N. America

Europe

1,025

1,525

2,171

2,505

3,196

4,030

2012

2017

N. America

Europe

525

1,335

407

762

2012

2017

N. America

Europe

932

2,097

Real Alloy Global Footprint

Real Alloy Operates 24 Facilities Strategically Located in Six Countries

Across North America and Europe

Note: Coldwater and Wabash locations have two facilities each

Rotary & Reverberatory

Furnaces

Molten Capable

Facilities

Pre-processing

Equipment

Total

Rock Creek

Elyria

Monclova

Goodyear

Sapulpa

Morgantown

Loudon

Steele

Friendly

Mississauga

Macedonia

Coldwater

Saginaw

Wabash

Chicago

Heights

Post Falls

Eidsväg

Raudsand

Swansea

Grevenbroich

Deizisau

OTCQX: SGGHU

Toeging

(Stuttgart)

OTCQX: SGGHU

Strong Customer Value Proposition

Average customer

relationship spans 10+ years

~95% renewal rate with top

customers

Diversified customer base

with Top 10 customers

accounting for < 50% of

volume

Competitive Advantage

Casting

Rolling / Extrusion

End-Product Fabrication

End-Customers

Pre-processing

Melting

Casting

Ingots

Scrap

Integrated Recycling Value Chain

Close proximity to customers

Integrated into supply chain

Multiple facilities to support

customers

~40% of deliveries in the form

of molten metal due to close

proximity to customers

Operational expertise and scale

bring higher efficiency and quality

Maximize use of customers’

metal

units to minimize their metal risk

Molten delivery provides significant

cost savings and improved

productivity to customers

Value Proposition for Customers

Impact to Real Alloy

Chrysler

Illustrative

Operations

Flow

–

Aluminum

Fabrication

Chain

General Motors

OTCQX: SGGHU

Tolling

Approximately two-thirds of Real Alloy’s volume is protected from

commodity price swings under tolling or hedging arrangements.

Buy/Sell

Real Alloy’s Attractive Business Model

Real Alloy earns a tolling or

processing fee on a volume basis

Real Alloy does not own the metal

but processes metal owned by

customers —

thereby insulated

from metal price risk and reducing

working capital needs

~53% of TTM volume at 9/30/14

was under tolling arrangements

Pass-through arrangements on

energy and other costs

Purchase aluminum scrap in the

open market and then sell the

converted metal

Profitability driven by the metal

spread

Real Alloy hedges some of its buy /

sell volume in Europe

~47% of TTM volume at 9/30/14

was under buy/sell agreements

Rapid inventory turns (12x/year)

ensure minimal commodity price

exposure

OTCQX: SGGHU

Primary vs. Secondary Production

Favorable Economics vs. Primary

~10% of the energy costs

Alloy elements already present in scrap

minimize input costs

Sustainability

Infinitely recyclable without loss of

quality

Lower energy consumption leads to

lower greenhouse gas emissions

Source: Freedonia Group, The Aluminum Association

Secondary Production Growing 40% Faster

than Primary and Expected to Account for

Half of North America and Europe

Aluminum Production by 2022

26.0

36.9

43.5

54.9

67.3

9.8

13.8

19.7

27.7

37.7

35.7

50.7

63.2

82.5

104.9

2002

2007

2012

2017E

2022E

Primary

Seconday

69.4%

63.1%

57.4%

52.9%

50.4%

30.6%

36.9%

42.6%

47.1%

49.6%

2002

2007

2012

2017E

2022E

Primary

Secondary

Global Aluminum Production by Type

(million tons)

% Share of Aluminum Production – N.A. & Europe

OTCQX: SGGHU

Position

Aluminum Industry

Experience (years)

Terry Hogan

Senior Vice President and General Manager

Russell Barr

Vice President and General Manager, RSEU

Michael Hobey

Vice President & CFO

Randy Collins

VP Commercial, North America

Cathryn Griffin

Vice President, Legal

Ralf Köring

Director, Commercial Wrought Alloys, Europe

Christoph Will

Finance Director, Europe

Experienced and Proven

Real Alloy Management Team

Exceptional management team with extensive industry experience

Proven ability to endure business cycles (positive EBITDA through the recession)

Successfully right-sized footprint to lower fixed cost structure and improve utilization rates

Real Alloy Financial Performance

(1)

Contribution

margin

defined

revenues

less

the

cost

raw

materials

and

freight

expense

included

cost

sales.

(2) Maintenance CapEx run approximately $25M-$30M/year

Revenue and Contribution Margin

($ millions)

Volume Invoiced

(metric tons in thousands)

Capital Expenditures -

Consolidated

($ millions)

Adjusted EBITDA

($ millions)

Key Takeaways

Acquisition of Real Alloy makes Signature a

global leader in third-party aluminum recycling

Significant market opportunities driving growth

and Adjusted EBITDA expansion

Stable cash flow through tolling, hedging and

contractual cost pass-through arrangements

Operational flexibility provides ability to

optimize performance through market cycles

High-quality and diversified customer base

Experienced and proven management

Real Alloy Holding

Adjusted EBITDA: $84.1M

Appendix

OTCQX: SGGHU

Rights Offering

$55 million Rights Offering launched January 29, 2015 to holders of record of common stock and warrants

outstanding on January 28, 2015, the effective date.

Stapled Rights in which investors can acquire and subsequently exercise their Rights AFTER the effective

date by purchasing shares of common stock with the Rights attached

Approximately 10 million shares to be issued at $5.64 per share

Use of proceeds is to fund the Real Alloy acquisition

Successful (fully subscribed) Rights Offering allows Signature to complete funding of the acquisition

price and general corporate purposes

In the event Signature does not raise at least $50 million in the Rights Offering, backstop commitments

are in place via a combination of senior notes and preferred stock

Basic Subscription Rights

Each share receives one subscription right

Each subscription right entitles the holder to purchase 0.562 shares (must hold unit at time of exercise)

Example: If a holder owns 100 shares, such holder will receive 100 subscription rights and may

subscribe for 57 shares (100 subscription rights * 0.562 = 56.2, rounded up to the eliminate

fractional shares)

Holders must exercise their basic subscription rights to prevent dilution from participating shareholders

Oversubscription Rights

If fully subscribed for pro rata shares, holders have the privilege to participate in residual portion of the

Rights Offering

Effectively allows shareholders to purchase additional shares at the rights offering discount, beyond pro

rata limitation, if available and subject to escrow mechanism to protect NOLs

OTCQX: SGGHU

Rights Offering Summary

Issuer

Signature Group Holdings, Inc.

Ticker

OTCQX: SGGHU (unit of common stock with attached subscription right)

Securities Offered

Common stock upon exercise of subscription right

Total Amount Seeking to Raise

$55 million

Basic Subscription Right; Exercise Price

0.562 shares per subscription right

Exercise price of $5.64 per share

Total Offering Size

(1)

9,751,773 shares (56.2% of our common stock outstanding)

Common Stock after this Offering

(1)

27,095,665 shares

Contemplated Expiration Date

February 17, 2015 (subject to extension by the Signature Board of Directors)

Backstop Commitments

In the event this Rights Offering does not raise at least $50 million, Signature

will fund the remainder of the Real Alloy acquisition price as follows:

Up to $20 million in senior notes issued by Signature to ZCOF and funds

managed by another institutional investor (eliminated after $32 million

raised in the Rights Offering)

Up to $30 million in incremental Series B Preferred Stock to be purchased

by Aleris Corporation

(1)

Excluding 843,000 shares available to warrant holders under this right;

Total Offering Size and Total Common Stock including impact of warrants is 10,594,773 shares and 27,938,665 shares, respectively

OTCQX: SGGHU

Warrant Treatment

Signature’s 1,500,000 outstanding warrants:

Current exercise price of $6.17 per warrant (price protection ratchet will

reduce exercise price to $5.64 upon closing of this Rights Offering)

Treated as if exercised for purpose of Rights Offering, results in holders ability

to subscribe for up to an aggregate of 843,000 shares of common stock

(1,500,000 * 0.562)

Oversubscription privilege available to holders up to the full 843,000 shares

Contractually have ‘special rights’

allowing for extended, 90 day period

following the Effective Date to exercise their subscription rights

Proceeds received from subscription and oversubscription rights exercised

prior

to the Expiration Date will be used toward funding the Real Alloy

acquisition; proceeds received from subscription and oversubscription rights

exercised following

the Expiration Date will be used for general corporate

purposes

If warrant holders fully participate in this Rights Offering, $4.8 million of

incremental capital raised

Sources and Uses

Sources

($ millions)

Cash

$45.0

Series B Preferred Stock

25.0

Proceeds

from

NABCO

sale

(1)

45.0

Senior Secured Notes

(2)

305.0

ABL and Factoring Facility

(3)

73.5

Rights Offering

55.0

October 2014 Private Placement

(4)

3.0

Equity Offering

(5)

28.5

Total Sources

$580.0

Uses

($ millions)

Fund GRSA acquisition

$525.0

Estimated fees and expense

35.8

Senior Secured Notes Issue

Discount

(2)

8.5

Pre-Funded Interest Reserve

(2)

4.2

Excess Cash

6.5

Total Uses

$580.0

Note: See Prospectus Supplement for additional information.

(1)

NABCO was sold January 9, 2015 for $78 million, with net cash proceeds totaling $55.7 million. Signature intends to use approximately $45 million of these

proceeds to help fund the Real Alloy acquisition.

(2)

Closed into escrow on January 8, 2015. Principal amount of $305 million 10.0% Senior Secured Notes due 2019 were issued. Gross proceeds of $296.5 million

were received following an $8.5 million original issue discount. $4.2 million reserved to pay interest on Senior Secured Notes during escrow period.

(3)

$73.5 million in combined opening draws on a $110 million U.S. / Canada ABL and a €50 million German factoring facility, each provided by GE Capital and/or its

affiliates.

(4)

$3.0 million raised in a private placement of shares on October 28, 2014. 0.3 million shares issued at $10.00 per share.

(5)

$28.5 million raised in a registered Equity Offering on December 19, 2014. 4.4 million shares issued at $6.50 per share.

OTCQX: SGGHU

OTCQX: SGGHU

Pro Forma Capitalization

Pro forma

($ millions)

9/30/2014

As Adjusted for the

Sale of NABCO

Adjusted for Sale of

NABCO, Equity Offering

and October 2014

Private Placement

Fully Adjusted

Cash

$44.8

$100.5

$130.5

$17.0

Line of Credit

1.2

September 2016 Term Loan

4.8

December 2018 Term Loan

9.8

Real Alloy Capital Leases

4.3

New Senior Secured Notes

305.0

New ABL and Factoring Facility

73.5

Total Debt

$15.8

$382.8

New Series B Preferred Stock

25.0

Shareholders’

Equity

51.5

91.0

121.0

151.4

Total Capitalization

$67.3

$91.0

$121.0

$559.2

Note: See Prospectus Supplement for relevant footnotes

(1) As Adjusted for this Rights Offering, the Equity Offering, the October 2014 Private Placement, the Senior Secured Notes, the Asset-Based Facility, the Factoring Facility and preliminary adjustments

for the Real Alloy acquisition

Real Alloy Adjusted EBITDA Reconciliation

9 Months Ended Sept 30,

LTM Sept 30,

($ millions)

2011

2012

2013

2014

Net income

$68.7

$26.4

$19.0

$11.4

$26.0

$33.6

Provision for (benefit from) income taxes

14.6

11.9

4.3

(0.7)

Depreciation and amortization

11.0

15.8

21.6

15.4

17.4

23.6

EBITDA

$94.3

$54.1

$44.9

$31.1

$42.7

$56.5

Restructuring charges

0.2

2.4

3.3

3.2

2.0

2.1

Unrealized losses (gains) on derivatives

3.2

(1.5)

(0.8)

0.2

0.6

(0.4)

Net income attributable to NCI

1.0

1.3

1.0

0.8

0.9

1.1

Loss on disposal of assets

0.1

0.8

1.3

0.7

1.7

2.3

Stock based compensation expense related to Real Alloy

employees and non-GRSA employees

3.0

4.2

4.8

3.7

3.6

4.7

SG&A allocated from Aleris not directly associated

with the business

13.6

12.0

12.6

8.6

9.5

13.5

Excluded entities/facilities

(6.7)

(3.6)

(3.3)

(2.2)

(1.1)

Medical expense adjustment

4.3

3.5

2.3

3.1

Extreme winter weather

2.1

Other

(3.3)

(0.8)

1.4

1.1

1.4

Adjusted EBITDA

$105.4

$68.9

$69.5

$50.7

$66.5

$85.3

Estimated standalone impact

(1.2)

Standalone Adjusted EBITDA

$84.1

Note: See Prospectus Supplement for relevant footnotes