425
Merger with Hilltop Holdings Inc.
October 2014
1
Filed by SWS Group, Inc.
Pursuant to Rule 425 of the Securities Act of 1933
and deemed filed pursuant to Rule 14a-6(b)
of the Securities Exchange Act of 1934
Subject Company: Hilltop Holdings, Inc.  
(Commission File No. for Registration Statement on Form S-4: 333-196367)  
The following updated presentation is being used by management of SWS Group, Inc. in investor meetings commencing on the date of this filing;
      members of management of Hilltop Holdings Inc. may participate in some or all of these meetings.


Forward-Looking Statements
2
From
time
to
time
we
make
statements
(including
some
contained
in
this
presentation)
that
predict
or
forecast
future
events,
depend
on
future
events
for
their
accuracy,
or
otherwise
contain
"forward-looking"
information
and
constitute
“forward-looking
statements”
within
the
meaning
of
applicable
U.S.
securities
laws.
Such
statements
are
generally
identifiable
by
terminology
such
as
“plans,”
“expects,”
“estimates,”
“budgets,”
“intends,”
“anticipates,”
“believes,”
“projects,”
“indicates,”
“targets,”
“objective,”
“could,”
“should,”
“potential,”
“may”
or
other
similar
words.
By
their
very
nature,
forward-looking
statements
require
us
to
make
assumptions
that
may
not
materialize
or
that
may
not
be
accurate.
Readers
should
not
place
undue
reliance
on
forward-looking
statements
and
should
recognize
that
such
statements
are
predictions
of
future
results,
which
may
not
occur
as
anticipated.
Actual
results
may
differ
materially
as
a
result
of
various
factors,
some
of
which
are
outside
of
our
control,
including:
failure
to
obtain
the
approval
of
stockholders
of
SWS
Group,
Inc.
(“SWS”
or
the
“Company”
in
connection
with
the
proposed
transaction
with
Hilltop
Holdings
Inc.
(“Hilltop”);
the
failure
to
consummate
or
delay
in
consummating
the
proposed
transaction
for
other
reasons;
the
timing
to
consummate
the
proposed
transaction;
the
risk
that
a
condition
to
closing
of
the
proposed
transaction
may
not
be
satisfied;
the
risk
that
a
regulatory
approval
that
may
be
required
for
the
proposed
transaction
is
delayed,
is
not
obtained,
or
is
obtained
subject
to
conditions
that
are
not anticipated;
Hilltop’s
ability
to
achieve
the
synergies
and
value
creation
contemplated
by
the
proposed
transaction;
Hilltop’s
ability
to
promptly
and
effectively
integrate
its
and
SWS’s
businesses;
the
diversion
of
management
time
on
transaction-related
issues;
the
interest
rate
environment;
the
volume
of
trading
in
securities;
the
liquidity
in
capital
markets;
the
volatility
and
general
level
of
securities
prices
and
interest
rates;
the
ability
to
meet
regulatory
capital
requirements
administered
by
federal agencies;
the
level
of
customer
margin
loan
activity
and
the
size
of
customer
account balances;
the
demand
for
real
estate
in
Texas,
New
Mexico
and
the
national
market;
the
credit-worthiness
of
our
correspondents,
trading
counterparties
and
of
our
banking
and
margin
customers;
the
demand
for
investment
banking
services;
general
economic
conditions,
especially
in
Texas
and
New
Mexico,
and
investor
sentiment
and
confidence;
the
value
of
collateral
securing
the
loans
we
hold;
competitive
conditions
in
each
of
our
business
segments;
changes
in
accounting,
tax
and
regulatory
compliance
requirements;
changes
in
federal,
state
and
local
tax
rates;
the
ability
to
attract
and
retain
key
personnel;
the
availability
of
borrowings
under
credit
lines,
credit
agreements
and
credit facilities;
the
potential
misconduct
or
errors
by
our
employees
or
by
entities
with
whom
we
conduct
business;
the
ability
of
borrowers
to
meet
their
contractual
obligations
and
the
adequacy
of
our
allowance
for
loan
losses;
and
the
potential
for
litigation
and
other
regulatory
liability.


3
Forward-Looking Statements (Continued)
Our
future
operating
results
also
depend
on
our
operating
expenses,
which
are
subject
to
fluctuation
due
to:
variations
in
the
level
of
compensation
expense
incurred
as
a
result
of
changes
in
the
number
of
total
employees,
competitive
factors
or
other
market
variables;
variations
in
expenses
and
capital
costs,
including
depreciation,
amortization
and
other non-
cash
charges
incurred
to
maintain
our
infrastructure;
and
unanticipated
costs
which
may
be
incurred
from
time
to
time
in
connection
with
litigation,
regulation
and
compliance,
loan
analyses
and
modifications
or
other
contingencies.
Other
factors,
risks
and
uncertainties
that
could
cause
actual
results
to
differ
materially
from
our
expectations
discussed
in
this
presentation
and
those
discussed
in
our
reports
filed
with
and
available
from
the
Securities
and
Exchange
Commission
(the
"SEC").
Our
forward-looking
statements
are
based
on
current
beliefs,
assumptions
and
expectations.
All
forward-looking
statements
speak
only
as
of
the
date
on
which
they
are
made
and,
except
as
required
by
law,
we
expressly
disclaim
any
obligation
or
undertaking
to
disseminate
any
updates
or
revisions
to
any
forward-looking
statements
contained
herein
to
reflect
any
change
in
our
expectations
with
regard
thereto
or
any
change
in
events,
conditions
or
circumstances
upon
which
any
statement
is
based.


Agenda
Executive Summary
Transaction Overview
SWS Independent Special Committee
Transaction Background
Transaction Rationale
Hilltop
2011 Credit Agreement
Shareholder Approval
Appendix
4


Executive Summary
5
On
March
31,
2014,
SWS
entered
into
an
agreement
to
merge
into
a
subsidiary
of
Hilltop
SWS
Board
(other
than
Messrs.
Ford
1
and
Crandall
2
,
who
recused
themselves
from
voting)
unanimously
approved
the
merger
agreement
and
recommend
SWS
stockholders
vote
FOR
the
merger
on
or
before
the
Special Meeting of Stockholders to be held on November 21, 2014
SWS
holders
of
record
on
October
3,
2014
are
entitled
to
vote
importantly,
failing
to
vote
has
the
same
effect
as a vote against the transaction
Hilltop’s price represents a significant premium to SWS’s unaffected stock price³ and a substantial multiple in light of
SWS’s historical losses and low prospective earnings
Hilltop’s
merger
delivers
immediate
cash
value
and
allows
SWS
stockholders
to
participate
in
significant
upside
potential of a larger, more profitable, more diversified organization with ample capital to grow
Hilltop is the ideal buyer for SWS:
Hilltop owns complementary broker / dealer and banking businesses based in Dallas, TX
Low risk execution from regulatory and financing perspective
Alleviated
SWS
repayment
risk
on
$100
million
unsecured
debt
and
burdensome
conditions
in
related
Credit
Agreement
1
Refers to Gerald J. Ford, Chairman of the Board of Hilltop Holdings Inc.
2
Refers to J. Taylor Crandall, a founding Managing Partner of Oak Hill Capital Management, LLC
3
Unaffected SWS share price was $6.06 on January 9, 2014; the day before the Hilltop initial proposal was made public


6
Executive Summary (Continued)
Due to the anticipated scrutiny of merging with Hilltop, SWS formed an independent Special Committee, solicited
numerous potential acquirers and discussed potential transactions with other parties
Agreement with Hilltop was reached after SWS successfully negotiated enhanced economics, though no other
party submitted a binding proposal
Hilltop has since exercised all of its warrants, is the largest stockholder of SWS and is no longer a lender to SWS –
sacrificing certain rights and protections in the 2011 Credit Agreement
Oak
Hill
consented
to
the
merger
with
Hilltop
and
has
since
exercised
75%
of
its
warrants
becoming
the
second
largest common stockholder. Oak Hill is not subject to a voting agreement 


Transaction Overview
Per share deal value at announcement was $7.88
Hilltop originally offered $7.00 per share on 1/9/14
Value will fluctuate with Hilltop market price
SWS per share merger consideration of 0.2496 Hilltop shares
plus $1.94 in cash
Approximate mix 75% stock / 25% cash
Aggregate
value
of
SWS
at
announcement
of
$398
million
1
Hilltop existing investment in SWS of $80 million
Merger consideration to other SWS holders of $318
million
Transaction multiples at announcement:
Price/Fully Diluted Tangible Book Value Per Share:
97%
2
Price/Estimated FY 2015 EPS (Street): 88x
Unaffected
market
premium:
30%
3
Premium to 52 week low: 52%
7
1
Aggregate value includes Hilltop and Oak Hill warrants
2
Fully diluted tangible book value per share equaled $8.15 at announcement
3
Based on SWS share price on January 9, 2014 of $6.06 per share
Financial Terms
Legal Requirements
Stockholder approval requires affirmative vote of >50% of
outstanding SWS shares as of record date
Hilltop has exercised all of its warrants and has agreed to
vote its 10.2 million outstanding shares FOR the merger
(21% outstanding)
There is no voting agreement for Oak Hill’s 6.5 million
outstanding shares (14% outstanding)
Conditions to close merger include regulatory approvals;
Hilltop does not have financing or other outs
SWS Board can change its recommendation of the merger,
but not terminate the merger agreement, if SWS receives an
unsolicited superior proposal or in certain other limited
circumstances
Transaction is expected to close by year end 2014 with
merger agreement termination date of 3/31/15


SWS Independent Special Committee
On January 15, 2014, SWS formed a Special Committee to
review Hilltop’s unsolicited original offer, consider other
strategic alternatives and lead the negotiations for any
potential transaction
Members of the Special Committee:
SWS directors unaffiliated with Hilltop or Oak Hill
Disinterested and non-executives
Have relevant experience and industry knowledge
Able and willing to devote significant time and
thoughtfulness
Special Committee engaged independent advisors after
discussions with several candidates
Legal advisor -
Davis Polk & Wardwell (“Davis Polk”)
was retained on 1/29/14
Investment bank -
Sandler O’Neill (“Sandler”) was
retained on 2/3/14
From formation through the announcement of the Hilltop
transaction, the Special Committee met a total of 21 times
8
Formation
Tyree Miller -
Chair
SWS director since November 2011
Has been in the private equity and money management
business since 2004
Currently President of A.G. Hill Partners, LLC
From 2005 to 2008 served as a partner of Austin Ventures
From 1974 to 2004 built career at Bank One Corporation
(merged with JP Morgan in 2004), advancing to roles which
included Chairman and CEO of Bank One Texas from 1998
to 2000 and President and CEO of Global Treasury Services
from 2000 to 2004
Robert Buchholz
SWS director since May 2008
Served as an officer of SWS from 1985 to 1995, advancing
to President and a director
Chairman and founder of Town Center Holdings, former
parent company to Town Center Bank
Prior experiences as an attorney and certified public
accountant
Joel Williams III
SWS director since November 2009
President of Bristol Investment Company, Inc., a private
investment firm, since 1985
Formerly served as President and CEO of Texas Federal
Financial Corporation prior to its sale in 1984
Special Committee Bios


Transaction Background –
Process Overview¹
9
1
The
information
in
this
section
and
in
the
Transaction
Background
set
forth
in
this
presentation
is
selected
from
the
definitive
SWS/Hilltop
Proxy
Statement/Prospectus
filed
with
the
Securities
and
Exchange
Commission
and
is
not
a
complete
summary
of
the
transaction
background.
For
the
complete
summary,
please
refer
to
the
“Background
of
the
Merger”
section
of
the
SWS/Hilltop
Proxy
Statement/Prospectus.
Notes
Hilltop offer in public
domain for 81
days
before signing merger
agreement
17
companies contacted
(including all that
contacted SWS)
Other than Hilltop, only 2
companies continued to
pursue a transaction after
early stage conversations
Other than Hilltop, only 1
suitor was financially
capable of closing
transaction but that party
did not make a binding
proposal
1/9/14:
Hilltop delivered to SWS Board an unsolicited letter of intent to acquire all shares it did not own for
$7.00 per share in a 50% stock / 50% cash transaction
2/13/14:
Special Committee instructed Sandler to contact third parties that:
2/14
3/14:
17
parties
were
contacted
2/14 –
3/14:
Special Committee, Sandler and/or Davis Polk held discussions with or negotiated potential
transactions with:
3/31/14:
SWS entered into merger agreement with Hilltop following extensive negotiations
1/10/14:
Hilltop made its offer public
Hilltop
Esposito Global and Party B
Party A
Hilltop raised its offer price to $7.75 and stock consideration to 75%
Neither of the other interested parties submitted a binding proposal with a firm price to acquire SWS
Were
financially
capable,
Were
likely
to
receive
regulatory
approval,
and
Would
not
require
material
conditions
to
complete
a
transaction
to
acquire
SWS


Transaction Background –
Esposito Global & Party B
2/18/14:
Esposito Global publicly disclosed a proposal to acquire SWS for $8.00 per share, expressly contingent on third-
party financing being arranged
2/20/14:
Special Committee instructed Sandler and Davis Polk to speak with Esposito Global and its legal advisor
to understand their plans for arranging outside financing and their ability to obtain regulatory approval
2/24/14:
Esposito Global and its legal advisors indicated that Esposito Global was not in a position to obtain
regulatory approval and would require additional resources to meet financing requirements
2/27/14:
Esposito Global informed the Special Committee that it would be
working with “Party B,”
a bank holding
company
Over the ensuing several weeks, multiple conversations were held
with Esposito Global, Party B, and their financial and
legal advisors
Party B informed the Special Committee that significant external
financing would be required to complete a
transaction; multiple private equity firms would need to be involved
3/17/14:
Party B’s financial advisor indicated that sixty days would be required to finalize price and secure
necessary financing
3/20/14:
Special Committee informed Party B that it was uncomfortable with the uncertainty surrounding their extended
timeline to secure financing, complete due diligence and affirm their price
10


Transaction Background –
Party A
11
1
The
Merger
Covenant
in
the
Credit
Agreements
prohibits
SWS
from
undergoing
a
“Fundamental
Change,”
which
includes
any
merger
or
substantial
asset
sale,
without
the
approval
of
each
lender
2/18/14:
Initial conversation with Party A regarding a potential acquisition of SWS
During late February and early March, SWS’s financial advisor had several calls with Party A
3/18/14:
CEO of Party A stated they were valuing SWS at approximately $8.00 per share, though the price could be higher
3/25/14:
SWS and Party A executed a non-disclosure agreement
3/27/14:
Party
A
was
informed
that
SWS
was
under
a
deadline
to
execute
a
merger
agreement
by
March
31,
2014
3/29/14 –
3/31/14:
Party A conducted in-person due diligence at SWS headquarters in Dallas
3/31/14:
SWS received a letter from Party A stating they:
Party A indicated an interest in acquiring SWS at a price approximating tangible book value of SWS “liquid assets”; believed to
approximate the fully diluted tangible book value of $8.15 per share as of December 31, 2013
Also discussed were issues regarding the Merger Covenant, due diligence and terms of a non-disclosure agreement
Party A provided a non-binding indication of interest to acquire SWS for $8.65 per share, subject to due diligence and describing
the process that it would require to meet the March 31, 2014 deadline
Were
not
able
to
execute
a
definitive
agreement
by
the
March
31,
2014
deadline,
Had
serious
concerns
agreeing
to
a
transaction
if
Hilltop
would
not
waive
the
Merger
Covenant,
and
Needed
more
time
for
their
due
diligence
Party
A
also
discussed
the
Merger
Covenant
1
with
Hilltop’s
financial
advisor
-
who
informed
Party
A
that
Hilltop
would
not
waive it


Transaction Background –
Hilltop
3/3/14:
Special Committee rejected Hilltop’s original offer
3/5/14:
Hilltop
indicated
that
it
did
not
believe
book
value
($8.15
per
share)
was
the
correct
method
to
value
SWS,
based
on,
among
other
things,
its lack of historical and prospective earnings
3/19/14:
Hilltop submitted a revised proposal at $7.50 per share, 75% stock / 25% cash
Hilltop indicated that it was approaching its limit on price and
would not leave the offer outstanding for a prolonged period time
3/20/14:
Hilltop
agreed
to
increase
offer
price
to
$7.75
per
share,
75%
stock
/
25%
cash
Hilltop reiterated its intention not to waive the Merger Covenant with respect to any deal with another party
3/24/14:
Hilltop said that if the merger agreement was not signed by March 31, 2014, Hilltop would withdraw its offer; this position was
subsequently repeated on several occasions
3/31/14:
Special Committee members met with Hilltop to negotiate remaining issues of merger agreement
Hilltop refused again to eliminate the “force the vote”
provision and refused to accept a possible two-tier termination fee that would provide
for a lower payment if a deal was done with Party A
Hilltop did agree to reduce the termination fee to $8 million from original $12 million
3/31/14:
Later in the day, SWS Board (other than Messrs. Ford and Crandall, who were recused from voting) unanimously approved the merger
agreement and recommended its adoption by SWS stockholders based
on, among other things:
Enhanced value and improved terms (including higher price and lower termination fee) achieved through negotiations with Hilltop
Risk of Hilltop withdrawing its offer without a binding proposal
from either of the interested parties
Concern over the repayment risk of the $100 million of loans under the 2011 Credit Agreement and Hilltop’s unwillingness to waive the
Merger Covenant
12


13
Transaction Rationale –
SWS Six-Year Financial Performance
($ in Millions, Except per Share Data)
Source: SWS SEC Filings. SWS fiscal years ending June 30.
1
Fully Diluted Tangible Book Value per Share is Non-GAAP and includes Hilltop and Oak Hill warrant shares. See calculation on separate slide in Appendix.
Bank credit losses,
prolonged low short-
term interest rates
and declining broker /
dealer revenues have
primarily resulted in
net losses over past 5
years
Hilltop’s deal value is
attractive given
limited earnings
visibility of SWS as
standalone company


14
Transaction Rationale –
SWS Stock Price Performance
Prior to 2011
July
2010:
Bank
entered
into
MOU
with
OTS
Dec.
2010:
Terminates
planned
debt
offering
Feb. 2011: Bank enters
into C&D with OTS
March 2011: Agrees to
$100M capital raise with 
Hilltop and Oak Hill
(closed July 2011)
Historical price has
lingered around
warrant exercise price
as company
performance has
declined and exercise
price provided floor
For the three years
prior to Hilltop’s initial
proposal, SWS’s stock
price averaged $5.77
August 2011:
Announces
FY 2011 loss
per share of
$0.71
Sep. 2012:
Announces
FY 2012 loss
per share of
$0.14
August 2013:
Announces
FY 2013 loss
per share of
$1.02
Jan. 2014:
Hilltop
Announces
LOI for $7.00
per share
March 2014:
Announces
definitive
agreement for
$7.88 per share
Jan. 2013: OCC
lifts C&D order
for Bank


15
Hilltop’s offer at announcement
Transaction Rationale –
Provides Immediate and Long-Term Value
1
Unaffected stock price is equal to $6.06 per share, the price preceding Hilltop’s initial proposal.
2
Research
coverage
on
Hilltop
is
published
by
KBW,
Raymond
James,
Stephens
and
Sterne
Agee.
Provided a 30% premium to SWS’s unaffected stock price¹
Exceeded SWS likely value as a standalone entity
Provided a 12.5% premium to Hilltop’s original offer
Discount to tangible book value merited due to SWS historical losses and low prospective earnings
SWS stockholders will own approximately 10% of Hilltop
Hilltop median analyst price target of $26.25 implies $8.49 SWS deal value²
Larger,
diversified
organization
will
benefit
from
synergies
and
more
efficient
platform
Complementary businesses create leading Texas-based broker / dealer with bolstered market share and scale
Combined bank enhanced by significant source of additional low-cost, core deposits
Following merger, Hilltop will be well capitalized with excess capital to deploy on future transactions
25% cash / 75% stock mix offers SWS stockholders immediate cash value and significant upside potential
Transaction
alleviated
SWS
from
repayment
risk
of
$100
million
of
loans
and
lenders’
blocking
rights
to
a
merger
Hilltop
transaction
has
low
execution
risk
no
financing
contingencies
and
high
likelihood
of
regulatory
approvals
With Dallas-based broker/dealer and bank, Hilltop is best suited to extract benefits in excess of the risk and costs of integration
Numerous
potential
acquirers
were
solicited
following
public
announcement
of
Hilltop’s
initial
proposal,
none
of
whom
made
a
binding
proposal.
In
the
absence
of
other
binding
proposals,
there
was
a
significant
risk
to
SWS
of
Hilltop
withdrawing
its
offer
Hilltop is best buyer for SWS and transaction uniquely benefits SWS stockholders


16
Hilltop –
Overview
Hilltop is a diversified financial holding company based in Dallas
Led by Chairman Gerald J. Ford, who has acquired, managed and
sold banking businesses and other financial services companies for
over 35 years
Hilltop provides banking, mortgage origination, financial advisory
and insurance through its wholly owned subsidiaries, PlainsCapital
Corporation and National Lloyds Corporation
PlainsCapital
Bank
(“PCB”)
is
the
5th
largest
Texas-based
bank with 78 branches located in all major Texas markets
PrimeLending is the 4th largest mortgage originator in the U.S.
by purchase units (2013) with 300 locations in 42 states
First Southwest (“FSW”), primarily a public finance advisor,
ranked #1 nationally and in Texas for number of issues 
completed over past five years
National Lloyds provides fire and homeowners insurance for
low value dwellings in Texas and other southern states with a
distribution network of over 6,500 independent agents
With $9.4 billion in assets and $158 million in freely usable cash,
Hilltop seeks to build a premier Texas-based bank and diversified
financial services holding company through acquisitions and organic
growth
Q2 2014 LTM Pre-Tax Income by Segment ($000)
Organizational Structure
Source: SWS/Hilltop Proxy Statement/Prospectus, SNL Financial (deposit market share),
Ipreo MuniAnalytics (public finance rankings), Marketrac (origination ranking),
Hilltop website (number of National Lloyds independent agents)
1.
As of Oct. 6, 2014, Hilltop owned 21% of the outstanding common stock of SWS.
2.
Deposit
data
as
of
June
30,
2014
and
pro
forma
for
acquisitions.
Includes
banks
and
thrifts
headquartered
in
Texas.
2


17
Hilltop –
Financial Highlights
2013 Q2
2013 Q3
2013 Q4
2014 Q1
2014 Q2
Income to Common ($000)
$20,943
$38,174
$29,528
$23,760
$27,085
EPS -
Diluted
$0.24
$0.43
$0.34
$0.26
$0.30
ROAE
7.29%
13.02%
10.97%
7.65%
7.99%
Book Value Per Share
$12.59
$13.00
$13.27
$13.76
$14.22
Tier 1 Leverage Ratio
13.66%
13.96%
12.81%
13.12%
13.51%
Source: Hilltop 10-Qs and 10-K
Note: Hilltop also includes a corporate segment, which is excluded in bar chart for illustrative purposes


18
Hilltop and SWS –
Five Year Stock Price Relative Performance
Note: Includes the total return of the HTH stock price, the SWS stock price, and the S&P 500 Financials Index from October 28, 2009 to October 28, 2014
Source: SNL Financial
82.5%
(46.8%)
63.8%
(100.0%)
(50.0%)
0.0%
50.0%
100.0%
150.0%
10/28/09
10/28/10
10/28/11
10/28/12
10/28/13
10/28/14
HTH Stock Price
SWS Stock Price
S&P 500 Financials


19
Hilltop and SWS –
Stock Price Relative Performance & Short Interest
Current deal value is
$7.35; down from $7.88 at
announcement
Bank market is down
2.5% in that time
Elevated short interest is
impeding Hilltop and SWS
stock prices
Although Lone Star Value
has built a 8.15% long
position in SWS, they
have a 6.28% short
position, leaving them an
economic interest of only
1.88%
Research analysts of
Hilltop have median price
target of $26.25, a
premium of 21.1% over
the current market price
Note: Based on closing prices as of October 28, 2014
Short Interest
(8.9%)
(2.9%)
(2.5%)
(20.0%)
(15.0%)
(10.0%)
(5.0%)
0.0%
5.0%
10.0%
4/3/14
5/3/14
6/3/14
7/3/14
8/3/14
9/3/14
10/3/14
Relative Stock Price Performance
HTH Stock Price
SWS Stock Price
KBW Bank Index
0
500
1,000
1,500
2,000
2,500
3,000
3,500
3/31/14
4/30/14
5/31/14
6/30/14
7/31/14
8/31/14
9/30/14
HTH Short Interest
SWS Short Interest


20
Hilltop –
SWS Combination
Pro Forma Balance Sheet Highlights (6/30/14)
$bn
HTH
SWS
Pro Forma
Loans HFI
$4.5
$0.9
$5.4
Assets
$9.4
$4.1
$13.3
Deposits
$6.2
$1.4
$7.5
Equity
$1.4
$0.3
$1.6
Combination Opportunity
Transaction creates the largest full service brokerage firm
headquartered in the Southwestern US based on number
of financial advisors
Fortifies strong presence in Texas, while adding
complementary offices throughout the United States
Significant opportunity to bolster market share and scale
of complementary broker / dealer businesses
Larger, diversified organization will benefit from synergies
and more efficient operating platform
Combined bank will have a larger, more scalable deposit
base given ability to source additional deposits from
broker / dealer customers through the sweep program
Following the acquisition, Hilltop will be well capitalized
with excess cash to deploy on future transactions
Continues to build on Hilltop’s goal of building the premier
Texas financial holding company franchise with a
dominant Texas broker / dealer
Complementary Businesses
SWS
FSW
Taxable
Fixed
Income,
Retail
Public Finance,
Capital Markets,
Clearing,
Stock Loan,
Bank
Housing,
Asset
Management
Source: SWS/Hilltop Proxy Statement/Prospectus


21
Hilltop –
SWS / FSW Business Opportunity
FSW was formed in Dallas in 1946 and is a diversified investment
banking firm and a registered broker-dealer
25 locations nationwide (9 in Texas) and employs
approximately 400 people
Four primary lines of business: (1) public finance, (2) capital
markets, (3) correspondent clearing services and (4) asset
management
Combining SWS with FSW’s franchise will improve overlapping
business lines, while providing expansion into new areas
Public
Finance
-
will
have
the
premier
Southwestern
franchise with the ability to build both the municipal advisory
and
underwriting
practices
combined
company
will
be
the
number one ranked financial advisor in the nation by tax-
exempt issues
Capital Markets
-
able to add key traders and sales reps and
bolster its distribution for the municipal business, particularly
on west coast
Stock Loan
-
will benefit from addition of “hard-to-borrow”
balances and significant stock borrow/loan conduit business
Clearing
-
meaningfully increases scale with significant
addition of correspondents and balances but with minimal
overlap
Back Office
-
substantial opportunity to improve overhead
efficiency and streamline operations
New Businesses
-
addition of Taxable Fixed Income and
Retail will improve diversification and top line growth while
expanding product breadth and distribution capabilities
Financial
Advisor
Number
of
Tax-Exempt
Issues:
2009
2013
Source:
SWS/Hilltop
Proxy
Statement/Prospectus
and
Ipreo
MuniAnalytics
Opportunity Summary


2011 Credit Agreement
Two $50 million unsecured loans with 8.00% coupon
Equal commitments from Hilltop and Oak Hill; each offered 1 seat
on the
board
Each lender was issued warrants to purchase up to 8.7 million shares of
SWS common stock at fixed exercise price of $5.75 per share
Loan pre-payable with Make-Whole Premium¹
if SWS closing price
exceeds $8.625 for 20 of 30 consecutive trading days
Credit agreement includes “Merger Covenant”
prohibits SWS from
undergoing a “Fundamental Change,”
which includes any merger or
substantial asset sale, without the approval of each lender
Any exercise of warrants results in pro-rata elimination of loan
Closed on July 29, 2011 after SWS stockholder and regulatory approval
22
1
Make-Whole
Premium
(defined
as
“Applicable
Premium”
in
Credit
Agreement)
is
equal
to
the
present
value
of
all
required
interest
payments
from
prepayment
date
through
maturity
date.
2011 Credit Agreement
Credit Agreement Rationale
Southwest Securities, FSB (“Bank”) suffered from significant credit losses
and was operating under a Cease & Desist Order with heightened capital
requirements
Bank had a $68 million pre-tax loss over 12 months preceding
Credit Agreement
Bank issues were negatively impacting core brokerage businesses and
jeopardizing SWS viability
Efforts to raise capital in public and private markets were unsuccessful
2014 Consent and Warrant Exercises
Hilltop has exercised 100% of its warrant for 8.7 million SWS shares – eliminating its rights under Credit Agreement 
At the time the merger was announced, Oak Hill agreed to consent to the merger with Hilltop and exchange any outstanding
warrants for same merger consideration as SWS common holders plus Make-Whole Premium it is entitled to for its outstanding loan
Oak Hill has subsequently exercised 75% of its warrant for 6.5 million shares – preserving its rights under Credit Agreement but
eliminating 75% of its Make-Whole Premium


23
Shareholder Approval
The Board of Directors of SWS
Group
1
unanimously
recommends
that SWS stockholders vote “FOR”
the transaction with Hilltop
1
Other than Mr. Ford and Mr. Crandall who recused themselves from voting


24
APPENDIX
*
*
*
*
*
*
*
*


25
Fully Diluted Tangible Book Value (Non-GAAP)
See
discussion
of
Non-GAAP
reconciliation
on
next
slide.
($ in Thousands, Except per Share Data)
6/26/09
6/25/10
6/24/11
6/29/12
6/30/13
6/30/14
Book Value
340,357
383,394
357,469
355,702
315,286
309,872
Less: Goodwill
(7,552)
(7,552)
(7,552)
(7,552)
(7,552)
(7,552)
Less: Intangible (Ameritrade)
(1,734)
(791)
(6)
---
---
---
Tangible Book Value
331,071
375,051
349,911
348,150
307,734
302,320
Pro-Forma Adjustments:
New Equity from exercise (Common & APIC)
NA
NA
NA
92,696
94,783
126,609
Loss on debt extinguishment
NA
NA
NA
(20,924)
(16,898)
(12,231)
Gain on warrant extinguishment
NA
NA
NA
35,114
29,414
1,187
Less: Unamortized debt issuance costs
NA
NA
NA
(2,009)
(1,517)
(1,025)
Embedded gain on exercise before tax
NA
NA
NA
12,181
10,999
(12,069)
Less taxes (35%)
NA
NA
NA
(4,263)
(3,850)
4,224
Embedded gain after tax
7,918
7,150
(7,845)
Pro-forma Tangible Book Value
331,071
375,051
349,911
448,764
409,666
421,084
Shares Outstanding
27,263
32,342
32,285
32,576
32,629
32,757
Deferred Compensation Shares
187
216
262
306
302
311
Warrant Shares
NA
NA
NA
17,391
17,391
17,391
Pro-forma Shares Outstanding
27,450
32,558
32,547
50,273
50,322
50,459
Fully Diluted Tangible Book Value per Share
$12.06
$11.52
$10.75
$8.93
$8.14
$8.35
1
1


Use of Non-GAAP Measures
26
SWS
has
included
in
the
presentation
Fully
Diluted
Tangible
Book
Value
Per
Share.
Fully
Diluted
Tangible
Book
Value
Per
Share
reflects
book
value
per
share,
less
goodwill,
assuming
exercise
of
all
of
the
Company’s
outstanding
warrants
and
resulting
repayment
of
the
$100
million
loan
from
Hilltop
and
Oak
Hill.
Fully
Diluted
Tangible
Book
Value
Per
Share
is
a
non-GAAP
financial
measure
as
defined
in
Item
10(e)
of
Regulation
S-K.
SWS
believes
that
the
presentation
of
this
non-GAAP
financial
measure
provides
useful
information.
While
management
believes
this
non-GAAP
financial
measure
is
useful
in
evaluating
SWS,
this
information
should
be
considered
as
supplemental
in
nature
and
not
as
a
substitute
for,
or
superior
to,
the
related
financial
information
prepared
in
accordance
with
GAAP.


This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a
solicitation of any vote or approval, nor shall there be any sale of securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such
jurisdiction. Hilltop Holdings Inc. (“Hilltop”) has filed with the Securities and Exchange Commission (“SEC”) a
registration statement on Form S-4 containing a definitive proxy statement of SWS Group, Inc. (“SWS”) that also
constitutes a prospectus of Hilltop, and SWS and Hilltop have each filed and will each file other documents with
respect to the proposed transaction and the definitive proxy statement/prospectus has been mailed to shareholders
of SWS. Investors and security holders of SWS are urged to read the definitive proxy statement/prospectus and
other documents filed or that will be filed with the SEC carefully and in their entirety because they contain important
information. Investors and security holders of SWS are able to obtain free copies of the registration statement and
the proxy statement/prospectus and other documents filed with the SEC by SWS or Hilltop through the website
maintained by the SEC at www.sec.gov. Copies of the documents filed with the SEC by SWS are available free of
charge on SWS’s internet website at www.swst.com or by contacting SWS’s Investor Relations Department at
(214) 859-1800. Copies of the documents filed with the SEC by Hilltop are available free of charge on Hilltop’s
internet website at www.hilltop-holdings.com or by contacting Hilltop’s Investor Relations Department at (214) 252-
4029.
SWS, Hilltop, their respective directors and certain of their executive officers and other members of management
and employees may be considered participants in the solicitation
of proxies in connection with the proposed
transaction. Information about the directors and executive officers of SWS is set forth in its Annual Report on Form
10-K/A (Amendment No. 1) for the year ended June 30, 2014, which was filed with the SEC on September 26,
2014. Information about the directors and executive officers of Hilltop is set forth in its most recent proxy statement,
which was filed with the SEC on May 2, 2014. Other information regarding the participants in the proxy solicitations
and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the
definitive proxy statement/prospectus and other relevant materials to be filed with the SEC when they become
available.
27
Important Information for Investors & Shareholders