##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 
 FORM 10-K
 þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
 FOR THE FISCAL YEAR ENDED DECEMBER 31, 2008
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 For the transition period from          to
 Commission File Number: 000-53352
 Titanium Asset Management Corp.
  Delaware
    
    20-8444031(State or other jurisdiction of
    
    (I.R.S. Employerincorporation or organization)
    
    Identification Number)777 E. Wisconsin Avenue, Milwaukee, Wisconsin
    
    53202-5310(Address of principal executive offices)
    
    (Zip Code)
 (414) 765-1980
  None
  Common Stock, par value $0.0001
 o þ
 o þ
 þ o
 þ
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Smaller reporting company þ(Do not check if a smaller reporting company)
 o þ
   DOCUMENTS INCORPORATED BY REFERENCE
 Definitive Proxy Statement for the Companys 2009 Annual Meeting of Stockholders  Part III of this Form 10-K




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##### 



TABLE OF CONTENTS
 PagePART IITEM 1. BUSINESS
    
    
    2ITEM 1A. RISK FACTORS
    
    
    13ITEM 1B. UNRESOLVED STAFF COMMENTS
    
    
    21ITEM 2. PROPERTIES
    
    
    21ITEM 3. LEGAL PROCEEDINGS
    
    
    22ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
    
    
    22PART IIITEM 5. MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER
PURCHASES OF EQUITY SECURITIES
    
    
    24ITEM 6 SELECTED FINANCIAL DATA
    
    
    24ITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
    
    
    25ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
    
    
    36ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
    
    
    37ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
    
    
    56ITEM 9A. CONTROLS AND PROCEDURES
    
    
    56ITEM 9B. OTHER INFORMATION
    
    
    56PART IIIITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
    
    
    56ITEM 11. EXECUTIVE COMPENSATION
    
    
    57ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDER MATTERS
    
    
    57ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
    
    
    58ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
    
    
    58PART IVITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
    
    
    58EX-10.22: EMPLOYMENT AGREEMENTEX-11.1: STATEMENT REGARDING COMPUTAION OF EARNINGS PER SHAREEX-21.1: SUBSIDIARIESEX-31.1: CERTIFICATIONEX-31.2: CERTIFICATIONEX-32.1: CERTIFICATIONEX-32.2: CERTIFICATION
  -i-




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FORWARD LOOKING STATEMENT
 This Annual Report on Form 10-K , including particularly the Managements Discussion and
Analysis of Financial Condition and Results of Operations contains forward-looking statements
within the meaning of the Private Securities Litigation Reform Act of 1995, which provides a safe
harbor for statements about future events, products and future financial performance that are
based on the beliefs of, estimates made by and information currently available to the management of
Titanium Asset Management Corp., a Delaware corporation (referred to as we, our or the
Company, and, unless the context indicates otherwise, includes our wholly owned asset management
subsidiaries, Wood Asset Management, Inc., or Wood, Sovereign Holdings, LLC, or Sovereign, National
Investment Services, Inc., or NIS, and Boyd Watterson Asset Management, LLC, or Boyd. We refer to
Wood, Sovereign, NIS and Boyd collectively as our subsidiaries. The outcome of the events
described in these forward-looking statements is subject to risks and uncertainties. Actual
results and the outcome or timing of certain events may differ significantly from those projected
in these forward-looking statements due to market fluctuations that alter our assets under
management; termination of investment advisory agreements; loss of key personnel; loss of
third-party distribution services; impairment of goodwill and other intangible assets; our
inability to compete; market pressure on investment advisory fees; problems experienced in the
acquisition or integration of target businesses; changes in law, regulation or tax rates;
ineffective management of risk; inadequacy of insurance; changes in interest rates, equity prices,
liquidity of global markets and international and regional political conditions; terrorism; changes
in monetary and fiscal policy, investor sentiment and availability and cost of capital;
technological changes and events; outcome of legal proceedings; changes in currency values,
inflation and credit ratings; failure of our systems to properly operate; or actions taken by Clal
Finance Ltd., or Clal, as our significant stockholder; and other factors listed in this Annual
Report on Form 10-K and from time to time in our other filings with the Securities and Exchange
Commission, or the Commission. For this purpose, statements relating to integrating the
operational, administrative and sales activities of our subsidiaries, earning of incentive fees,
amount of future assets under management, acquisitions of additional asset management firms and
payment therefor, payment of deferred consideration for the purchase of our subsidiaries and
anticipated levels of future revenues, expenses or earnings, among other things; any statements
using the terms aim, anticipate, appear, based on, believe, can, continue, could,
are emerging, estimate, expect, expectation, intend, may, ongoing, plan, possible
potential, predict, project, should and would or similar words or phrases, or the
negatives of those words or phrases; or discussions of strategy, plans, objectives or goals, may
identify forward-looking statements that involve risks, uncertainties and other factors that could
cause our actual results, financial condition and the outcome and timing of certain events to
differ materially from those projected or managements current expectations. By making
forward-looking statements, we have not assumed any obligation to, and you should not expect us to,
update or revise those statements because of new information, future events or otherwise.
 
 PART I
 
 Item 1. Business
 Company Background
    2




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The Acquisitions
 The Wood Agreement
   The Sovereign Agreement
   The NIS Agreement
  3




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The Boyd Agreement
   Our Subsidiaries
     4




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i.e.
     Principal Products and Services
 Our Investment Strategies
  Wood
    
    Sovereign
    
    NIS
    
    BoydU.S. Relative Value 
     Equity 
U.S. Core Equity 
Balanced 
Quantitative
Strategies
    
    Enhanced Cash Fixed Income
Limited Duration Fixed
     
     Income
Intermediate Taxable
Fixed      Income
Intermediate Municipal
Fixed       Income
Core Fixed Income
Total Return Fixed Income
Diversified Fixed Income
      Strategy
Managed Fixed Income
      Solution
    
    Short Duration Fixed Income
Intermediate Fixed Income
Intermediate Plus Fixed Income
Intermediate Aggregate Fixed
Income
Aggregate Core Fixed Income
Aggregate Core Plus Fixed
Income
Fixed Income Arbitrage Fund
Preferred Stock Funds
Immunized/Liability Matching
Fixed      Income
Fixed Income Transition
Management
Multi-Strategy Fund
Long-Short Equity Fund
All Cap International Growth
Equity
    
    Short-Term Fixed Income 
High Quality
Intermediate       Fixed
Income 
Intermediate Fixed Income
High Quality Core Fixed
      Income 
Total Return Core Fixed
      Income 
Disciplined Core Fixed
Income
Ultra Enhanced Core
Fixed      Income 
U.S. Equities 
Balanced 
International Equities
  5




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Other Investment Strategies
  6




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Our Clients
   Wood(1)
    
    Sovereign
    
    NIS
    
    BoydPercentage
    
    
    
    
    
    Percentage of
    
    
    
    
    
    Percentage
    
    
    
    
    
    Percentage
    
    Percentageof Total
    
    Percentage of
    
    Total
    
    Percentage of
    
    of Total
    
    Percentage of
    
    of Total
    
    of AssetsNumber of
    
    Assets Under
    
    Number of
    
    Assets Under
    
    Number of
    
    Assets Under
    
    Number of
    
    UnderClient Type
    
    Clients
    
    Management
    
    Clients
    
    Management
    
    Clients
    
    Management
    
    Clients
    
    ManagementIndividuals (other than high net-worth individuals)
    
    
    55
    
    
    
    27
    
    
    
    62
    
    
    
    17
    
    
    
    
    
    
    
    
    
    
    
    67
    
    
    
    6High net-worth individuals
    
    
    31
    
    
    
    18
    
    
    
    22
    
    
    
    38
    
    
    
    
    
    
    
    
    
    
    
    9
    
    
    
    11Banking and thrift institutions
    
    
    *
    
    
    
    1
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Pension and profit sharing plans (other than plan participations)
    
    
    4
    
    
    
    31
    
    
    
    4
    
    
    
    4
    
    
    
    51
    
    
    
    57
    
    
    
    5
    
    
    
    13Other pooled investment vehicles (e.g., hedge funds)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3
    
    
    
    1
    
    
    
    *
    
    
    
    1Charitable organizations
    
    
    3
    
    
    
    5
    
    
    
    5
    
    
    
    7
    
    
    
    12
    
    
    
    17
    
    
    
    4
    
    
    
    6Corporations or other businesses not listed above
    
    
    4
    
    
    
    5
    
    
    
    7
    
    
    
    34
    
    
    
    
    
    
    
    
    
    
    
    12
    
    
    
    23State or municipal government entities
    
    
    2
    
    
    
    14
    
    
    
    1
    
    
    
    1
    
    
    
    2
    
    
    
    1
    
    
    
    3
    
    
    
    40Taft-Hartley health and welfare plans
    
    
    *
    
    
    
    *
    
    
    
    
    
    
    
    
    
    
    
    32
    
    
    
    24
    
    
    
    
    
    
    
    
 
 *
    
    Less than 1.0%(1)
    
    Prior to our acquisition of NIS, it offered Woods U.S. Relative Value Equity product to its
clients through a sub-advisory relationship. In this table, those assets are attributed to
Wood. 7




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8




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Distribution and Marketing
 Broker-Dealer Relationships
  WOOD
    
    SOVEREIGN
    
    BOYDWrap Programs:
    
    Wrap Programs:
    
    Wrap Programs:▪     RBC Dain Raucher
    
    ▪     Raymond James Financial Services Inc.
    
    ▪     Edward Jones & Co.▪     Raymond James Financial Services Inc.
    
    ▪     Lockwood Advisors Inc.
    
    ▪     Morgan Stanley and Co. Incorporated▪     Envestnet Asset Management Inc.
    
    ▪     UVEST Investment Services Group
    
    ▪     Advisor Port Inc.▪     Optimum Investment Advisors Inc.
    
    ▪     Fund Quest Incorporated▪     NBC Securities
    
    ▪     First Global Advisors Inc.▪     ARIS Corporation of America▪     Stifel Nicholas & Company Incorporated▪     Mid Atlantic Financial Management Inc.▪     Envestnet Asset Management Inc.
 
 9




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##### Table of Contents



WOOD
    
    SOVEREIGN
    
    BOYDDual Contracts:
    
    Dual Contracts:
    
    Dual Contracts:▪     Morgan Keegan
    
    ▪     American Securities Group Inc.
    
    ▪     Merrill Lynch & Co.▪     Wachovia
    
    ▪     Essex Financial Services Inc.
    
    ▪     UBS Financial Services Inc.▪     AXA Equitable
    
    ▪     RW Baird & Co.▪     Charles Schwab▪     Wealth Trust Advisors Inc.Model Portfolios:▪     Placemark▪     Envestnet Asset Management Inc.
  Institutional Distribution
  ▪
    
    Investment Performance Services▪
    
    Lowery Asset Consulting▪
    
    Marco Consulting Group▪
    
    Marquette Association▪
    
    New England Pension Consultants▪
    
    CapTrust Advisors/Schott Group▪
    
    Segal Advisors▪
    
    Strategic Capital Investment Advisors
   Referral Arrangements
  10




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Competitive Business Conditions
 The U.S. Economy
    Our Competitive Position in the Industry
  i.e.
  Governmental Regulation
  11




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Commission Regulation
      State Regulation
  12




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ERISA
  Non-U.S. Regulation
  Employees
  
 Item 1A. Risk Factors
  Risks Relating to Our Business
 Because we have a limited operating history, you may not be able to evaluate our current and future
business prospects accurately.
  Our fees are subject to market fluctuations.
  ▪
    
    causing the value of the assets under management to decrease, which would result in
lower investment advisory fees; or▪
    
    causing negative absolute performance returns for some accounts that have
performance-based fees, resulting in a reduction of revenue from such fees.
 13




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Poor investment performance of our investment strategies could affect our sales or reduce the
amount of assets under management, potentially negatively impacting revenue and profitability.
  We derive substantially all of our revenues from contracts that may be terminated on short notice.
  We depend on the continued services of our key personnel. The loss of key personnel could have a
material adverse effect on us.
  14




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We depend on third-party distribution sources to market our investment strategies and access our
client base.
    We have significant goodwill and intangible assets subject to impairment analysis. The impairment
analysis is based on subjective criteria, and an impairment loss could be recorded.
 Goodwill and Other Intangible Assets
 15




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Market pressure to lower our subsidiaries investment advisory fees could reduce our profit margin.
  The due diligence process that we undertake in connection with our acquisitions may not reveal all
facts that may be relevant in connection with an acquisition.
  Acquisitions of target businesses involve inherent risks that could threaten our ability to
successfully consummate a transaction.
  ▪
    
    inability to secure enough affirmative votes to gain approval of a proposed
acquisition from the target companys stockholders;▪
    
    higher than anticipated acquisition costs and expenses; and▪
    
    the potential diversion of our managements time and attention.
   Future
acquisitions may have a dilutive effect on existing holders of Common Stock.
   16




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Our failure to successfully integrate an acquired businesses could have an adverse effect on our
business, financial condition or results of operations.
  ▪
    
    loss of key personnel, either by us, our subsidiaries or by the target company;▪
    
    termination of key investment advisory agreements by clients of the target company;▪
    
    operating a significantly larger combined organization;▪
    
    coordinating geographically disparate organizations, systems and facilities; and▪
    
    integrating corporate, technological and administrative functions.
 Some of our revenue, net income and cash flow is dependent upon incentive fees, which may make it
difficult for us to achieve steady earnings growth on an annual basis.
  Changes in tax law, the interpretation of existing tax laws and amendments to existing tax rates
could adversely affect our business.
  Changes in laws and regulations could adversely affect our business.
  If our techniques for managing risk are ineffective, we may be exposed to material unanticipated
losses.
  17




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Insurance coverage may not protect us from all of the liabilities that could arise from the risks
inherent in our business.
  Risks Relating to the Asset Management Industry
 The asset management industry has inherent risks and difficult market conditions can adversely
affect the ability of our subsidiaries to successfully execute their investment strategies.
  The asset management industry faces substantial litigation risks which could materially adversely
affect our business, financial condition or results of operations or cause significant harm to our
reputation.
  18




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The asset management business is intensely competitive.
  Employee misconduct could expose us to significant legal liability and reputational harm.
  The asset management business is extensively regulated and the failure to comply with regulatory
requirements may harm our financial condition.
  Operational risks may disrupt our business, result in losses or limit our growth.
  19




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Risks Relating to Our Common Stock
 There is no public U.S. market for our shares and an active market may not develop or be
maintained, which could limit stockholders ability to sell shares of our Common Stock.
  We incur increased costs as a result of being a U.S. public reporting company.
  The transfer of our shares of Common Stock is restricted.
 ,
 Clal can exercise control over all matters requiring stockholder approval and could make decisions
about our business that conflict with other stockholders.
  ▪
    
    the majority composition of our board of directors and, through it, any
determination with respect to our business direction and policies, including the
appointment and removal of officers;▪
    
    any determinations with respect to mergers or other business combinations;▪
    
    our acquisition or disposition of assets;▪
    
    our financing arrangements; and▪
    
    the payment of dividends on our stock.
  20




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Our charter documents contain provisions that may delay, defer or prevent a change of control.
  ▪
    
    allowing removal of directors for cause only; and not allowing the removal of
directors nominated by Clal, except for removal by Clal (or any affiliate thereof) so
long as Clal or any of its affiliates owns of record at least 35.0% of the then issued
and outstanding shares of Common Stock;▪
    
    giving the board of directors the ability to authorize the issuance of shares of our
preferred stock, par value $0.0001, without stockholder approval;▪
    
    vesting exclusive authority in the board of directors to fill vacancies on the board
of directors, other than the vacancies of the directors nominated by Clal;▪
    
    limiting stockholders ability to call special meetings; and▪
    
    giving Clal or any affiliate thereof, special rights so long as Clal or any of its
affiliates owns of record at least 35.0% of the then issued and outstanding Common
Stock.
 We do not expect to pay any dividends for the foreseeable future.
  
 Item 1B. Unresolved Staff Comments
  
 Item 2. Properties
       21




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Item 3. Legal Proceedings
   
 Item 4. Submission of Matters to a Vote of Security Holders.
  EXECUTIVE OFFICERS
  Name
    
    Age
    
    PositionNigel Wightman
    
    
    55
    
    
    Chief Executive Officer and ChairmanLarry Haslee
    
    
    49
    
    
    Chief Financial Officer and SecretaryRobert Kelly
    
    
    64
    
    
    Vice Chairman and DirectorJohn (Jack) Fisher
    
    
    54
    
    

Managing Director and President and Chief Executive
Officer of Wood and Chief Executive Officer of
SovereignRobert Brooks
    
    
    54
    
    
    Managing Director and Executive Vice President of NISRobert J. Siefert
    
    
    60
    
    
    Managing Director and President and Chief Investment
Officer of NISBrian L. Gevry
    
    
    42
    
    
    Managing Director and Chief Executive Officer and
co-Chief Investment Officer of Boyd
 Nigel Wightman
 22




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Larry Haslee CPA,
 Robert Kelly
 John (Jack) Fisher ,
 Robert Brooks
 Robert J. Siefert, CPA,
 23




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Brian L. Gevry, CFA,
 
 PART II
 
 Item 5.
    
    Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
   Price Per Share of CommonStock ($)Quarterly Period
    
    Low
    
    High3rd Quarter, 2007
    
    
    4.50
    
    
    
    5.854th Quarter, 2007
    
    
    4.63
    
    
    
    5.751st Quarter, 2008
    
    
    5.63
    
    
    
    5.632nd Quarter, 2008
    
    
    5.63
    
    
    
    5.633rd Quarter, 2008
    
    
    5.25
    
    
    
    5.884th Quarter, 2008
    
    
    5.25
    
    
    
    5.25
   Unregistered Securities
  
 Item 6. Selected Financial Data
  24




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Item 7. Managements Discussion and Analysis of Financial Condition and Results of
Operations
  Overview
       25




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Assets Under Management
  Wood
    
    Sovereign
    
    NIS
    
    Boyd
    
    Total(in millions)Wood acquisition on October 1, 2007 (1)
    
    $
    1,488.0
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    1,488.0Sovereign acquisition on October 1, 2007 (2)
    
    
    
    
    
    
    1,817.0
    
    
    
    
    
    
    
    
    
    
    
    1,817.0New accounts
    
    
    8.0
    
    
    
    74.0
    
    
    
    
    
    
    
    
    
    
    
    82.0Terminated accounts
    
    
    (75.0
    )
    
    
    (86.0
    )
    
    
    
    
    
    
    
    
    
    
    (161.0
    )Other inflows (outflows) to (from) existing
accounts
    
    
    (49.0
    )
    
    
    (43.0
    )
    
    
    
    
    
    
    
    
    
    
    (92.0
    )Other activity, principally market movement
    
    
    (81.2
    )
    
    
    18.0
    
    
    
    
    
    
    
    
    
    
    
    (63.2
    )Balance at December 31, 2007
    
    
    1,290.8
    
    
    
    1,780.0
    
    
    
    
    
    
    
    
    
    
    
    3,070.8% change from acquired balance
    
    
    (13
    %)
    
    
    (2
    %)
    
    
    
    
    
    
    
    
    
    
    (7
    %)NIS acquisition on March 31, 2008 (3)
    
    
    
    
    
    
    
    
    
    
    2,884.1
    
    
    
    
    
    
    
    2,884.1Boyd acquisition on December 31, 2008 (4)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,856.0
    
    
    
    2,856.0New accounts
    
    
    102.3
    
    
    
    223.3
    
    
    
    287.2
    
    
    
    
    
    
    
    612.8Terminated accounts
    
    
    (345.2
    )
    
    
    (804.7
    )
    
    
    (145.4
    )
    
    
    
    
    
    
    (1,295.3
    )Other inflows (outflows) to (from) existing
accounts
    
    
    (51.4
    )
    
    
    26.6
    
    
    
    (118.2
    )
    
    
    
    
    
    
    (143.0
    )Other activity, principally market movement
    
    
    (328.6
    )
    
    
    (61.6
    )
    
    
    (22.0
    )
    
    
    
    
    
    
    (412.2
    )Balance at December 31, 2008
    
    $
    667.9
    
    
    $
    1,163.6
    
    
    $
    2,885.7
    
    
    $
    2,856.0
    
    
    $
    7,573.2% change from beginning of year or
acquired balance
    
    
    (48
    %)
    
    
    (35
    %)
    
    
    0
    %
    
    
    
    
    
    
    (14
    %)
 
 (1)
    
    In connection with our acquisition of Wood as of October 1, 2007, we acquired $1,488.0
million of assets under management that were with institutional and retail customers and
invested primarily in equity investments. We earned investment advisory fees of $1,576,000
over the balance of 2007.(2)
    
    In connection with our acquisition of Sovereign as of October 1, 2007, we acquired $1,817.0
million of assets under management that were principally with retail and institutional
customers and invested primarily in fixed-income investments. We earned investment advisory
fees of $1,084,000 over the balance of 2007.(3)
    
    In connection with our acquisition of NIS as of March 31, 2008, we acquired $2,884.1 million
of assets under management that were principally with institutional customers and invested in
fixed-income investments. We earned investment advisory fees of $5,522,000 over the balance
of 2008.(4)
    
    In connection with our acquisition of Boyd as of December 31, 2008, we acquired $2,856.0
million of assets under management that were principally with institutional customers and
invested in fixed-income investments.  26




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2008
    
    
    2007(in millions)
    
    
    % of total
    
    
    (in millions)
    
    
    % of totalU.S. fixed income
    
    $
    6,674.8
    
    
    
    88.2
    %
    
    $
    1,833.1
    
    
    
    59.7
    %U.S. equity
    
    
    874.6
    
    
    
    11.5
    %
    
    
    1,237.7
    
    
    
    40.3
    %International equity
    
    
    23.8
    
    
    
    0.3
    %
    
    
    
    
    
    
    Balance at end of period
    
    $
    7,573.2
    
    
    
    100.0
    %
    
    $
    3,070.8
    
    
    
    100.0
    %
   2008
    
    
    2007(in millions)
    
    
    % of total
    
    
    (in millions)
    
    
    % of totalInstitutional  Retirement plans
    
    $
    3,633.3
    
    
    
    48.0
    %
    
    $
    1,126.4
    
    
    
    36.7
    %Institutional  Other
    
    
    2,197.3
    
    
    
    29.0
    %
    
    
    73.3
    
    
    
    2.4
    %Retail  Broker/dealer accounts
    
    
    948.6
    
    
    
    12.5
    %
    
    
    1,143.8
    
    
    
    37.2
    %Retail  Other
    
    
    794.0
    
    
    
    10.5
    %
    
    
    727.3
    
    
    
    23.7
    %Balance at end of period
    
    $
    7,573.2
    
    
    
    100.0
    %
    
    $
    3,070.8
    
    
    
    100.0
    %
   Balance at March 31, 2008
    
    $
    938.3New accounts
    
    
    43.2Other inflows (outflows) to existing accounts
    
    
    15.5Other activity, principally market movement
    
    
    (190.8
    )Balance at December 31, 2008
    
    $
    806.2% change from acquired balance
    
    
    (14
    %)
  27




---



##### Table of Contents



Results of Operations
 Consolidated Results of Operations
  Period fromFebruary 2,Year ended
    
    Percent of
    
    2007 (inception)
    
    Percent ofDecember 31,
    
    operating
    
    to December 31,
    
    operating2008
    
    revenue
    
    2007
    
    revenue(dollars in thousands, except for per share data)Operating revenues:Investment advisory fees
    
    $
    12,358
    
    
    
    84
    %
    
    $
    2,660
    
    
    
    100
    %Incentive fees
    
    
    518
    
    
    
    4
    %
    
    
    
    
    
    
    Referral fees
    
    
    1,799
    
    
    
    12
    %
    
    
    
    
    
    
    Total operating revenues
    
    
    14,675
    
    
    
    100
    %
    
    
    2,660
    
    
    
    100
    %Operating expenses:Administrative
    
    
    16,283
    
    
    
    111
    %
    
    
    2,490
    
    
    
    94
    %Amortization of intangible assets
    
    
    4,190
    
    
    
    29
    %
    
    
    809
    
    
    
    30
    %Impairment of intangible assets
    
    
    6,533
    
    
    
    45
    %
    
    
    829
    
    
    
    31
    %Total operating expenses
    
    
    27,006
    
    
    
    184
    %
    
    
    4,128
    
    
    
    155
    %Operating loss
    
    
    (12,331
    )
    
    
    (84
    %)
    
    
    (1,468
    )
    
    
    (55
    %)Interest income
    
    
    1,032
    
    
    
    7
    %
    
    
    2,191
    
    
    
    82
    %Interest expense
    
    
    (28
    )
    
    
    
    
    
    
    
    
    
    
    Income (loss) before taxes
    
    
    (11,327
    )
    
    
    (77
    %)
    
    
    723
    
    
    
    27
    %Income tax expense (benefit)
    
    
    (4,287
    )
    
    
    (29
    %)
    
    
    280
    
    
    
    11
    %Net income (loss)
    
    $
    (7,040
    )
    
    
    (48
    %)
    
    $
    443
    
    
    
    17
    %Net income (loss) per sharebasic
    
    $
    (0.34
    )
    
    
    
    
    
    $
    0.04diluted
    
    $
    (0.34
    )
    
    
    
    
    
    $
    0.03
 Operating Revenues
   2008
    
    2007(in thousands)Wood
    
    $
    4,149
    
    
    $
    1,576Sovereign
    
    
    2,687
    
    
    
    1,084NIS
    
    
    5,522
    
    
    
    Total
    
    $
    12,358
    
    
    $
    2,660
  28




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##### Table of Contents



Operating Expenses
    29




---



##### Table of Contents



30




---



##### Table of Contents



Liquidity and Capital Resources
 Period fromFebruary 2, 2007Year Ended
    
    (inception) toDecember 31,
    
    December 31,2008
    
    2007Net cash provided by (used in) operating activities
    
    $
    (633,000
    )
    
    $
    2,478,000Net cash provided by (used in) investing activities
    
    
    12,015,000
    
    
    
    (89,571,000
    )Net cash provided by (used in) financing activities
    
    
    (12,017,000
    )
    
    
    106,481,000
      Amounts due in 2009:Boyd acquisition payment made January 2009
    
    $
    7,500,000NIS deferred acquisition payment due March 2009
    
    
    645,0008,145,000Amounts due in 2011:NIS deferred acquisition payment due March 2011
    
    
    1,000,000Total cash obligations under acquisition agreements
    
    $
    9,145,000
  31




---



##### Table of Contents



Total
    
    Cash portion
    
    Stock portionAmounts due in 2009:Payment due based on Wood assets under
management at September 30, 2009. The
maximum payment of $2,000,000 is
prorated based on $1.5 billion of assets
under management and up to 50% is
payable in Common Stock.
    
    $
    990,000
    
    
    $
    495,000
    
    
    $
    495,000Payment due based on Sovereign assets
under management at September 30, 2009.
The maximum payment of $2,000,000 is
prorated based on $1.9 billion of assets
under management and up to 50% is
payable in Common Stock.
    
    
    1,010,000
    
    
    
    505,000
    
    
    
    505,0002,000,000
    
    
    
    1,000,000
    
    
    
    1,000,000Amounts due in 2011:Payment due based on Wood assets under
management at September 30, 2011. The
maximum payment of $2,000,000 is
prorated based on $1.5 billion of assets
under management and up to 50% is
payable in Common Stock.
    
    
    1,613,000
    
    
    
    807,000
    
    
    
    806,000Payment due based on Sovereign assets
under management at September 30, 2011.
The maximum payment of $2,000,000 is
prorated based on $1.9 billion of assets
under management and up to 50% is
payable in Common Stock.
    
    
    1,325,000
    
    
    
    663,000
    
    
    
    662,000Deferred variable payment due based on
the revenue run rate for Boyd as of
December 31, 2010 exceeding $6,250,000.
The maximum payment of $8,000,000, of
which up to 35% is payable in Common
Stock.
    
    
    8,000,000
    
    
    
    5,200,000
    
    
    
    2,800,00010,938,000
    
    
    
    6,670,000
    
    
    
    4,268,000Total amounts due under acquisition agreements
    
    $
    12,938,000
    
    
    $
    7,670,000
    
    
    $
    5,268,000
   Off-Balance Sheet Arrangements
  32




---



##### Table of Contents



Critical Accounting Estimates
   Other Intangible Assets Other Than Goodwill Accounting for the Impairment or Disposal of Long-lived Assets
    Goodwill Goodwill and Other Intangible Assets
 33




---



##### Table of Contents



Potential Valuation Allowance for Deferred Tax Asset Accounting for Income Taxes
  Accounting
for Uncertainty in Income Taxes  an Interpretation of FASB Statement No. 109,
 Fair Value of Financial Instruments Disclosure About Fair Value of Financial Instruments
  Contingencies and Litigation
 34




---



##### Table of Contents



.
  Recent Accounting Pronouncements
 Business Combinations Noncontrolling Interests in Consolidated Financial Statements
 Disclosures about Derivative Instruments and
Hedging Activities
 The Hierarchy of Generally Accepted Accounting
Principles
 35




---



##### Table of Contents



Effective Date of FASB
Statement No. 157 Fair Value Measurements
 Determination of the Useful Life
of Intangible Assets
 
 Item 7A. Quantitative and Qualitative Disclosures About Market Risk
  36




---



##### Table of Contents



Item 8. Financial Statements and Supplementary Data
 Report of Independent Registered Public Accounting Firm
 
    
 37




---



##### Table of Contents



Titanium Asset Management Corp.
Consolidated Balance Sheets
(in thousands except for share and per share amounts)
 December 31,
    
    December 31,2008
    
    2007AssetsCurrent assetsCash and cash equivalents (Note 10)
    
    $
    18,753
    
    
    $
    19,388Securities available for sale (Note 10)
    
    
    10,683
    
    
    
    Cash and cash equivalents held in trust (Note 3)
    
    
    
    
    
    
    55,587Accounts receivable
    
    
    4,041
    
    
    
    388Refundable income taxes (Note 7)
    
    
    512
    
    
    
    Other current assets
    
    
    908
    
    
    
    115Total current assets
    
    
    34,897
    
    
    
    75,478Securities available for sale (Note 10)
    
    
    672
    
    
    
    Property and equipment
    
    
    543
    
    
    
    19Less accumulated depreciation
    
    
    87
    
    
    
    16Property and equipment, net
    
    
    456
    
    
    
    3Goodwill (Note 6)
    
    
    32,757
    
    
    
    21,987Intangible assets, net (Note 6)
    
    
    32,206
    
    
    
    15,340Deferred income taxes (Note 7)
    
    
    4,202
    
    
    
    377Total assets
    
    $
    105,190
    
    
    $
    113,185Liabilities and Stockholders EquityCurrent liabilitiesAccounts payable
    
    $
    663
    
    
    $
    149Accrued income taxes (Note 7)
    
    
    
    
    
    
    657Acquisition payments due (Note 5)
    
    
    8,145
    
    
    
    Deferred revenues
    
    
    273
    
    
    
    Other current liabilities
    
    
    1,516
    
    
    
    455Total current liabilities
    
    
    10,597
    
    
    
    1,261Acquisition payments due (Note 5)
    
    
    1,889
    
    
    
    Total liabilities
    
    
    12,486
    
    
    
    1,261Commitments and contingencies (Notes 8 and 12)Common stock, subject to possible conversion, 20,000,000
shares at conversion value (Note 3)
    
    
    
    
    
    
    55,587Stockholders equity (Note 3)Common stock, $0.0001 par value; 54,000,000 shares
authorized; 20,464,002 and 22,993,731 shares issued
and outstanding at December 31, 2008 and 2007,
respectively
    
    
    2
    
    
    
    2Restricted common stock, $0.0001 par value; 720,000
shares authorized; 612,716 and 696,160 shares issued
and outstanding at December 31, 2008 and 2007,
respectively
    
    
    
    
    
    
    Preferred stock, $0.0001 par value; 1,000,000 shares
authorized; none issued
    
    
    
    
    
    
    Additional paid-in capital
    
    
    99,694
    
    
    
    55,892Retained earnings (deficit)
    
    
    (6,597
    )
    
    
    443Other comprehensive loss
    
    
    (163
    )
    
    
    Unearned compensation
    
    
    (232
    )
    
    
    Total stockholders equity
    
    
    92,704
    
    
    
    56,337Total liabilities and stockholders equity
    
    $
    105,190
    
    
    $
    113,185
 See notes to consolidated financial statements.
 38




---



##### Table of Contents



Titanium Asset Management Corp.
Consolidated Statements of Operations
(in thousands except for per share amounts)
 Period fromFebruary 2,2007(inception)Year Ended
    
    throughDecember 31,
    
    December 31,2008
    
    2007Fee income
    
    $
    14,675
    
    
    $
    2,660Operating expensesAdministrative
    
    
    16,283
    
    
    
    2,490Amortization of intangible assets
    
    
    4,190
    
    
    
    809Impairment of intangible assets
    
    
    6,533
    
    
    
    829Total operating expenses
    
    
    27,006
    
    
    
    4,128Operating loss
    
    
    (12,331
    )
    
    
    (1,468
    )Other IncomeInterest income
    
    
    1,032
    
    
    
    2,191Interest expense
    
    
    (28
    )
    
    
    Income (loss) before taxes
    
    
    (11,327
    )
    
    
    723Income tax expense (benefit)
    
    
    (4,287
    )
    
    
    280Net income (loss)
    
    $
    (7,040
    )
    
    $
    443Earnings (loss) per shareBasic
    
    $
    (0.34
    )
    
    $
    0.04Diluted
    
    $
    (0.34
    )
    
    $
    0.03
 See notes to consolidated financial statements.
 39




---



##### Table of Contents



Titanium Asset Management Corp.
Consolidated Statements of Changes in Stockholders Equity
For the year ended December 31, 2008 and for the period from February 2, 2007 (inception) through December 31, 2007
(in thousands except for share amounts)
 Common Stock
    
    Restricted SharesShares
    
    
    
    
    
    
    
    
    
    
    
    
    
    Additional
    
    Retained
    
    Other
    
    
    
    
    
    Totalheld by
    
    
    
    
    
    
    
    
    
    
    
    
    
    Paid-in
    
    Earnings
    
    Comprehensive
    
    Unearned
    
    StockholdersShares
    
    TIP
    
    Amount
    
    Shares
    
    Amount
    
    Capital
    
    (Deficit)
    
    Loss
    
    Compensation
    
    EquityCommon stock issued
    
    
    2,880,000
    
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    $
    20
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    20Restricted stock issued
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    720,000
    
    
    
    
    
    
    
    5
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5Issue of stock units (Note 3)
    
    
    20,000,000
    
    
    
    
    
    
    
    2
    
    
    
    
    
    
    
    
    
    
    
    52,668
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    52,670Stock issued in connection with acquisition of Wood and Sovereign (Note 5)
    
    
    909,091
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,000Common stock redemption (Note 3)
    
    
    (795,360
    )
    
    
    
    
    
    
    
    
    
    
    (23,840
    )
    
    
    
    
    
    
    (3,892
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,892
    )Warrant issued to placement agent
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,091
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,091Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    443
    
    
    
    
    
    
    
    
    
    
    
    443Balance at December 31, 2007
    
    
    22,993,731
    
    
    
    
    
    
    
    2
    
    
    
    696,160
    
    
    
    
    
    
    
    55,892
    
    
    
    443
    
    
    
    
    
    
    
    
    
    
    
    56,337Transfer in  repurchase rights not executed (Note 3)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    55,587
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    55,587Common stock redemption (Note 3)
    
    
    (2,542,229
    )
    
    
    
    
    
    
    
    
    
    
    (83,444
    )
    
    
    
    
    
    
    (12,017
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (12,017
    )Unallocated shares acquired with acquisition of TIP (Note 3)
    
    
    
    
    
    
    (97,011
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Employee share grants (Note 3)
    
    
    12,500
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    232
    
    
    
    
    
    
    
    
    
    
    
    (232
    )
    
    
    Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (7,040
    )
    
    
    (163
    )
    
    
    
    
    
    
    (7,203
    )Balance at December 31, 2008
    
    
    20,464,002
    
    
    
    (97,011
    )
    
    $
    2
    
    
    
    612,716
    
    
    $
    
    
    
    $
    99,694
    
    
    $
    (6,597
    )
    
    $
    (163
    )
    
    $
    (232
    )
    
    $
    92,704
 See notes to consolidated financial statements
 40




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##### Table of Contents



Titanium Asset Management Corp.
Consolidated Statements of Cash Flows
(in thousands)
 Period fromFebruary 2,Year ended
    
    2007 throughDecember 31,
    
    December 31,2008
    
    2007Cash flows from operating activitiesNet income (loss)
    
    $
    (7,040
    )
    
    $
    443Adjustments to reconcile net income (loss) to net cash provided
by operating activities:Depreciation and amortization
    
    
    4,262
    
    
    
    825Impairment of intangible assets
    
    
    6,533
    
    
    
    829Accretion of acquisition payments
    
    
    26
    
    
    
    Deferred income taxes
    
    
    (3,823
    )
    
    
    (377
    )Changes in assets and liabilities:Increase in accounts receivable
    
    
    (29
    )
    
    
    (388
    )Increase in other current assets
    
    
    (607
    )
    
    
    (115
    )Increase in accounts payable
    
    
    511
    
    
    
    149Increase(decrease) in income taxes
    
    
    (1,070
    )
    
    
    657Increase in other current liabilities
    
    
    604
    
    
    
    455Net cash provided by (used in) operating activities
    
    
    (633
    )
    
    
    2,478Cash flows from investing activitiesPurchases of property and equipment
    
    
    (326
    )
    
    
    (19
    )Cash and cash equivalents held in (released from) trust
    
    
    55,587
    
    
    
    (55,587
    )Purchase of short-term securities available for sale
    
    
    (10,651
    )
    
    
    Purchase of securities available for sale
    
    
    (968
    )
    
    
    Cash paid for acquisition of subsidiaries, net of cash acquired
    
    
    (31,627
    )
    
    
    (33,965
    )Net cash provided by (used in) investing activities
    
    
    12,015
    
    
    
    (89,571
    )Cash flows from financing activitiesIssuance of common stock units
    
    
    
    
    
    
    120,025Costs associated with share issue
    
    
    
    
    
    
    (9,652
    )Common stock redeemed
    
    
    (12,017
    )
    
    
    (3,892
    )Net cash provided by (used in) financing activities
    
    
    (12,017
    )
    
    
    106,481Net increase (decrease) in cash and cash equivalents
    
    
    (635
    )
    
    
    19,388Cash and cash equivalents:Beginning
    
    
    19,388
    
    
    
    Ending
    
    $
    18,753
    
    
    $
    19,388Supplemental disclosure of cash flow informationIncome taxes paid
    
    $
    606
    
    
    $
    Supplemental disclosure of non-cash investing and financing activitiesNet unrealized loss on securities available for sale
    
    $
    163
    
    
    $
    Paid-in capital attributed to common stock repurchase rights
not executed
    
    $
    55,587
    
    
    $
    Fair value of placement agent warrant
    
    $
    
    
    
    $
    2,091Payments due in connection with acquisitions
    
    $
    10,365
    
    
    $
    
 See notes to consolidated financial statements.
 41




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##### Table of Contents



Titanium Asset Management Corp.
Notes to Consolidated Financial Statements
 Note 1  Nature of business
   Note 2  Significant accounting policies
  Consolidation
 Fee income
 Accounting for Management Fees Based on a
Formula
 Cash equivalents and concentration of credit risk
 42




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##### Table of Contents



Titanium Asset Management Corp.
Notes to Consolidated Financial Statements (continued)
 Investments in securities
   Fair value of financial instruments Disclosure About Fair Value of Financial
Instruments
  Receivables and allowance for doubtful accounts
 Property and equipment
 Business combinations
 43




---



##### Table of Contents



Titanium Asset Management Corp.
Notes to Consolidated Financial Statements (continued)
 Goodwill and intangible assets
  Accounting for the Impairment or Disposal of Long-Lived
Assets
 Advertising costs
 Operating leases
 Share-based payments
  Income taxes Accounting for Income Taxes
 Accounting
for Uncertainty in Income Taxes  an Interpretation of FASB Statement No. 109 Accounting for
Income Taxes
 44




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##### Table of Contents



Titanium Asset Management Corp.
Notes to Consolidated Financial Statements (continued)
 Earnings per share Earnings per Share
 Operating segments
 Accounting estimates
 Recent accounting pronouncements
 Business Combinations Noncontrolling Interests in Consolidated Financial Statements
 Disclosures about Derivative Instruments and Hedging
Activities
 The Hierarchy of Generally Accepted Accounting
Principles
 45




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##### Table of Contents



Titanium Asset Management Corp.
Notes to Consolidated Financial Statements (continued)
  Effective Date of FASB Statement
No. 157 Fair Value Measurements
 Determination of the Useful Life of
Intangible Assets
 Note 3  Stockholders equity
  Accounting for Certain Financial Instruments with Characteristics of Both Liabilities and Equity
   46




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##### Table of Contents



Titanium Asset Management Corp.
Notes to Consolidated Financial Statements (continued)
     Note 4  Comprehensive Income (Loss)
  Period fromFebruary 2, 2007Year ended
    
    (inception)December 31,
    
    to December 31,2008
    
    2007(in thousands)Net income (loss)
    
    $
    (7,040
    )
    
    $
    443Unrealized loss, net of tax benefit
    
    
    (163
    )
    
    
    Comprehensive income (loss)
    
    $
    (7,203
    )
    
    $
    443
 47




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##### Table of Contents



Titanium Asset Management Corp.
Notes to Consolidated Financial Statements (continued)
 Note 5  Acquisitions
 Acquisition of Wood
    Goodwill
    
    $
    19,865,000Intangible asset  customer relationships
    
    
    12,026,000Intangible asset  non-compete covenant
    
    
    829,000Intangible asset  brand
    
    
    444,000$
    33,164,000
 Acquisition of Sovereign
    Goodwill
    
    $
    2,122,000Intangible asset  customer relationships
    
    
    2,665,000Intangible asset  non-compete covenant
    
    
    833,000Intangible asset  brand
    
    
    181,000$
    5,801,000
 Acquisition of NIS
   48




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##### Table of Contents



Titanium Asset Management Corp.
Notes to Consolidated Financial Statements (continued)
   Current assets
    
    $
    3,123,000Property and equipment
    
    
    130,000Goodwill
    
    
    7,091,000Intangible asset  customer relationships
    
    
    23,089,000Current liabilities
    
    
    (599,000
    )$
    32,834,000
 Acquisition of Boyd
    Current assets
    
    $
    700,000Property and equipment
    
    
    69,000Goodwill
    
    
    3,679,000Intangible asset  customer relationships
    
    
    4,500,000Current liabilities
    
    
    (134,000
    )$
    8,814,000
 49




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##### Table of Contents



Titanium Asset Management Corp.
Notes to Consolidated Financial Statements (continued)
 Pro forma effect of acquisitions
   Period fromFebruary 2, 2007Year ended
    
    (inception)December 31,
    
    to December 31,2008
    
    2007Total revenue
    
    $
    23,226,000
    
    
    $
    27,025,000Net loss
    
    $
    (7,124,000
    )
    
    $
    (363,000
    )Net loss per share:Basic
    
    $
    (0.35
    )
    
    $
    (0.03
    )Diluted
    
    $
    (0.35
    )
    
    $
    (0.03
    )Pro forma weighted average number of
common shares outstanding:Basic
    
    
    20,598,318
    
    
    
    12,403,672Diluted
    
    
    20,598,318
    
    
    
    12,403,672
 Note 6  Goodwill and intangible assets
  Wood acquisition
    
    $
    19,865,000Sovereign acquisition
    
    
    2,122,000Goodwill at December 31, 2007
    
    
    21,987,000NIS acquisition
    
    
    7,091,000Boyd acquisition
    
    
    3,679,000Goodwill at December 31, 2008
    
    $
    32,757,000
  50




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##### Table of Contents



Titanium Asset Management Corp.
Notes to Consolidated Financial Statements (continued)
  Wood acquisition
    
    $
    13,299,000Sovereign acquisition
    
    
    3,679,000Amortization expense
    
    
    (809,000
    )Impairment (a)
    
    
    (829,000
    )Intangible assets at December 31, 2007
    
    
    15,340,000NIS acquisition
    
    
    23,089,000Boyd acquisition
    
    
    4,500,000Amortization expense
    
    
    (4,190,000
    )Impairment (b)
    
    
    (6,533,000
    )Intangible assets at December 31, 2008
    
    $
    32,206,000
 
 (a)
    
    One of the principals from Wood, with whom the Company had a non-compete agreement, passed
away in 2007. As a result, the Company wrote off the remaining $829,000 balance related to
that intangible asset.(b)
    
    As a result of the principals death in 2007, Wood lost several accounts primarily in the
second quarter of 2008. The Company determined that the loss of these accounts impaired the
original value of the Wood customer relationships and recorded an impairment charge of
$1,478,000 in the second quarter of 2008.In the second quarter of 2008, Sovereign lost an institutional account that represented
approximately 19% of the assets under management at the time of the Sovereign acquisition.
As a result, the Company determined that the loss had impaired the original value of the
Sovereign customer relationships and recorded an impairment charge of $314,000 in the second
quarter of 2008.As a result of the significant equity market decreases over the second half of 2008, the
Company reassessed the recoverability of the customer relationship intangible assets
acquired in the Wood, Sovereign and NIS acquisitions at December 31, 2008. The Company
determined that the Wood customer relationship asset had been further impaired and
recognized a $4,540,000 impairment charge. The Company also determined that the Sovereign
customer relationship asset had been further impaired and recognized a $201,000 impairment
charge. The Company determined the carrying amount of the NIS client referral relationship
was still recoverable.  December 31, 2008
    
    December 31, 2007Accumulated
    
    
    
    
    
    
    
    
    
    AccumulatedCost
    
    Amortization
    
    Net
    
    Cost
    
    Amortization
    
    Net(in thousands)Wood customer relationships
    
    $
    12,026
    
    
    $
    8,850
    
    
    $
    3,176
    
    
    $
    12,026
    
    
    $
    601
    
    
    $
    11,425Wood brand
    
    
    444
    
    
    
    139
    
    
    
    305
    
    
    
    444
    
    
    
    28
    
    
    
    416Sovereign customer relationships
    
    
    2,665
    
    
    
    966
    
    
    
    1,699
    
    
    
    2,665
    
    
    
    95
    
    
    
    2,570Sovereign non-compete agreement
    
    
    833
    
    
    
    347
    
    
    
    486
    
    
    
    833
    
    
    
    70
    
    
    
    763Sovereign brand
    
    
    181
    
    
    
    76
    
    
    
    105
    
    
    
    181
    
    
    
    15
    
    
    
    166NIS client referral relationship
    
    
    23,089
    
    
    
    1,154
    
    
    
    21,935
    
    
    
    
    
    
    
    
    
    
    
    Boyd customer relationships
    
    
    4,500
    
    
    
    
    
    
    
    4,500
    
    
    
    
    
    
    
    
    
    
    
    Totals
    
    $
    43,738
    
    
    $
    11,532
    
    
    $
    32,206
    
    
    $
    16,149
    
    
    $
    809
    
    
    $
    15,340
 51




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##### Table of Contents



Titanium Asset Management Corp.
Notes to Consolidated Financial Statements (continued)
   Year
    
    Amount2009
    
    $
    3,691,0002010
    
    
    3,691,0002011
    
    
    3,664,0002012
    
    
    2,436,0002013
    
    
    1,879,000
 Note 7  Income taxes
  Period fromFebruary 2, 2007Year ended
    
    (inception)December 31,
    
    to December 31,2008
    
    2007(in thousands)CurrentFederal
    
    $
    (464
    )
    
    $
    545State
    
    
    
    
    
    
    112(464
    )
    
    
    657DeferredFederal
    
    
    (3,055
    )
    
    
    (313
    )State
    
    
    (768
    )
    
    
    (64
    )(3,823
    )
    
    
    (377
    )Income tax expense (benefit)
    
    $
    (4,287
    )
    
    $
    280
  Period fromFebruary 2, 2007Year ended
    
    (inception)December 31,
    
    to December 31,2008
    
    2007(in thousands)Income tax
expense (benefit) at federal statutory rate
    
    $
    (3,851
    )
    
    $
    246State income taxes, net of federal tax benefit
    
    
    (507
    )
    
    
    31Other
    
    
    71
    
    
    
    3Income tax expense (benefit)
    
    $
    (4,287
    )
    
    $
    280
 52




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##### Table of Contents



Titanium Asset Management Corp.
Notes to Consolidated Financial Statements (continued)
  December 31,
    
    December 31,2008
    
    2007(in thousands)Net operating loss carryforwards
    
    $
    1,329
    
    
    $
    Goodwill and intangible assets
    
    
    2,779
    
    
    
    378Other
    
    
    94
    
    
    
    (1
    )Total deferred tax asset
    
    $
    4,202
    
    
    $
    377
   Note 8  Commitments
 Operating leases
 Year endingDecember 31,
    
    Amount2009
    
    $
    878,0002010
    
    
    750,0002011
    
    
    289,0002012
    
    
    252,0002013
    
    
    198,000Thereafter
    
    
    880,000
 Retirement plans
 Note 9  Line of credit
  53




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Titanium Asset Management Corp.
Notes to Consolidated Financial Statements (continued)
 Note 10  Fair Value Measurement
   Category used for Fair ValuesLevel 1
    
    Level 2
    
    Level 3(in thousands)Assets:Cash and cash equivalents
    
    $
    18,753
    
    
    $
    
    
    
    $
    Current securities available
for sale  Corporate bonds
    
    
    10,683
    
    
    
    
    
    
    
    Noncurrent securities available
for sale  Commingled stock
fund
    
    
    672
    
    
    
    
    
    
    
    $
    30,108
    
    
    $
    
    
    
    $
    
  Note 11  Major customer
  54




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##### Table of Contents



Titanium Asset Management Corp.
Notes to Consolidated Financial Statements (continued)
 Note 12  Contingencies
    Note 13  Earnings per Share
  Period fromFebruary 2, 2007Year ended
    
    (inception)December 31,
    
    to December 31,2008
    
    2008Basic EPS:Net income (loss)
    
    $
    (7,040,000
    )
    
    $
    443,000Weighted average shares outstanding
    
    
    20,406,318
    
    
    
    11,529,853Basic EPS
    
    $
    (0.34
    )
    
    $
    0.04Diluted EPS:Net income (loss)
    
    $
    (7,040,000
    )
    
    $
    443,000Weighted average common shares outstanding
    
    
    20,406,318
    
    
    
    11,529,853Dilutive warrants
    
    
    
    
    
    
    3,177,723Diluted weighted average shares outstanding
    
    
    20,406,318
    
    
    
    14,707,576Diluted EPS
    
    $
    (0.34
    )
    
    $
    0.03
  
 55




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##### Table of Contents



Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure
  
 Item 9A. Controls and Procedures
 Evaluation of disclosure controls and procedures
  Changes in internal control over financial reporting
 
 Item 9B. Other Information
 .
 
 PART III
 
 Item 10. Directors, Executive Officers and Corporate Governance
  http://www.ti-am.com
  56




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##### Table of Contents



Item 11. Executive Compensation
  
 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters
  Equity Compensation Plan Information
  Number of SecuritiesRemaining Available forFuture Issuance underEquity CompensationNumber of Securities to be
    
    Weighted-average
    
    Plans (ExcludingIssued upon Exercise of
    
    Exercise Price of
    
    Securities ReflectedOutstanding Options,
    
    Outstanding Options,
    
    in thePlan Category
    
    Warrants and Rights
    
    Warrants and Rights
    
    First Column)Equity compensation
plans approved by
security holders
    
    
    
    
    
    
    
    
    
    
    Equity compensation
plans not approved
by security holders
    
    
    4,000,000
    (1)
    
    $
    5.30
    
    
    
    97,011
    (2)Total
    
    
    4,000,000
    
    
    $
    5.30
    
    
    
    97,011
 
 (1)
    
    Consists of currently exercisable unit purchase options, or UPOs, to purchase 2,000,000
units, i.e., 2,000,000 shares of Common Stock at an exercise price of $6.60 and 2,000,000
Warrants, which are exercisable for $4.00 per share of Common Stock granted to certain
officers, directors and employees of Sunrise Securities Corp., or Sunrise, and a Sunrise
charitable foundation as partial compensation for Sunrises services as placement agent for
our private placement, not part of an ongoing plan. Each UPO expires on June 20, 2012. If,
however, a UPO is exercised later than June 22, 2011, then no Warrants will be issued and the
exercise price will be reduced to $5.50 per Unit. The Warrants are non-callable.(2)
    
    Titanium Incentive Plan, LLC, or TIP, a wholly owned subsidiary of ours, owns 306,358 shares
of our Common Stock. TIP was created at the time of our organization to hold shares of our
Common Stock for one-time awards to the employees of our acquired companies. It was not
intended as a vehicle to provide additional on-going equity compensation to our employees.
The shares of Common Stock held by TIP are held in escrow until June 21, 2010. Pursuant to
individual share grant agreements, TIP allocated all of its shares to Wood and Sovereign
employees around the time of our acquisitions in 2007. We amended and restated the terms of
these share grant agreements effective as of July 15, 2008. Each grantee received a
non-voting membership interest in TIP. At June 21, 2010, the grantees non-voting membership
interest in TIP terminates and the grantee is entitled to an in-kind distribution of his or
her allocated shares of our Common Stock. The shares are subject to 57




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##### Table of Contents



forfeiture in the event that the grantees employment with us or any of our subsidiaries is
terminated for any reason (other than death of the grantee), unless otherwise determined by our
board of directors (or an authorized committee thereof). In the event of the grantees death,
the beneficiary identified by the grantee shall have rights to receive the shares to which the
grantee was entitled upon their release from escrow. At December 31, 2008, 97,011 shares of our
Common Stock held by TIP were unallocated due to grantee terminations and available for future
grants. 
 Item 13. Certain Relationships and Related Transactions, and Director
Independence
  
 Item 14. Principal Accounting Fees and Services
  
 PART IV
 
 Item 15. Exhibits, Financial Statement Schedules
  Financial Statements:
 §
    
    Report of Independent Registered Public Accounting Firm§
    
    Consolidated Balance Sheets as of December 31, 2008 and 2007§
    
    Consolidated Statements of Operations for the Year Ended December 31, 2008 for the
period from February 2, 2007 (inception) to December 31, 2007§
    
    Consolidated Statements of Changes in Stockholders Equity for the year ended
December 31, 2008 and for the period from February 2, 2007 (inception) to December 31,
2007§
    
    Consolidated Statements of Cash Flows for Year Ended December 31, 2008 for the
period from February 2, 2007 (inception) to December 31, 2007§
    
    Notes to Financial Statements
 Financial Statement Schedule:
  58




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##### Table of Contents



Exhibits:
 Exhibit
    
    Description2.1
    
    Sale and Purchase Agreement among Titanium Asset Management Corp., Wood Asset Management Inc.,
and a number of individuals dated September 5, 2007(1) (incorporated by reference
to Exhibit 2.1 to the Registrants Registration Statement on Form 10 filed with the Securities
and Exchange Commission on July 25, 2008, File No. 000-53352)2.2
    
    Sale and Purchase Agreement among Titanium Asset Management Corp., Sovereign Holdings, LLC and
JARE, Inc. and its owners dated September 5, 2007 (1) (incorporated by reference
to Exhibit 2.2 to the Registrants Registration Statement on Form 10 filed with the Securities
and Exchange Commission on July 25, 2008, File No. 000-53352)2.3
    
    Stock Purchase Agreement by and among Titanium Asset Management Corp., National Investment
Services, Inc., NIS Holdings, Inc., and the shareholders of NIS Holdings, Inc. dated
February 28, 2008 (1) (incorporated by reference to Exhibit 2.3 to the
Registrants Registration Statement on Form 10 filed with the Securities and Exchange
Commission on July 25, 2008, File No. 000-53352)2.4
    
    Membership Interest Purchase Agreement, dated as of November 7, 2008, by and among Titanium
Asset Management Corp., BWAM Holdings, LLC, Boyd Watterson Asset Management, LLC, the common
members of BWAM Holdings, LLC and, for limited purposes, the preferred members of BWAM
Holdings, LLC. (1)(incorporated by reference to Exhibit 2.1 to the Registrants
Form 8-K filed with the Securities and Exchange Commission on January 5, 2009, File No.
000-53352)2.5
    
    Amendment No. 1 to Membership Interest Purchase Agreement, dated as of December 30, 2008,
among Titanium Asset Management Corp., Boyd Watterson Asset Management, LLC and Mr. Michael E.
Bee, acting in his capacity as the agent and attorney in fact with the authority to act on
behalf of BWAM Holdings, LLC, the common members of BWAM Holdings, LLC and, for limited
purposes, the preferred members of BWAM Holdings, LLC (incorporated by reference to Exhibit
2.2 to the Registrants Form 8-K filed with the Securities and Exchange Commission on
January 5, 2009, File No. 000-53352)3.1
    
    Amended and Restated Certificate of Incorporation of Titanium Asset Management Corp.
(incorporated by reference to Exhibit 3.1 to the Registrants Registration Statement on Form
10 filed with the Securities and Exchange Commission on July 25, 2008, File No. 000-53352)3.2
    
    Amendment to Amended and Restated Certificate of Incorporation of Titanium Asset Management
Corp. (incorporated by reference to Exhibit 3.2 to the Registrants Registration Statement on
Form 10 filed with the Securities and Exchange Commission on July 25, 2008, File No.
000-53352)3.3
    
    Bylaws of Titanium Asset Management Corp. (incorporated by reference to Exhibit 3.3 to the
Registrants Registration Statement on Form 10 filed with the Securities and Exchange
Commission on July 25, 2008, File No. 000-53352)4.1
    
    Form of Common Stock Share Certificate (incorporated by reference to Exhibit 4.1 to the
Registrants Registration Statement on Form 10 filed with the Securities and Exchange
Commission on July 25, 2008, File No. 000-53352)4.2
    
    Form of Warrant (incorporated by reference to Exhibit 4.2 to the Registrants Registration
Statement on Form 10 filed with the Securities and Exchange Commission on July 25, 2008, File
No. 000-53352)4.3
    
    Warrant Deed dated as of June 21, 2007 between Titanium Asset Management Corp. and Capita
Registrars (Jersey) Limited (incorporated by reference to Exhibit 4.3 to the Registrants
Registration Statement on Form 10 filed with the Securities and Exchange Commission on July
25, 2008, File No. 000-53352)4.4
    
    Registration Rights Agreement between Titanium Asset Management Corp. and the parties on the
signature pages thereto dated June 21, 2007 (incorporated by reference to Exhibit 4.4 to the
Registrants Registration Statement on Form 10 filed with the Securities and Exchange
Commission on July 25, 2008, File No. 000-53352)
 59




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##### Table of Contents



Exhibit
    
    Description4.5
    
    Investor Rights Agreement between Titanium Asset Management Corp., Sunrise Securities Corp.
and Seymour Pierce Limited dated June 21, 2007 (incorporated by reference to Exhibit 4.5 to
the Registrants Registration Statement on Form 10 filed with the Securities and Exchange
Commission on July 25, 2008, File No. 000-53352)4.6
    
    Form of Unit Purchase Option between Titanium Asset Management Corp. and certain Employees and
Affiliates of Sunrise Securities Corp. (incorporated by reference to Exhibit 4.6 to the
Registrants Registration Statement on Form 10 filed with the Securities and Exchange
Commission on July 25, 2008, File No. 000-53352)4.7
    
    Share Escrow Agreement dated as of June 21, 2007 by and among Titanium Asset Management Corp.,
Founding Stockholders and Capita Trust Company (Jersey) Limited (1) (incorporated
by reference to Exhibit 4.6 to the Registrants Registration Statement on Form 10 filed with
the Securities and Exchange Commission on July 25, 2008, File No. 000-53352)4.8
    
    Form of Lock In Deed for Individuals (incorporated by reference to Exhibit 4.8 to the
Registrants Registration Statement on Form 10 filed with the Securities and Exchange
Commission on July 25, 2008, File No. 000-53352)4.9
    
    Form of Lock In Deed for Entities (incorporated by reference to Exhibit 4.9 to the
Registrants Registration Statement on Form 10 filed with the Securities and Exchange
Commission on July 25, 2008, File No. 000-53352)4.10
    
    Form of Lock In Deed for Acquisitions (incorporated by reference to Exhibit 4.10 to the
Registrants Registration Statement on Form 10 filed with the Securities and Exchange
Commission on July 25, 2008, File No. 000-53352)10.1 
    
    Letter Agreement between Thomas Hamilton and Titanium Asset Management Corp. dated
November 12, 2007, as amended (incorporated by Exhibit 10.1 to the Registrants Amendment
No. 1 to Form 10 filed with the Securities and Exchange Commission on September 15, 2008, File
No. 000-53352)10.2
    
    Amended and Restated Fee Arrangement Agreement between Titanium Asset Management Corp. and
Integra Management Limited dated July 22, 2008 (1) (incorporated by reference to
Exhibit 10.2 to the Registrants Registration Statement on Form 10 filed with the Securities
and Exchange Commission on July 25, 2008, File No. 000-53352)10.3 
    
    Employment Agreement between Nigel Wightman and Titanium Asset Management Corp. dated
September 5, 2007 (incorporated by reference to Exhibit 10.3 to the Registrants Registration
Statement on Form 10 filed with the Securities and Exchange Commission on July 25, 2008, File
No. 000-53352)10.4 
    
    Employment Agreement between Jeffrey Hines and Sovereign Holdings LLC (incorporated by
reference to Exhibit 10.4 to the Registrants Registration Statement on Form 10 filed with the
Securities and Exchange Commission on July 25, 2008, File No. 000-53352)10.5 
    
    Employment Agreement between John Fisher and Wood Asset Management, Inc. dated June 9, 2008
(incorporated by reference to Exhibit 10.5 to the Registrants Registration Statement on Form
10 filed with the Securities and Exchange Commission on July 25, 2008, File No. 000-53352)10.6 
    
    Employment Agreement between Robert Kelly and National Investment Services, Inc.
(incorporated by reference to Exhibit 10.6 to the Registrants Registration Statement on Form
10 filed with the Securities and Exchange Commission on July 25, 2008, File No. 000-53352)10.7 
    
    Employment Agreement between Robert Brooks and National Investment Services, Inc.
(incorporated by reference to Exhibit 10.7 to the Registrants Registration Statement on Form
10 filed with the Securities and Exchange Commission on July 25, 2008, File No. 000-53352)10.8 
    
    Employment Agreement between Robert J. Siefert and National Investment Services, Inc.
(incorporated by reference to Exhibit 10.8 to the Registrants Registration Statement on Form
10 filed with the Securities and Exchange Commission on July 25, 2008, File No. 000-53352)
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##### Table of Contents



Exhibit
    
    Description10.9 
    
    Letter of Appointment to the Board of Directors between Yehoshua Abramovich and Titanium Asset
Management Corp. dated July 17, 2007 (1) (incorporated by reference to Exhibit
10.9 to the Registrants Registration Statement on Form 10 filed with the Securities and
Exchange Commission on July 25, 2008, File No. 000-53352)10.10 
    
    Letter of Appointment to the Board of Directors between Avigdor Kaplan and Titanium Asset
Management Corp. dated July 17, 2007 (1) (incorporated by reference to Exhibit
10.10 to the Registrants Registration Statement on Form 10 filed with the Securities and
Exchange Commission on July 25, 2008, File No. 000-53352)10.11
    
    Indemnification Agreement dated July 17, 2007 by and between Titanium Asset Management Corp.
and Yehoshua Abramovich (incorporated by reference to Exhibit 10.11 to the Registrants
Registration Statement on Form 10 filed with the Securities and Exchange Commission on July
25, 2008, File No. 000-53352)10.12
    
    Indemnification Agreement dated July 17, 2007 by and between Titanium Asset Management Corp.
and Avigdor Kaplan (incorporated by reference to Exhibit 10.12 to the Registrants
Registration Statement on Form 10 filed with the Securities and Exchange Commission on July
25, 2008, File No. 000-53352)10.13
    
    Amended and Restated Investment Sub-Advisory Agreement dated February 13, 2006 by and between
Attalus Capital, L.L.C. and National Investment Services Inc. (1) (incorporated by
reference to Exhibit 10.13 to the Registrants Registration Statement on Form 10 filed with
the Securities and Exchange Commission on July 25, 2008, File No. 000-53352)10.14
    
    Referral Letter Agreement dated December 1, 2006 between Attalus Capital, L.L.C. and National
Investment Services Inc. (incorporated by reference to Exhibit 10.14 to the Registrants
Registration Statement on Form 10 filed with the Securities and Exchange Commission on July
25, 2008, File No. 000-53352)10.15 
    
    Titanium Asset Management Corp. Nonqualified Deferred Compensation Plan (incorporated by
reference to Exhibit 10.15 to the Registrants Registration Statement on Form 10 filed with
the Securities and Exchange Commission on July 25, 2008, File No. 000-53352)10.16 
    
    Titanium Incentive Plan LLC Operating Agreement (1) (incorporated by reference to
Exhibit 10.16 to the Registrants Registration Statement on Form 10 filed with the Securities
and Exchange Commission on July 25, 2008, File No. 000-53352)10.17 
    
    Amendment to Titanium Incentive Plan LLC Operating Agreement (incorporated by reference to
Exhibit 10.17 to the Registrants Registration Statement on Form 10 filed with the Securities
and Exchange Commission on July 25, 2008, File No. 000-53352)10.18 
    
    Titanium Incentive Plan LLC Form of Grant Agreement (incorporated by reference to Exhibit
10.18 to the Registrants Registration Statement on Form 10 filed with the Securities and
Exchange Commission on July 25, 2008, File No. 000-53352)10.19
    
    Business Note between National Investment Services, Inc. and Park Bank dated September 22,
2004 (incorporated by reference to Exhibit 10.19 to the Registrants Registration Statement
on Form 10 filed with the Securities and Exchange Commission on July 25, 2008, File No.
000-53352)10.20 
    
    Oral Agreements regarding Director Compensation (incorporated by reference to Exhibit 10.20
to the Registrants Registration Statement on Form 10 filed with the Securities and Exchange
Commission on July 25, 2008, File No. 000-53352)10.21
    
    Form of Indemnification Agreement (incorporated by reference to  Exhibit 10.21 to the Registrants
Amendment No. 1 to Form 10 filed with the Securities and Exchange Commission on September 15,
2008, File No. 000-53352)10.22
    
    Employment Agreement between Brian L. Gevry and Boyd Watterson Asset Management, LLC dated
November 7, 2008
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##### Table of Contents



Exhibit
    
    Description11.1
    
    Statement regarding Computation of Per Share Earnings21.1
    
    Subsidiaries of Titanium Asset Management Corp.31.1
    
    Chief Executive Officer Certification Pursuant to Rule 13a-14(a) of the Securities Exchange Act31.2
    
    Chief Financial Officer Certification Pursuant to Rule 13a-14(a) of the Securities Exchange Act32.1
    
    Chief Executive Officer Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant
to Section 906 of the Sarbanes-Oxley Act of 200232.2
    
    Chief Financial Officer Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002
 
 (1)
    
    Certain schedules and exhibits have been omitted from these exhibits pursuant to
Item 601(b)(2) of Regulation S-K. The Company hereby undertakes to furnish supplementally copies
of any of the omitted schedules and exhibits upon request by the Commission.
    
    indicates management contract or compensatory arrangement. 62




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##### Table of Contents



SIGNATURES
   TITANIUM ASSET MANAGEMENT CORP.By:
    /s/ Nigel WightmanName:
    Nigel WightmanTitle:
    Chairman and Chief Executive Officer  Signature
    
    Capacity
    
    Date/s/ Nigel Wightman
Nigel Wightman
    
    Chairman and Chief Executive Officer(Principal
Executive Officer)
    
    March 31, 2009/s/ Larry HasleeLarry Haslee
    
    Chief Financial Officer(Principal Financial Officer and 
Principal Accounting Officer)
    
    March 31, 2009/s/ Robert Kelly
Robert Kelly
    
    Director
    
    March 31, 2009/s/ Avigdor Kaplan
Avigdor
Kaplan
    
    Director
    
    March 31, 2009/s/ Yehoshua Abramovich
Yehoshua Abramovich
    
    Director
    
    March 31, 2009/s/ T. Raymond Suplee
T. Raymond Suplee
    
    Director
    
    March 31, 2009/s/ Thomas Hamilton
Thomas Hamilton
    
    Director
    
    March 31, 2009
 63




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EXHIBIT INDEX
 Exhibit
    
    Description2.1
    
    Sale and Purchase Agreement among Titanium Asset Management Corp., Wood Asset Management Inc.,
and a number of individuals dated September 5, 2007(1) (incorporated by reference
to Exhibit 2.1 to the Registrants Registration Statement on Form 10 filed with the Securities
and Exchange Commission on July 25, 2008, File No. 000-53352)2.2
    
    Sale and Purchase Agreement among Titanium Asset Management Corp., Sovereign Holdings, LLC and
JARE, Inc. and its owners dated September 5, 2007 (1) (incorporated by reference
to Exhibit 2.2 to the Registrants Registration Statement on Form 10 filed with the Securities
and Exchange Commission on July 25, 2008, File No. 000-53352)2.3
    
    Stock Purchase Agreement by and among Titanium Asset Management Corp., National Investment
Services, Inc., NIS Holdings, Inc., and the shareholders of NIS Holdings, Inc. dated
February 28, 2008 (1) (incorporated by reference to Exhibit 2.3 to the
Registrants Registration Statement on Form 10 filed with the Securities and Exchange
Commission on July 25, 2008, File No. 000-53352)2.4
    
    Membership Interest Purchase Agreement, dated as of November 7, 2008, by and among Titanium
Asset Management Corp., BWAM Holdings, LLC, Boyd Watterson Asset Management, LLC, the common
members of BWAM Holdings, LLC and, for limited purposes, the preferred members of BWAM
Holdings, LLC. (1) (incorporated by reference to Exhibit 2.1 to the Registrants
Form 8-K filed with the Securities and Exchange Commission on January 5, 2009, File No.
000-53352)2.5
    
    Amendment No. 1 to Membership Interest Purchase Agreement, dated as of December 30, 2008,
among Titanium Asset Management Corp., Boyd Watterson Asset Management, LLC and Mr. Michael E.
Bee, acting in his capacity as the agent and attorney in fact with the authority to act on
behalf of BWAM Holdings, LLC, the common members of BWAM Holdings, LLC and, for limited
purposes, the preferred members of BWAM Holdings, LLC (incorporated by reference to Exhibit
2.2 to the Registrants Form 8-K filed with the Securities and Exchange Commission on
January 5, 2009, File No. 000-53352)3.1
    
    Amended and Restated Certificate of Incorporation of Titanium Asset Management Corp.
(incorporated by reference to Exhibit 3.1 to the Registrants Registration Statement on Form
10 filed with the Securities and Exchange Commission on July 25, 2008, File No. 000-53352)3.2
    
    Amendment to Amended and Restated Certificate of Incorporation of Titanium Asset Management
Corp. (incorporated by reference to Exhibit 3.2 to the Registrants Registration Statement on
Form 10 filed with the Securities and Exchange Commission on July 25, 2008, File No.
000-53352)3.3
    
    Bylaws of Titanium Asset Management Corp. (incorporated by reference to Exhibit 3.3 to the
Registrants Registration Statement on Form 10 filed with the Securities and Exchange
Commission on July 25, 2008, File No. 000-53352)4.1
    
    Form of Common Stock Share Certificate (incorporated by reference to Exhibit 4.1 to the
Registrants Registration Statement on Form 10 filed with the Securities and Exchange
Commission on July 25, 2008, File No. 000-53352)4.2
    
    Form of Warrant (incorporated by reference to Exhibit 4.2 to the Registrants Registration
Statement on Form 10 filed with the Securities and Exchange Commission on July 25, 2008, File
No. 000-53352)4.3
    
    Warrant Deed dated as of June 21, 2007 between Titanium Asset Management Corp. and Capita
Registrars (Jersey) Limited (incorporated by reference to Exhibit 4.3 to the Registrants
Registration Statement on Form 10 filed with the Securities and Exchange Commission on July
25, 2008, File No. 000-53352)4.4
    
    Registration Rights Agreement between Titanium Asset Management Corp. and the parties on the
signature pages thereto dated June 21, 2007 (incorporated by reference to Exhibit 4.4 to the
Registrants Registration Statement on Form 10 filed with the Securities and Exchange
Commission on July 25, 2008, File No. 000-53352)
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Exhibit
    
    Description4.5
    
    Investor Rights Agreement between Titanium Asset Management Corp., Sunrise Securities Corp.
and Seymour Pierce Limited dated June 21, 2007 (incorporated by reference to Exhibit 4.5 to
the Registrants Registration Statement on Form 10 filed with the Securities and Exchange
Commission on July 25, 2008, File No. 000-53352)4.6
    
    Form of Unit Purchase Option between Titanium Asset Management Corp. and certain Employees and
Affiliates of Sunrise Securities Corp. (incorporated by reference to Exhibit 4.6 to the
Registrants Registration Statement on Form 10 filed with the Securities and Exchange
Commission on July 25, 2008, File No. 000-53352)4.7
    
    Share Escrow Agreement dated as of June 21, 2007 by and among Titanium Asset Management Corp.,
Founding Stockholders and Capita Trust Company (Jersey) Limited (1) (incorporated
by reference to Exhibit 4.6 to the Registrants Registration Statement on Form 10 filed with
the Securities and Exchange Commission on July 25, 2008, File No. 000-53352)4.8
    
    Form of Lock In Deed for Individuals (incorporated by reference to Exhibit 4.8 to the
Registrants Registration Statement on Form 10 filed with the Securities and Exchange
Commission on July 25, 2008, File No. 000-53352)4.9
    
    Form of Lock In Deed for Entities (incorporated by reference to Exhibit 4.9 to the
Registrants Registration Statement on Form 10 filed with the Securities and Exchange
Commission on July 25, 2008, File No. 000-53352)4.10
    
    Form of Lock In Deed for Acquisitions (incorporated by reference to Exhibit 4.10 to the
Registrants Registration Statement on Form 10 filed with the Securities and Exchange
Commission on July 25, 2008, File No. 000-53352)10.1 
    
    Letter Agreement between Thomas Hamilton and Titanium Asset Management Corp. dated
November 12, 2007, as amended (incorporated by Exhibit 10.1 to the Registrants Amendment
No. 1 to Form 10 filed with the Securities and Exchange Commission on September 15, 2008, File
No. 000-53352)10.2
    
    Amended and Restated Fee Arrangement Agreement between Titanium Asset Management Corp. and
Integra Management Limited dated July 22, 2008 (1) (incorporated by reference to
Exhibit 10.2 to the Registrants Registration Statement on Form 10 filed with the Securities
and Exchange Commission on July 25, 2008, File No. 000-53352)10.3 
    
    Employment Agreement between Nigel Wightman and Titanium Asset Management Corp. dated
September 5, 2007 (incorporated by reference to Exhibit 10.3 to the Registrants Registration
Statement on Form 10 filed with the Securities and Exchange Commission on July 25, 2008, File
No. 000-53352)10.4 
    
    Employment Agreement between Jeffrey Hines and Sovereign Holdings LLC (incorporated by
reference to Exhibit 10.4 to the Registrants Registration Statement on Form 10 filed with the
Securities and Exchange Commission on July 25, 2008, File No. 000-53352)10.5 
    
    Employment Agreement between John Fisher and Wood Asset Management, Inc. dated June 9, 2008
(incorporated by reference to Exhibit 10.5 to the Registrants Registration Statement on Form
10 filed with the Securities and Exchange Commission on July 25, 2008, File No. 000-53352)10.6 
    
    Employment Agreement between Robert Kelly and National Investment Services, Inc.
(incorporated by reference to Exhibit 10.6 to the Registrants Registration Statement on Form
10 filed with the Securities and Exchange Commission on July 25, 2008, File No. 000-53352)10.7 
    
    Employment Agreement between Robert Brooks and National Investment Services, Inc.
(incorporated by reference to Exhibit 10.7 to the Registrants Registration Statement on Form
10 filed with the Securities and Exchange Commission on July 25, 2008, File No. 000-53352)10.8 
    
    Employment Agreement between Robert J. Siefert and National Investment Services, Inc.
(incorporated by reference to Exhibit 10.8 to the Registrants Registration Statement on Form
10 filed with the Securities and Exchange Commission on July 25, 2008, File No. 000-53352)
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Exhibit
    
    Description10.9 
    
    Letter of Appointment to the Board of Directors between Yehoshua Abramovich and Titanium Asset
Management Corp. dated July 17, 2007 (1) (incorporated by reference to Exhibit
10.9 to the Registrants Registration Statement on Form 10 filed with the Securities and
Exchange Commission on July 25, 2008, File No. 000-53352)10.10 
    
    Letter of Appointment to the Board of Directors between Avigdor Kaplan and Titanium Asset
Management Corp. dated July 17, 2007 (1) (incorporated by reference to Exhibit
10.10 to the Registrants Registration Statement on Form 10 filed with the Securities and
Exchange Commission on July 25, 2008, File No. 000-53352)10.11
    
    Indemnification Agreement dated July 17, 2007 by and between Titanium Asset Management Corp.
and Yehoshua Abramovich (incorporated by reference to Exhibit 10.11 to the Registrants
Registration Statement on Form 10 filed with the Securities and Exchange Commission on July
25, 2008, File No. 000-53352)10.12
    
    Indemnification Agreement dated July 17, 2007 by and between Titanium Asset Management Corp.
and Avigdor Kaplan (incorporated by reference to Exhibit 10.12 to the Registrants
Registration Statement on Form 10 filed with the Securities and Exchange Commission on July
25, 2008, File No. 000-53352)10.13
    
    Amended and Restated Investment Sub-Advisory Agreement dated February 13, 2006 by and between
Attalus Capital, L.L.C. and National Investment Services Inc. (1) (incorporated by
reference to Exhibit 10.13 to the Registrants Registration Statement on Form 10 filed with
the Securities and Exchange Commission on July 25, 2008, File No. 000-53352)10.14
    
    Referral Letter Agreement dated December 1, 2006 between Attalus Capital, L.L.C. and National
Investment Services Inc. (incorporated by reference to Exhibit 10.14 to the Registrants
Registration Statement on Form 10 filed with the Securities and Exchange Commission on July
25, 2008, File No. 000-53352)10.15 
    
    Titanium Asset Management Corp. Nonqualified Deferred Compensation Plan (incorporated by
reference to Exhibit 10.15 to the Registrants Registration Statement on Form 10 filed with
the Securities and Exchange Commission on July 25, 2008, File No. 000-53352)10.16 
    
    Titanium Incentive Plan LLC Operating Agreement (1) (incorporated by reference to
Exhibit 10.16 to the Registrants Registration Statement on Form 10 filed with the Securities
and Exchange Commission on July 25, 2008, File No. 000-53352)10.17 
    
    Amendment to Titanium Incentive Plan LLC Operating Agreement (incorporated by reference to
Exhibit 10.17 to the Registrants Registration Statement on Form 10 filed with the Securities
and Exchange Commission on July 25, 2008, File No. 000-53352)10.18 
    
    Titanium Incentive Plan LLC Form of Grant Agreement (incorporated by reference to Exhibit
10.18 to the Registrants Registration Statement on Form 10 filed with the Securities and
Exchange Commission on July 25, 2008, File No. 000-53352)10.19
    
    Business Note between National Investment Services, Inc. and Park Bank dated September 22,
2004 (incorporated by reference to Exhibit 10.19 to the Registrants Registration Statement
on Form 10 filed with the Securities and Exchange Commission on July 25, 2008, File No.
000-53352)10.20 
    
    Oral Agreements regarding Director Compensation (incorporated by reference to Exhibit 10.20
to the Registrants Registration Statement on Form 10 filed with the Securities and Exchange
Commission on July 25, 2008, File No. 000-53352)10.21
    
    Form of Indemnification Agreement (incorporated by reference to Exhibit 10.21 to the Registrants
Amendment No. 1 to Form 10 filed with the Securities and Exchange Commission on September 15,
2008, File No. 000-53352)10.22 
    
    Employment Agreement between Brian L. Gevry and Boyd Watterson Asset Management, LLC dated
November 7, 2008
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##### Table of Contents



Exhibit
    
    Description11.1
    
    Statement regarding Computation of Per Share Earnings21.1
    
    Subsidiaries of Titanium Asset Management Corp.31.1
    
    Chief Executive Officer Certification Pursuant to Rule 13a-14(a) of the Securities Exchange Act31.2
    
    Chief Financial Officer Certification Pursuant to Rule 13a-14(a) of the Securities Exchange Act32.1
    
    Chief Executive Officer Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant
to Section 906 of the Sarbanes-Oxley Act of 200232.2
    
    Chief Financial Officer Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002
 
 (1)
    
    Certain schedules and exhibits have been omitted from these exhibits pursuant to
Item 601(b)(2) of Regulation S-K. The Company hereby undertakes to furnish supplementally copies
of any of the omitted schedules and exhibits upon request by the Commission.
    
    indicates management contract or compensatory arrangement. 67