BENCHMARK BANKSHARES INC BMBN

listed = True...er Paying a control premium to shareholders being cashed-out would penalize the remaining shareholders since no sale of the Bank is expected in the foreseeable future Factors supporting the use of fair value with a control premium The Company is not currently traded on a national exchange or Nasdaq and will not be eligible for trading on the OTC Bulletin Board following the transaction The Company will deregister its shares and cease being a reporting company following the transaction Cashed-out shareholders may have difficulty repurchasing their positions following the transaction Davenport & Company LLC Confidential Page 10 VALUA...

mechanism = FIXED...$10 million $12 million Ratios Tier 1 leverage ratio 10.4% 9.8% 9.1% 8.5% 7.8% 7.1% 6.5% 5.0% Tier 1 to RW assets 14.5% 13.5% 12.5% 11.6% 10.6% 9.6% 8.6% 6.0% Total capital to RW assets 15.5% 14.5% 13.5% 12.6% 11.6% 10.6% 9.6% 10.0% Pro forma data assumes a repurchase price of $20.00 per share and no issuance of trust preferred securities. Davenport & Company LLC Confidential Page 22 VALUATION considerations Stock Price Premium Analysis Time Prior to Closing Premiums at Corresponding Repurchase Prices December 16, 2004 Date Price $16.00 $17.00 $18.00 $19.00 $20.00 $21.00 1 day 12/15/04 $17.00 -5.9% 0.0% 5.9% 11.8% 17.6% 23.5%...

price = USD 20.0....1% 6.5% 5.0% Tier 1 to RW assets 14.5% 13.5% 12.5% 11.6% 10.6% 9.6% 8.6% 6.0% Total capital to RW assets 15.5% 14.5% 13.5% 12.6% 11.6% 10.6% 9.6% 10.0% Pro forma data assumes a repurchase price of $20.00 per share and no issuance of trust preferred securities. Davenport & Company LLC Confidential Page 22 VALUATION considerations Stock Price Premium Analysis Time Prior to Closing Premiums at Corresponding Repurchase Prices Decembe...

txn_type = CONSOLIDATION...s one shareholder Must file with SEC to suspend registration Must cease trading on an exchange, NASDAQ or OTC Bulletin Board May continue to trade in the “Pink Sheets” or “Desk Drawer” Reducing the Shareholder Count Odd-lot and other share repurchase programs Reverse split and cash-out of fractional shares Increasing number of shares held in “street name” Davenport & Company LLC Confidential Page 3 Going private considerations pros and cons of going private Pro No SEC reporting requirements Provisions of Sarbanes - Oxley no longer apply Substantial cost savings resulting from the above Might result in less...