TRANSPORTATION & LOGISTICS

Transcription

1 Investment banking services are provided by Harris Williams LLC, a registered broker-dealer and member of FINRA and SIPC, and Harris Williams & Co. Ltd, which is authorised and regulated by the Financial Conduct Authority. Harris Williams & Co. is a trade name under which Harris Williams LLC and Harris Williams & Co. Ltd conduct business.

2 WHAT WE RE READING CAR SALES, MILES DRIVEN SPUR AUTOMOTIVE AFTERMARKET GROWTH The automotive aftermarket industry grew to $14.6 billion in 2015, with dollar sales increasing by 3.9 percent and units/quarter by 1.7 percent, according to The NPD Group. While dollar sales have been accelerating since 2013, unit/quarter sales have been down, and 2015 marked the first year in which both ended positively. New and used car sales, an increase in miles driven and atypical weather were factors that influenced the aftermarket s strong performance during the year. NPD forecasts that automotive aftermarket retail sales will reach $15.1 billion in 2016, growing the industry by 2.7 percent for the year. Tying in with that, NPD estimates that miles driven will return to a more modest growth rate of around 1.9 percent. Body Shop Business MARYLAND BILL WOULD REQUIRE OE REPAIR PARTS FOR FIRST 2 YEARS The recurring debate over the use of original-equipment vs. aftermarket parts for vehicle repairs has taken a new twist in Maryland. A proposed state law there would mandate the use of OE parts for the first two years of a vehicle s life. The bill would require auto body repairers to use OE parts exclusively for the first two years after a vehicle s date of manufacture, and would also require insurance companies that pay for repairs to approve only OE parts. For older vehicles, the bill would limit repairs to either OE parts or certified replacement parts. Automotive News GENERAL MOTORS TO BUY CRUISE AUTOMATION General Motors on March 11 th said that it was acquiring the software firm Cruise Automation as part of its larger effort to develop fully autonomous vehicles. G.M. has been aggressively expanding its portfolio of new businesses dedicated to driverless cars and other personal mobility options like ride-hailing services. While G.M. did not disclose the terms of the latest deal, two people with knowledge of the acquisition said the automaker agreed to pay more than $1 billion in cash and stock for Cruise. Founded in 2013, Cruise has been successful in adapting conventional cars to operate on highways with self-driving features. The company installs sensors, computer equipment and other devices that can control steering, braking and acceleration. New York Times NEW-VEHICLE SALES IN FEBRUARY FORECAST TO INCREASE 8.1% New-vehicle retail sales in February are projected to reach 1,046,700 units from 968,316 in February 2015, with the same number of selling days, 24 days, as last year. The seasonally adjusted annualized rate (SAAR) for retail sales in February 2016 is expected to reach 13.9 million units, up significantly from 12.8 million units in February 2015 and the strongest retail SAAR in the month of February since 2002 when it was 14.7 million. J.D. Power CONTENTS M&A TRANSACTIONS PUBLIC MARKETS OVERVIEW STOCK PRICE PERFORMANCE OUR GROUP CONTACTS UNITED STATES Frank Mountcastle Managing Director fmountcastle@harriswilliams.com +1 (804) Jason Bass Managing Director jbass@harriswilliams.com +1 (804) Joe Conner Managing Director jconner@harriswilliams.com +1 (804) Jershon Jones Director jjones@harriswilliams.com +1 (804) Jeff Burkett Director jburkett@harriswilliams.com +1 (804) Jeff Kidd Vice President jkidd@harriswilliams.com +1 (804) James O Malley Vice President jomalley@harriswilliams.com +1 (804) EUROPE Jeffery Perkins Managing Director jperkins@harriswilliams.com +49 (0) AUTO CLAIMS AND COLLISION REPAIR AT AN INFLECTION POINT According to the CCC s 2016 Crash Course report the auto claims and collision repair industries are at an inflection point as vehicle technology, driving data, mobility and analytics converge and gain momentum. As an industry, we ve been discussing, and slowly moving toward many of these trends, including the growing sophistication of vehicle technology, mobility, telematics and analytics. For the first time, these trends are being acted upon broadly, across national, regional and local auto insurers and collision repairers, and the impact to our industry is significant. said Susanna Gotsch, Lead Industry Analyst, CCC. CCC PAGE 1

3 M&A TRANSACTIONS RECENT M&A TRANSACTIONS 1,2 Date Target Business Description Acquirer 3/11/2016 Cruise Automation, Inc. Develops and manufactures autonomous vehicle technologies. General Motors Company 2/29/2016* Pittsburgh Glass Works LLC Manufactures and distributes automotive glass in the United States and internationally. LKQ Corp. 2/17/2016 Texas Hydraulics, Inc. Operates as a custom manufacturer of fluid power components for original equipment manufacturers. Wynnchurch Capital, LLC 2/9/2016 Trans-Safety LOCKS GmbH Manufactures and markets anti-theft protection products for the transport industry. WABCO Holdings Inc. 2/3/2016* PurePOWER Technologies, LLC Offers research and development, engineering, and manufacturing of engine control and emissions management solutions. 2/2/2016 UGN, Inc. Manufactures acoustic, interior trim, and thermal management products for the automotive industry. Smithfield Group LLP; Kensington Capital Partners, LLC Angeles Equity Partners 2/2/2016* Key Safety Systems, Inc. Designs, develops, and manufactures automotive safety-critical components and systems for automotive and non-automotive markets worldwide. 2/2/2016 MICO, Incorporated Manufactures and sells hydraulic components, controls, and brake systems primarily for off-road vehicles worldwide. Ningbo Joyson Electronic Corp. WABCO Holdings Inc. 1/28/2016 Save-A-Load, Inc. Manufactures cargo load bars for tractor trailers, light duty/commercial vehicles, sprinter vans, SUVs, and pick-up trucks. Fleet Engineers, Inc. 1/12/2016 H&S Autoshot Manufacturing Co., Ltd. Manufactures stud welders for the automotive industry. Nu-Tec Systems, LLC 1/11/2016 Drake Automotive Group, Inc. Manufactures and markets auto parts for new and vintage American muscle cars and recreational off-road vehicles. Huron Capital Partners, LLC 1/5/2016* TowerSec Inc. Operates as an automotive cyber security vendor which develops and provides on-board cyber security software to OEMs, suppliers, and aftermarket telematics manufacturers. Harman International Industries, Incorporated 12/21/2015 Big Tex Trailer Manufacturing, Inc. Manufactures professional grade open trailers in North America. Bain Capital Private Equity 12/16/2015 Colwood-Langford Auto Supply and B.H. McFarlane Automotive Wholesaler of automotive parts and paint products. Uni-Select Inc. 12/8/2015 Aquia Auto Parts, Inc. Distributes paints, coatings, and other finishes to the automotive market. Finishmaster Inc. 12/7/2015 Pep Boys - Manny, Moe & Jack Engages in the automotive aftermarket service and retail business, offering a range of automotive maintenance and repair services. Icahn Enterprises, L.P. 11/24/2015 Dynojet Research, Inc. Develops and manufactures fuel management and diagnostic products. Irving Place Capital; New Value Capital 11/19/2015 Colorado Components, Inc. Manufactures wheel alloys, tires, and accessories for all-terrain vehicles, utility-terrain vehicles, low speed vehicles, recreational vehicles, side by sides, and golf carts. Wheel Pros, LLC *Denotes pending transactions PAGE 2

4 PUBLIC MARKETS OVERVIEW TEV / LTM EBITDA TEV / 2016P EBITDA Dealerships and Services Providers 12.3x 11.4x 11.9x Dealerships and Services Providers 10.9x 8.3x 8.7x 5.6x 5.7x AVERAGE REVENUE GROWTH ( E) AVERAGE REVENUE GROWTH (2015E 2017P) Dealerships and Services Providers 15.0% Dealerships and Services Providers 7.7% 6.6% 4.4% 4.4% 2.8% 0.7% 2.3% AVERAGE EBITDA GROWTH ( E) AVERAGE EBITDA GROWTH (2015E 2017P) Dealerships and Services Providers 16.5% 12.4% 13.7% 7.8% 7.8% Dealerships and Services Providers 7.2% 2.4% 2.2% PAGE 3

5 STOCK PRICE PERFORMANCE MEDIAN % CHANGE (1 MONTH) MEDIAN % CHANGE (12 MONTH) 20.2% Distributors and Retailers 22.5% Dealerships and Service Providers 19.5% S&P 500 (2.5%) Distributors and Retailers 13.4% Dealerships and Service Providers (15.7%) Vehicle Manufacturers 10.0% (19.1%) S&P % Vehicle Manufacturers (24.0%) TRAILING TWELVE MONTHS (Indexed to March 13, 2015) 40% 30% 20% 10% 0% (10%) (20%) (30%) (40%) Mar-15 Jun-15 Sep-15 Dec-15 Mar-16 Dealerships and Service Providers S&P 500 Index PAGE 4

6 OUR GROUP Harris Williams & Co. is a leading advisor to the transportation and logistics M&A market. Our Transportation & Logistics Group serves companies in a broad range of attractive niches, including third-party logistics (3PL), truck, rail, marine and air transportation, transportation equipment, and the automotive and heavy duty vehicle market. RECENTLY CLOSED T&L TRANSACTIONS has acquired RCL Services Group in partnership with and has sold and to DEEP EXPERIENCE ACROSS T&L SECTORS THIRD-PARTY LOGISTICS RAIL & RAIL SERVICES MARINE TRANSPORTATION TRANSPORTATION EQUIPMENT NICHE TRANSPORTATION AUTOMOTIVE & HEAVY DUTY VEHICLE AIR TRANSPORTATION PAGE 5

7 OUR FIRM Harris Williams & Co. has a broad range of industry expertise, which creates powerful opportunities. Our clients benefit from our deep-sector experience, integrated industry intelligence and collaboration across the firm, and our commitment to learning what makes them unique. For more information, visit our website at Aerospace, Defense & Government Services Building Products & Materials Business Services Consumer Energy, Power & Infrastructure Healthcare & Life Sciences Industrials Specialty Distribution Technology, Media & Telecom Transportation & Logistics HARRIS WILLIAMS & CO. OFFICE LOCATIONS Boston Two International Place 24th Floor Boston, Massachusetts Phone: +1 (617) Cleveland 1900 East 9th Street 20th Floor Cleveland, Ohio Phone: +1 (216) Minneapolis 222 South 9th Street Suite 3350 Minneapolis, Minnesota Phone: +1 (612) UNITED STATES Richmond (Headquarters) 1001 Haxall Point 9th Floor Richmond, Virginia Phone: +1 (804) San Francisco 575 Market Street 31st Floor San Francisco, California Phone: +1 (415) EUROPE Frankfurt Bockenheimer Landstrasse Frankfurt Germany Phone: London 63 Brook Street London W1K 4HS, England Phone: +44 (0) Beijing Hong Kong Mumbai NETWORK OFFICES New Delhi Shanghai PAGE 6

8 PUBLIC COMPARABLES Stock Performance Stock Price Change from 52-Week TEV / LTM EBITDA as of TEV / EBITDA ($ in millions except per share data) TEV Current Prior Month Prior Year High % of High Mar-15 Sep-15 Current 2016P 2017P Automotive Aftermarket BorgWarner Inc. $9,638 $ % (40.9%) $ % 9.9x 8.0x 7.1x 6.5x 6.0x Cooper Tire & Rubber Co. 1, % 1.5% % 3.9x 4.2x 3.6x 4.0x 4.4x Dorman Products, Inc. 1, % 12.6% % 10.5x 11.4x 10.7x 9.9x 9.2x Federal-Mogul Holdings Corporation 4, % (32.9%) % 7.6x 7.3x 7.7x 6.5x 6.0x The Goodyear Tire & Rubber Company 13, % 27.2% % 5.2x 5.6x 5.6x 5.0x 4.9x Modine Manufacturing Company % (24.3%) % 6.2x 5.4x 5.2x 4.7x 4.4x Motorcar Parts of America, Inc % 43.5% % 12.6x 15.8x NM 8.5x 7.5x Standard Motor Products Inc (8.8%) (22.9%) % 7.9x 7.4x 6.9x 6.9x 6.1x Tenneco Inc. 3, % (15.4%) % 5.9x 5.3x 4.8x 4.5x 4.3x Visteon Corporation % (24.0%) % NM 2.5x 2.5x 2.0x 1.8x Median 20.2% (19.1%) 73.0% 7.6x 6.5x 5.6x 5.7x 5.5x Advance Auto Parts Inc. $12,590 $ % 6.0% $ % 8.9x 11.1x 10.2x 9.2x 8.8x AutoZone, Inc. 28, % 22.5% % 11.7x 12.0x 12.4x 11.9x 11.2x Genuine Parts Company 14, % 1.7% % 11.6x 10.4x 11.5x 10.9x 10.4x LKQ Corp. 10, % 26.3% % 11.5x 13.0x 12.7x 11.5x 10.4x O'Reilly Automotive Inc. 27, % 31.3% % 14.9x 15.5x 15.7x 14.2x 13.1x U.S. Auto Parts Network, Inc % 15.4% % 19.5x NM NM 11.4x 9.7x Uni-Select Inc (7.5%) 30.3% % 9.7x 9.4x 9.8x 9.2x 8.5x Median 13.4% 22.5% 94.6% 11.6x 11.6x 11.9x 11.4x 10.4x Dealerships and Service Providers Asbury Automotive Group, Inc. $3,210 $ % (22.1%) $ % 12.2x 12.0x 9.7x 9.8x 9.5x AutoNation, Inc. 11, % (17.7%) % 13.2x 12.3x 11.4x 10.6x 10.0x Boyd Group Income Fund % 44.4% % 12.2x 13.5x 13.8x 10.8x 9.5x CarMax Inc. 20, % (17.8%) % 19.8x 18.4x 17.4x 17.3x 16.1x Copart, Inc. 5, % 8.9% % 12.3x 11.3x 12.4x 11.6x 10.8x Group 1 Automotive Inc. 4, % (24.6%) % 11.1x 11.3x 10.0x 10.2x 9.6x KAR Auction Services, Inc. 7, % (1.0%) % 13.5x 12.7x 12.3x 10.9x 9.9x Lithia Motors Inc. 4, % 2.9% % 15.6x 14.4x 11.9x 11.2x 10.5x Monro Muffler Brake Inc. 2, % 7.8% % 16.0x 14.7x 15.8x 15.3x 13.1x Penske Automotive Group, Inc. 8, % (19.4%) % 14.9x 14.2x 12.7x 12.2x 11.4x Sonic Automotive Inc. 3, % (15.7%) % 10.6x 11.0x 10.5x 10.7x 10.2x Median 19.5% (15.7%) 74.1% 13.2x 12.7x 12.3x 10.9x 10.2x PAGE 7

9 PUBLIC COMPARABLES Stock Performance Stock Price Change from 52-Week TEV / LTM EBITDA as of TEV / EBITDA ($ in millions except per share data) TEV Current Prior Month Prior Year High % of High Mar-15 Sep-15 Current 2016P 2017P Automotive Aftermarket Bayerische Motoren Werke Aktiengesellschaft $147,233 $ % (36.7%) $ % 11.8x 10.4x 10.2x 8.9x 8.7x Daimler AG 171, % (32.1%) % 9.5x 10.7x 6.8x 7.9x 7.7x Ford Motor Co. 161, % (16.5%) % 19.7x 13.4x 10.1x 13.3x 12.9x General Motors Company 90, % (18.4%) % 9.1x 6.0x 6.6x 5.7x 5.6x Harley-Davidson, Inc. 15, % (23.4%) % 12.3x 12.1x 11.2x 11.1x 10.7x Navistar International Corporation 5, % (62.9%) % 19.2x 18.8x 14.3x 8.8x 7.9x Oshkosh Corporation 3, % (22.3%) % 7.5x 7.3x 7.5x 8.4x 7.4x PACCAR Inc. 23, % (15.1%) % 11.0x 9.2x 8.5x 10.8x 10.8x Toyota Motor Corporation 298, (6.1%) (24.6%) % 10.5x 9.2x 7.4x 8.6x 8.8x Volkswagen AG 158, % (55.1%) % 9.4x 7.5x 8.1x 5.4x 4.9x Median 10.0% (24.0%) 67.9% 10.8x 9.8x 8.3x 8.7x 8.3x PAGE 8

10 PUBLIC COMPARABLES Revenue Revenue Growth EBITDA EBITDA Growth ($ in millions) E 2016P 2017P '12-15E '15E-17P E 2016P 2017P '12-15E '15E-17P Automotive Aftermarket BorgWarner Inc. $7,183 $7,437 $8,305 $8,023 $9,088 $9, % 9.0% $1,126 $1,224 $1,398 $1,362 $1,493 $1, % 7.8% Cooper Tire & Rubber Co. 4,201 3,439 3,425 2,973 3,017 3,073 (10.9%) 1.7% (4.1%) (9.2%) Dorman Products, Inc % 5.9% % 7.7% Federal-Mogul Holdings Corporation 6,444 6,786 7,317 7,419 7,600 7, % 3.0% % 13.2% The Goodyear Tire & Rubber Company 20,992 19,540 18,138 16,443 16,143 16,306 (7.8%) (0.4%) 1,819 2,132 2,251 2,336 2,652 2, % 7.6% Modine Manufacturing Company 1,577 1,376 1,478 1,496 1,354 1,337 (1.7%) (5.5%) (5.3%) 5.5% Motorcar Parts of America, Inc % 19.6% % 59.8% Standard Motor Products Inc ,006 1, % 3.8% % 6.2% Tenneco Inc. 7,363 7,964 8,420 8,209 8,491 8, % 4.3% % 6.7% Visteon Corporation 5,715 1,724 2,586 3,245 3,240 3,432 (17.2%) 2.8% (18.5%) 18.4% Total $55,173 $50,127 $51,659 $49,885 $51,171 $52, % 4.4% $5,503 $5,535 $6,033 $6,276 $6,957 $7, % 12.4% Advance Auto Parts Inc. $6,205 $6,494 $9,844 $9,737 $9,760 $9, % 1.1% $847 $969 $1,381 $1,233 $1,376 $1, % 8.7% AutoZone, Inc. 8,604 9,148 9,475 10,187 10,734 11, % 5.3% 1,841 2,000 2,081 2,223 2,386 2, % 6.8% Genuine Parts Company 13,014 14,078 15,342 15,280 15,500 15, % 2.2% 1,114 1,209 1,273 1,266 1,306 1, % 4.6% LKQ Corp. 4,123 5,063 6,740 7,193 7,739 8, % 7.4% , % 9.9% O'Reilly Automotive Inc. 6,182 6,649 7,216 7,967 8,555 9, % 7.2% 1,159 1,291 1,468 1,743 1,913 2, % 9.3% U.S. Auto Parts Network, Inc NA (1.4%) NA NA (8.5%) NA Uni-Select Inc. 1,798 1,788 1,784 1,355 1,139 1,182 (9.0%) (6.6%) % 7.5% Total $40,229 $43,474 $50,685 $52,010 $53,730 $55, % 2.8% $5,540 $6,182 $7,091 $7,414 $8,025 $8, % 7.8% Dealerships and Service Providers Asbury Automotive Group, Inc. $4,475 $5,128 $5,639 $6,325 $6,841 $7, % 6.9% $210 $259 $297 $332 $335 $ % 1.1% AutoNation, Inc. 15,020 16,674 18,180 19,847 22,565 23, % 8.4% ,064 1, % 5.9% Boyd Group Income Fund , % 11.8% % 15.3% CarMax Inc. 10,004 10,963 12,574 14,269 15,142 16, % 7.2% ,091 1,186 1, % 8.1% Copart, Inc ,046 1,163 1,146 1,209 1, % 5.4% % 8.6% Group 1 Automotive Inc. 7,216 8,607 9,571 10,224 11,327 11, % 6.9% % 3.7% KAR Auction Services, Inc. 1,963 2,173 2,365 2,640 2,942 3, % 9.5% % 11.1% Lithia Motors Inc. 3,204 3,867 5,200 7,581 8,580 8, % 8.8% % 5.7% Monro Muffler Brake Inc , % 8.3% % 13.7% Penske Automotive Group, Inc. 12,584 14,112 16,796 18,807 20,431 21, % 6.4% % 4.6% Sonic Automotive Inc. 8,115 8,571 8,897 9,298 9,936 10, % 4.9% % 1.8% Total $64,522 $72,312 $81,857 $91,908 $100,918 $105, % 7.7% $3,818 $4,212 $4,785 $5,428 $5,772 $6, % 7.2% PAGE 9

11 PUBLIC COMPARABLES Revenue Revenue Growth EBITDA EBITDA Growth ($ in millions) E 2016P 2017P '12-15E '15E-17P E 2016P 2017P '12-15E '15E-17P Automotive Aftermarket Bayerische Motoren Werke Aktiengesellschaft $57,296 $63,981 $62,738 $88,995 $102,394 $105, % 9.0% $11,820 $11,724 $13,502 $15,800 $16,242 $16, % 3.7% Daimler AG 105, , , , , , % 16.1% 12,119 12,120 20,220 25,231 21,728 22, % (5.3%) Ford Motor Co. 128, , , , , , % 3.4% 11,464 19,724 8,132 16,017 12,266 12, % (12.8%) General Motors Company 148, , , , , , % (1.4%) 10,914 10,741 9,084 13,690 16,104 15, % 8.0% Harley-Davidson, Inc. 4,662 4,943 5,258 5,568 5,322 5, % (1.8%) 1,198 1,321 1,460 1,362 1,351 1, % 2.2% Navistar International Corporation 13,441 12,527 10,617 10,653 10,213 8,919 (7.5%) (8.5%) (468) (423) NM 27.8% Oshkosh Corporation 7,539 8,141 7,665 6,808 6,076 5,822 (3.3%) (7.5%) % (1.6%) PACCAR Inc. 15,326 15,952 15,949 17,793 18,068 16, % (4.1%) 1,927 2,047 2,446 2,768 2,149 2, % (10.5%) Toyota Motor Corporation 156, , , , , , % 8.2% 12,518 22,125 31,157 36,580 33,463 33, % (3.9%) Volkswagen AG 158, , , , , , % 9.4% 21,676 21,328 22,897 25,490 29,883 33, % 14.6% Total $796,151 $841,879 $888,546 $955,902 $1,066,730 $1,093, % 2.3% $83,677 $101,342 $109,672 $137,880 $134,228 $139, % 2.2% PAGE 10

12 TRANSPORTATION & LOGISTICS SOURCES 1. Capital IQ. 2. MergerMarket. DISCLOSURES Harris Williams & Co. ( is a preeminent middle market investment bank focused on the advisory needs of clients worldwide. The firm has deep industry knowledge, global transaction expertise, and an unwavering commitment to excellence. Harris Williams & Co. provides sell-side and acquisition advisory, restructuring advisory, board advisory, private placements, and capital markets advisory services. Investment banking services are provided by Harris Williams LLC, a registered broker-dealer and member of FINRA and SIPC, and Harris Williams & Co. Ltd, which is authorised and regulated by the Financial Conduct Authority. Harris Williams & Co. is a trade name under which Harris Williams LLC and Harris Williams & Co. Ltd conduct business. THIS REPORT MAY CONTAIN REFERENCES TO REGISTERED TRADEMARKS, SERVICE MARKS AND COPYRIGHTS OWNED BY THIRD-PARTY INFORMATION PROVIDERS. NONE OF THE THIRD-PARTY INFORMATION PROVIDERS IS ENDORSING THE OFFERING OF, AND SHALL NOT IN ANY WAY BE DEEMED AN ISSUER OR UNDERWRITER OF, THE SECURITIES, FINANCIAL INSTRUMENTS OR OTHER INVESTMENTS DISCUSSED IN THIS REPORT, AND SHALL NOT HAVE ANY LIABILITY OR RESPONSIBILITY FOR ANY STATEMENTS MADE IN THE REPORT OR FOR ANY FINANCIAL STATEMENTS, FINANCIAL PROJECTIONS OR OTHER FINANCIAL INFORMATION CONTAINED OR ATTACHED AS AN EXHIBIT TO THE REPORT. FOR MORE INFORMATION ABOUT THE MATERIALS PROVIDED BY SUCH THIRD PARTIES, PLEASE CONTACT US AT THE ABOVE ADDRESSES OR NUMBERS. The information and views contained in this report were prepared by Harris Williams & Co. ( Harris Williams ). It is not a research report, as such term is defined by applicable law and regulations, and is provided for informational purposes only. It is not to be construed as an offer to buy or sell or a solicitation of an offer to buy or sell any financial instruments or to participate in any particular trading strategy. The information contained herein is believed by Harris Williams to be reliable, but Harris Williams makes no representation as to the accuracy or completeness of such information. Harris Williams and/or its affiliates may be market makers or specialists in, act as advisers or lenders to, have positions in and effect transactions in securities of companies mentioned herein and also may provide, may have provided, or may seek to provide investment banking services for those companies. In addition, Harris Williams and/or its affiliates or their respective officers, directors and employees may hold long or short positions in the securities, options thereon or other related financial products of companies discussed herein. Opinions, estimates and projections in this report constitute Harris Williams judgment and are subject to change without notice. The financial instruments discussed in this report may not be suitable for all investors, and investors must make their own investment decisions using their own independent advisors as they believe necessary and based upon their specific financial situations and investment objectives. Also, past performance is not necessarily indicative of future results. No part of this material may be copied or duplicated in any form or by any means, or redistributed, without Harris Williams prior written consent. Copyright 2016 Harris Williams & Co., all rights reserved. PAGE 11