TRANSPORTATION & LOGISTICS

Transcription

1 Investment banking services are provided by Harris W illiams LLC, a registered broker-dealer and member of FINRA and SIPC, and Harris W illiams & Co. Ltd, which is authorised and regulat ed bythe FinancialConduct Authority. HarrisWilliams &Co.is atrade name underwhichharriswilliams LLC and HarrisWilliams &Co. Ltd conduct business.

2 WHAT WE RE READING E-COMMERCE CONTINUES TO EXPAND IN THE AFTERMARKET Consumers expect their auto parts buying experience to be enhanced with conv enient, online tools. Roughly half of 1,000 v ehicle owners surv eyed by ebay had purchased auto parts online, and nearly one in fiv e have purchased a v ehicle online in the last fiv e years. Growth in v ehicle and auto parts sales on line is much higher than for regula r e-commerce, says Sree Menon, general manager of ebay Motors. Automotiv e aftermarket retailers hav e to understand that they can t ignore hav ing a digital strategy in place we re in an era where online and offline really hav e to come together. Auto Serv ice World DRIVERLESS CARS CAN DRIVE UP THE BOTTOM LINE AT REPAIR SHOPS Repair shops, and the parts manufacturers, wholesalers and retailers that supply them, will be among the beneficiaries of the shift to autonomous v ehicles. Today, the v ehicles entering shops for maintenance or repairs sit parked 95 percent of the time. Tomorrow, fleets of driv erless cars will spend nearly all their time on the road, with an increase in wear and tear and a proportionate need for maintenance and repair. Aftermarket Business World 3D PRINTING IS REVOLUTIONIZING TRUCK PARTS 3D printing as of right now is brin ging new possibilities and meaningful changes in areas like truck parts av ailability / inventory, production costs, and time-to-market for new ideas. The latest dev elopments in 3D printing hav e made replacement parts easily accessible and of consistent manufacturer s quality. The ability to make a single giv en part on-demand is exponentially less expensiv e than a traditional manufacturing run for that part, and once a 3D printer is in place for a specific locality or region, it also eliminates the typical requisite supply and distribution network to make such parts av ailable. Fleet Owner MAINTENANCE & REPAIR STUDY REVEALS AN OFFER WORTH BILLIONS Automotiv e dealerships only capture approximately 30% of total serv ice v isits, and are missing out on billions in serv ice rev enue annually, accordin g to the Cox Automotiv e 2016 Maintenance and Repair Study. The study found that 25% of respondents took their v ehicles to a general repair shop, while 14% utilized quick lube locations and 11% went to tire stores. The remaining 20% were split among retailers, specialists (like Midas), body shops or other. The top fiv e reasons that serv ice customers did not go to the dealer were total cost, fears they would be ov ercharged, unreasonable labor charges, unreasonable parts charges and distance/location. Auto Serv ice World CONNECTED CAR MARKET EXPECTED TO GROW AT 31% CAGR TO 2020 CONTENTS M &A TRANSACTIONS PUBLIC M ARKETS OVERVIEW STOCK PRICE PERFORM ANCE OUR GROUP CONTACTS UNITED STATES Frank Mountcastle M anaging Director fmountcastle@harriswilliams.com +1 (804) Jason Bass M anaging Director jbass@harrisw illiams.com +1 (804) Joe Conner M anaging Director jconner@harrisw illiams.com +1 (804) Jershon Jones Director jjones@harrisw illiams.com +1 (804) Jeff Burkett Director jburkett@harriswilliams.com +1 (804) Jeff Kidd Vice President jkidd@harrisw illiams.com +1 (804) James O Malley Vice President jomalley@harriswilliams.com +1 (804) EUROPE Jeffery Perkins M anaging Director jperkins@harrisw illiams.com +49 (0) Between 2016 and 2020, automotiv e OEMs and other ecosystem players will continue to inv est heavily in dedicated connected car programs that go beyond traditional telematics. Multiple automotiv e OEMs are beginning to integrate inv ehicle payment capabilities with their connected car platforms to make it possible for driv ers to pay for serv ices such as fuel, parkin g, food and tollin g, without hav ing to leave their v ehicles. By the end of 2016, research estimates that connected car serv ices will account for $14 billion in annual rev enue. Althou gh the market is presently dominated by infotain ment and telematics, connect ed driv er assistance systems and autonomous driv ing applications will witness the high est growth rate ov er the next four years. Yahoo Finance PAGE 1

3 M&A TRANSACTIONS RECENT M&A TRANSACTIONS 1,2,3 Date Target Business Description Acquirer 8/2/2016 Experi-Metal, Inc. Provides metal formed parts and assemblies for the automotive, aerospace, and other industries. The Watermill Group 8/1/2016 Aftermarket Telematics Technologies LLC Developer of automotive telematics software and services for the automotive aftermarket. Innova Electronics Corp. 7/26/2016 Powertrain Industries, Inc. Supplies automotive replacement parts, automotive hardware, brake products and household hardware. Dorman Products, Inc. 7/25/2016 Rubber Enterprises, Inc. Manufactures a line of vibration control products. Anand Nvh Products Private Limited 7/21/2016 Novita Technologies, Inc. Manufactures automotive LED modules. Osram GmbH 7/6/2016 Baja Designs, Inc. Develops and manufactures specialty aftermarket motorcycle and automotive lighting systems. Bestop, Inc. 7/1/2016 ABC Group, Inc. (Canada) Designs, develops, and produces plastic automotive systems. Cerberus Capital Management LP 7/1/2016 Jayco, Inc. Develops, markets, and manufactures recreational vehicles and accessories. 6/28/2016 UQM Technologies Inc. Manufactures electrical motors, generators and hybrid systems for passenger and commercial vehicles. Thor Industries, Inc. American Compass Inc. 6/21/2016* Auto-Camping Ltd. Distributes imported OEM automobile parts and fluids in Canada. Genuine Parts Co. 6/16/2016* Dejana Truck & Utility Equipment Co., Inc. Offers a variety of truck equipment. Douglas Dynamics, Inc. 6/2/2016* FTE Automotive GmbH Manufactures brake and clutch actuation systems. Valeo SA 6/2/2016* OEConnection LLC Provides original equipment replacement parts solutions. Providence Equity Partners, Inc. 5/23/2016* Bridgestone Firestone Venezolana CA Offers tires and rubber products in Venezuela. Corimon CA 5/17/2016 4Knines Manufactures and supplies dog seat covers for cars. Hall Capital Partners 5/16/2016 Rear View Safety, Inc. Provides back up camera systems and video-based road safety solutions for passenger vehicles. 5/11/2016 Grand Rapids Auto Auction, Inc. Provides dealer-to-dealer auto auction services within the used car remarketing industry. Safe Fleet Acquisition Corp. XLerate Group / Huron Capital Partners 5/9/2016 Johann Hay GmbH und Co. KG Automobiltechnik *Denot es pending t ransactions Manufactures and supplies machined and forged components for automotive, commercial vehicles, and bearing industries in Germany and internationally. Musashi Seimitsu Industry Co., Ltd. PAGE 2

4 PUBLIC MARKETS OVERVIEW TEV / LTM EBITDA TEV / 2016P EBITDA 12.7x 12.3x Dealerships and Services Providers 11.4x Dealerships and Services Providers 11.7x 8.2x 9.9x 6.9x 6.3x AVERAGE REVENUE GROWTH ( ) AVERAGE REVENUE GROWTH ( P) Dealerships and Services Providers 13.9% Dealerships and Services Providers 6.1% 6.6% 5.1% (0.7%) 4.3% (1.8%) (0.4%) AVERAGE EBITDA GROWTH ( ) AVERAGE EBITDA GROWTH ( P) Dealerships and Services Providers 16.1% 17.0% 7.0% 10.7% 5.9% Dealerships and Services Providers 7.9% 4.7% (2.3%) PAGE 3

5 STOCK PRICE PERFORMANCE MEDIAN % CHANGE (1 MONTH) MEDIAN % CHANGE (12 MONTH) Vehicle Manufacturers 10.2% Distributors and Retailers 11.5% 9.8% S&P % S&P % (5.3%) Dealerships and Service Providers Distributors and Retailers (1.0%) 1.3% Vehicle Manufacturers Dealerships and Service Providers (18.2%) (8.7%) TRAILING TWELVE MONTHS (Indexed t o August 11 th, 2015) 40% 30% 20% 10% 0% (10%) (20%) (30%) (40%) Aug-15 Nov-15 Feb-16 May-16 Aug-16 Dealerships and Service Providers S&P 500 Index PAGE 4

6 INDUSTRY UPDATE AUGUST 2016 OUR GROUP Harris Williams & Co. is a leading adv isor to the transportation and logistics M&A market. Our Transportation & Logistics Group serv es companies in a broad range of attractiv e niches, including third-party logistics (3PL), tru ck, rail, marine and air transportation, transportation equipment, and the automotiv e and heav y duty v ehicle market. RECENTLY CLOSED T&L TRANSACTIONS has merged with an operating company of has acquired in a recapitalization by and 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 & M aterials Business Services Consumer Energy, Pow er & Infrastructure Healthcare & Life Sciences Industrials Specialty Distribution Technology, M edia & Telecom Transportation & Logistics HARRIS WILLIAMS & CO. OFFICE LOCATIONS Boston Tw o International Place 24th Floor Boston, M assachusetts Phone: +1 (617) Cleveland 1900 East 9th Street 20th Floor Cleveland, Ohio Phone: +1 (216) Minneapolis 222 South 9th Street Suite 3350 M inneapolis, M innesota Phone: +1 (612) UNITED STATES Richmond (Headquarters) 1001 Haxall Point 9th Floor Richmond, Virginia Phone: +1 (804) San Francisco 575 M arket 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 Aug-15 Feb-16 Current 2016P 2017P Automotive Aftermarket BorgWarner Inc. $9,581 $ % (27.3%) $ % 8.5x 6.7x 6.8x 6.4x 6.2x Cooper Tire & Rubber Company 1, % (9.2%) % 4.4x 3.6x 3.2x 3.6x 4.0x Dorman Products, Inc. 2, % 21.0% % 11.6x 8.6x 11.9x 11.3x 10.6x Federal-Mogul Holdings Corp 4, % (8.6%) % 8.7x 6.4x 7.1x 6.1x 5.7x Goodyear Tire & Rubber Company 13, % (5.9%) % 5.9x 5.9x 6.3x 5.0x 4.9x Modine Manufacturing Company % 7.9% % 5.4x 7.3x 2.6x 4.8x 4.2x Motorcar Parts of America, Inc % (4.6%) % 15.3x 13.8x 13.1x 6.7x 5.8x Standard Motor Products, Inc. 1, % 21.5% % 8.6x 8.9x 9.8x 8.9x 8.7x Tenneco Inc. 4, % 11.9% % 5.5x 4.5x 5.3x 5.2x 4.8x Visteon Corporation 2, % (30.4%) % 4.1x 1.6x 9.9x 6.5x 5.9x Median 9.8% (5.3%) 85.4% 7.2x 6.6x 6.9x 6.3x 5.8x Advance Auto Parts, Inc. $13,438 $ % (3.1%) $ % 11.0x 9.9x 11.6x 10.9x 10.1x AutoZone, Inc. 29, (1.0%) 11.1% % 10.2x 11.6x 12.6x 12.3x 11.5x Genuine Parts Company 15, (3.1%) 16.4% % 11.1x 10.8x 12.7x 12.3x 11.1x LKQ Corporation 13, % 11.5% % 13.4x 10.6x 14.7x 12.9x 11.2x O'Reilly Automotive, Inc. 29, % 16.5% % 16.4x 14.5x 16.1x 15.4x 14.0x U.S. Auto Parts Network, Inc (10.6%) 75.2% % NA NA 18.3x 12.8x 11.1x Uni-Select Inc. 1, (6.9%) 4.8% % 8.9x 10.2x 11.9x 10.9x 9.9x Median (1.0%) 11.5% 96.3% 11.1x 10.7x 12.7x 12.3x 11.1x Dealerships and Service Providers Asbury Automotive Group, Inc. $3,082 $ % (31.0%) $ % 11.5x 9.2x 9.5x 9.5x 9.3x AutoNation, Inc. 11, (2.6%) (18.2%) % 12.7x 11.4x 11.5x 11.7x 11.4x Boyd Group Income Fund 1, % 36.6% % 11.1x 10.7x 16.2x 12.9x 11.2x CarMax, Inc. 21, % (5.3%) % NM NM NM 18.0x 17.2x Copart, Inc. 6, % 40.7% % 12.5x 11.6x 14.9x 14.2x 13.3x Group 1 Automotive, Inc. 4, % (34.1%) % 11.9x 9.9x 9.9x 11.0x 10.5x KAR Auction Services, Inc. 7, (3.5%) 5.9% % 11.5x 10.0x 11.3x 10.3x 9.5x Lithia Motors, Inc. Class A 4, % (27.2%) % 15.2x 10.5x 10.6x 10.3x 9.7x Monro Muffler Brake, Inc. 2, (18.2%) (12.1%) % 15.9x 15.2x 14.0x 13.0x 11.5x Penske Automotive Group, Inc. 8, % (21.3%) % 14.5x 11.5x 12.3x 12.1x 11.3x Sonic Automotive, Inc. Class A 3, (4.7%) (20.6%) % 11.2x 10.1x 10.2x 10.7x 10.4x Median 1.3% (18.2%) 75.5% 12.2x 10.6x 11.4x 11.7x 11.2x 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 Aug-15 Feb-16 Current 2016P 2017P Automotive Aftermarket Bayerische Motoren Werke AG $155,829 $ % (6.7%) $ % 7.7x 7.3x 7.7x 9.5x 9.3x Daimler AG 174, % (17.1%) % 6.4x 6.4x 7.1x 8.7x 7.8x Ford Motor Company 149, (7.2%) (16.1%) % 17.8x 9.2x 10.2x 11.8x 11.5x General Motors Company 101, % 2.9% % 6.0x 5.4x 5.4x 6.1x 6.2x Harley-Davidson, Inc. 15, % (8.3%) % 12.8x 10.5x 12.2x 12.5x 11.8x Navistar International Corporation 5, % (27.3%) % 12.0x 9.5x 9.6x 9.8x 9.0x Oshkosh Corp 4, % 34.8% % 7.3x 6.7x 10.1x 10.0x 8.5x PACCAR Inc 25, % (7.8%) % 8.7x 7.0x 8.1x 11.8x 12.1x Toyota Motor Corp. 302, % (9.0%) % 8.7x 8.0x 8.3x 10.1x 9.6x Volkswagen AG Pref 203, % (28.6%) % 6.6x 7.6x 7.9x 6.9x 6.2x Median 10.2% (8.7%) 82.8% 8.2x 7.5x 8.2x 9.9x 9.1x PAGE 8

10 PUBLIC COMPARABLES Revenue Revenue Growth EBITDA EBITDA Growth ($ in millions) P 2017P '12-15 '15-17P P 2017P '12-15 '15-17P Automotive Aftermarket BorgWarner Inc. $7,178 $7,435 $8,304 $8,025 $9,136 $9, % 8.8% $1,106 $1,224 $1,385 $1,330 $1,493 $1, % 8.1% Cooper Tire & Rubber Company 4,201 3,439 3,421 2,959 2,956 3,046 (11.0%) 1.5% % (5.3%) Dorman Products, Inc % 8.4% % 10.1% Federal-Mogul Holdings Corp 6,664 6,786 7,317 7,419 7,467 7, % 2.0% % 16.7% Goodyear Tire & Rubber Company 20,992 19,540 18,138 16,443 15,632 15,948 (7.8%) (1.5%) 1,824 2,107 2,251 2,085 2,655 2, % 13.5% Modine Manufacturing Company 1,376 1,478 1,496 1,463 1,353 1, % (2.9%) % (20.7%) Motorcar Parts of America, Inc (3.2%) 13.8% NM 44.5% Standard Motor Products, Inc ,061 1, % 7.0% % 15.9% Tenneco Inc. 7,363 7,964 8,420 8,209 8,609 9, % 5.1% % 8.1% Visteon Corporation 6,857 7,439 7,509 3,245 3,164 3,291 (22.1%) 0.7% (18.7%) 15.9% Total $56,556 $55,988 $56,639 $49,906 $50,669 $52,493 (1.8%) 4.3% $5,348 $6,002 $6,475 $6,104 $7,077 $7, % 10.7% Advance Auto Parts, Inc. $6,205 $6,494 $9,844 $9,737 $9,380 $9, % (0.9%) $847 $901 $1,244 $1,147 $1,244 $1, % 7.8% AutoZone, Inc. 8,604 9,148 9,475 10,187 10,663 11, % 4.8% 1,841 2,002 2,081 2,223 2,365 2, % 6.7% Genuine Parts Company 13,014 14,078 15,342 15,280 15,479 16, % 2.5% 1,122 1,117 1,273 1,266 1,286 1, % 4.5% LKQ Corporation 4,123 5,063 6,740 7,193 9,161 10, % 19.7% ,071 1, % 19.8% O'Reilly Automotive, Inc. 6,182 6,649 7,216 7,967 8,593 9, % 7.2% 1,154 1,287 1,465 1,743 1,919 2, % 10.0% U.S. Auto Parts Network, Inc (1.4%) 4.4% (8.5%) 58.6% Uni-Select Inc. 1,821 1,788 1,784 1,355 1,220 1,300 (9.4%) (2.1%) % 11.8% Total $40,253 $43,474 $50,685 $52,010 $54,799 $57, % 5.1% $5,554 $6,031 $6,961 $7,331 $8,006 $8, % 17.0% Dealerships and Service Providers Asbury Automotive Group, Inc. $4,640 $5,335 $5,868 $6,588 $6,526 $6, % 1.0% $209 $270 $313 $331 $328 $ % 0.5% AutoNation, Inc. 15,669 17,518 19,109 20,862 21,884 22, % 4.4% % (0.3%) Boyd Group Income Fund ,056 1, % 13.0% % 16.9% CarMax, Inc. 10,963 12,574 14,269 15,150 15,881 17, % 6.6% ,227 1, % 27.1% Copart, Inc ,046 1,163 1,146 1,256 1, % 8.0% % 11.6% Group 1 Automotive, Inc. 7,476 8,919 9,938 10,633 11,064 11, % 3.4% % (1.6%) KAR Auction Services, Inc. 1,963 2,173 2,365 2,640 3,052 3, % 11.4% % 13.5% Lithia Motors, Inc. Class A 3,316 4,006 5,390 7,864 8,523 8, % 6.9% % 6.3% Monro Muffler Brake, Inc ,001 1, % 7.1% % 9.5% Penske Automotive Group, Inc. 13,164 14,705 17,177 19,285 20,310 20, % 4.2% % 5.0% Sonic Automotive, Inc. Class A 8,365 8,843 9,197 9,624 9,574 9, % 1.5% % (1.1%) Total $67,648 $76,512 $86,134 $95,653 $100,129 $104, % 6.1% $3,553 $4,019 $4,617 $5,142 $5,757 $6, % 7.9% PAGE 9

11 PUBLIC COMPARABLES Revenue Revenue Growth EBITDA EBITDA Growth ($ in millions) P 2017P '12-15 '15-17P P 2017P '12-15 '15-17P Automotive Aftermarket Bayerische Motoren Werke AG $98,709 $100,976 $106,648 $102,215 $104,982 $107, % 2.6% $20,286 $19,443 $21,734 $19,303 $16,162 $16,608 (1.6%) (7.2%) Daimler AG 146, , , , , , % 2.9% 19,691 21,079 24,558 25,604 20,651 22, % (6.3%) Ford Motor Company 134, , , , , , % (1.5%) 12,958 13,183 11,324 15,557 12,500 13, % (6.9%) General Motors Company 152, , , , , , % (0.9%) 10,670 12,708 8,853 15,518 17,181 16, % 2.2% Harley-Davidson, Inc. 5,581 5,900 6,229 5,995 5,286 5, % (5.1%) 1,183 1,324 1,452 1,330 1,276 1, % (0.3%) Navistar International Corporation 12,948 10,775 10,806 10,140 8,437 8,353 (7.8%) (9.2%) (374) (192) NM 2.9% Oshkosh Corp 8,181 7,665 6,808 6,098 6,101 6,628 (9.3%) 4.3% % 3.2% PACCAR Inc 17,051 17,124 18,997 19,115 17,200 16, % (6.4%) 2,458 2,648 2,899 3,198 2,084 2, % (18.8%) Toyota Motor Corp. 266, , , , , ,352 (3.9%) 7.9% 30,332 35,160 38,164 36,457 29,539 31, % (6.7%) Volkswagen AG Pref 247, , , , , ,635 (1.5%) 1.3% 29,739 30,822 33,686 24,722 29,135 32,902 (6.0%) 15.4% Total $1,089,420 $1,119,448 $1,138,291 $1,084,281 $1,107,889 $1,132,740 (0.7%) (0.4%) $127,443 $136,819 $143,587 $142,779 $129,578 $138, % (2.3%) PAGE 10

12 TRANSPORTATION & LOGISTICS SOURCES 1. FactSet. 2. MergerMarket. 3. Pitchbook. DISCLOSURES Harris W illiams & 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 unw avering commitment to excellence. Harris Willia ms & 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, w hich is authorised and regulated by the Financial Conduct Authority. Harris Williams & Co. is a trade name under w hich Harris Williams LLC and Harris W illiams & 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 ISS UER OR UNDERWRITER OF, THE SECURITIES, FINANCIAL INSTRUMENTS OR OTHER INVESTMENTS DISCUSSED IN THIS REPORT, AND SHALL NOT HAVE AN Y LIABILITY OR RESPONSIBILITY FOR ANY STATEMENTS MADE IN THE REPORT OR FOR ANY FINANCIAL STATEMENTS, FINANCIAL PROJECTIONS OR OTHER FINAN CIAL INFORMATION CONTAINED OR ATTACHED AS AN EXHIBIT TO THE REPORT. FOR MORE INFORMATION ABOUT THE MATERIALS PROVIDED BY SUCH THIR D PARTIES, PLEASE CONTACT US AT THE ABOVE ADDRESSES OR NUMBERS. The information and view s contained in this report w ere prepared by Harris Williams & Co. ( Harris Williams ). It is not a re search 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 o ffer 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 i nformation 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 W illiams 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 w ithout notice. The financial instruments discussed in this re port may not be suitable for all investors, and investors must make their ow n investment decisions using their own independent advisors as they believe ne cessary 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, w ithout Harris Williams prior w ritten consent. Copyr ight 2016 Harris Williams & Co., all rights reserved. PAGE 11