Tag: US Market

Business Strategy & Outlook:   

Allegion, a global leader in security products and solutions, was spun off from Ingersoll-Rand in December 2013. No longer forced to compete for capital from a conglomerate parent, Allegion is now able to employ a more robust acquisition strategy to expand its scale, technological capabilities, and product portfolio. At over 70% of sales and 80% of segment profitability, Allegion’s Americas segment is the firm’s largest and strongest business, with a leading position in locks, exit devices, and door controls. The Americas business has been the key driver of Allegion’s stable, industry-leading profitability, which is a testament to the firm’s market position and pricing power. We expect the Americas business to post mid-to-high single-digit organic growth after the coronavirus-fueled downturn in 2020-21 as the segment capitalizes on increased retrofit and upgrade spending across commercial and residential end markets that is drive by the convergence of electronics and mechanical security solutions, elevated U.S. residential construction, and strategic acquisitions. The segment’s already strong profit margins should benefit from a mix-shift to higher-priced electronics products and operating leverage on increased volumes, partially offset by structurally lower profit margins from the acquired access technologies business.

 We believe that the company’s international businesses are subscale, which factors into the segment’s weak margin performance relative to Allegion’s strong Americas segment; however, the company is working diligently to keep strengthening these businesses through restructuring, channel development, and strategic acquisitions that build scale and expand the company product portfolio. These initiatives appear to be working as the international segment reported record profitability in fiscal 2021 (11% adjusted operating margin). We expect international segment profitability will continue to improve as these initiatives take hold. Like the Americas segment, this segment should also benefit from the convergence of electronic and mechanical security technology

Financial Strengths:  

As part of the spinoff transaction in 2013, Allegion paid a $1.3 billion one-time dividend to Ingersoll-Rand. Allegion issued a commensurate amount of debt in 2013 to fund the dividend to its former parent. Since then, Allegion’s gross debt/EBITDA leverage ratio has improved to approximately 2.0 currently (based on our estimate of 2022 adjusted EBITDA). Management continues to target an investment-grade rating on its debt going forward. Allegion has approximately $1.4 billion of outstanding debt, which consists of approximately $250 million outstanding on the company’s term facility, $400 million of 3.2% senior notes due in 2024, $400 million of 3.55% senior notes due in 2027, and $400 million of 3.5% senior notes due in 2029. In 2021, Allegion incurred about $50 million of net interest expense and generated approximately $618 million of adjusted EBITDA, which equates to a comfortable EBITDA coverage ratio of about 12 times. We think Allegion’s use of leverage is reasonable, and the company’s free cash flow generation should comfortably support its debt service requirements and future capital allocation decisions. Given the firm’s reasonable use of leverage and consistent free cash flow generation, we believe Allegion’s financial health is satisfactory.

Bulls Say: 

• Allegion’s strong market position and pricing power in North America should continue to support the firm’s stable, industry-leading profitability. 
• The convergence of electronic and mechanical security products and increased infrastructure spending should drive sales growth and margin expansion opportunities. 
• Allegion generates strong free cash flow and is a balanced capital allocator. The company can continue to use its free cash flow to increase its dividend, repurchase shares, and make value-accretive acquisitions and invest in lead-edge technology ventures.

Company Description:  

Allegion is a global security products company with a portfolio of leading brands, such as Schlage, von Duprin, and LCN. The Ireland-domiciled company was created via a spinoff transaction from Ingersoll-Rand in December 2013. In fiscal 2021, Allegion generated 68% of sales in the United States. The company mainly competes with Swedish-based Assa Abloy AB and Switzerland-based Dormakaba.

(Source: Morningstar)

DISCLAIMER for General Advice: (This document is for general advice only).

This document is provided by Laverne Securities Pty Ltd T/as Laverne Investing. Laverne Securities Pty Ltd, CAR 001269781 of Laverne Capital Pty Ltd AFSL No. 482937.

The material in this document may contain general advice or recommendations which, while believed to be accurate at the time of publication, are not appropriate for all persons or accounts. This document does not purport to contain all the information that a prospective investor may require.  The material contained in this document does not take into consideration an investor’s objectives, financial situation or needs. Before acting on the advice, investors should consider the appropriateness of the advice, having regard to the investor’s objectives, financial situation, and needs. The material contained in this document is for sales purposes. The material contained in this document is for information purposes only and is not an offer, solicitation or recommendation with respect to the subscription for, purchase or sale of securities or financial products and neither or anything in it shall form the basis of any contract or commitment. This document should not be regarded by recipients as a substitute for the exercise of their own judgment and recipients should seek independent advice.

The material in this document has been obtained from sources believed to be true but neither Laverne and Banyan Tree nor its associates make any recommendation or warranty concerning the accuracy or reliability or completeness of the information or the performance of the companies referred to in this document. Past performance is not indicative of future performance. Any opinions and or recommendations expressed in this material are subject to change without notice and, Laverne and Banyan Tree are not under any obligation to update or keep current the information contained herein. References made to third parties are based on information believed to be reliable but are not guaranteed as being accurate.

Laverne and Banyan Tree and its respective officers may have an interest in the securities or derivatives of any entities referred to in this material. Laverne and Banyan Tree do and seek to do business with companies that are the subject of its research reports. The analyst(s) hereby certify that all the views expressed in this report accurately reflect their personal views about the subject investment theme and/or company securities.

Although every attempt has been made to verify the accuracy of the information contained in the document, liability for any errors or omissions (except any statutory liability which cannot be excluded) is specifically excluded by Laverne and Banyan Tree, its associates, officers, directors, employees, and agents.  Except for any liability which cannot be excluded, Laverne and Banyan Tree, its directors, employees and agents accept no liability or responsibility for any loss or damage of any kind, direct or indirect, arising out of the use of all or any part of this material.  Recipients of this document agree in advance that Laverne and Banyan Tree are not liable to recipients in any matters whatsoever otherwise; recipients should disregard, destroy or delete this document. All information is correct at the time of publication. Laverne and Banyan Tree do not guarantee reliability and accuracy of the material contained in this document and are not liable for any unintentional errors in the document.

The securities of any company(ies) mentioned in this document may not be eligible for sale in all jurisdictions or to all categories of investors. This document is provided to the recipient only and is not to be distributed to third parties without the prior consent of Laverne and Banyan Tree.

Business Strategy & Outlook:   

While Constellation Brands historically made its bones as a winery and distillery, we now view the firm as one of the most stellar brewers across our global coverage. After parlaying AB InBev’s antitrust quandary (allowing it to acquire Mexican brewer Grupo Modelo) into exclusive U.S. ownership rights to brands like Corona and Modelo, we see the firm’s overall Mexican beer portfolio as auspiciously situated at the confluence of unwavering secular and demographic trends. With an enviable growth profile and best of breed margins, we have confidence that the beer business can thrive even amid an evolving industry landscape. The increase in political, social, and cultural clout of the Hispanic population in the U.S. is widely expected to continue, which augurs well for Constellation’s intangible assets. The firm is not resting on its laurels, however, as it continues to expand its addressable market by widening the gamut of categories in which it competes. One of the primary avenues through which it is seeking to do this is innovation, with line extensions like Corona Refresca being a quintessential illustration. Management is looking for 25% of its growth outlook to be driven by innovation, a mark we think is achievable given the broad resonance of its trademarks. Another avenue is through acquisition, currently embodied by its controlling stake in Canopy Growth. Even as the outlook for cannabis in the U.S. remains uncertain, we remain sanguine on the optionality that this investment affords. 

The firm’s wine and spirits business should offer some stability, after the divestiture of lower-quality brands, allowing Constellation to place more intentionality behind its “high growth, high margin” long-term strategy. However, in our opinion, the remaining brands (such as Meiomi, Kim Crawford, Svedka vodka, and High West craft whiskey) will still face rife competition. Constellation’s foray into explosive-growth categories like hard seltzer have demanded nontrivial investment, given the competitive intensity and brand equity already built up by the incumbents. Nevertheless, we believe the experience of the management team will allow the firm to navigate these risks.

Financial Strengths:  

Constellation Brands’ financial health looks sound to us, and is markedly improved from the precarious positions of the past. Management’s internally calculated leverage ratio (based on adjusted EBITDA) rose to 5 times in order to fund its 2013 acquisition of the perpetual rights to the Mexican beer portfolio, and after steadily reducing it over the next four years, leverage rose again to over 4 times in order to fund the second-round Canopy investment. Nevertheless, we see levels declining to 3.4 by the end of fiscal 2022, thanks to the firm’s robust cash flow, and the prior redemption notes with near-term maturities. Constellation has spun off healthy free cash flow in the low-20s as a proportion of sales on average over the past three years. This is quite the feat when juxtaposed with its hefty capital outlays to solidify and expand its production capacity in Mexico. Capital expenditures have averaged roughly 11% since it purchased the Mexican beer business, versus the 5%-7% that is typical across our brewing coverage. We expect a couple more years of elevation as management makes capital investment to make up for its failed Mexicali expansion, after which normalization (combined with improving margins and working capital management) should support free cash flow for reinvestment and cash returns to shareholders. Given the Canopy investment, management has indicated it plans to avoid transformative acquisitions, but with leverage now at more comfortable levels, we expect cash flow will primarily be deployed toward capacity, share buybacks, and its dividend (instituted in fiscal 2016). There is ample liquidity to fund its operations; in addition to its cash flow and over $200 million in cash as of February 2022, it has access to a $2 billion revolving credit facility.

Bulls Say: 

• Constellation Brands essentially monopolizes the U. S. market for Mexican beer imports, which augurs well for its positioning given the country’s large Hispanic population. 
• The ability to parlay the Corona trademarks into different categories is a testament to the broad resonance of the brand and is evidenced by robust initial consumer takeaway of Corona Hard Seltzer. 
• As we get more clarity regarding what the contours of cannabis legalization will look like in the U.S., the Canopy investment could yield significant upside.

Company Description:  

Constellation Brands is the largest multi-category alcohol supplier in the U.S. The business is anchored by a portfolio of Mexican beer trademarks, including Corona and Modelo, for which it acquired exclusive and perpetual U.S. ownership from AB InBev. The latter had to divest these rights due to antitrust mandates as it consummated its 2013 acquisition of dominant Mexican brewer, Grupo Modelo. Constellation’s wine/spirits business has recently transitioned, divesting several lower-margin assets, including myriad wine brands and its Ballast Point craft beer brand. The firm imports most products after manufacturing them abroad, going to market through independent wholesalers. It owns 36% of Canopy Growth, a leading provider of medicinal and recreational cannabis products

(Source: Morningstar)

DISCLAIMER for General Advice: (This document is for general advice only).

This document is provided by Laverne Securities Pty Ltd T/as Laverne Investing. Laverne Securities Pty Ltd, CAR 001269781 of Laverne Capital Pty Ltd AFSL No. 482937.

The material in this document may contain general advice or recommendations which, while believed to be accurate at the time of publication, are not appropriate for all persons or accounts. This document does not purport to contain all the information that a prospective investor may require.  The material contained in this document does not take into consideration an investor’s objectives, financial situation or needs. Before acting on the advice, investors should consider the appropriateness of the advice, having regard to the investor’s objectives, financial situation, and needs. The material contained in this document is for sales purposes. The material contained in this document is for information purposes only and is not an offer, solicitation or recommendation with respect to the subscription for, purchase or sale of securities or financial products and neither or anything in it shall form the basis of any contract or commitment. This document should not be regarded by recipients as a substitute for the exercise of their own judgment and recipients should seek independent advice.

The material in this document has been obtained from sources believed to be true but neither Laverne and Banyan Tree nor its associates make any recommendation or warranty concerning the accuracy or reliability or completeness of the information or the performance of the companies referred to in this document. Past performance is not indicative of future performance. Any opinions and or recommendations expressed in this material are subject to change without notice and, Laverne and Banyan Tree are not under any obligation to update or keep current the information contained herein. References made to third parties are based on information believed to be reliable but are not guaranteed as being accurate.

Laverne and Banyan Tree and its respective officers may have an interest in the securities or derivatives of any entities referred to in this material. Laverne and Banyan Tree do and seek to do business with companies that are the subject of its research reports. The analyst(s) hereby certify that all the views expressed in this report accurately reflect their personal views about the subject investment theme and/or company securities.

Although every attempt has been made to verify the accuracy of the information contained in the document, liability for any errors or omissions (except any statutory liability which cannot be excluded) is specifically excluded by Laverne and Banyan Tree, its associates, officers, directors, employees, and agents.  Except for any liability which cannot be excluded, Laverne and Banyan Tree, its directors, employees and agents accept no liability or responsibility for any loss or damage of any kind, direct or indirect, arising out of the use of all or any part of this material.  Recipients of this document agree in advance that Laverne and Banyan Tree are not liable to recipients in any matters whatsoever otherwise; recipients should disregard, destroy or delete this document. All information is correct at the time of publication. Laverne and Banyan Tree do not guarantee reliability and accuracy of the material contained in this document and are not liable for any unintentional errors in the document.

The securities of any company(ies) mentioned in this document may not be eligible for sale in all jurisdictions or to all categories of investors. This document is provided to the recipient only and is not to be distributed to third parties without the prior consent of Laverne and Banyan Tree.

Business Strategy & Outlook:   

For most of the 2010s, Thomson Reuters was a laggard relative to its information services peers, in our view. Since deciding to spin off its Refinitiv financial and risk operations to London-based LSE Group, we believe the firm has gained more focus. Some of its past offerings have been clunky, and we believe efforts to streamline its business should lead to meaningful margin expansion and higher retention in the years ahead. We view Thomson Reuters’ legal offerings as the firm’s crown jewel. The company’s Westlaw offering serves as an important research service for lawyers. Thomson Reuters’ main competitor in the space is RELX’s LexisNexis, but given the critical nature of the information being sought, many law firms subscribe to both services. 

The firm’s other two main businesses are its corporate and tax and accounting segments. We believe these three units will constitute the core of Thomson Reuters’ operations going forward, as the other two segments are news, which operates with razor-thin margins, and print, which is in runoff. The new Thomson Reuters is poised to operate as more of an operating company and less of a holding company, the merits of which we appreciate. The firm should be able to double down on industry-leading software like Westlaw in the legal segment and Checkpoint in tax and accounting, leveraging a customer base that includes the Big Four global accounting firms and virtually all the top 100 U.S. legal and accounting firms in some capacity. In our view, the stickiness of the firm’s products in legal and accounting (which overlap almost completely with corporate) should help Reuters navigate a piecemeal pivot to cloud software, or SaaS offerings, with minimal attrition

Financial Strengths:  

At the end of 2021, the company had a net debt/EBITDA ratio (the value of debt obligations outstanding less cash and equivalents divided by adjusted EBITDA) of 1.6 times, a substantial improvement from 2016, when debt stood at about 2.5 times EBITDA. Total debt outstanding was $3.7 billion with $0.8 billion in cash. The firm has no maturities until November 2023. We expect that over time, Thomson Reuters will reduce its stake in LSE Group and use its proceeds for activities that better align with the firm’s strategy. Thomson Reuters has the ability to sell to cover tax gains, but after that, it can begin to sell batches of LSE Group stock. We expect the firm to look for acquisition opportunities. Notably, its government business is a fast grower and the firm could enhance its government offerings with acquisitions. We believe the firm has ample capacity to pursue acquisitions.

Bulls Say: 

• The pivot to a software-intensive model could lower customer acquisition costs, allowing the firm to drive growth through previously inaccessible small and midsize legal and tax firms. 
• Increasing regulatory complexity and requirements for a library of previous years of regulations increase barriers to entry, reduce competition, and strengthen advantages in the legal and tax and accounting segments. 
• A renewed focus and new management following the Refinitiv divestment could see margins improve, driving profitability.

Company Description:  

Thomson Reuters is the result of the $17.6 billion megamerger of Canada’s Thomson and the United Kingdom’s Reuters Group in 2008 and the 2018 carve-out of its finance and risk business, Refinitiv, in which it holds a 45% stake. In 2019, the company agreed to exchange its 45% stake in Refinitiv for a 15% stake in LSE, which closed in early 2021. Since the divestiture, the company is more concentrated on selling its flagship legal data and software, Westlaw, and its tax accounting software, Onesource. Reuters sees roughly 80% of revenue and 70% of expenses attributed to the United States, while the remainder (largely through the global print and Reuters News segments) is distributed across Latin America, Europe, the Middle East, Africa, and Asia-Pacific. 

(Source: Morningstar)

DISCLAIMER for General Advice: (This document is for general advice only).

This document is provided by Laverne Securities Pty Ltd T/as Laverne Investing. Laverne Securities Pty Ltd, CAR 001269781 of Laverne Capital Pty Ltd AFSL No. 482937.

The material in this document may contain general advice or recommendations which, while believed to be accurate at the time of publication, are not appropriate for all persons or accounts. This document does not purport to contain all the information that a prospective investor may require.  The material contained in this document does not take into consideration an investor’s objectives, financial situation or needs. Before acting on the advice, investors should consider the appropriateness of the advice, having regard to the investor’s objectives, financial situation, and needs. The material contained in this document is for sales purposes. The material contained in this document is for information purposes only and is not an offer, solicitation or recommendation with respect to the subscription for, purchase or sale of securities or financial products and neither or anything in it shall form the basis of any contract or commitment. This document should not be regarded by recipients as a substitute for the exercise of their own judgment and recipients should seek independent advice.

The material in this document has been obtained from sources believed to be true but neither Laverne and Banyan Tree nor its associates make any recommendation or warranty concerning the accuracy or reliability or completeness of the information or the performance of the companies referred to in this document. Past performance is not indicative of future performance. Any opinions and or recommendations expressed in this material are subject to change without notice and, Laverne and Banyan Tree are not under any obligation to update or keep current the information contained herein. References made to third parties are based on information believed to be reliable but are not guaranteed as being accurate.

Laverne and Banyan Tree and its respective officers may have an interest in the securities or derivatives of any entities referred to in this material. Laverne and Banyan Tree do and seek to do business with companies that are the subject of its research reports. The analyst(s) hereby certify that all the views expressed in this report accurately reflect their personal views about the subject investment theme and/or company securities.

Although every attempt has been made to verify the accuracy of the information contained in the document, liability for any errors or omissions (except any statutory liability which cannot be excluded) is specifically excluded by Laverne and Banyan Tree, its associates, officers, directors, employees, and agents.  Except for any liability which cannot be excluded, Laverne and Banyan Tree, its directors, employees and agents accept no liability or responsibility for any loss or damage of any kind, direct or indirect, arising out of the use of all or any part of this material.  Recipients of this document agree in advance that Laverne and Banyan Tree are not liable to recipients in any matters whatsoever otherwise; recipients should disregard, destroy or delete this document. All information is correct at the time of publication. Laverne and Banyan Tree do not guarantee reliability and accuracy of the material contained in this document and are not liable for any unintentional errors in the document.

The securities of any company(ies) mentioned in this document may not be eligible for sale in all jurisdictions or to all categories of investors. This document is provided to the recipient only and is not to be distributed to third parties without the prior consent of Laverne and Banyan Tree.

Business Strategy & Outlook

Aurora cultivates and sells cannabis predominantly in Canada but also exports it to the global medical market. Aurora considers itself a medical cannabis company first but has benefited from the legalization of recreational cannabis in Canada in 2018. Recreational use now accounts for nearly 40% of gross sales, although this share is slightly lower than peers. The Canadian medical market to grow slowly at roughly 1.5% as recreational legalization takes customers. The robust recreational growth of roughly 15%, driven by the conversion of illicit-market consumers into the legal market and new cannabis consumers.

Aurora has expanded its global medical exports, currently shipping to more than 20 countries. The global market looks lucrative, given higher realized prices and the growing acceptance of cannabis’ medical benefits. Exporters must pass strict regulations to enter markets, protecting early entrants like Aurora. Continued growth in its medical exports has helped Aurora see volume and price growth even as its domestic market has struggled during pandemic lockdowns. The roughly 20% average annual growth through 2031. The U.S. will change federal law to recognize states’ choices on legality within their borders, unlocking the fastest-growing and largest potential cannabis market, which as per the estimate will be more than five times larger than the Canadian market. At present, Aurora would not benefit from a change in U.S. federal law on THC cannabis, as its only exposure is through hemp-derived CBD products through its May 2020 acquisition of Reliva. Aurora is one of the few Canadian producers with no standing deals with a U.S. multistate operator, although it believes it would be able to draw an attractive partner should the law change.

Unlike some of its peers, Aurora doesn’t have the financial backing of a bigger company. This forces it to rely more heavily on equity market access while its peers can rely on the deep pockets of a large partner for capital. This raises the risk of massive equity dilution to avoid running out of cash. Most recently, it issued equity at a 60% discount to the fair value estimates in May 2022.

Financial Strengths

Aurora’s financial health has been a lingering concern but is improving. At the end of its third quarter of fiscal 2022, the company had about CAD 334 million of convertible notes compared with a market capitalization of roughly CAD 700 million. The notes are due in 2024, so the company has some time. The company raised another $150 million in May 2022 by selling shares and warrants. The extra cash boosts financial health at a massive cost to existing shareholders. Aurora continues to generate cash losses. This is particularly concerning because the company has limited capital markets access and no major strategic partner backing it. However, since announcing its restructuring program, the company has significantly reduced its cash burn and positive EBITDA is nearing. Aurora’s access to debt markets is limited. Consequentially, the company has relied on equity offerings to fund its cash needs, leading to significant dilution for existing shareholders. In fact, shares roughly doubled from March 2020 to March 2021. Having sizable leverage while remaining unprofitable creates additional risk for Aurora. This creates a wide range of possible valuation outcomes for shares amid the significant risk of value destruction. With Aurora shares having fallen over the last several months along with the broader cannabis sector, any share issuances would be even more dilutive.

Bulls Say

Aurora has rationalized its production facilities and head count, significantly reducing its cash burn.

Cannabis cultivation is complicated, including challenging operational ramp-ups and optimization. Aurora’s strategic focus on its cultivation operations will help it achieve lower production costs than peers.

Aurora’s international exposure can deliver high margin sales to help its path to profitability.

Company Description

Aurora Cannabis, headquartered in Edmonton, Canada, cultivates and sells medicinal and recreational cannabis through a portfolio of brands that includes Aurora, CanniMed, Daily Special, MedReleaf, and San Rafael ’71. Although the company primarily operates in Canada, it has expanded internationally through medical cannabis exporting agreements or cultivation facilities in more than 20 countries.

(Source: Morningstar)
DISCLAIMER for General Advice: (This document is for general advice only).
This document is provided by Laverne Securities Pty Ltd T/as Laverne Investing. Laverne Securities Pty Ltd, CAR 001269781 of Laverne Capital Pty Ltd AFSL No. 482937.
The material in this document may contain general advice or recommendations which, while believed to be accurate at the time of publication, are not appropriate for all persons or accounts. This document does not purport to contain all the information that a prospective investor may require. The material contained in this document does not take into consideration an investor’s objectives, financial situation or needs. Before acting on the advice, investors should consider the appropriateness of the advice, having regard to the investor’s objectives, financial situation, and needs. The material contained in this document is for sales purposes. The material contained in this document is for information purposes only and is not an offer, solicitation or recommendation with respect to the subscription for, purchase or sale of securities or financial products and neither or anything in it shall form the basis of any contract or commitment. This document should not be regarded by recipients as a substitute for the exercise of their own judgment and recipients should seek independent advice.
The material in this document has been obtained from sources believed to be true but neither Laverne and Banyan Tree nor its associates make any recommendation or warranty concerning the accuracy or reliability or completeness of the information or the performance of the companies referred to in this document. Past performance is not indicative of future performance. Any opinions and or recommendations expressed in this material are subject to change without notice and, Laverne and Banyan Tree are not under any obligation to update or keep current the information contained herein. References made to third parties are based on information believed to be reliable but are not guaranteed as being accurate.
Laverne and Banyan Tree and its respective officers may have an interest in the securities or derivatives of any entities referred to in this material. Laverne and Banyan Tree do and seek to do business with companies that are the subject of its research reports. The analyst(s) hereby certify that all the views expressed in this report accurately reflect their personal views about the subject investment theme and/or company securities.
Although every attempt has been made to verify the accuracy of the information contained in the document, liability for any errors or omissions (except any statutory liability which cannot be excluded) is specifically excluded by Laverne and Banyan Tree, its associates, officers, directors, employees, and agents. Except for any liability which cannot be excluded, Laverne and Banyan Tree, its directors, employees and agents accept no liability or responsibility for any loss or damage of any kind, direct or indirect, arising out of the use of all or any part of this material. Recipients of this document agree in advance that Laverne and Banyan Tree are not liable to recipients in any matters whatsoever otherwise; recipients should disregard, destroy or delete this document. All information is correct at the time of publication. Laverne and Banyan Tree do not guarantee reliability and accuracy of the material contained in this document and are not liable for any unintentional errors in the document.
The securities of any company(ies) mentioned in this document may not be eligible for sale in all jurisdictions or to all categories of investors. This document is provided to the recipient only and is not to be distributed to third parties without the prior consent of Laverne and Banyan Tree.