Member FINRA / SIPC

Market Insights

February 2020

2018 2019 2018 vs. 2019Sector $ (MM) Volume (#) $ (MM) Volume (#) % Change ($) % Change (#)

Business Services $2,753.5 7 $10,450.5 3 279.5% (57.1%)Consumer 1,273.8 10 4,967.5 16 290.0% 60.0% Healthcare 8,013.9 68 12,057.6 65 50.5% (4.4%)Industrial / Manufacturing 2,174.5 6 606.3 2 (72.1%) (66.7%)Leisure & Entertainment 0.0 0 0.0 0 N/A N/A Technology / Media / Telecom 7,187.9 30 6,255.5 20 (13.0%) (33.3%)

Total IPO's $21,403.6 121 $34,337.4 106 60.4% (12.4%)

Follow-On Offerings 69,483.1 521 50,038.7 486 (28.0%) (6.7%)

Total Public Offerings $90,886.6 642 $84,376.1 592 (7.2%) (7.8%)

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

Feb-15 Feb-16 Feb-17 Feb-18 Feb-19 Feb-20

Fed Funds Target Rate LIBOR (3 Month) 10 Year Treasury Note

14.6x 14.6x

18.3x

14.6x 14.6x

18.3x

12.7x 13.1x

16.2x

0.0x

4.0x

8.0x

12.0x

16.0x

20.0x

DJIA S&P 500 NASDAQ

February-20 52-Week High 52-Week Average

(20.0%)

0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

Feb-15 Feb-16 Feb-17 Feb-18 Feb-19 Feb-20

Dow Jones Industrial Average (^DJI) S&P 500 (^SPX) NASDAQ (̂ COMP)

$615 $594 $557$669 $681

$743$829

$1,029

$1,197

$1,540

-

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600

$1,800

2010 2011 2012 2013 2014 2015 2016 2017 2018 Q2 2019

Capital Markets Overview

Member FINRA / SIPC

Public Market Index Performance (1) Public Index Valuation (TEV / EBITDA)

Interest Rates (1) Private Equity Dry Powder

IPO Activity by Select Sectors

Perc

enta

ge C

hang

e

TEV

/ EBI

TDA

Dry

Pow

der (

$ in

Bill

ions

)

Perc

enta

ge

Source: S&P CapitalIQ, Preqin, Pitchbook

Note:

1. Indexed relative to February 13, 2015.

1

2

February 2020 Summary

Member FINRA / SIPC

Capital Markets Overview Public Market Valuation by Select Sectors

On February 12, 2020, the S&P 500 Index closed at 3,379.45, 4.6% higher than the beginning of the year, and 16.0% higher than its average closing price throughout 2019.

The 10-year Treasury Note yield was 1.63% on February 12, 2020, 25 basis points lower than its yield of 1.88% at the beginning of 2020 and 51 basis points below its average closing yield of 2.14% in 2019.

The level of Dry Powder in private equity funds reported at the end of the second quarter of 2019 was $1.54 trillion, higher than the reported $1.2 trillion at the end of 2018 and $1.0 trillion at the end of 2017.

The Consumer, Healthcare and Technology / Media / Telecom sectors, as defined by Genesis Capital, traded at higher TEV / EBITDA multiples in February 2020(1) than at the end of 2019, and each traded at a higher TEV / EBITDA multiple than its average since the beginning of 2015.

The Business Services, Industrial / Manufacturing and Leisure & Entertainment sectors, as defined by Genesis Capital, traded at lower TEV / EBITDA multiples in February 2020 (1) than at the end of 2019.

U.S. M&A Market Overview U.S. M&A Valuation by Select Sectors

The median TEV / EBITDA multiple for U.S. M&A transactions(2) in 2019 was 10.9x, below the median of 11.5x and 12.1x for 2018 and 2017, respectively.

The value of M&A transactions completed in the U.S.(3) in 2019 was $1,320 billion, an increase of 43.0% from 2018. Further, the number of M&A transactions completed in the U.S. during 2019 increased by 4.6% from 2018.

Higher TEV / EBITDA valuation multiples were reported on average in 2019 versus 2018 for U.S. M&A transactions in the Business Services, Consumer and Industrial / Manufacturing sectors, as defined by Genesis Capital.

The volume of U.S. M&A transactions completed increased in 2019 versus 2018 for Business Services, Consumer, Industrial / Manufacturing, Leisure & Entertainment and Technology / Media / Telecom sectors, as defined by Genesis Capital.

Source: S&P CapitalIQ, Preqin, Pitchbook

Note:

1. February 2020 as of February 13, 2020.

2. Excludes real estate transactions; four quarter rolling median.

3. Excludes real estate transactions.

16.0x 15.9x 16.5x 16.5x 16.8x

0.0x

4.0x

8.0x

12.0x

16.0x

20.0x

11.2x 12.4x 12.3x 12.1x 11.7x

0.0x

4.0x

8.0x

12.0x

16.0x

20.0x

10.6x 11.7x 10.5x 11.3x 10.5x

0.0x

4.0x

8.0x

12.0x

16.0x

20.0x

14.1x 14.2x 15.0x 14.3x 14.9x

0.0x

4.0x

8.0x

12.0x

16.0x

20.0x

11.5x12.8x

11.3x 11.8x 12.2x

0.0x

4.0x

8.0x

12.0x

16.0x

20.0x

10.1x 10.4x 11.2x 11.7x10.1x

0.0x

4.0x

8.0x

12.0x

16.0x

20.0x

Public Market Valuation by Select Sectors

Member FINRA / SIPC

Business Services Consumer

Healthcare Industrial / ManufacturingTE

V / E

BITD

A

Source: S&P CapitalIQ, Preqin, Pitchbook

TEV

/ EBI

TDA

TEV

/ EBI

TDA

TEV

/ EBI

TDA

Leisure & Entertainment Technology / Media / Telecom

TEV

/ EBI

TDA

TEV

/ EBI

TDA

3

Note: Avg. Since 1/1/15 represents period from January 1, 2015 through February 13, 2020.

$734 $870

$601

$829

$1,287

$1,658

$1,443

$1,050 $923

$1,320

10,846

12,052 12,071 11,366

13,510 13,276

11,857 12,125

11,066 11,575

0

3000

6000

9000

12000

15000

-

$500

$1,000

$1,500

$2,000

$2,500

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

5.5x5.3x

6.3x5.7x

5.0x

0.0x

1.0x

2.0x

3.0x

4.0x

5.0x

6.0x

7.0x

2015 2016 2017 2018 2019

Overall U.S. M&A

10.0x10.5x

12.1x11.5x

10.9x

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

14.0x

2015 2016 2017 2018 2019

Overall U.S. M&A

TEV Range 2009 - 2018 Average 2018 2019 2018 vs. 2019

$1,000MM+ 154 137 180 31.4% $250-$1,000MM 324 279 311 11.5%

$25-$250MM 1,116 929 912 (1.8%) $0-$25MM 1,996 1,174 1,216 3.6%

Not Disclosed 8,002 8,547 8,956 4.8%

Total: 11,592 11,066 11,575 4.6%

U.S. M&A Market Overview

Member FINRA / SIPC

U.S. M&A Activity by Year (1)

U.S. M&A Deal Volume (# in Actuals) by Size

Source: S&P CapitalIQ, Preqin, Pitchbook

M&A Multiples (TEV / EBITDA) Leverage Multiples (Total Debt / EBITDA)

Note:

1. U.S. M&A Activity includes closed deals with U.S. targets only; excludes real estate transactions.

2. LTM as of December 31, 2019; four quarter rolling median.

Dea

l Val

ue ($

in B

illio

ns)

Deal Volum

e (# in Actuals)

4

$0-$25MM

$25-$250MM

$250-$1,000MM

$1,000MM+

Deal Count (#)

(2) (2)

9.7x 10.0x

7.4x

8.8x

11.1x

2,046

1,686 1,722 1,704

2,043

-

1,000

2,000

3,000

4,000

5,000

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

14.0x

16.0x

18.0x

2015 2016 2017 2018 2019

10.8x

9.6x

7.1x

10.0x

12.4x

1,878 1,717

1,575 1,508

1,936

-

1,000

2,000

3,000

4,000

5,000

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

14.0x

16.0x

18.0x

2015 2016 2017 2018 2019

12.7x

14.9x

12.4x13.1x 12.7x

1,366 1,278 1,251 1,163

975

-

1,000

2,000

3,000

4,000

5,000

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

14.0x

16.0x

18.0x

2015 2016 2017 2018 2019

8.0x

6.6x

8.1x9.2x 9.4x

1,385 1,342 1,330 1,383

1,450

-

1,000

2,000

3,000

4,000

5,000

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

14.0x

16.0x

18.0x

2015 2016 2017 2018 2019

9.3x 9.1x9.8x

11.1x 11.1x

465 360 356 340 387

-

1,000

2,000

3,000

4,000

5,000

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

14.0x

16.0x

18.0x

2015 2016 2017 2018 2019

13.7x

11.3x

16.0x16.9x

13.6x

2,004 1,808 1,836 1,866

1,919

-

1,000

2,000

3,000

4,000

5,000

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

14.0x

16.0x

18.0x

2015 2016 2017 2018 2019

U.S. M&A Valuation by Select Sectors

Member FINRA / SIPC

Business Services Consumer

Healthcare Industrial / ManufacturingTE

V / E

BITD

A

Source: S&P CapitalIQ, Preqin, Pitchbook

TEV

/ EBI

TDA

TEV

/ EBI

TDA

TEV

/ EBI

TDA

Leisure & Entertainment Technology / Media / Telecom

Deal Volum

e (# in Actuals)

Deal Volum

e (# in Actuals)

Deal Volum

e (# in Actuals)

Deal Volum

e (# in Actuals)

TEV

/ EBI

TDA

TEV

/ EBI

TDA

Deal Volum

e (# in Actuals)

Deal Volum

e (# in Actuals)

5

Note: Data for YTD through December 31 of each year.

Sell-side and Buy-side

Management Buyouts

Restructurings

Corporate Divestitures

Private Placements

Recapitalizations

Private investment in public equity (PIPE)

Employee stock ownership plans (ESOP)

Capital and Strategic Planning

Fairness and Valuation Opinions

Committee Representation

Mergers, Acquisitions & Sales

Capitalizations

Financial Advisory Services

Business Services

Consumer

Healthcare

Industrial / Manufacturing

Leisure & Entertainment

Technology / Media / Telecom

What Distinguishes Us

Successful Outcomes With Family Businesses Entrepreneur-Led Companies Public Corporations

Independent Platform No asset management, lending, research

or trading Multi-industry practice creates

diversification and prevents conflicts with same investors / buyers / sellers

Focus on “Need” vs. Size Clients range from under $50 million to

over $30 billion Transactions range from under $30

million to over $1 billion

Deep Knowledge and Experience With Various Transaction Types

Buy-Side Expertise Approximately 1/3 of our transactions

Corporate Divestitures Public Companies & Family Businesses

International & Cross-Border Transactions Executed numerous transactions on six

continents

Complex, “Storied” Transactions

EXPERTISE INDUSTRIES

An Independent Firm

Member FINRA / SIPC 6

Member FINRA / SIPC

Genesis Capital, LLC3414 Peachtree Road NESuite 700Atlanta, GA 30326

Tel: 404.816.7540Fax: 404.816.7553info@genesis-capital.com

Contact:

Disclosure:

The information contained in this report has been compiled from publicly available sources; it is not a research report 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 Genesis Capital to be reliable, but Genesis Capital makes no representation as to the accuracy or completeness of such information. Genesis Capital may act as advisers 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 services for those companies. In addition, Genesis Capital or their respective officers, directors and employees may hold positions in the securities, options thereon or other related financial products of companies discussed herein. This is provided as informational only and is not a solicitation for investment in any security whatsoever. Any investment by any investors must be made using their own investment decisions and criteria using their own independent financialadvisors. 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 Genesis Capital’s prior written consent. Sources of information include but are not limited to, Pitchbook, Preqin, and S&P Capital IQ.

Total Enterprise Value (TEV) — Equity Value (fully-diluted shares outstanding x current market share price) + market value of debt + minority interest - cash and equivalents.

TEV may include payments to seller(s) in cash or stock, the present value of notes or similar instruments, net long-term debt assumed by a buyer, and appropriate adjustments for other assets retained by a seller or liabilities assumed by a buyer.

Total Debt — Short-Term Debt (interest-bearing liabilities due in 12 months or less, including, but not limited to, short-term bank loans and lease payments) + Long-Term Debt (interest-bearing liabilities with a maturity date longer than 12 months, including, but not limited to, bonds, lease payments, term loans, revolving lines of credit, and notes payable).

EBITDA — Earnings Before Interest, Taxes, Depreciation, and Amortization. It is calculated as: Net Income + Interest + Taxes + Depreciation + Amortization

Dry Powder — Capital/funds raised by private equity firms that are available to be invested. Middle Market — Companies having Total Enterprise Values between $10 and $250 million. Middle Market Financial Sponsor — A Private Equity firm which invests in companies with Total Enterprise Values

between $10 and $250 million.

Definitions: