Description
Serial Acquirer Case Study Danaher Corporation
New York
One Penn Plaza, 36
th
Floor
New York, NY 10119
August 2010
Preliminary and subject to further review and change. See final page for important information about this document.
Copyright 2010 Fortuna Advisors LLC. All Rights Reserved.
Serial Acquirer Case Study:
Danaher Corporation
Copyright 2010 Fortuna Advisors LLC. All Rights Reserved.
Overview
• Despite the claim that acquisitions destroy value certain
companies excel as acquirers and deliver outstanding value
for shareholders.
• We studied the relationship between long term total
shareholder returns (TSR) and different acquisition strategies
and a variety of deal characteristics.
– The only trait that consistently has a strong positive
relationship with long term TSR across each industry is
acquisition frequency.
• We call them Serial Acquirers and many generate
outstanding results by being better at planning, executing
and integrating acquisitions than their peers.
• Danaher Corporation is one of the world’s best serial acquirers
2
Copyright 2010 Fortuna Advisors LLC. All Rights Reserved.
Danaher’s M&A Strategy Emphasizes Returns
• Even during the
downturn in 2008 and
2009 Danaher
delivered Cash Flow in
excess of the required
return on all capital
• This strategy creates
value for shareholders
and demonstrates the
benefits of
continuously
redeploying capital
into positive returns
0%
4%
8%
12%
16%
$0
$400
$800
$1,200
$1,600
1
9
9
6
1
9
9
7
1
9
9
8
1
9
9
9
2
0
0
0
2
0
0
1
2
0
0
2
2
0
0
3
2
0
0
4
2
0
0
5
2
0
0
6
2
0
0
7
2
0
0
8
2
0
0
9
Danaher's Fundamental Performance
Acquisition Residual Cash Earnings Acquisition Residual Cash Margin
3
Source: Fortuna Advisors Analytics, using CapitalIQ Data
Note: Acquisition Residual Cash Earnings (ARCE) is EBITDA + Rent + R&D Less Taxes Less Capital Charge Including Goodwill & Intangibles
Acquisitions Residual Cash Margin (ARCM) is ARCE as a % of Revenue
Copyright 2010 Fortuna Advisors LLC. All Rights Reserved.
Danaher Creates Value Through Superior Returns and
Growth
Source: Fortuna Advisors Analytics, using CapitalIQ Data
Note: Residual Cash Margin (RCM) is EBITDA + Rent + R&D Less Taxes Less Capital Charge (Acquisition RCM includes Goodwill and Intangibles in the Capital Charge
4
• Danaher’s M&A
strategy relies on
being able to operate
the target company in
a more efficient way
• The Company’s
Residual Cash Margin
(with and without
intangibles) has been
consistently positive
and relatively stable
• When a business is
run this efficiently,
growth is
tremendously
valuable
0%
5%
10%
15%
20%
25%
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Residual Cash Margin
Residual Cash Margin Acquistion Residual Cash Margin
-20%
0%
20%
40%
60%
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Revenue Growth
-200%
0%
200%
400%
600%
800%
1,000%
1,200%
1,400%
Danaher
S&P 500
S&P 500 Machinery
Pacific Scientific
Fluke Hach
American Precision
Kollmorgen
Maconi Data Systems
Radiometer
Sybron Dental
Kavo Dental
ChemTreat
Tektronix
MDS Analytical
Technologies
Molecular
Devices
Applied
Biosystems
Copyright 2010 Fortuna Advisors LLC. All Rights Reserved.
The Danaher Business System (DBS) Focuses
Management on the Relentless Pursuit of Efficiency
5
• DBS is a culture
where every
employee from CEO
to the shop floor is
responsible for
findings ways to
improve the way
work gets done
• Danaher has held
margins stable
despite the recent
downturn
• More remarkable is
the Company’s
ability to maintain
low levels of Asset
Intensity
Source: Fortuna Advisors Analytics, using CapitalIQ Data
Note: Gross Business Returns is Gross Cash Earnings (EBITDA + Rent + R&D Less Taxes) Divided by Gross Operating Assets (NWC, Gross PP&E, Capitalized Rent and R&D)
Asset Intensity is Gross Operating Assets Divided by Revenue
0%
10%
20%
30%
40%
50%
60%
70%
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Gross Business Return
Gross Business Return Acquisition Gross Business Return Required Return
0.0x
0.2x
0.4x
0.6x
0.8x
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Asset Intensity
0%
5%
10%
15%
20%
25%
30%
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
EBITDAR Margins
Copyright 2010 Fortuna Advisors LLC. All Rights Reserved.
Danaher Tends to Acquire Lagging Companies in
Attractive Sectors
6
Medical Technology: 27%
Young Innovations (YDNT), Schein Henry
(HSIC), Sybron Dental (SYD), Patterson
(PDCO), Dentsply (XRAY).
Electronic Test: 23%
Visual Networks (VNWK), Microtest
(MTST), Fluke (FLK), Mettler Toledo
(MTD), Ametek (AME), Fisher Scientific
(FSH), Roper Industries (ROP), Tektronix
(TEK).
Motion: 20%
Kollmorgen (KOL), Pacific Scientific
(PSX), American Precision (APR), Joslyn
(JOSL), Baldor Elect. (BEZ), Spectris
(SXS), Parker-Hannifin (PH), Rockwell
Automation (ROK).
Environmental: 15%
Ionics (ION), Pall Corp (PLL), Hach
(HACH), Lifschultz (LIFF), Esco Tech
(ESE), Cuno (CUNO), Pentair (PNR).
Sector Profitability and Competitive Landscape
Competitively
Disadvantaged
5%
10%
15%
20%
25%
30%
35%
0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%
L
F
Y
S
e
c
t
o
r
M
e
d
i
a
n
G
r
o
s
s
B
u
s
i
n
e
s
s
R
e
t
u
r
n
LFY Company Gross Business Return
Sector Median
S
X
S
R
O
P
F
S
H
P
D
C
O
S
Y
D
X
R
A
Y
H
S
I
C
Y
D
N
T
A
M
E
M
T
D
T
E
K
V
N
W
K
M
T
S
T
F
L
K
R
O
K
B
E
Z
P
H
J
O
S
L
P
S
X
A
P
R
K
O
L
E
S
E
P
N
R
L
I
F
F
P
L
L
I
O
N
C
U
N
O
H
A
C
H
Competitively
Advantaged
Source: Fortuna Advisors Analytics, using CapitalIQ data
Note: Danaher acquired Gendex from XRAY not the entire company
Copyright 2010 Fortuna Advisors LLC. All Rights Reserved.
Danaher’s Public Targets Tend to have Higher Gross
Margins, SG&A and most Notably Asset Intensity
7
Source: Fortuna Advisors Analytics, using CapitalIQ data
Danaher 2009 25% 48% 27% 0.54x 41% 3.68x 16%
Tektronix 2007 36% 60% 31% 1.56x 21% 1.12x 18%
Sybron Dental Specialties 2005 25% 56% 37% 0.81x 26% 3.63x 13%
Visual Networks 2004 28% 70% 48% 1.58x 18% 0.72x 12%
Lifschultz Industries 2000 18% 49% 34% 0.88x 22% 1.25x 11%
Kollmorgen Corporation 1999 12% 29% 22% 0.89x 14% 1.09x 3%
American Precision Industries 1998 14% 31% 22% 0.96x 12% 0.89x 3%
Hach Company 1998 26% 49% 28% 1.43x 14% 1.11x 7%
Fluke Corporation 1997 25% 54% 35% 1.39x 15% 0.72x 7%
Pacific Scientific Company 1996 13% 31% 22% 1.07x 12% 1.19x 2%
Acquired Target Median 25% 49% 31% 1.07x 15% 1.11x 7%
Gross Business
Return
Enterprise Value
to Gross Asset
Residual Cash
Margin Danaher Acquired Companies Time Period
EBITDARR
Margin
Gross
Margin
SG&A % of
Sales
Asset
Intensity
Danaher Peer Median 2009 18% 27% 20% 0.95x 19% 1.69x 8%
Danaher Peers includes Textron, Tyco, 3M, Ingersoll-Rand, Illinois Tool Works, Honeywell, and United Technologies
Copyright 2010 Fortuna Advisors LLC. All Rights Reserved.
Like an Astute Value Investor Danaher has Demonstrated
the Ability to Buy Companies Trading at a Discount
8
Source: Fortuna Advisors Analytics, using CapitalIQ data.
Note: “Long-Term Market Norm” based on the historical relationship between Gross Business Returns and Market Multiples for the 1,000 largest non-financial US Companies
0.0x
0.5x
1.0x
1.5x
2.0x
2.5x
3.0x
3.5x
4.0x
4.5x
5.0x
0% 5% 10% 15% 20% 25% 30% 35% 40%
E
n
t
e
r
p
r
i
s
e
V
a
l
u
e
t
o
G
r
o
s
s
A
s
s
e
t
s
Gross Business Return
Tektronix
Lifschultz
Visual
Networks Fluke
Hach
Kollmorgen
Pacific
Scientific
American
Precision Microtest
Joslyn
Sybron
Dental
“Long term market
norm”
Post –Transaction Announcement
Pre–Transaction Announcement
Danaher
Percent of Targets at a Discount
Pre-Announcement
91%
Median Target Premium/Discount
Pre-Announcement
-40%
Median Target Premium/Discount
Post-Announcement
-21%
Copyright 2010 Fortuna Advisors LLC. All Rights Reserved.
Appendix
Copyright 2010 Fortuna Advisors LLC. All Rights Reserved.
Fortuna Advisors Partners
Experts in Strategy, Finance and Value Management
Gregory V. Milano
Managing Partner, Founder & CEO
• 25 years of experience including 17 years in value based management as
Partner and President of Stern Stewart & Co., and Managing Director and Co-
Head of the Strategic Finance Group at Credit Suisse
• Industry thought leader and advisor to senior executives on business and
financial strategies designed to increase share prices, financial management
processes to support value based strategies and a strong focus on behavioral
economics to align the interests of managers with those of shareholders.
John R. Cryan
Partner & Co-Founder
• 10 years of experience including value management at Credit Suisse and
Accenture
• Extensive experience in Enterprise Performance Management, developing and
implementing value-based strategies into financial management and decision
making processes
Steven C. Treadwell
Partner
• 15 years of experience including 9+ years of value management experience at
HOLT and Credit Suisse
• Extensive work with some of the largest companies in the retail, consumer
products and industrial sectors incorporating shareholder insights into the client’s
strategic decision process
10
Copyright 2010 Fortuna Advisors LLC. All Rights Reserved.
Focus and Discipline of Postmodern Corporate Finance
11
Diagnostic
A View from the
Investors’ Shoes
Internal Capitalism
Audit
Process Enhancement
Capital Allocation
Approvals
Budgeting and
Forecasting
Performance
Measures & Key
Value Drivers
Value Based
Strategic Planning
Incentives to
Simulate
Ownership
Training &
Development
Strategic Advice
Capital Deployment
Strategy
Business
Unit/Portfolio
Evaluation
Strategic M&A
Planning &
Valuation
Strategic Plan
Evaluation
Strategy Alignment
Investor
Communication &
Targeting
These materials have been provided to you by Fortuna Advisors LLC in connection with an actual or potential mandate
or engagement and may not be used or relied upon for any purpose other than as specifically contemplated by a
written agreement with Fortuna Advisors LLC. In addition, these materials may not be disclosed, in whole or in part, or
summarized or otherwise referred to except as agreed in writing by Fortuna Advisors LLC. The information used in
preparing these materials was obtained from or through you or your representatives or from public sources. Fortuna
Advisors LLC assumes no responsibility for independent verification of such information and has relied on such information
being complete and accurate in all material respects. To the extent such information includes estimates and forecasts of
future financial performance (including estimates of potential cost savings and synergies) prepared by or reviewed or
discussed with the managements of your company and/or other potential transaction participants or obtained from
public sources, we have assumed that such estimates and forecasts have been reasonably prepared on bases reflecting
the best currently available estimates and judgments of such managements (or, with respect to estimates and forecasts
obtained from public sources, represent reasonable estimates). These materials were designed for use by specific
persons familiar with the business and the affairs of your company and Fortuna Advisors LLC assumes no obligation to
update or otherwise revise these materials. Nothing contained herein should be construed as tax, accounting or legal
advice. You (and each of your employees, representatives or other agents) may disclose to any and all persons, without
limitation of any kind, the tax treatment and tax structure of the transactions contemplated by these materials and all
materials of any kind (including opinions or other tax analyses) that are provided to you relating to such tax treatment
and structure. For this purpose, the tax treatment of a transaction is the purported or claimed U.S. federal income tax
treatment of the transaction and the tax structure of a transaction is any fact that may be relevant to understanding the
purported or claimed U.S. federal income tax treatment of the transaction.
Copyright 2010 Fortuna Advisors LLC. All Rights Reserved.
doc_345562179.pdf
Serial Acquirer Case Study Danaher Corporation
New York
One Penn Plaza, 36
th
Floor
New York, NY 10119
August 2010
Preliminary and subject to further review and change. See final page for important information about this document.
Copyright 2010 Fortuna Advisors LLC. All Rights Reserved.
Serial Acquirer Case Study:
Danaher Corporation
Copyright 2010 Fortuna Advisors LLC. All Rights Reserved.
Overview
• Despite the claim that acquisitions destroy value certain
companies excel as acquirers and deliver outstanding value
for shareholders.
• We studied the relationship between long term total
shareholder returns (TSR) and different acquisition strategies
and a variety of deal characteristics.
– The only trait that consistently has a strong positive
relationship with long term TSR across each industry is
acquisition frequency.
• We call them Serial Acquirers and many generate
outstanding results by being better at planning, executing
and integrating acquisitions than their peers.
• Danaher Corporation is one of the world’s best serial acquirers
2
Copyright 2010 Fortuna Advisors LLC. All Rights Reserved.
Danaher’s M&A Strategy Emphasizes Returns
• Even during the
downturn in 2008 and
2009 Danaher
delivered Cash Flow in
excess of the required
return on all capital
• This strategy creates
value for shareholders
and demonstrates the
benefits of
continuously
redeploying capital
into positive returns
0%
4%
8%
12%
16%
$0
$400
$800
$1,200
$1,600
1
9
9
6
1
9
9
7
1
9
9
8
1
9
9
9
2
0
0
0
2
0
0
1
2
0
0
2
2
0
0
3
2
0
0
4
2
0
0
5
2
0
0
6
2
0
0
7
2
0
0
8
2
0
0
9
Danaher's Fundamental Performance
Acquisition Residual Cash Earnings Acquisition Residual Cash Margin
3
Source: Fortuna Advisors Analytics, using CapitalIQ Data
Note: Acquisition Residual Cash Earnings (ARCE) is EBITDA + Rent + R&D Less Taxes Less Capital Charge Including Goodwill & Intangibles
Acquisitions Residual Cash Margin (ARCM) is ARCE as a % of Revenue
Copyright 2010 Fortuna Advisors LLC. All Rights Reserved.
Danaher Creates Value Through Superior Returns and
Growth
Source: Fortuna Advisors Analytics, using CapitalIQ Data
Note: Residual Cash Margin (RCM) is EBITDA + Rent + R&D Less Taxes Less Capital Charge (Acquisition RCM includes Goodwill and Intangibles in the Capital Charge
4
• Danaher’s M&A
strategy relies on
being able to operate
the target company in
a more efficient way
• The Company’s
Residual Cash Margin
(with and without
intangibles) has been
consistently positive
and relatively stable
• When a business is
run this efficiently,
growth is
tremendously
valuable
0%
5%
10%
15%
20%
25%
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Residual Cash Margin
Residual Cash Margin Acquistion Residual Cash Margin
-20%
0%
20%
40%
60%
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Revenue Growth
-200%
0%
200%
400%
600%
800%
1,000%
1,200%
1,400%
Danaher
S&P 500
S&P 500 Machinery
Pacific Scientific
Fluke Hach
American Precision
Kollmorgen
Maconi Data Systems
Radiometer
Sybron Dental
Kavo Dental
ChemTreat
Tektronix
MDS Analytical
Technologies
Molecular
Devices
Applied
Biosystems
Copyright 2010 Fortuna Advisors LLC. All Rights Reserved.
The Danaher Business System (DBS) Focuses
Management on the Relentless Pursuit of Efficiency
5
• DBS is a culture
where every
employee from CEO
to the shop floor is
responsible for
findings ways to
improve the way
work gets done
• Danaher has held
margins stable
despite the recent
downturn
• More remarkable is
the Company’s
ability to maintain
low levels of Asset
Intensity
Source: Fortuna Advisors Analytics, using CapitalIQ Data
Note: Gross Business Returns is Gross Cash Earnings (EBITDA + Rent + R&D Less Taxes) Divided by Gross Operating Assets (NWC, Gross PP&E, Capitalized Rent and R&D)
Asset Intensity is Gross Operating Assets Divided by Revenue
0%
10%
20%
30%
40%
50%
60%
70%
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Gross Business Return
Gross Business Return Acquisition Gross Business Return Required Return
0.0x
0.2x
0.4x
0.6x
0.8x
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Asset Intensity
0%
5%
10%
15%
20%
25%
30%
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
EBITDAR Margins
Copyright 2010 Fortuna Advisors LLC. All Rights Reserved.
Danaher Tends to Acquire Lagging Companies in
Attractive Sectors
6
Medical Technology: 27%
Young Innovations (YDNT), Schein Henry
(HSIC), Sybron Dental (SYD), Patterson
(PDCO), Dentsply (XRAY).
Electronic Test: 23%
Visual Networks (VNWK), Microtest
(MTST), Fluke (FLK), Mettler Toledo
(MTD), Ametek (AME), Fisher Scientific
(FSH), Roper Industries (ROP), Tektronix
(TEK).
Motion: 20%
Kollmorgen (KOL), Pacific Scientific
(PSX), American Precision (APR), Joslyn
(JOSL), Baldor Elect. (BEZ), Spectris
(SXS), Parker-Hannifin (PH), Rockwell
Automation (ROK).
Environmental: 15%
Ionics (ION), Pall Corp (PLL), Hach
(HACH), Lifschultz (LIFF), Esco Tech
(ESE), Cuno (CUNO), Pentair (PNR).
Sector Profitability and Competitive Landscape
Competitively
Disadvantaged
5%
10%
15%
20%
25%
30%
35%
0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%
L
F
Y
S
e
c
t
o
r
M
e
d
i
a
n
G
r
o
s
s
B
u
s
i
n
e
s
s
R
e
t
u
r
n
LFY Company Gross Business Return
Sector Median
S
X
S
R
O
P
F
S
H
P
D
C
O
S
Y
D
X
R
A
Y
H
S
I
C
Y
D
N
T
A
M
E
M
T
D
T
E
K
V
N
W
K
M
T
S
T
F
L
K
R
O
K
B
E
Z
P
H
J
O
S
L
P
S
X
A
P
R
K
O
L
E
S
E
P
N
R
L
I
F
F
P
L
L
I
O
N
C
U
N
O
H
A
C
H
Competitively
Advantaged
Source: Fortuna Advisors Analytics, using CapitalIQ data
Note: Danaher acquired Gendex from XRAY not the entire company
Copyright 2010 Fortuna Advisors LLC. All Rights Reserved.
Danaher’s Public Targets Tend to have Higher Gross
Margins, SG&A and most Notably Asset Intensity
7
Source: Fortuna Advisors Analytics, using CapitalIQ data
Danaher 2009 25% 48% 27% 0.54x 41% 3.68x 16%
Tektronix 2007 36% 60% 31% 1.56x 21% 1.12x 18%
Sybron Dental Specialties 2005 25% 56% 37% 0.81x 26% 3.63x 13%
Visual Networks 2004 28% 70% 48% 1.58x 18% 0.72x 12%
Lifschultz Industries 2000 18% 49% 34% 0.88x 22% 1.25x 11%
Kollmorgen Corporation 1999 12% 29% 22% 0.89x 14% 1.09x 3%
American Precision Industries 1998 14% 31% 22% 0.96x 12% 0.89x 3%
Hach Company 1998 26% 49% 28% 1.43x 14% 1.11x 7%
Fluke Corporation 1997 25% 54% 35% 1.39x 15% 0.72x 7%
Pacific Scientific Company 1996 13% 31% 22% 1.07x 12% 1.19x 2%
Acquired Target Median 25% 49% 31% 1.07x 15% 1.11x 7%
Gross Business
Return
Enterprise Value
to Gross Asset
Residual Cash
Margin Danaher Acquired Companies Time Period
EBITDARR
Margin
Gross
Margin
SG&A % of
Sales
Asset
Intensity
Danaher Peer Median 2009 18% 27% 20% 0.95x 19% 1.69x 8%
Danaher Peers includes Textron, Tyco, 3M, Ingersoll-Rand, Illinois Tool Works, Honeywell, and United Technologies
Copyright 2010 Fortuna Advisors LLC. All Rights Reserved.
Like an Astute Value Investor Danaher has Demonstrated
the Ability to Buy Companies Trading at a Discount
8
Source: Fortuna Advisors Analytics, using CapitalIQ data.
Note: “Long-Term Market Norm” based on the historical relationship between Gross Business Returns and Market Multiples for the 1,000 largest non-financial US Companies
0.0x
0.5x
1.0x
1.5x
2.0x
2.5x
3.0x
3.5x
4.0x
4.5x
5.0x
0% 5% 10% 15% 20% 25% 30% 35% 40%
E
n
t
e
r
p
r
i
s
e
V
a
l
u
e
t
o
G
r
o
s
s
A
s
s
e
t
s
Gross Business Return
Tektronix
Lifschultz
Visual
Networks Fluke
Hach
Kollmorgen
Pacific
Scientific
American
Precision Microtest
Joslyn
Sybron
Dental
“Long term market
norm”
Post –Transaction Announcement
Pre–Transaction Announcement
Danaher
Percent of Targets at a Discount
Pre-Announcement
91%
Median Target Premium/Discount
Pre-Announcement
-40%
Median Target Premium/Discount
Post-Announcement
-21%
Copyright 2010 Fortuna Advisors LLC. All Rights Reserved.
Appendix
Copyright 2010 Fortuna Advisors LLC. All Rights Reserved.
Fortuna Advisors Partners
Experts in Strategy, Finance and Value Management
Gregory V. Milano
Managing Partner, Founder & CEO
• 25 years of experience including 17 years in value based management as
Partner and President of Stern Stewart & Co., and Managing Director and Co-
Head of the Strategic Finance Group at Credit Suisse
• Industry thought leader and advisor to senior executives on business and
financial strategies designed to increase share prices, financial management
processes to support value based strategies and a strong focus on behavioral
economics to align the interests of managers with those of shareholders.
John R. Cryan
Partner & Co-Founder
• 10 years of experience including value management at Credit Suisse and
Accenture
• Extensive experience in Enterprise Performance Management, developing and
implementing value-based strategies into financial management and decision
making processes
Steven C. Treadwell
Partner
• 15 years of experience including 9+ years of value management experience at
HOLT and Credit Suisse
• Extensive work with some of the largest companies in the retail, consumer
products and industrial sectors incorporating shareholder insights into the client’s
strategic decision process
10
Copyright 2010 Fortuna Advisors LLC. All Rights Reserved.
Focus and Discipline of Postmodern Corporate Finance
11
Diagnostic
A View from the
Investors’ Shoes
Internal Capitalism
Audit
Process Enhancement
Capital Allocation
Approvals
Budgeting and
Forecasting
Performance
Measures & Key
Value Drivers
Value Based
Strategic Planning
Incentives to
Simulate
Ownership
Training &
Development
Strategic Advice
Capital Deployment
Strategy
Business
Unit/Portfolio
Evaluation
Strategic M&A
Planning &
Valuation
Strategic Plan
Evaluation
Strategy Alignment
Investor
Communication &
Targeting
These materials have been provided to you by Fortuna Advisors LLC in connection with an actual or potential mandate
or engagement and may not be used or relied upon for any purpose other than as specifically contemplated by a
written agreement with Fortuna Advisors LLC. In addition, these materials may not be disclosed, in whole or in part, or
summarized or otherwise referred to except as agreed in writing by Fortuna Advisors LLC. The information used in
preparing these materials was obtained from or through you or your representatives or from public sources. Fortuna
Advisors LLC assumes no responsibility for independent verification of such information and has relied on such information
being complete and accurate in all material respects. To the extent such information includes estimates and forecasts of
future financial performance (including estimates of potential cost savings and synergies) prepared by or reviewed or
discussed with the managements of your company and/or other potential transaction participants or obtained from
public sources, we have assumed that such estimates and forecasts have been reasonably prepared on bases reflecting
the best currently available estimates and judgments of such managements (or, with respect to estimates and forecasts
obtained from public sources, represent reasonable estimates). These materials were designed for use by specific
persons familiar with the business and the affairs of your company and Fortuna Advisors LLC assumes no obligation to
update or otherwise revise these materials. Nothing contained herein should be construed as tax, accounting or legal
advice. You (and each of your employees, representatives or other agents) may disclose to any and all persons, without
limitation of any kind, the tax treatment and tax structure of the transactions contemplated by these materials and all
materials of any kind (including opinions or other tax analyses) that are provided to you relating to such tax treatment
and structure. For this purpose, the tax treatment of a transaction is the purported or claimed U.S. federal income tax
treatment of the transaction and the tax structure of a transaction is any fact that may be relevant to understanding the
purported or claimed U.S. federal income tax treatment of the transaction.
Copyright 2010 Fortuna Advisors LLC. All Rights Reserved.
doc_345562179.pdf