March 02, 2020Reservation Economic Summit 2020

Accessing Capital: Capitalizing Your Business or Tribal ProjectNative American Financial Services

©2018 KeyCorp. Confidential

Native American Financial Services - Overview

• Commercial Banking• Industry Expertise• Key Team• NAFS History and Focus• Types of Funding• Syndicated Financing• Key Government Finance– Tax Exempt Financing

• New Market Tax Credits• Public Sector• Things to Consider

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The Role of Commercial Banking

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Native American Financial Services ("NAFS") provides full commercial banking services that combine individual attention through Senior Bankers as well as tailored solutions provided by Industry Vertical Bankers and Product Specialists

• The Bellevue, Washington-based NAFS team will manage the relationship with your organization and commit to delivering customized solutions and strategic advice

• The goal is to develop meaningful long-term client relationships using a solutions-based, product agnostic approach to capital raising, advisory, and treasury needs

Corporate Banking

§ Integrated Team Approach

§ Geographically Focused

§ Industry Aligned

Loans Deposits & Treasury Management (ECP)

Advisory Services Investment Management

Institutional Banking

Loan Syndications Derivatives & ForeignExchange

Equity Capital Markets Equity Research

M&A / Fin Sponsors / Leveraged Finance

Investment Grade & High-Yield Debt

Commercial MortgageBanking Public Finance

KeyBanc Capital Market Capabilities

Native American

Energy

KeyBank Industry Specialists

Consumer

Healthcare

Industrial

Real Estate

Tribe

Deep Industry Expertise Paired with Best-In-Class Product Capabilities

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Capabilities

Debt Capital Markets

• Loan Syndications• High Yield• Leveraged Cash Flow

Financing• Asset-Based Lending

M&A

• Advisory Services• Buy-side M&A• Sell-side M&A• Private Capital Raise

Sales & Trading

• Institutional Equities• Investment Grade Debt• High Yield Debt• Foreign Exchange

Corporate Banking

• Commercial Lending• Treasury Management• Asset Based Lending• Derivatives• Foreign Exchange

• Equity Research• Securities Issuance• Equity Syndications• Focused Industry

Conferences

Equity Capital Markets

Dedicated Senior Banker Attention

Bulge Bracket Resources Focused on

Selected Sectors

Strategically Aligned in Industries Where We

Possess Deep Expertise

Disciplined Focus on Small & Mid Cap

Companies Through Economic Cycles

Longstanding Client Relationships Built

Upon Insightful Strategic Advice

Industrial

• Automotive• Building Products• CE&I• Industrial Distribution• Industrial Technology• Metals & Mining• Packaging• Specialty Chemicals• Transportation &

Logistics

Industry Specialists

Consumer

• Apparel & Footwear• Active & Outdoor /

Leisure• Food & Beverage• Gaming & Travel • Home Environment• Personal Care• Restaurants /

Foodservice• Specialty Retail

Energy

• Investor Owned Utilities• Public Power• Independent Power

Producers• Renewable Energy• Midstream• Oil & Gas• Clean Technology

Healthcare

• Facility Based Services• HCIT• Payer / Provider

Outsourcing• Pharmacy Services• Drug Development

Services• Managed Care• Distribution

Real Estate

• Multi-Family• Office• Industrial• Student Housing• Data Centers• Infrastructure• Self-storage• Hotels• Healthcare• Triple-Net

Native American

• Casino Gaming and Hospitality

• C-Store• Governmental

Infrastructure and Administration

• Natural Resources and Energy

• Agriculture• Non-gaming Economic

Development

Your Key Team

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Your dedicated Relationship Manager will: • Navigate the full breadth of Key’s expertise, insight, and strategic guidance to deliver the Bank to you• Present ideas and capabilities in an integrated way• Efficiently transfer knowledge among your dedicated teamWe are a team of experts working on behalf your Tribe, its Enterprises, and Members.

PaymentsRyan Bilsky• Manage your cash

SyndicationsKevin Brickman• Lead multi-investor transactions

Investment ManagementJeff Wortley• Manage and protect financial assets

Debt Capital MarketsGeoff Urbina• Taxable / Tax-exempt bond financing

DerivativesWil Spink• Manage interest rate risk

Key Government FinanceKendall Hansen• Tax exempt financing structures

Native American Financial ServicesManaging Director

Native American Financial ServicesMike Lettig, National Executive

Native American Financial ServicesDirector

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KeyBank Native American Financial Services

60+ yearsof business in Indian Country

70+ Native American Tribesserved across the U.S.

$2.0 Billioncredit commitments to Indian Country

$1.0 Billion deposits for Tribes and Tribal Entities

$2.0 Billion assets under management

Tribal Government & Public Finance

Casino Gaming & Hospitality

Non-Gaming Economic Development

Natural Resources & Energy

Tribal Sector FocusHistory and Overview

Native American Financial Services Clients Served (16 States)

Native American Financial Services Headquarters, Bellevue WAAdditional Presence, Ann Arbor, MI, Oklahoma City, OK, and Portland, OR

National Geographic Coverage

KeyBank Native American Financial Services

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Governmental Infrastructure and

Administration

Natural Resources and

Energy

Agriculture

RetailDevelopment

Economic Development

• Tax Exempt Credit• Tax Exempt Capital

Markets• Healthcare Finance• Construction

Finance

• Production Agriculture• Vertically Integrated

Agriculture• Crop Financing• Equipment Financing

• Acquisition Finance

• New Markets Tax Credits

• Leasing• TED Bond

Advisory

• Construction Finance• Tax Revenue Pledge• Renovation Financing• Operating Lines

• Independent Power Producers

• Public Power• Renewable Energy• Midstream• Oil & Gas

Casino Gamingand Hospitality

• Syndicated Credit• Construction and

Expansion• Equipment Leasing• Capital Markets and

Debt Restructuring

Syndicated Finance

• Consists of a nationwide practice of over 50 professionals

• Nationally recognized syndication practice providing origination, structuring, distribution, trading, and servicing of syndicated debt

• Professionals work with clients to structure marketable syndicated credit facilities by balancing client needs with market demands

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Best-in-class execution of syndicated transactions Select Senior Professionals

Select KBCM Agency Relationships

Strong support of our clients with meaningful event driven financing results in repeat lead arranger roles

Strong, consistent performance through loan market cycles

• Raised over $34.8 billion in capital commitments across 120 corporate, leveraged finance and real estate transactions in 1H17

• Raised over $79.9 billion in capital commitments across 226 corporate, leveraged finance and real estate transactions in 2016

• Raised over $60.9 billion in capital commitments across 208 corporate, leveraged finance and real estate transactions in 2015

Amy CarlsonExecutive Vice

President / Headof Debt Capital

Markets

• Head of Debt Capital Markets, Origination and Structuring

• 29+ years of experience in structuring and consummating multi-investor financing for both public and private companies in a multitude of industries

Beth MikesManaging Director / Head of Corporate

Syndications

• 25 years of experience in banking, financial analysis and project management experience

• Focused on loan origination, structuring and distribution for corporate clients in each of Key’s industry lines of business and middle market segments

Kevin BrickmanManaging Director

• 10+ years in the banking industry• Supports origination, structuring and distribution of loans

for public and private clients in a wide variety of industry sectors

John KernVice President

• 15+ years experience in public accounting, asset securitization, leveraged finance and corporate syndications

• Supports structuring and syndication of corporate and acquisition financings for public and private companies

Key Government Finance

• Road Construction• Qualified Tribal Economic Development Projects• Water and Utility Infrastructure• Tribal Government Buildings• Hospitals

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Tribal Government Infrastructure Projects Innovative Products and Structures

Balancing governmental budgets with capital project funding needs requires planning and goal setting. KeyBank’s Native American Financial Services, along with Key’s Government Finance team of specialists, have helped many Native American Nations achieve their goals by providing financing solution for government related projects.

• Tribal Economic Development (TED) Bonds• Tax and Utility Revenue Bonds• Balance-sheet Loans• Investment Secured Credit Facilities• General Obligation Tax Exempt Financing

Select Governmental Transactions Senior Professionals

Kendall HansenSenior Vice President

• Head of Debt Capital Markets, Origination and Structuring• 20+ years of experience in structuring and consummating multi-

investor financing for both public and private companies in a multitude of industries

Janice ThomanVice President

• Senior Loan Servicer• 20+ years of experience in servicing multi-investor financing for

both public and private companies in a multitude of industries

Tribal Economic Development Bond

Senior SecuredTaxable Financing

General Obligation Tax-exempt Financing

General Obligation Tax-exempt Financing

General Obligation Tax-exempt Financing

Joint Lead Arranger

General Obligation Tax-exempt Financing

General Obligation Tax-exempt Financing

Stillaguamish Tribe of Indians

$15,000,000Tribal AdministrationBuilding Construction

Stillaguamish Tribe of Indians

$7,000,000Tribal Natural Resources

Building Construction

Stillaguamish Tribe of Indians

$7,000,000Hotel and Golf Course

Refinance

Stillaguamish Tribe of Indians

$6,300,000Information Technology

Infrastructure

Muscogee Creek Nation

$86,000,000Hospital and Clinic

Construction

Navajo Nation

$60,000,000Judicial and Correctional Facilities Construction

Confederated Tribes of the Colville Reservation

$38,000,000Tribal AdministrationBuilding Construction

Match-e-be-nash-she-wishBand of PottawatomiIndians of Michigan

$20,000,000Tribal Government

Center Construction

Tax-exempt Financing for Native American Governmental Projects

• Tribes are treated similar to states and other municipalities for purposes of borrowing for their governmental projects

• Tribes can issue tax-exempt debt used in the “exercise of an essential government function

• Interest earnings on tax-exempt debt can be excluded from income, which results in decreased borrowing costs for the Nation

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Indian Tribal Government Tax Status Act of 1982 Key Government Finance

Tax-exempt financing structures allow Native American Tribes to borrow money at lower rates for essential government functions

Examples of Tax-exempt Qualified Projects

Characteristics of Tax-exempt Financing

• Lender/investor does not pay federal income tax on interest payments received from tribal issuer

• Lower interest rates for tribal issuer (typically 1-2%)• The proceeds must be used for “essential government

purposes” as defined by the IRS• Different investor pool than taxable debt• Tax exempt debt service can be paid for/secured by cash flow

from casino/resort or other “taxable” sources, but the proceeds from tax-exempt financings cannot be utilized for taxable purposes (must only be utilized for infrastructure)

Non-gaming Economic Development Tribal Government Buildings

Schools Hospitals

KeyCorp

Native American Financial Services

Key Government Finance, Inc.

• Taxable Financing• Deposit Accounts• Investment

Management and Trust

• Tax Exempt Financing• Tribal Economic

Development Bonds• Equipment Financing

New Market Tax Credits

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• New Market Tax Credits (“NMTCs”) provide tax credit incentives to investors for equity investments in certified Community Development Entities.

• Community Development Entities then invest in Qualified Active Low Income Community Business, which are entities formed for the qualifying project at hand.

• Recipients of NMTCs receive an equity investment alongside more traditional bank financing to fund the project.

• Capital does not need to be repaid to the NMTC investor. The NMTC funds essentially becomes the project’s own equity.

• This structure may provide significant cost savings, as the project does not repay the NMTC principal investment

Provides ~75% of capital needed for project

(Debt)

Provides ~25% of capital needed for project

(Equity) Investment Fund

Community Development Entity

Qualified Active Low Income Community

BusinessThe Project

Fees are paid to the CDE

Leverage Lender(KeyBank)

NMTC Investor

Public Sector – Debt Capital Markets

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Large Taxable & Tax-Exempt

Primary Market Fixed Income

Practice Group

Select Native American Financing and Investors

98 Person Sales & Trading Professionals

24 Professionals Dedicated to Tribal Tax-Exempt High Yield Distribution

covering over1,600 institutional investors

Underwriting Capabilities Broader Reach to Investors Product Offering

• Underwriting capabilities exceed $2.0 billion per offering

• Specialized coverage for Native American Tribes

• Multiple offices across the country: Atlanta, Boston, Charlotte, Chicago, Cleveland, New York City, San Francisco and Seattle

• Sales professionals service long-term Tier 1, Tier 2 and Tier 3 institutional accounts

650 Tax-Exempt Underwritings

Since 2010

980 Primary Market Fixed Income Transactions

Since 2010

$152.5 Billion $89.7 Billion

Sector Knowledge Deepest Account Relationships Debt Capital Markets Finance Team

• Direct Placements• Private Placements• Public Offerings• Tax-Exempt Syndicated Loans

Geoff Urbina Managing Director, Regional ManagerOffice: (206) 684-6259Email: geoff.urbina@key.com

Caitlin CaldwellVice PresidentOffice: (206) 684-6040Email: caitlin_caldwell@key.com

Odin AtkinsonAnalystOffice: (206) 684-6209Email: odin.atkinson@key.com

Additional Strength from Alignment with KBCM and ~$135B KeyCorp

1 of top 10 full-service firms by broker share; weighted by commission size of institution and each broker's relative importance to institutions on sector-by-sector bases; share shows each broker's share of total commissions based on buy-side analysts' broker vote

Things To Consider For Your Project

• 3 Years Historical Financials (Audited if available)– Government– Enterprise

• Most recent Interim Financial Statements • Projected Financials (5 years if possible)• Project Information

– Architecture /Building plans– Business Valuation– Capital Project Plans

• Market Studies• Waivers of Sovereign Immunity

– Required for most transactions

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Contact Info

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Allard TeepleVice President – Portfolio ManagerKeyBank Native American Financial Services425-709-4345allard_teeple@keybank.com

Website: https://www.key.com/businesses-institutions/industry-expertise/native-american.jsp