September 24, 2020

Working Capital Management: Why the pandemic has made it more

important than ever

Notice to RecipientConfidential

“Bank of America” and “BofA Securities” are the marketing names used by the Global Banking and Global Markets divisions of Bank of America Corporation. Lending, other commercial banking activities, and trading in certain financialinstruments are performed globally by banking affiliates of Bank of America Corporation, including Bank of America, N.A., Member FDIC. Equal Housing Lender . Trading in securities and financial instruments, and strategic advisory,and other investment banking activities, are performed globally by investment banking affiliates of Bank of America Corporation (“Investment Banking Affiliates”), including, in the United States, BofA Securities, Inc. and Merrill LynchProfessional Clearing Corp., both of which are registered broker-dealers and Members of SIPC, and, in other jurisdictions, by locally registered entities.BofA Securities, Inc. and Merrill Lynch Professional Clearing Corp. are registered as futures commission merchants with the CFTC and are members of the NFA.

Investment products offered by Investment Banking Affiliates: Are Not FDIC Insured * May Lose Value * Are Not Bank Guaranteed.

These materials have been prepared by one or more subsidiaries of Bank of America Corporation for the client or potential client to whom such materials are directly addressed and delivered (the “Company”) in connection with anactual 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 us. These materials are based on information provided by or onbehalf of the Company and/or other potential transaction participants, from public sources or otherwise reviewed by us. We assume no responsibility for independent investigation or verification of such information (including,without limitation, data from third party suppliers) and have relied on such information being complete and accurate in all material respects. To the extent such information includes estimates and forecasts of future financialperformance prepared by or reviewed with the managements of the Company and/or other potential transaction participants or obtained from public sources, we have assumed that such estimates and forecasts have beenreasonably 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). Norepresentation or warranty, express or implied, is made as to the accuracy or completeness of such information and nothing contained herein is, or shall be relied upon as, a representation, whether as to the past, the present or thefuture. These materials were designed for use by specific persons familiar with the business and affairs of the Company and are being furnished and should be considered only in connection with other information, oral or written,being provided by us in connection herewith. These materials are not intended to provide the sole basis for evaluating, and should not be considered a recommendation with respect to, any transaction or other matter. Thesematerials do not constitute an offer or solicitation to sell or purchase any securities and are not a commitment by Bank of America Corporation or any of its affiliates to provide or arrange any financing for any transaction or topurchase any security in connection therewith. These materials are for discussion purposes only and are subject to our review and assessment from a legal, compliance, accounting policy and risk perspective, as appropriate, followingour discussion with the Company. We assume no obligation to update or otherwise revise these materials. These materials have not been prepared with a view toward public disclosure under applicable securities laws or otherwise,are intended for the benefit and use of the Company, and may not be reproduced, disseminated, quoted or referred to, in whole or in part, without our prior written consent. These materials may not reflect information known toother professionals in other business areas of Bank of America Corporation and its affiliates.

Bank of America Corporation and its affiliates (collectively, the “BAC Group”) comprise a full service securities firm and commercial bank engaged in securities, commodities and derivatives trading, foreign exchange and otherbrokerage activities, and principal investing as well as providing investment, corporate and private banking, asset and investment management, financing and strategic advisory services and other commercial services and products toa wide range of corporations, governments and individuals, domestically and offshore, from which conflicting interests or duties, or a perception thereof, may arise. In the ordinary course of these activities, parts of the BAC Group atany time may invest on a principal basis or manage funds that invest, make or hold long or short positions, finance positions or trade or otherwise effect transactions, for their own accounts or the accounts of customers, in debt,equity or other securities or financial instruments (including derivatives, bank loans or other obligations) of the Company, potential counterparties or any other company that may be involved in a transaction. Products and servicesthat may be referenced in the accompanying materials may be provided through one or more affiliates of Bank of America Corporation. We have adopted policies and guidelines designed to preserve the independence of ourresearch analysts. These policies prohibit employees from offering research coverage, a favorable research rating or a specific price target or offering to change a research rating or price target as consideration for or an inducement toobtain business or other compensation. We are required to obtain, verify and record certain information that identifies the Company, which information includes the name and address of the Company and other information that willallow us to identify the Company in accordance, as applicable, with the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) and such other laws, rules and regulations as applicable within and outside theUnited States.

We do not provide legal, compliance, tax or accounting advice. If any person uses or refers to any such tax statement in promoting, marketing or recommending a partnership or other entity, investment plan or arrangement to anytaxpayer, then the statement expressed herein is being delivered to support the promotion or marketing of the transaction or matter addressed and the recipient should seek advice based on its particular circumstances from anindependent tax advisor. Notwithstanding anything that may appear herein or in other materials to the contrary, the Company shall be permitted to disclose the tax treatment and tax structure of a transaction (including anymaterials, opinions or analyses relating to such tax treatment or tax structure, but without disclosure of identifying information or any nonpublic commercial or financial information (except to the extent any such information relatesto the tax structure or tax treatment)) on and after the earliest to occur of the date of (i) public announcement of discussions relating to such transaction, (ii) public announcement of such transaction or (iii) execution of a definitiveagreement (with or without conditions) to enter into such transaction; provided, however, that if such transaction is not consummated for any reason, the provisions of this sentence shall cease to apply.

©2020 Bank of America Corporation. All rights reserved. 07/2020

3

Introductions

Vlada Karalnik, CFADirector, Treasury & InvestmentsAAA Northern California, Nevada & UtahWalnut Creek, California

Vlada Karalnik is the Director of Treasury & Investments at AAA Northern California, Nevada and Utah. Vlada has been with AAA NCNU for 2.5 years, in both Mergers & Acquisitions and Corporate Strategy roles. Prior to AAA NCNU, Vlada was a consultant at MSCI Inc. and Moody's Analytics. Vlada graduated from UC Berkeley with degrees in Economics and Business Administration from the Walter A. Haas School of Business. Vlada is a CFA® charter holder.

Michael DiekmannDirector, Working Capital Advisor, Global Commercial Bank West RegionBank of AmericaLos Angeles, California

Michael Diekmann is a Director at Bank of America Merrill Lynch, for the past 8 years as the West Region Working Capital Advisor for Bank of America Global Commercial Bank. Michael has been with Bank of America throughout his 31 year career, the first 23 years with Global Treasury Solutions for the Global Corporate & Investment Bank. Michael graduated from UCLA.

Working Capital Cash Conversion Cycle Its all about cash flow!

4

CASH(Liquidity)

PROCUREMENTAccounts Payables

Cash Outflow

INVENTORYResources into Finished Goods

SALESAccounts Receivable

Cash Inflow

Days Payable Outstanding (DPO)

Cash Conversion Cycle

Days Inventory Outstanding (DIO)

Days Sales Outstanding (DSO)

CCC = Receivables (DSO) + Inventory days (DIO) – Payables (DPO)

Ord

er

to C

ash

Pro

cure

to P

ay

Working Capital Considerations & Best PracticesEvaluate all aspects of the entire cash conversion cycle

5

• Evaluate the entire CCC do not look at DSO or DPO

in a vacuum

• Procure to Pay

• Order to Cash

• Measure, develop KPIs, benchmark and goal

setting

• Holistic solutions; internal improvements, bank

partner solutions, 3rd party solutions

• Include all stakeholders, seek input and hold

accountable

• Senior level buy in and support

• Celebrate and reward success

• Pursue best in class and best practices, don’t

settle for simply improving

The AAA Way6

Membership Insurance

AAA Smart Home GIG

7

AAA Services

MWG is 6th in Insurance market share for states in our footprint8

Key Performance Metric

2015 2016* 2017 2018 2019

Membership (millions)

4.3 5.6 5.8 6.0 6.1

Revenue (millions)

$648 $816 $873 $937 $1,035

Team Members

2,835 3,873 3,957 4,092 4,690

MWG has increased revenue 60% in four years9

*Merger period with Arizona and Mountain West (Alaska, Montana, Wyoming

Innovation10

• Teams across the organization may be working in siloes with conflicting objectives.

• Manual working capital optimization and payment processes make it challenging to achieve value.

• Even the best working capital program will fail to deliver value if suppliers do not adopt our processes and systems.

• Align processes and goals to get the most value out of working capital and payment programs.

• Digitize these processes to make it easy to run a modern working capital program

• Make driving supplier adoption a key goal of our working capital programs. Use KPIs and peer benchmarks to monitor adoption and operational efficiency, and drive ongoing improvements.

Challenge Transformation

11

AAA Treasury operating model

Area Initiative

Procurement Standardize payment terms acrosssupplier negotiations and contracts to make it easier to manage DPO

Accounts Payable Accelerate liquidity to suppliers by expanding the Virtual Card program

Accounts Receivable Implement e-billing solution to ensure receivables are paid on a timely basis

Cash Forecasting Improve granularity and accuracy of cash forecast by beta-testing bank’s AI-enhanced platform

AAA Treasury Initiatives12

“Value-oriented” instead of “process-oriented”

Metrics that show the C-suite what your department can bring to the table• cash and liquidity management• funding management• risk management

Selection process should reflect organization structure and stakeholder priorities

KPIs should be relevant and effective for the industry and for the specific company’s condition

Treasury KPIs – Measure What Matters13

Transforming Treasury

Transactional“Transaction Processor”

• Payment Execution• Interco Cash Movements• FX Purchases/Sales• Bank Acct Management

Advisory“Data Analytics Provider”

• Spend Analysis• Investment Options Analysis• Risk Management Advice• Policy Management

Strategic

“Forward Looking Strategist”

• Cap Structure Planning• Interest Optimization• Acquisitions/Divestitures• Supply Chain Finance

Transform the Treasury Organization from Transactional to Strategic

Impact of the PandemicFriday March 13th 2020 …the day it all changed

15

• Supply Chain Disruption - Treasury

• Cash Flow

• Counterparty Risk

• Supplier & Customer Survival

• Work From Home - connectivity

• Bank Client Requests

• What Paper?

• ERPs and the Digital shift

• Company shift on payables and

receivables

• Bank Solutions Shift and

Development Acceleration

Cash Flow – Real Impact & Real ValueSample Company, L.A. Widgets

16

Company: L.A. WidgetsSales: $500MMCOGS: $375MMCost of Capital: 8.50%

Days Sales Outstanding: 40 daysDays Inventory Outstanding: 60 DaysDays Payables Outstanding: 40 daysCash Conversion Cycle: 60 Days

Improvement Cash Flow Impact Cash Value

Annualized Annualized WACC 8.50%

DSO 1 Day $1,369,863 $116,438

DIO 1 Day $1,027,397 $87,328

DPO 1 Day $1,027,397 $87,328

CCC 3 Days $3,424,657 $291,094

Improvement Cash Flow Impact Cash Value

Annualized Annualized WACC 8.50%

DSO 8 Days $10,958,900 $931,507

DIO 10 Days $10,273,970 $873,287

DPO 12 Days $12,328,770 $1,047,945

CCC 30 Days $33,561,640 $2,852,739

It Takes a VillageNo Silver Bullet, Enterprise Wide Effort

17

o Process improvement

o Reduced resource time

o Reduced cost

o Improved cash flow

o Improved DSO/DPO

o Profit center vs. cost center

o Planningo Internal

education/awareness

o System capabilitieso Payment typeso A/P process &

termso A/R process &

termso Visibilityo Resource time

o Comprehensive payables

o Comprehensive receivables

o Supplier/Receivables financing alternatives

o Liquidity structures

o Reconciliation/cash application

o Advanced reporting& analytics

o Leverage ERP

o Create awareness

o Identify key stakeholders

o Establish KPIs and accountability

o Implement comprehensive integrated solutions

o Requires senior leadership support and buy in

o Continued improvement

OptimizedWorkingCapitalManagementApproach

These steps are instrumental for driving rapid improvement and continued satisfaction

Identify Potential Solutions

Support Holistic Approach

Identify Your Objectives

Success

Understand Your Challenges1

2

3

4

Delivering results through better working capital management…