Executive and Insider Perspective Donald N. Gray  DeLaval International AB (Tetra Laval AB)  Diversey Corporation (The Molson Companies Limited)  ExxonMobile Chemical Co. (ExxonMobile Corporation)  Director, Montreal Canadiens

Factors for International Companies Coming to the USA  Cost structure is key  Raw materials / natural resources drive analysis, not proximity to market  DeLaval International AB: Swedish company, world leader in the milking industry  Choose US for location of largest, state of the art pharmaceutical plant (Des Plaines, IL) because of availability of certified suppliers of critical chemicals  Removing question of quality in raw materials allowed DeLaval focus on production efficiencies, thereby increasing production  Eliminated iodine-based products provided by third parties, would have been unable to do so with lower cost nations due to unreliability local vendors

Factors for International Companies Coming to the USA  Domestic surplus of Natural Gas and Crude Oil supply is very attractive to companies which rely either/both for end product production  Ex. BMW investing in South Carolina factory to make it their largest in the world from which it will export over 70%  Lower cost of materials and non-unionized labor force drove the analysis  China is world’s largest consumer of coal; heavily used as source of energy for manufacturing  Global impact of burning coal now front and center to production as companies are required to provide more transparency in process  Lower cost of China labor now being pitted against other “environmental costs”

Natural Resources Changing International Landscape  Natural Gas & Europe  US has massive supply but it can’t be shipped by tanker  Western Europe is primarily supplied by pipeline through Ukraine  If you can’t bring the resource to you, go to where it is  Crude Oil  US is expected to be largest producer of oil (many hurdles remain)  Laws limiting export of certain crude types  Chinese companies are coming in the form of JVs and Partnerships – resource dependent  US Labor Market  History of labor being heavily unionized is no longer the case, US now being viewed as friendly for manufacturing jobs  Federal labor regulations considered a strength in comparison to China for corporate transparency