1. © 2008 BOK Financial Corporation. Member FDIC. Equal Opportunity Lender. Services provided by: Bank of Albuquerque, N.A., Bank of Arizona, N.A., Bank of Arkansas, N.A., Bank of Kansas City, N.A., Bank of Oklahoma, N.A., Bank of Texas, N.A., Colorado State Bank and Trust, N.A. Managing Payment Risk Related to Foreign Currency AFP 6-11-2014 Oscar Arriaza

2. © 2008 BOK Financial Corporation. Member FDIC. Equal Opportunity Lender. Services provided by: Bank of Albuquerque, N.A., Bank of Arizona, N.A., Bank of Arkansas, N.A., Bank of Kansas City, N.A., Bank of Oklahoma, N.A., Bank of Texas, N.A., Colorado State Bank and Trust, N.A. Managing Payment Risk Related to Foreign Currency FX risk occurs at various points in the trade/sale cycle  Typically associated with a payable or a receivable  Settled immediately or at some future date in time Two common challenges associated with FX risk in cross-border transactions  Recognizing or identifying exposure  Mitigating exposure ahead of the related payment “Settling all cross-border transactions in US dollars eliminates FX risk” Myth or Fact ?

3. © 2008 BOK Financial Corporation. Member FDIC. Equal Opportunity Lender. Services provided by: Bank of Albuquerque, N.A., Bank of Arizona, N.A., Bank of Arkansas, N.A., Bank of Kansas City, N.A., Bank of Oklahoma, N.A., Bank of Texas, N.A., Colorado State Bank and Trust, N.A. HOLY GUACAMOLE!

4. © 2008 BOK Financial Corporation. Member FDIC. Equal Opportunity Lender. Services provided by: Bank of Albuquerque, N.A., Bank of Arizona, N.A., Bank of Arkansas, N.A., Bank of Kansas City, N.A., Bank of Oklahoma, N.A., Bank of Texas, N.A., Colorado State Bank and Trust, N.A. Should we pay $57.00US dollars or 630.00 Mexican pesos?  Implied exchange rate = 630.00 / $57.00 = 11.05  Hotel exchange rate = 12.85 ; 630.00 / 12.85 = $49.02

5. © 2008 BOK Financial Corporation. Member FDIC. Equal Opportunity Lender. Services provided by: Bank of Albuquerque, N.A., Bank of Arizona, N.A., Bank of Arkansas, N.A., Bank of Kansas City, N.A., Bank of Oklahoma, N.A., Bank of Texas, N.A., Colorado State Bank and Trust, N.A. Managing Payment Risk Related to Foreign Currency Consider three different types of FX Risk Transactional- payables, receivables Translational- net income from foreign subsidiaries Economic- bid-to-award on a foreign project Best practices Request dual currency invoicing / pricing list In a recent FX risk management survey: 74% of companies have a formal written FX policy 98% use forward contracts to hedge balance sheet exposure Develop a Foreign Exchange Policy Identify and quantify exposures Identify strategies to manage risks Define corporate philosophy

6. © 2008 BOK Financial Corporation. Member FDIC. Equal Opportunity Lender. Services provided by: Bank of Albuquerque, N.A., Bank of Arizona, N.A., Bank of Arkansas, N.A., Bank of Kansas City, N.A., Bank of Oklahoma, N.A., Bank of Texas, N.A., Colorado State Bank and Trust, N.A. 6  “ We don’t have any foreign exchange risk because we deal exclusively in US dollars”  If you transact business outside the boundaries of the U.S. and deal in U.S. dollars only, you are participating in the foreign exchange market  In any international transaction, foreign exchange risk exists  What business opportunities are lost by dealing exclusively in US dollars? Hidden Risk of Transacting International Payables and Receivables in US Dollars

7. © 2008 BOK Financial Corporation. Member FDIC. Equal Opportunity Lender. Services provided by: Bank of Albuquerque, N.A., Bank of Arizona, N.A., Bank of Arkansas, N.A., Bank of Kansas City, N.A., Bank of Oklahoma, N.A., Bank of Texas, N.A., Colorado State Bank and Trust, N.A. Hidden Risk of Transacting International Payables and Receivables in US Dollars 7 Situation Analysis:  US golf club manufacturer imports components from China for final product assembly in the USA. A Chinese vendor provides a price list in US dollars good for 90 days; terms are net 45 days  Prices have increased 2.63% Year-Over-Year directly impacting profit margins  Tough competition in the US market makes it difficult to pass along price increase to consumers With a newly minted Foreign Exchange Policy in place, the US company can inquire about obtaining component prices in both US dollars and Chinese Renminbi

8. © 2008 BOK Financial Corporation. Member FDIC. Equal Opportunity Lender. Services provided by: Bank of Albuquerque, N.A., Bank of Arizona, N.A., Bank of Arkansas, N.A., Bank of Kansas City, N.A., Bank of Oklahoma, N.A., Bank of Texas, N.A., Colorado State Bank and Trust, N.A. 8 Hidden Risk of Transacting International Payables and Receivables in US Dollars Chinese Vendor- 2013 Sales Budget 13-Jan ¥ 28,000,000.006.2800 $ 4,458,598.73 Price Increase Progression Quarter ReceivablesFX RateUSD EquivalentActual FX RateShort Fall in USDNew USD Pricing 13-Mar ¥ 7,000,000.006.2800 $ 1,114,649.686.20680 $ (13,145.64) $ 1,127,795.32 13-Jun ¥ 7,000,000.006.2068 $ 1,127,795.326.13560 $ (13,087.40) $ 1,140,882.72 13-Sep ¥ 7,000,000.006.1356 $ 1,140,882.726.08650 $ (9,203.54) $ 1,150,086.26 13-Dec ¥ 7,000,000.006.0865 $ 1,150,086.266.05000 $ (6,938.54) $ 1,157,024.79 Total $ 28,000,000.00 $ 4,533,413.986.17636 $ (42,375.11) $ 4,575,789.092.63% US Importer- 2013 Inventory Budget 13-Jan ¥ 28,000,000.006.2800 $ 4,458,598.73 Quarter PayablesForwardUSD EquivalentActual FX Rate Savings from HedgingUS dollar Pricing 13-Mar ¥ 7,000,000.006.2755 $ 1,115,448.976.20680 $ (12,346.35) $ 1,127,795.32 13-Jun ¥ 7,000,000.006.2805 $ 1,114,560.946.13560 $ (26,321.77) $ 1,140,882.72 13-Sep ¥ 7,000,000.006.2860 $ 1,113,585.756.08650 $ (36,500.51) $ 1,150,086.26 13-Dec ¥ 7,000,000.006.2900 $ 1,112,877.586.05000 $ (44,147.21) $ 1,157,024.79 Total $ 28,000,000.00 $ 4,456,473.24 $ (119,315.85) $ 4,575,789.092.63%

9. © 2008 BOK Financial Corporation. Member FDIC. Equal Opportunity Lender. Services provided by: Bank of Albuquerque, N.A., Bank of Arizona, N.A., Bank of Arkansas, N.A., Bank of Kansas City, N.A., Bank of Oklahoma, N.A., Bank of Texas, N.A., Colorado State Bank and Trust, N.A.

10. © 2008 BOK Financial Corporation. Member FDIC. Equal Opportunity Lender. Services provided by: Bank of Albuquerque, N.A., Bank of Arizona, N.A., Bank of Arkansas, N.A., Bank of Kansas City, N.A., Bank of Oklahoma, N.A., Bank of Texas, N.A., Colorado State Bank and Trust, N.A. Disclaimer In our written and oral communications with you, we are not giving you any economic, tax, accounting, legal or regulatory advice or recommendations, and are not acting in a fiduciary relationship with you. You should conduct a thorough and independent review of the economic, tax, accounting, legal and regulatory characteristics, consequences and risks of any transaction in light of your particular circumstances, consulting with such advisors as you consider appropriate. Some of the information or opinions stated in this message may have been obtained or developed by BOK Financial from sources outside BOK Financial. In such cases, BOK Financial believes the information or opinions to be reliable. However, BOK Financial will not have independently confirmed the reliability of such information or opinions and does not guarantee their accuracy or completeness or the reliability of their sources. The information and opinions in this message, whether or not they were obtained or developed from outside sources, may not be appropriate for, or applicable to, some or any of your activities or circumstances. As a result, BOK Financial makes no express or implied promises, commitments, guarantees, representations, or warranties with respect to any of the information or opinions in this message, including, without limitation, any express or implied warranty of fitness for a particular purpose. BOK Financial strongly recommends that you seek your own independent professional advice before using or acting on such information or opinions.