EFTA00294306.pdf

BERN DYNAMIC LLP The Bern Lucerne Fund Bern Dynamic LLP I 41 Paradise Walk I London, SW3 4JL UK I Phone •44 20 7745 2435 EFTA00294306 Disclaimer THESE MATERIALS DO NOT CONSTITUTE AN OFFER OF SECURITIES. SUCH AN OFFER WILL ONLY BE MADE BY MEANS OF A CONFIDENTIAL MEMORANDUM TO BE FURNISHED TO QUALIFIED INVESTORS UPON REQUEST. ALL INFORMATION CONTAINED HEREIN IS SUBJECT TO REVISION AND COMPLETION. THESE MATERIALS ARE CONFIDENTIAL AND INTENDED SOLELY FOR THE INFORMATION OF THE PERSON TO WHOM DELIVERED. RECIPIENTS MAY NOT REPRODUCE OF TRANSMIT, IN WHOLE OR IN PART, TO THIRD PARTIES. NOTE: Performance results are described herein are net of fees. The latest month's performance is preliminary and subject to revision. BERN DYNAMIC LLP 2 EFTA00294307 Bern Lucerne Fund Introduction Bern Lucerne Fund The fund is a joint venture between Bern Dynamic LLP and Lucerne Capital, LLC The Bern Lucerne Fund is a joint venture between Bern Dynamic (GP) and Lucerne Capital (Sub-Advisor), a collaboration born from a childhood friendship between Thijs Hovers (Lucerne) and Lars Christiaanse (Bern). Lucerne Capital is a European long-short equity fund with a track record starting in 2002 and a net annual return of over 13% since inception. The Bern Lucerne Fund will run pad passu with the existing Lucerne Capital Fund Strategy. As General Partner, Bern will monitor and control the fund's investments and offer transparency to investors, while maintaining client relationships and facilitating dialogue between investors and Lucerne. All historical data presented in this document represent Lucerne's existing offshore fund. BERN DYNAMIC LLP 3 EFTA00294308 Bern Dynamic Overview Bern Dynamic LLP ("Bern") A boutique advisory and brokerage firm since 2011 Partner: Lars A. Christiaanse Bern offers clients access to a pool of world-class, senior experts with a global reach, along with the experience and ability to provide advice across the broadest range of issues; geopolitical, security and business. In tandem with its advisory role, Bern Dynamic will use its unique international network to benefit its clients; creating, managing and executing the ambitions of investors and entrepreneurs. Team of 16 in London, UK BERN DYNAMIC LLP 4 EFTA00294309 Lucerne Capital Management, LLC ("Lucerne") An SEC-Registered Investment Advisor since 2000 Partners: Pieter Taselaar (founder) and Thijs Hovers European long / short equity management 'A, Firm assets under management: $290 million (11.01.2013) 'A, 10-year track record compounding 14.5% net of fees annually, +314.2% cumulative net since inception (May 2003 through October 2013) 'A, Team of 6 in Greenwich, CT Unique management skill attributable to Unique expertise in uncovering value in global leaders and local leading-edge companies within Continental Europe Four decades experience interacting with a focused list of 250 European management teams 'A, Evaluate companies in a proven and repeatable private equity investment style, considering dynamics for above-average market growth, free cash flow, hard assets, and valuation 'A, Tactical trading around positions with defined entry and exits BERN DYNAMIC LLP EFTA00294310 Lucerne Cumulative Returns vs Indices 400% 375% 350% 325% 300% c 275% '5 250% la 225% N CC 200% aj 175% -ic 150% ft3 125% 100% 75?: n L.1 25% .J 2 QJ Z 0% -25% -50% .75% 2003 :(Jc.-: 205 2008 220 The Lucerne Capital Offshore Fund, LTD Cumulative Returns 2008 2009 2010 .—MSCI Euro Net LCL TR 2011 2012 —.500 TR 2013 Net Cumulative Net Annualized Net Annual Returns 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Return Return The Lucerne Capital Offshore Fund, LTD 29.7% 18.7% 27.6% 25.9% -3.5% -43.8% 95.9% 24.7% -19.8% 26.5% 24.6% 314.2% 14.51 MSCI Europe Net LCL TR 19.8% 12.2% 24.9% 19.1% 6.0% -38.9% 27.7% 6.8% -9.3% 15.6% 19.8% 121.8% 7.9% 500 TR 22.8% 10.9% 4.9% 15.8% 5.5% -37.0% 26.5% 15.1% 2.1% 16.0% 25.3% 137.4% 8.6% BERN DYNAMIC LLP 6 EFTA00294311 • The Bern Lucerne Fund Strategy - European Long / Short Equity Opportunity Capitalize on the inefficiencies in the Continental Europe that result from: Invest in a fund with well-established operational and administrative controls both internally and through service provider partners 'ie. Maintain a highly liquid portfolio allowing for flexible risk management and active management Focus on making money on the buy by being more nimble than other European equity investors, of which there are few true competitors Portfolio Construction Universe of Continental European large, mid- and small-cap companies Currency exposure is monitored and hedged to the USD Opportunistic management of exposures 20 to 50 positions with sector and country diversification Normal holding period: 3 to 24 months for longs, 1 to 6 months for shorts Long positions are usually less than 10% of NAV and short positions less than 3% At least 70% of the portfolio can normally be liquidated over S to 7 days, measured as no more than 25% of average daily traded volume o Reporting lags o Inadequate analyst coverage o Misunderstood trade and fiscal policies o Changing industry dynamics among companies in the same value chain BERN DYNAMIC LLP o Changing industry and corporate dynamics o Perceived-versus-real changes to the competitive landscape o Lack of deep equity \ it culture 7 EFTA00294312 Investment Process Bottom-up value research Research requires watching for a private equity style opportunity with a potential 30% return scenario Universe of 2000 European stocks Quality filter using metrics that have proven to be good indicators of companies' financial performance Dynamic use of the screening tool to focus our bottom-up research efforts Apply in-depth bottom-up valuation-driven research to selected group of 100-200 stocks Longs Typically Exhibit +Growing cash flows due to a strong competitive position +Opportunities to expand domestic and global market share +High-quality management focused on opportunities to expand market share while delivering a continuously high rate of return +Corporate events that are catalysts to change Shorts Typically Exhibit -Declining return on capital employed -Balance sheet or cash flow issues -Low barriers to entry -Margin pressure - High multiples on incorrect earnings estimates BERN DYNAMIC LLP Macroeconomic Overlay Alignment of portfolio to macroeconomic environment Rotation between sectors and companies with varying sensitivities to discretionary versus non- discretionary spending Established database of research on economic cycle sensitivity: durable/ non-durable segments, industrial/consumer buyers, competitive landscape 8 EFTA00294313 Proprietary Opportunity Screen Index IV liketert._Peno mower BESTFPERIOO soar once tan ono, INT Dee mating +Her NnM weicep Ticker Name title tp ARKEMA AC FP ACCOlt SA AI FP AIR UQUIDE SA PIO FP ALSTOM BN FP CANON( CA FP CARREFOUR SA CAP FP CAP &MN! DGFP VINO SA (PIMP (ADS NV EDF FP EDF El FP ESSILOR INTERNATIONAL EN FP BOUTGUES SA FP FP TOW SA FR FP FRANCE TELECOMSA GU FP GOF SUEZ GTO FP GEMALTO Electronic & Electrical (Quinn LG FP WANG( SA ConstiuctIon & %%tonal, LR FP LEGRAND SA Electronic & Electrical (Quinn MC FP LUPIN MOST HENNESSY LOUIS VUI Personal Goods M.FP MICHELIN (CGDEI Automobiles & Parts MT NA ARCELORMTTAL Industrial Metals& Wining OR FP L'OREAL Personal Goods Pp FP PPR General Retailers PUBFP PUBUOS GROUPE Media RI FP PERNOPRICARD SA Beverages RHO FP RENAULT SA Automobiles & Palls SAF FP SAFRAN SA Aerospace & Defense SAN FP SANOFI Pharmaceuticals& Illotechnolog SGO FP COMPAGNIE DE SAINTGOBAIN Construction & %%tonal' SUFP SCHNEICER ELECTRIC SA Electronic & Electrical Equipm TIC FP TECHNIP SA Oil Equipment. Services& Dist VIE FP VEOLIA ENVNIONNEMENT Gas, Water& Multiutilities WV FP VIVENDI Media VK FP VALLOUREC Industrial Engineering CRC a% ESITDA Gross Margin vs ROTC ex Sector Revenue %HMCO CAGR 4 YR 5 Tr data ROIL Gooda di Chemicals 8% .3% 14.1% 14.6% Travel & leisure 20% 52% Chemicals 21% 2% 10.4% 14.0% Industrial Engineering 15% .5% 25% 13.3% Feed Producers 11% 11% 9.9% Feed & Drug R013110(5 42/6 Om Software &Computer Services 21% 9.3% 14.5% Constmcnon & Matenals 0% • 1% 6.0% Aerospace & Defense 13.7% Elettnety 4.916 Health Care EQUIPTCM & Servic 13.7% Construction & Matenais 5.4% Oil & Gas Producers 88% Fixed line Telecommunications 79% Gas, Water& Multiutilities I ICY % DIV % 3.0% 2.6% 30% 2.7% 4.2% 10% 6.7% 2.8% 50% 11% 52% 10% 31% tin Debt/ LOMA Capital intern, 0.6 14 03 41% 13 Lfi 25% 13 24 fiA 14 2% 4R% 3.5% 86% 398 SS% 4.1% Sze 149% S' .5% 12% Go, a 54a 11.9% 4.7% 15% 25% 10% IS% IS% 10% 10% 25% 2,4 25% IS% 28% IS% 10% 155 27 a2 1 It 115 2-3 4914 23 27 Zi% 0% 10.0 6.6% 11% OS OM 11.5% 110/6 5.2% 2.5% UM 14.4% 88% 5.3% 19% 39% 1.4G 42% 2.2% 6.2% 2.9% 7,0% 1.9% 4% 4.8% 1.8% 1% .5% 4.7% 43% 4% 10.3% 14.7% 5.3% 1976 2% 1% SP% 4.3% .211 8% 48% 7.5 6.2% 4.4% 5% 10. 69% 3.5% 21% 11.0% 4.9 13% 4% 11% 59% .1% 7.3 50% 1% 5.2% .0396 14% One stage EV/ESIT vs Valuation History upside 2 2 4 3 3 24% 42% 3 4% 2 .1234 2 03 OA 12 22% 46% 3 all IMI 12% 2 22% aS 2 44% 4 24% 04 3 3% 04 1.7 41% .794 02 20% 3 11% 35% 62% .4% 1.7 a 2414 1.9 2 BERN DYNAMIC LIP 9 EFTA00294314 Multiple Contraction, Cheap Global Players Richemont 2500 2000 1500 1000 500 - 0 Apr-06 Apr-07 Apr-08 Apr-09 Apr-10 Apr-11 Apr-12 Apr-05 - EBITDA - EV/EBITDA (RHS) 27 22 17 12 Continental 1200t 1000( 70W 6 800( 000 5 600( 000 400( 200( 4000 3000 2300 1000 0 1200 - 1000 • GOO 6.W 4.00 FY1 FY1 FY1 FYI FY1 FYI FY1 1934 1997 2000 2003 2006 2009 2012 -6B110A -EV/EBITDA 000 FY1 2015E 2 CO Index Ticker Company EBITDA Gross Margin ROIC ROC Working Capital FCY % FCY DIV % Balance sheet Shares Out EWEBITDA Valuation upside CAGR 3yr vs 4 yr avg ex Goodwill 4 yr trend 4 yr Av ND/EBITDA 6 YR CAGR vs History (%) SWI CFR VX Richemont -6.5% 4% 2 I -15% DAX CON GY Continental 11% 4% 15% 4% 1.1 4% BERN DYNAMIC LLP 10 EFTA00294315 Europe: Pockets of Excellence 2 ..‘" :saint irtilL4r Pockets of Excellence • Aged Spirits 4- Automotive • Luxury Goods 4- Oil Services Engineering & Industrial Services • Engineering & Telecom Cabling ‘tEr Focus Countries Germany France Switzerland Benelux Ar Northern Italy Scandinavia Austria Despite the maturity of the European capital markets, value dislocations and inefficiencies persist BERN DYNAMIC LIS 11 EFTA00294316 Europe: Global Footprint Example Worldwide automotive industry —global unit sales Exposure to growth markets is key Allows for acceleration in growth despite challenging domestic markets 70 60 - SO 40 • 30 20 10 0 BERN DYNAMIC LIP 6% CAGR 2% CAGR 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 ■ Developed markets ■ Emerging markets 12 EFTA00294317 Yield is Scarce French 2 yr Government Yield German 2 yr Government Yield tete ID 'TOM= 415 ••••• 40 Otitc0 lam tD tax tO 1 Negative yield % % % % a a a au IWOJOKICS0 tinPIZ0INkk km/. [MY, so au teDIZI • to k ▪ ft Ili le % k ik DAC:), itlEAIZS C•1O,3145113t3 Conlittketeskint 494 11. 60 ta to .OX eJX BERN DYNAMIC LIP 1i EFTA00294318 Corporate Bond Yields to All-Time Low European BBB Corporate Yield ....while dividend yields over credit is at an all time high BERN DYNAMIC LIP EURO 600 Stock with Div Yield > Credit 1999 20002001 2002 20032004 2005 20062007 2008 20092010 2011 2012 companies DY > CY —Average 14 EFTA00294319 Europe ISM breaks through 50 again after 4 years BERN DYNAMIC LLP urope is Investable Again The Draghi Effect Italian 10 yr Yields Credit market takes view European system is well underwritten ­ Growth periphery remains subdued ­ However, our companies are positioned to benefit from global growth Austerity and tax hikes widen gap between winners and losers ­ Second derivative in Europe improving ­ We have counted over 50 companies that are turning positive on Europe in their earnings reports 15 EFTA00294320 Europe in Recovery Mode.... Eurozone Business Climate 1.5 1 0.5 0 0 0 el es -0.5 > 02 > 4, .6 -1 2 z 2 = 2 -1.5 -2 -2.5 -3 Source: Bloomberg Italian Retail Sales 1.00% 0.00% -1.0094 -2.00% -3.00% -4.00% -5.00% .6.00% cc es. ares, s.)Y Source. Bloomberg Corporate EBIT Margins (ex Financials) close to 10 year low enables strong profit growth BERN DYNAMIC LIP 14.00% 13.0096 12.0096 11.0096 10.0096 9.00% 8.00% 7.0096 6.0096 11111111111111 cf;' tF;4 4534' e cOlb as' se, cc:› c;09 c;%1' 4'14 4` 4. et. et. et. et. et. et. et. 44 Source Bloomberg. UBS 16 EFTA00294321 Leading German engineer with global foot print and secular growth trends • World market leader in paint shops for automotive industry • Unique footprint after decades of expanding in growth markets • Unique skillset helps lower cost and energy efficiency at OEMS • Volkswagen, Daimler and BMW among largest clients • German OEM Capex plans reveal > 10% growth per annum • High investments in more energy efficient plants • As well as expansion in Emerging markets • Valuation suggest Duerr at peak profitability, while we expect many years of +10% growth Summary Financials Sales 2012 1.5bn EBIT 2012 EBIT CAGR 2012-2015 Market cap Net debt/ EBITDA EV/EBIT 2013 Dividend Yield 2013 ROIC 170m 20% 1bn 0.1x 5.3x 3.80% 16% China Expansion Unique Global Footprint Country Founded Employees Brazil 48 years 250 2005 2011 CAGR% Mexico 46 years 210 Orders 146 858 34 South Africa 41 years 50 Sales 83 575 38 Korea 30 years 115 Employees 119 887 40 China 28 years 1550 Source: Duerr India 21 years 410 Russia 14 years 30 Source: Duerr BERN DYNAMIC LLP 17 EFTA00294322 Utilities & telecom incumbents, risk dividend cuts and right issues Recent examples are RWE, EON, and KPN Many contractors took too much risk to 'survive' recession ­ Saipem and lmtech: recent examples where aggressive accounting masked cost overruns and loss making contracts. ­ Hochtief has a high risk of being next contractor to warn due to: ­ Dramatic rise in working capital driven by (unbilled) receivables signal either: ­ Cost overruns preventing billing their clients ­ Aggressive revenue recognition ­ Trade receivables rose to record 93 days in 1O13, up from 79 days in 2012 and 75 days in 2011. ­ Hochtief has lent EUR 600m to Dubai subsidiary to cover high amounts of overdue receivables following the property bust. None of the debt has been repaid. BERN DYNAMIC LLP Hochtief receivables rise 100 90 80 70 60 50 40 1 1O2010 1O2011 1O2012 1O2013 DSO (days) —YOY rise % 20.00% 15.00% 10.00% 5.00% 0.00% -5.00% 18 EFTA00294323 Shorts: Fake Yielders, Contractors & Accounting Irregularities Utilities & telecom incumbents, risk dividend cuts and right issues r Recent examples are RWE, EON, and KPN Many contractors took too much risk to 'survive' recession Saipem and lmtech: recent examples where aggressive accounting masked cost overruns and loss making contracts. Hochtief has a high risk of being next contractor to warn due to: • Dramatic rise in working capital driven by (unbilled) receivables signal either: • Cost overruns preventing billing their clients • Aggressive revenue recognition • Trade receivables rose to record 93 days in 1O13, up from 79 days in 2012 and 75 days in 2011. • Hochtief has lent EUR 600m to Dubai subsidiary to cover high amounts of overdue receivables following the property bust. None of the debt has been repaid. BERN DYNAMIC LLP Hochtief receivables rise 100 90 80 70 60 50 40 20.00% /I 15.00% 10.00% 5.00% 0.00% -5.00% 1O2010 1O2011 1O2012 1O2013 DSO (days) —YOY rise % 19 EFTA00294324 Appendix Appendix ­ Monthly Returns ­ Terms and Service Providers ­ Bios ­ Valuation Metrics ­ Back Office Processes ­ Top 5 Investment Cases ­ AUM History ­ Investor Base ­ Awards & Press ­ Investor Relations 20 BERN DYNAMIC LLP EFTA00294325 Net Monthly Returns The Lucerne Capital Offshore Fund, LTD Inception: May 2003 BERN DYNAMIC LIP Jan Feb Mar Apr 2013 4.8% 3.5% -0.6% 0.2% 2012 12.5% 7.0% -0.7% -0.4% 2011 -2.4% 1.4% 4.2% 1.3% 2010 -1.2% -6.4% 11.8% -0.1% 2009 -0.8% -8.6% 1.9% 28.8% 2008 -16.0% 3.8% -3.8% 6.3% 2007 3.0% -1.2% 5.6% 5.8% 2006 7.5% 3J% 2.9% 2.0% 2005 1.8% 4.5% 0.8% -2.0% 2004 6.1% 3.0% -3A% -0.3% 2003 May Jun Jul Aug Sep Oct Nov Dec Year MSCI Net Europe LC L TR 3.6% -0.8% 3.5% -0.5% 4.2% 4.6% 24.6% 19.8% -6.1% -2.1% 0.9% 2.1% 3.1% 2.9% 3.5% 2.2% 26.5% 15.6% -3.4% -0.7% -9.2% -11.4% -5.6% 8.9% -3.7% 0.5% -19.8% •9.3% -12.4% -2.6% 4.2% -5.3% 11.3% 10.1% 6.5% 9.9% 24.7% 6.8% 16.4% 1.1% 13.7% 15.5% 10.2% •9.2% -1.0% 7.5% 95.9% 27.7% 1.7% -11.2% -0.2% 133% -17.2% -15.0% -2.6% -10.1% -43.8% -38.9% 3.7% -0.4% -25% -6.7% -0.2% 3.2% -10.4% -2.1% -3.5% 6.0% -5.1% -0.9% 0.3% 2.1% 0.2% 2.7% 1.9% 6.5% 25.9% 19.1% 2.5% 3.8% 4.5% 2.1% 4.7% -4.6% 3.6% 3.5% 27.6% 24.9% -1.4% 1.5% -0.3% 0.1% 2.4% 1.0% 4.5% 4.5% 18.7% 12.2% 4.2% 3.9% 5.4% 2.5% 1.0% 6.0% 2.1% 1.6% 29.7% 19.8% Cumulative since inception Net annualized return 3142% 14.5% 121.8% 7.9% 21 EFTA00294326 Terms and Service Providers The Bern Lucerne Fund Fees Liquidity Management fee: 1.5% Incentive fee: 20% Monthly, with 60 days notice Minimum Investment $500,000 Early Redemption Fee First year, 2% Administrator Citco Fund Services (Bermuda) Ltd Prime Brokers Morgan Stanley Goldman Sachs Auditor PricewaterhouseCoopers Legal Paul, Weiss, Rifkind, Wharton & Garrison Walkers BERN DYNAMIC LIP 22 EFTA00294327 Bios Lucernce Capital Team PIETER TASELAAR Founding Partner & Portfolio Manager since 2002 r Previously, Senior Managing Director, ABN AMRO New York, Head of European Equities 'r Corporate Finance and Capital Markets, ABN AMRO Amsterdam 'r MBA, Columbia University 'r Law Degree, Leiden University, the Netherlands THUS HOVERS Partner & Portfolio Manager r Joined Lucerne Capital Management in 2007 • Previously, Head of Pan European Small and Mid-cap Equity Research, ABN AMRO • Head of Benelux Equity Research, ABN AMRO • Senior Equity Analyst, ABN AMRO • Equity Analyst, Rabobank • MA, International Finance • BA, Economics, University of Amsterdam, the Netherlands • II Ranked Analyst #2, 2006 • Thomson Extel - al Benelux: Small Caps Research, 2006 • Brendan Woods Top Gun, 2010 and 2011 r Brendan Woods Best Minds in Consumer Products, 2011 CASEY NUNEZ, Chief Compliance Officer/Chief Financial Officer r Joined Lucerne Capital Management in 2010  Previously, Senior Associate, BDO Seidman • BS, Georgetown University ERNEST J. VERRICO, JR., Controller/Investor Relations r Joined Lucerne Capital Management in 2013  Previously, Associate, Deloitte & Touche - MBA, Fairfield University Dolan School of Business • BBA, Loyola College in Maryland BRIAN JOHNSON, Head of Trading  Joined Lucerne Capital Management in 2008 r Previously, Senior Account Officer, Citi Private Bank • BS, University of Florida YOHANES WAHYUDI Trader Joined Lucerne Capital Management in 2011  Previously, Trading Assistant and Research Analyst Intern, Matrix Capital Group  BS, Syracuse University BERN DYNAMIC LIP 23 EFTA00294328 Absolute fair value metrics (rather than relative value analysis) enhances the selling discipline Strict valuation multiples at entry to invest in pricing inefficiencies with limited downside  Identify attractive entry points with a potential 30% return scenario • Typically 10x EV/EBIT for strong global franchises, generating high returns and have a low capital intensity to support growth r Typically 6x EBIT for more capital intensive cyclical stocks r Key variables are cash conversion, capex/EBITDA, ROIC, fair equity risk premium, cost of debt it Assess risk (beta) by the volatility of a company's cash flow and earnings growth Cash flow based valuation model Focuses on key drivers to generate cash under a variety of market circumstances: • Top line and gross margin resilience • Cost, working capital and capex flexibility • Potential risks in tax, interest charges and hedging policies Ongoing testing of assumptions Models incorporate revenue line input from external macro advisors • Sell if growth is priced in or if investment case fundamentally changes Outperformance is due to our ability to identify and value companies focused on reinvesting or distributing strong and growing cash flows BEAN DYNAMIC LLP 24 EFTA00294329 Back Office Processes Committed to protecting client capital while providing the team enough support to effectively manage the Fund Operational Control Features ir Internal features — Clear roles, redundancies and ability to adapt ir External features — Service providers, NAV confirmation, and third-party custody Process Documentation ir Trade processes — Daily reconciliation. Multi-layered system both in-house and at administrator ­ Research mosaic — Documentation to record our multi-level research process )-e Valuation policy — Month-end formal review including external input away from investment professionals )-e Risk management policy — Daily review of position sizes )-e Cash control policy — Dual signatures and maintaining cash away from brokerage account Registered investment advisor best practices — Documented policies / procedures and compliance oversight ir Privacy policy for investor information Counterparty Agreements ir Extensively negotiated term and facilities with all counterparties Disaster Recovery & Backup Procedures ir Daily backup, off-site data storage, and remote access ready Please refer to the Due Diligence Questionnaire for detail BERN DYNAMIC LLP 25 EFTA00294330 Top 5 Investment Cases As of October 2013 (in alphabetical order)* Company (Country) Descri .tion Recent Dynamics 2014 Valuation Market Cap Summary — (Mil lion €) Adecco SA (Switzerland) Largest European temporary employment company, with 60% of revs in Europe, 20% in US and 20% in the UK (Ticker: ADEN VX) Ea rly cyclica I recovery play on Europe; significant operating leverage; signals double-digit growth in periphery with core Europe expected to follow 13.8x FCY 6% Div 3.3% C 10,285 Arca dis NV (Netherlands) Leading engineering and consultancy firm, with strong leading positions in the US, Europe and the UK (Ticker: ARCAD NA) Recovering end markets (U.S. architect index & early European recovery indicated by permits & planning); high ROIL; large accretive acquisition expected PE 12.8x FCY 7.9% Div 2.9% C 1,730 Continental AG (Germany) German automotive component and tire producer. Key supplier to German OEMs (Ticker: CON GY) Superior growth prospects on geo diversification, new products in safety, and recovery of tire markets; one of cheapest high quality cycl icals in our universe PE 10.lx FCY 7.2% Div 2.6% C 26,991 Rexel SA (France) Distributor of electrical equipment, including wires, cables, ducts, security & telecom products & household appliances (Ticker: RXL FP) Strong growth in the US; European growth is not yet priced in; when it is, operating leverage would kick in and push multiples down from already low levels PE 11x FCY 9% Div 4.7% C 5,189 TKH Group NV (Netherlands) Designer & manufacturer of innovative systems for IT, telecom, electrotechnical engineering & industrial production (Ticker:TWEKA NA) Among highest ROIC in Dutch market; clean balance sheet to propel growth; pa rtid pati ng in strong healthcare and security growth trends PIE 9.4x FCY 10% Div 4.6% C 888 •Excludes index hedges. "These are Lucerne Capital Management, LLC's projections for 2014 as of April 2013 and are subject to change. Source for Market Capitalization: Bloomberg, March 31, 2013 BERN DYNAMIC LIP 26 EFTA00294331 AUM History - Lucerne Capital Management Current Funds 27 BERN DYNAMIC LIP EFTA00294332 Investor Base Firm Investor Base as of November 1, 2013 Employee 7.4% Multi-family office 4.3% Fund of funds 21.5% BERN DYNAMIC LLP Endowment/ foundation 0.1% High-net worth individuals 66.7% 28 EFTA00294333 Awards & Press 2010 & 2011 2012 2013 Brendan Wood International's Top Gun Award Thijs Hovers, among the 75 most influential buyside specialists in Europe Bloomberg Brief: Hedge Funds June 19, 2012 Lucerne Bets on European Multinationals while Shorting Builders Bloomberg Brief: Hedge Funds March 12, 2013 Returns in Brief BarclayHedge Award Recognition Award Annual Top 10 The Lucerne Capital Fund, LP Sector: Equity Long/Short — Europe Brendan Wood International's Top Gun Award Thijs Hovers, among top 11 buyside investment minds in the Dutch Market Barclay Managed Funds Report 3'd Quarter 2012 Barclay Roundtable: No Optimal Solution is at Hand to Resolve Europe's Credit Crisis Het Financieele Dagblad June 3, 2013 (Dutch article) Hedgefonds Lucerne speculeert op verdere koersimplosie Imtech (Hedge Fund Lucerne Speculates on lmtech) Effect Aug 2012 (Dutch article) De korte lijntjes van een Nederlands-Amerikaan hedgefonds (The Short Lines of a Dutch-American Hedge Fund) Het Financieele Dagblad June 14, 2013 (Dutch article) Nederlands hedgefonds in de Verenigde Staten belegt vooral in Europese aandelen (Dutch Hedge Fund in the US Invests Primarily in European Equities) Brendan Wood International's Best Investment Minds Thijs Hovers, Worldwide Consumer Products BarclayHedge Award Recognition Award Annual Top 10 The Lucerne Capital Fund, LP Sector: Equity Long/Short — Europe HFMWeek Awards Nominee October 2013 Long/Short equity (Global) under 51bn & Long/ short equity long term performance (5 years) Institutional Investor Feb 2011 (Online Article) How Hedge Funds Generate Returns in Europe Business in Canada October 29, 2013 Star Heckle Fund Managers See Opportunity In European Equities BERN DYNAMIC LIP 29 EFTA00294334 Investor Relations BERN DYNAMIC LLP CONTACT Lars A Christiaanse Routine Reporting Monthly: Day I Estimate, Newsletter, Statement Annual: Audited Financial Statements and Kls, both mid-April BERN DYNAMIC LLP 30 EFTA00294335