Kinetics

Partners L.P.

Fund Investment Objectives

The objective of the Partnership is to obtain both long and short term returns by investing in a portfolio of securities across a broad array of industries not limited by market capitalization considerations. The primary investment objective of the Partnership is the attainment of superior investment returns by investing in companies that have sustainable high returns on equity. The Partnership will invest in common stocks, preferred stocks, convertible preferred obligations, debt instruments, options, puts and calls. The Partnership will also engage in margin borrowing, short sales and synthetic short sales. At any given time the Partnership may be fully invested and may be 100% (or more) net long or as much as 100% net short. Portfolio turnover rates may vary from year to year and at different times during the same year, but in general should not be great as is typically the case with many hedge funds. There are no restrictions on the types of positions the Partnership may take or the number or extent of its short positions, however, the Partnership does not intend to invest more than 12% of its assets, measured at the time of investment, in the securities of any one issuer, unless the General Partner believes it can find an effective hedge. Similarly, the Partnership does not intend to allow a short position to become greater than 7% of the portfolio, measured at market value, unless the General Partner believes it can find an effective hedge against such a position. A wide range of investments, including common stocks, related derivatives, futures contracts, preferred stocks, debt instruments, cash equivalents, and options on securities indices is permitted. There can be no assurance that the Partnership's objectives will be satisfied. The Partnership also reserves the right to amend its investment objectives and strategies.