Lucerne

Capital Fund, L.P.

Fund Investment Objectives

The Lucerne Capital Fund, L.P. (the "Fund") is a European long-short equity fund with a track record starting in January 2002. The portfolio managers bring decades of experience in uncovering and profiting from value dislocations. The actively managed portfolio typically holds between 20 and 50 positions with an emphasis on mid-cap Western European companies that differentiate themselves, on the long side, through their high free cash flow yield and high technology content. Currency exposure is monitored and hedged. Since inception, Lucerne Capital Management, LLC has always met redemption requests. The Fund capitalizes on value dislocations and inefficiencies that are often a result of the capital market structure of the European equity markets. Inefficiencies can be a result of reporting lags, inadequate analyst coverage, misunderstood trade and fiscal policies, changing industry dynamics among companies in the same value chain, and perceived-versus-real changes to the competitive landscape. The portfolio managers evaluate companies in a private equity investment style, considering dynamics for growth, free cash flow, hard assets, and valuation. In-depth research, with hundreds of company meetings a year, allows for delineation between improving fundamentals or technical catalysts (both buying opportunities) and fundamental factor declines (selling opportunities). The Lucerne Capital Fund, L.P., a Delaware limited partnership, was formed for the participation of certain U.S. investors. In addition, The Lucerne Capital Offshore Fund, Ltd. is a Cayman Islands exempted company incorporated under the provisions of the Companies Law.