LMV HOLDINGS

An alternative investment rm focused on active value investing in distressed asset-rich companies in the public and private markets in Japan.

Investment Philosophy
PMV: M&A-Based Net Asset Value We pursue strategic minority investments in public and private companies whose securities trade at a substantial discount to private market value: net asset value (NAV) viewed through the lens of merger and acquisition activity. In Japan, NAV has historically been based on a companys liquidation value. Research is the Foundation Rigorous research is the foundation of our investment approach. We focus on undervalued (and typically distressed) asset-rich businesses in periods of change. To identify ideal targets, we use typical value screens such as low P/ B and low P/CF. We also seek companies with shareholder-friendly management teams, high levels of insider ownership, and weak balance sheets. Private Equity in the Public Markets Our focus on minority positions, either in the primary or secondary markets, eliminates the need to pay a premium for control of a business. We prefer situations where there is an opportunity to implement nancial and/or business strategies that materially improve the intrinsic value of the company.

Investment Strategy
Overview

LMV Holdings (Lehman Moorjani Value Holdings) invests in undervalued asset-rich companies in Japan. Our active value philosophy is unique: we pursue private equity investments in the public markets. Our value approach favors strategic minority investments in undervalued companies: value investments in securities underpriced relative to intrinsic value or which are expected to appreciate in value if circumstances change or an anticipated event occurs. Our active approach favors investments in distressed companies with signicant potential restructuring opportunities. We focus on the public markets; this exible investment approach gives us access to a larger, more inecient universe of attractive investment opportunities. As public market investors, we are able to avoid the typical control at a premium dilemma created by the limited nature of private auctions. We continuously develop and revise a select list of companies which match our criteria: fundamentally solid businesses that we believe are undervalued, and in which our value-added strategies can be implemented and realized in a two to three year time period. We also will initiate our investment via the debt markets with the aim of taking control of the creditor committee or swapping debt for equity. LMV performs due diligence at a level normally associated with a full acquisition, reecting our goal of having an active partnership in the business. We prefer situations where a close-working relationship with management can be achieved in order to implement value-creating strategies. Firms become targets precisely because they are underperforming, and their assets are worth less than potential; restructuring improves value and can act as the best long-term defense. We work with management teams on a friendly basis to develop and implement value-creating strategies, especially as it relates to unlocking the embedded value of real estate portfolios: securitizations, spin-os, recapitalizations, strategic realignments, management buyouts and other major changes. While maintaining a exible approach, we focus on real-estate rich industries: media, transportation, retail, and manufacturing. For many asset-rich rms, corporate real estate ranks as the most valuable asset of the organization; however, portfolios typically reect past requirements, not future needs. Our breadth of experience, intensive research and risk-averse approach to investing allows us to seek creative alternative investment opportunities. We structure our investments based on each companys circumstances and generally seek to invest in established businesses requiring capital of $10-50 million. While these investments commonly are made in common stock and preferred equities, we seek to nd the security or instrument in the capital structure that we believe oers the best risk/reward prole, either in the public equity markets or in the distressed debt markets. For distressed companies or companies with highly illiquid public market securities, we typically favor a negotiated investment.

Investment Strategy
Focus on Special Situations We emphasize preservation of capital with an emphasis on restructuring and value investments in asset-intensive businesses. We generally favor special situations where prot is dependent on corporate rather than market action; we prefer to be insulated from the behavior of the general market. Management Partnership Our proactive deal sourcing culture prefers opportunities where we can build a close working relationship with management teams. LMV will never engage in hostile transactions.

Lehman Moorjani Value Holdings (Deepak Moorjani)

June 2006