Distressed & High Income Investing

Distressed and high income investing involves the purchase of securities (predominantly debt) in companies experiencing financial and/or operational difficulties. Portfolio investments may include bank debt, bonds, convertible securities, and equities. Investments are made across multiple segments of the distressed universe, defined as "distressed", "stressed" or "higher quality" segments and can also include post reorganization equity.

Strategy seeks to provide both capital appreciation and high current income by investing primarily in bank debt and corporate bonds across several market segments:

"Distressed" - companies in or near reorganization
"Stressed" - companies experiencing financial difficulty

• Investments across the capital structure, ranging from senior secured debt (bank debt or bonds) through unsecured debt and equity
• Focus on securities of middle market issuers
• Intensive due diligence to generate independent in-house research
• Limited use of leverage
• Portfolio diversification: 15% position limits / 25% sector limit
• Opportunistic partnering with other firms for block position leverage, restructuring participation
• Middle market focus and depth of experience provides investor with a differentiated approach from many other distressed managers
• Distressed and high income portfolio managed by Katalin Kutasi

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