Bay Bridge Capital Management, LLC utilizes a Value investing philosophy consistent with that of Benjamin Graham and David Dodd in their 1934 seminal book, Security Analysis. Core tenets of Bay Bridge Capital:

• Value Investing Approach: Identify investments trading at a significant (20%+) differential to intrinsic value. The value of any company is the net present value of all future free cash flows. Free cash flow is central to scenario analysis and multi-factor valuation in determining discrepancies between value and price.

• Long-Term Time Horizon: Analyze major structural, industry, and competitive dynamics which affect a company’s long-term return on capital. Short-term investors focus less on strategic analysis, capital allocation, return on capital, corporate governance, and options dilution – all of which create or destroy value over the long-term.

• Volatility vs. Permanent Value Destruction: Volatility does not equal risk, and stocks fluctuate more widely than intrinsic value and will reflect intrinsic value over the long-term. Rather, risk is when value is permanently impaired, such as by management teams overpaying for an asset, spending capital on low-return projects, or diluting shareholders via excessive options issuance.

• Mr. Market: Security prices fluctuate more widely than company fundamentals and intrinsic value, and will reflect intrinsic value over a longer time horizon (3+ years).

• Focus on Intrinsic Value and Margin of Safety: A long security is sold when its price reaches intrinsic value, the investment thesis changes, or there are better risk/reward opportunities for capital allocation.

• Embedded Expectations: Analysis determines embedded expectations in the current stock price.