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- PRIVATE & CONFIDENTIAL -
BROADVIEW DARK HORSE LPAN INVESTMENT PARTNERSHIP MANAGED BY EWING MORRIS & CO. INVESTMENT PARTNERS LTD.
Investor Presentation | September 2019
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► Established in 2011 with $3m;
currently manage ~$380m*
► Focused on small/mid
capitalization companies
primarily in North America
► More than 350 clients
across the country and
in the US
► 13 full-time teammates
VALUE-DRIVEN CANADIAN BOUTIQUE INVESTMENT FIRM
EWING MORRIS OVERVIEW
Serving clients across the country
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*As of June 30, 2019.
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$0
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2011 2012 2013 2014 2015 2016 2017 2018
Ew
ing M
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EWING MORRIS TEAM
EXPERIENCED TEAM WITH STRONG ADVISORY BOARD
AND GOVERNANCE STRUCTURE
John Ewing, CFA
Co-President & Chief
Investment Officer
Darcy Morris
Co-President & Chief
Executive Officer
Jill Hamblin
Office Manager
Alex Ryzhikov, CFA
Portfolio Manager
Anthony Hammill, CFA
Co-Portfolio Manager
Lee Matheson, CFA
Co-Portfolio Manager
Randy Steuart, CFA
Portfolio Manager
Breann Kirincich, LLB
Chief Compliance &
Operating Officer
William Jones, JD
Relationships
Sharon Rodrigues
Reception
Oghale Omosa
Client Administration
Cynthia Chan, CA, CPA
Controller
As of June 30, 2019.
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A STRONG ADVISORY BOARD
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Martin Connell
Rosamond Ivey
Bill Stedman
Linda Haynes
Ira Gluskin
David Wilson
John MacIntyre
Hon. David
Peterson
Harry Rosen
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STRATEGY OVERVIEW
Focus on small capitalization companies
North American long /short strategy
Capital structure agnostic seeking “equity like”
returns
Heavy due diligence and continued involvement in
companies
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$1,000
$1,500
$2,000
$2,500
$3,000
Sam
ple
gro
wth
of
$1000
Broadview Dark Horse S&P/TSX Small Cap Index S&P/TSX Composite Index
BROADVIEW DARK HORSE LP
SAMPLE GROWTH OF $1000 INVESTED SINCE INCEPTION
*Year-to-date returns. Returns reflect the A Class – Master Series as of August 31, 2019. Broadview Dark Horse LP returns since inception are net of fees and expenses and are for the consolidated series. Past performance doesnot guarantee future results. This letter does not constitute an offer to sell or the solicitation of an offer to buy any interest in the Broadview Dark Horse LP. Such an offer may only be made by way of a definitive subscriptionagreement and are only available to investors who meet legal requirements for investor suitability and sophistication. The strategy’s composition is materially different from major indices. (1) We have listed the S&P/TSX Compositeand S&P/TSX Small Cap Indices because they are representative of widely known and followed investment alternatives of similar market capitalization. These benchmark indices are provided for information only and comparisonsto benchmarks and indices have limitations. Investing in Canadian equities is the primary strategy for the Dark Horse, however the Dark Horse does not invest in all, or necessarily any, of the securities that compose the referencedbenchmark indices, and the Dark Horse portfolio may contain, among other things, options, short positions and other securities, concentrated levels of securities and may employ leverage not found in this indices. As a result, nomarket indices are directly comparable to the results of the Dark Horse. Benchmark source: Capital IQ. While all information prepared in this report is believed to be accurate, Ewing Morris & Co. Investment Partners Ltd. makes noexpress warranty as to the completeness or accuracy nor can it accept responsibility for errors, appearing in the report. This report is not intended for public use or distribution.
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Cumulative Annualized
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019*Since
Inception
Since
Inception
Broadview Dark
Horse LP15.8% 4.7% 13.4% 19.9% 6.9% 5.4% -2.2% 12.5% 1.9% 4.3% 186.7% 10.7%
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SECURITY SELECTION
Competitive advantage:
• Small capital base
• Alignment - partners
invested alongside
clients
Exploit structural,
nuanced or temporal
inefficiencies. We are
value investors and
content to look very
different from peers
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Heavy due diligence and
continued involvement in
virtually all files, with an
“Activist” involvement as
back-up plan
LONG/SHORT FUND, ALPHA LONGS, ALPHA SHORTS AND INDEX HEDGES
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UNDERWRITING PROCESS
DARK HORSE FUND LP
Identify situations with mispricing likely associated with distress,
disinterest, complicationIdea Generation
Focus on businesses we understand well and can properly
handicap with a strong preference for recurring, contractual
cashflow streams Expertise
Determine value through the lens of Private Market Value with the
insight of a sophisticated, arm’s length buyer with full dataPrivate Value
Business operations, industry structure, creditors, credit
environment, shareholders, boards of directors and managementDeep Diligence
Determine fair value range using spectrum of scenarios, acquire at
meaningful discount to probability weighted fair value. Payoff
asymmetry & liquidity help determine position sizingScenario Analysis
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RISK MANAGEMENT
FRAMEWORK
Asset/Liability
matching
framework
Prevent against
over-investing in
illiquid securities
EXPOSURE LIMIT
Aim not to exceed
100% gross long
or 100% gross
short
SECTOR LIMIT *
Aim not to exceed
20% gross long
POSITION LIMIT
Aim not to exceed
8% long exposure
to any single
issuer
Aim not to exceed
4% short
exposure to any
single issuer
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*Sector classifications may differ from commonly used classifications such as GICS.
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THE DARK HORSE VS. INDICES
Returns reflect the A Class – Master Series as of August 31, 2019. Broadview Dark Horse LP returns since inception are net of fees and expenses and are for the consolidated series. Past performance does not guarantee futureresults. This letter does not constitute an offer to sell or the solicitation of an offer to buy any interest in the Broadview Dark Horse LP. Such an offer may only be made by way of a definitive subscription agreement and are onlyavailable to investors who meet legal requirements for investor suitability and sophistication. The strategy’s composition is materially different from major indices. (1) We have listed the S&P/TSX Composite and S&P/TSX SmallCap Indices because they are representative of widely known and followed investment alternatives of similar market capitalization. These benchmark indices are provided for information only and comparisons to benchmarks andindices have limitations. Investing in Canadian equities is the primary strategy for the Dark Horse, however the Dark Horse does not invest in all, or necessarily any, of the securities that compose the referenced benchmark indices,and the Dark Horse portfolio may contain, among other things, options, short positions and other securities, concentrated levels of securities and may employ leverage not found in this indices. As a result, no market indices aredirectly comparable to the results of the Dark Horse. Benchmark source: Capital IQ. While all information prepared in this report is believed to be accurate, Ewing Morris & Co. Investment Partners Ltd. makes no express warrantyas to the completeness or accuracy nor can it accept responsibility for errors, appearing in the report. This report is not intended for public use or distribution.
Performance SummaryBroadview
Dark Horse
S&P/TSX
Composite Index
S&P/TSX
Small Cap Index
Return
1-Month -1.7% 0.4% -1.5%
MRQ -2.0% 0.8% 1.6%
1-Year 5.8% 4.3% -5.2%
3-Year 4.6% 7.2% 0.1%
5-Year 5.2% 4.1% -1.3%
ReturnCumulative Returns (SI) 181.0% 146.0% 114.6%
Annualized Returns (SI) 10.4% 9.0% 7.6%
RiskStandard Deviation 3-Year 6.0% 9.0% 10.8%
Standard Deviation (SI)** 6.9% 10.3% 15.5%
Sharpe Ratio Sharpe Ratio (SI)** 1.3 0.7 0.4
Correlation Correlation 3-Year 1 -0.2 0.1
Max Drawdown Max Drawdown (SI) 7.4% 16.5% 31.5%
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THE DARK HORSE
88 POSITIVE MONTHS VS. 37 NEGATIVE MONTHS
*Returns reflect Class A – Master Series. Inception date of the Fund is April 3, 2009
NET RETURNS SINCE INCEPTION (CAD)*
JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC YEAR
2019 0.33 0.03 0.84 0.08 3.60 1.39 -0.29 -1.69 --- --- --- --- 4.30
2018 1.22 -1.52 -1.48 -1.02 0.91 1.04 -1.18 2.53 -0.20 2.07 -1.13 0.70 1.85
2017 -1.42 4.75 0.66 2.93 -0.35 0.27 -1.00 1.30 1.45 2.58 -1.74 2.60 12.48
2016 -4.33 0.67 4.12 0.85 -0.22 1.03 0.55 -0.31 0.84 0.05 -3.31 -1.90 -2.21
2015 -1.44 2.46 1.50 -0.46 1.89 -0.41 -1.98 -0.49 2.79 -0.45 1.17 0.84 5.42
2014 0.03 3.23 2.07 -1.46 -0.82 -0.57 0.77 -0.94 0.60 0.95 1.36 1.53 6.85
2013 3.18 1.09 1.78 -1.52 2.23 0.42 3.80 1.60 2.06 2.20 0.81 0.70 19.85
2012 2.46 2.84 2.94 1.37 -2.16 0.85 0.05 2.11 1.18 -0.96 0.20 1.87 13.37
2011 2.45 1.93 1.03 -1.58 1.36 1.51 1.17 -7.13 -0.30 1.86 1.46 1.24 4.71
2010 1.07 0.62 0.50 6.23 -1.59 -3.90 3.44 -0.86 3.65 1.42 1.37 3.20 15.80
2009 --- --- --- 4.79 1.47 3.02 5.66 4.87 2.08 -0.87 2.83 2.61 29.6
TERMS AND INVESTOR SERVICES
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SUMMARY OF KEY TERMSAlignment of interests Over 25% insider assets are invested in the Fund
Fees
Class A: 1.65% annual fee + performance fee, 30-day
redemption notice period
Class B: Available to certain institutional investors at the
discretion of the Manager
Perpetual High Water MarkPerpetual; performance fee does not start accruing until after
the previous losses have been recouped + hurdle rate
Performance Fee20% of profits over a hurdle rate equal to the higher of 3% or
the 1-year Bank of Canada Treasury Rate
Lockup provision None
Liquidity Monthly (2% early redemption fee payable to LP)
Reporting
Monthly investment statements and pricing
Quarterly commentary
Annual Limited Partners Meeting
Custodian/Prime Broker TD Securities / Goldman Sachs / BMO Nesbitt Burns
Fund Administrator SS&C Commonwealth Fund Services
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CONTACT US
WILL JONES
Partner, Relationships
416.317.0050
LEE MATHESON
Portfolio Manager
416.640.2791
1407 Yonge Street
Suite 500 Toronto, ON
Canada M4T 1Y7
telephone 416.640.2791
www.ewingmorris.com
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DISCLAIMER
This document does not constitute an offer to sell units of the Broadview Dark Horse LP.
Past performance does not guarantee future results. The information contained herein
reflects the views of Ewing Morris as of the date of publication. These views are subject to
change without notice at any time subsequent to the date of issue. All information
provided is for informational purposes only and should not be construed as personal
investment advice. Users of these materials are advised to conduct their own analysis
prior to making any investment decision. While the information is believed to be reliable,
no representation or warranty is made concerning the accuracy of any data presented.
There can be no guarantee that any projection, forecast or opinion will be realized.