The investment objective of the Lion Capital Management Group is to seek medium-term capital appreciation through leveraged trading of both long and short portfolios of equity and fixed income securities of issuers traded on the United States markets (including on stock exchanges and in the OTC markets) and their derivatives pursuant to the proprietary leveraged securities trading strategies of the Investment Adviser, other direct and indirect investment schemes.

Investments will be made under the advice of Lion Capital Management LLC, the Registered Investment Adviser of the group.

Lion Capital Management LLC, the Registered Investment Advisory firm of the group focuses on hedge funds that are specialized in long/short equity strategy, fixed income strategies, event driven strategies, global macro and multi-process strategies. Lion Capital Management will be using derivatives products and leverage to execute its strategies, and take other positions on the markets to increase its members' and investors' return on investment (ROI).

Investment Approach and Philosophy

These types of hedge funds are all specialized in the application of the group's statistical methodology to portfolio management. This proprietary approach, called the Statistical Approach to Trading, involves the following four fixed rules:

1. Define fixed mathematical rules that indicate when to buy and sell assets and how much to buy or sell.
2. Test those rules on as much historical market data as possible to determine which rules provide the best risk/reward characteristics on a daily basis over the entire historical data set. This is measured in terms of how well a portfolio using those rules would have performed on a daily basis over the entire historical data set.
3. Evaluate the results to insure that the test findings meet high standards of statistical reliability and validity.
4. Implement the rules in actual trading exactly as they were tested, without any human intervention, judgment or override.

The perceived strengths of this approach are based: (a) in its ability to identify rules that may work well for particular market classes; (b) in its overall portfolio focus; and (c) in the discipline and consistency that it provides. The application of this approach attempts to implement the cornerstones of Lion Capital Management Group's investment philosophy, Diversification, Discipline and Consistency.

The objective of the approach outlined above is to successfully apply the group's approach to investing in the US equity and the fixed income markets. In doing so, we intent to show consistent ROI commensurable to the accrued result of a global systematic exchange traded fixed income investment methodology (the "Global Systematic System") in an historical equity and fixed income markets fashion.

Structure of Investments Strategies

The principles of our fund open up a number of possibilities with respect to creating hybrid structures of funds in optimizing some of the efficiencies inherent to master feeder hedge funds. One of our most intriguing possibilities with regard to this structure is the combination of our master feeder structure with an umbrella structure that employs multiple investment strategies under a single entity to meeting the investment needs of our domestic and offshore investors.

The Multi-strategy concept of the fund is proprietary hedge fund of funds composed of about 15 strategies. The portfolio funds allocate its assets among a number of its investment strategies recommended by the investment adviser rebalanced from time to time as to maintain an approximately equal allocation of the portfolio among the strategies throughout all market cycles. Lion Capital Management Group Funds' current portfolio Strategies are as follow:

• Long/Short Equity
• Exchange-Traded Fixed Income Instruments covering the European Union, Japan, Australia, Canada, and the U.S.
• Convertible Arbitrage
• Event Driven-Risk Arbitrage in M&A
• Event Driven-Distress Securities
• Event Driven-Regulation D
• Event Driven-High Yield
• Equity Market Neutral
• Equity Trading
• Global Macro
• Fixed Income-Interest Rates Swap Arbitrage
• Fixed Income-U.S. & Non U.S. Government Bond Arbitrage
• Fixed Income-Forward Yield-Curve Arbitrage
• Fixed Income-Mortgage Backed Securities Arbitrage
• Emerging Markets (Gov. & Corp.) Bonds Arbitrages

The structure of the fund in term of asset allocation will be defined as follow:

1. Exchange-Traded Fixed Income Instruments-27% of all the Assets under management
2. Long/Short Equity-29% of all the Assets under management
3. Event Driven Strategies-17% of all the Assets under management
4. Global Macro-14% of all the Assets under management
5. Fixed Income-Arbitrage Strategies-13% of all the Assets under management

Trading Methodology

Lion Capital Management's trading methodology is a systematic, long-term, trend-following approach implementing techniques that avoid adverse risk/reward characteristics. While the goal is to capture long-term trends, we only enters the market during periods when the risk/reward of a trade is heavily in the manager's favor. If unacceptable risk characteristics is found, we will automatically stay awy from any trend that has even a positive profit expectation. The end result is a trading methodology that would provide an exceptional and an uncorrelated ROI to the market.

Lion Capital Management considers its proprietary research methodologies as superior. These techniques would help the group in contantly identifying opportunities even during tought periods.

All of the methodologies we use are robust with very few degrees of freedom/parameters.

Our understanding of the financial market has always helps in overcoming undesirable outcomes. We understand that statistics require many assumptions. But it is extremely difficult to know which of those assumptions will have effect on the manager's action. This is the real challenge people face today in this constantly evolving industry.

Lion Capital Management success comes from its original thinking and its managers refusal to blindly accept statistical methodology, economic theories, and even common wisdom in the investment industry. We use no assumptions in research that have not secured a proven track record. We strive to trade the most diversified hedge fund portfolio possible for our investors. Our portfolio contains 13 different strategies markets covering not only the equity and fixed income markets, but also the interest rate, option, swap, swaption and other derivatives markets. The strategies are individually weighted for diversification purposes, resulting in an overall 53% equity-based instruments and 47% fixed income-based exposure.