INVESTMENT HISTORY



Herb Jackson managed investment portfolios for his private clients from January 1, 1985 through June 30, 1996. Herb’s investment performance for this 11 ½-year period represents a time and dollar-weighted aggregate performance of all advisory accounts under management during this time frame. Herb’s advisory accounts were managed as “balanced accounts” at his clients’ request, yet they outperformed the S&P 500 index during this period despite their conservative asset allocation. (Each portfolio on average maintained a 65% to 80% equity allocation with the remaining 20% to 35% invested for income and principal protection in cash equivalents, short- to intermediate-term municipal and other bonds, including corporate convertible issues.) The equity portion of these portfolios outperformed the portfolios as a whole, compensating for the underperformance of the more conservative assets that comprised the balance of the accounts. Pure equity performance for these advisory accounts exceeded 19.5% compounded annually. Herb attributes the out-performance of his portfolios’ equity base to his “equity development” style of investing. (See charts and related information below.) Herb left the investment advisory business in mid-1996 because he felt stocks in general were becoming overvalued, and accordingly he was having increasing difficulty finding the attractive special situation investment opportunities upon which he has achieved much of his investment success. From late 1996 through 2005, Herb managed a small, “angel” venture fund through his investment company, Renaissance Ventures, LLC.

Herb returned to the business of investing in special situations through Renaissance Ventures in July of 2002, using a concentrated, private equity approach to investing in public and private securities. He conducts extensive due diligence on projects prior to a initiating a transaction and subsequently focuses on developing and increasing its investment value. Renaissance Ventures currently originates and participates in proprietary transactions for Private Equity Sponsors and their affiliated Investors.

Charts and Other Items Related to the Manager’s Prior Investment Record.  

·          Pure equity performance exceeded 19.5% compounded annually.

·          Pure equity performance enhanced by Mr. Jackson’s “equity development” methods.  


Previous “Equity Development” Projects by the Manager.


Mr. Jackson’s “equity development” projects have generally involved investing in a contrary, value oriented, public equity security at depressed market prices after extensive due diligence.  After establishing a position, he has then assisted management in enhancing the security's market value through syndication efforts or otherwise, prior to exiting the investment.  Average performance of Mr. Jackson’s “equity development” projects exceeded a 35% Internal Rate of Return (IRR), including a near total loss from one 1996 – 2000 project, Broadband Technologies Corp.

   

ECA

We acquired common stock in Electronics Corp. of America through public market purchases from June, 1984 through October, 1985 at prices ranging from $15.63 to $19 per share (at an average price of approximately $17 per share).  The company paid a dividend of $1.40 per share equating to a dividend yield of 8.2% on our average cost.  Rockwell Automation, Inc. (NYSE: ROK) agreed in September, 1986 to acquire the company for $52 cash per share.  Our investments generated a return on invested capital in excess of 3X.  (Approximate IRR ~ 96.09%).

 

MNC FINANCIAL

We acquired common stock in MNC Financial through public market purchases in July, 1991 at an average price of $3.29 per share for our hedge fund.  We later sold positions in MNC in various public market sales in January, 1992 at an average price of approximately $6 per share.  NationsBank Corp. (now Bank of America) later acquired the company for $1.36 billion in stock in October, 1993 or $15.17 per MNC share.  Our fund investments generated a return on invested capital of approximately 2X.  This project, though, demonstrates the benefits of a longer-term horizon for realizing ultimate value.  Where we retained MNC for longer-term accounts because of improving fundamentals, our ultimate return on invested capital exceeded 4X.  (Approximate IRR ~ 92.33%). 

   

 We acquired common stock in The Timberland Company (NYSE: TBL) through public market purchases from January, 1992 through October, 1992 at prices ranging from $10.91 to $14.20 per share (for an average price of approximately $12 per share).  We later sold positions in Timberland in various public market sales in May, 1994 at an average price of approximately $47 per share.  Our investments generated a return on invested capital of approximately 4X.  (Approximate IRR ~ 92.64%).

   

We acquired common stock in First Mississippi Corp. through public market purchases from July, 1993 through March, 1994 at prices ranging from $9.38 to $15.48 per share (at an average price of approximately $12 per share).  The company later changed its name to ChemFirst, Inc.  The company initiated a common stock buyback in May, 1995; announced record profits through June 1995; spun off First Mississippi Gold Corp. in September, 1995; announced stock buyback, November, 1995; spun off Mississippi Chemical Corp. in October, 1996.  DuPont E.I. de Nemours & Co. (NYSE: DD) acquired ChemFirst in November, 2002 in a cash transaction valued at $408 million or $29.20 per ChemFirst share.  Our investments generated a return on invested capital of approximately 4X, including the returns from spin-offs.  (Approximate IRR ~ 31.46%).

 


We acquired common stock in Summa Four, Inc. through public market purchases from March, 1996 through October, 1997 at prices ranging from $7 to $13.13 (at an average price of approximately $11 per share).  Cisco Systems, Inc. (Nasdaq: CSCO) acquired Summa for $116 million of Cisco stock in November, 1998 or approximately $16.50 per Summa Four share.  Our investments generated a return on invested capital in excess of 2X from the sale of Cisco shares received in the acquisition.  (Approximate IRR ~ 22.51%).

 




We acquired common stock in Cree, Inc. (Nasdaq: CREE) through public market purchases from July, 1995 through March, 1997 at prices ranging from $9.63 to $18.75 (at an average price of approximately $15 per share – or $7.50 per share adjusted for subsequent split).  The company split its common stock 2:1 in July, 1999.  We later sold positions in Cree, Inc. in various public market sales December, 1998 through June, 2000 at a split-adjusted price of approximately $46 per share.  Our investments generated a return on invested capital in excess of 6X.  (Approximate IRR ~ 70.04%).  




We acquired common stock in Hurco Companies, Inc. (Nasdaq: HURC) through public market purchases from April, 2003 through July, 2003 at prices ranging from $1.55 to $2.80 (at an average price of approximately $2.35 per share). We later sold positions in Hurco in various public market sales during December, 2006 at an average price of approximately $31 per share. Our investments generated a return on invested capital in excess of 13X. (Approximate IRR ~105.30%).  

  




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