This document outlines an investment opportunity in emerging and frontier markets debt. It notes that emerging market economies are experiencing high growth while developed markets maintain low interest rates. This creates an opportunity to invest in emerging market corporate bonds, which offer higher yields than US high yield bonds yet carry less risk due to stronger balance sheets of emerging market companies. The proposed investment funds would pursue this opportunity by investing in emerging market sovereign and corporate debt across various countries and industries.

1. CAPITAL

2. INVESTMENT CASE

3. OPPORTUNITY
Identify the best investment opportunities in the Emerging
and Frontier Markets, providing clients non-leveraged
equity-like returns with fixed income seniority within a
company’s capital structure
3

4. MARKET PROFILE
Current Scenario
●High growth expectation for the Emerging Markets
●Tendency for the developed economies to maintain its low
fixed income rates
●Constantly growing overseas interest in Emerging Markets
assets
●Well-managed Emerging Market companies solidified their
balance sheets and are gaining access to capital
4

5. OPPORTUNITY
INVESTING IN EMERGING MARKETS HIGH YIELD
Emerging Markets and Advanced Economies GDP Growth
500%
GDP Current USD Emerging Markets
400%
GDP Current USD Developed Economies
300%
200%
100%
0%
90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11
Source: Bloomberg / Jan 2012
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6. OPPORTUNITY
INVESTING IN EMERGING MARKETS HIGH YIELD
EM High Yield, US High Yield and US Equities accumulated return over the last 10 years
Accumulated returns over the last 10 years
150% 140% 131%
S&P 500 Index
125% 120%
CS EM Corp Bonds Index
100%
iBoxx USD Liquid HY Index 100%
88%
75%
80%
50%
60%
25%
40%
0%
22%
20% 16%
-25% 11% 8%
-50% 0%
SPX IBOXHY CEMBTOTR
dez-07
dez-10
dez-01
dez-02
dez-03
dez-04
dez-05
dez-06
dez-08
dez-09
dez-11
Vol (Std. Dev.) Acum. Return
Source: Bloomberg / May 2012
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7. OPPORTUNITY
INVESTING IN EMERGING MARKETS HIGH YIELD
Ever since 2002, the major selloffs in Emerging Markets Debt (EMD) occurred after credit
crises that emanated from the developed world, not the emerging world.
The Lehman bankruptcy and global credit crisis created a huge buying opportunity in EMD in
2008/2009. If this pattern holds, the selloff induced by the European crisis could be creating
another big buying opportunity.
Source: J.P. Morgan. As of December 31, 2011.
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8. OPPORTUNITY
INVESTING IN EMERGING MARKETS HIGH YIELD
Emerging Markets (EM) have accounted for a large and increasing share of global economic growth.
Not only do EM generate most of the world’s economic growth, they contain most of the world’s
population, hold most of its foreign exchange reserves and produce about half of its GDP. It is benefiting
from powerful tailwinds that don’t figure to dissipate anytime soon. Also, the trend toward improving
credit quality in EM is structural and secular in nature. The deleveraging process is extremely clear.
Sources: UBS and J.P. Morgan. All data annualized. Emerging market
corporate debt is denominated in USD. As of December 31, 2011
.
8

9. OPPORTUNITY
INVESTING IN EMERGING MARKETS HIGH YIELD
Emerging Markets High Yield carries less leverage, lower default rates and pays over
200bps more yield vis a vis US High Yield. Furthermore, if compared to B rated Bonds this
number is significantly higher. All of this for the same expected recovery value on its
unsecured debt should a company default.
Source: J.P. Morgan. As of December 31, 2011.
Note: Emerging Markets Corporate Debt is denominated in USD.
9

10. OPPORTUNITY
INVESTING IN EMERGING MARKETS SOVEREIGN
●Emerging Markets countries in general have
higher expected growth rates with often
lower leverage when compared to
Developed Markets
●Selective Emerging Markets countries
still show gaps between its current ratings
and their macroeconomic reality providing
opportunities to obtain higher returns when
upgrades occur
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11. OPPORTUNITY
INVESTING IN EMERGING MARKET BONDS
● The Emerging Markets Debt market is
dominated by Large Institutional Funds
and Private Banks
● Large institutional funds also tend to focus
on Emerging Markets High Grade credits
due to issue size and liquidity
● Private Banks will mostly offer clients
obvious Emerging Markets High Grade
names which the bank supports and that the
client feels comfortable with
Lack of reach from the larger players often
forces the Emerging Markets High Yield
asset class to provide investors higher
yields, even beyond its implicit risks
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12. PRODUCTS

13. INVESTMENT FUNDS
GALLOWAY’S FIXED INCOME ALTERNATIVES
• Galloway Global Emerging Markets High Yield Fund
• Galloway Latin America High Yield Fund
• Galloway Brazil Biased Investment Grade Fund
• Fixed Income Long-only Funds
• Corporate and Sovereign Credit Bonds
• Galloway’s Multi-approach Due Diligence
• Well Diversified Portfolios
• Consistent Risk-Adjusted Returns
• No Leverage and no use of Derivatives
• Fully Invested
13

14. INVESTMENT PROCESS
GENERATION OF INVESTMENT IDEAS
● Experienced investment team focused on
Emerging Markets: over 50 years of EM
experience combined
● Proprietary Research: In depth analysis of
opportunities through company visits, calls and
meetings with companies’ top management
● Sell Side & Buy Side Research: Wide network of
relationships with counterparties around the
world (Investment Funds, Family Offices, Brokers,
Banks, etc.) providing a deeper level of information
and access to local expertise
14

15. INVESTMENT PROCESS
PORTFOLIO CONSTRUCTION
● Committee’s based investment decisions:
• Monthly: Strategy and Risk Management Committees
• Weekly: Investment Committee
● Daily Meetings to discuss investment opportunities
● Dynamic process of monitoring the portfolio and
opportunities through the constant reassessment of
the positions
● Replacing good ideas with better ideas.
We change a position when we find a bond with:
• The same risk and a higher yield
• The same yield and a lower risk
15

16. INVESTMENT PROCESS
MULTI-APPROACH DUE DILLIGENCE
There is always a reason why a given company is paying an above average market return.
To assert why, and reach conviction to invest, we first have to understand:
1. COUNTRY MACRO 2. GEOPOLITICS 3. SECTOR
ECONOMIC OUTLOOK
It is paramount for companies Companies have to be Thoughtful analysis to understand
and/or sovereign issues to be in aligned with local the sector’s importance to the
countries or regions that have a governments country (subsidies, government
positive growth outlook or are in a support, etc); and its relative value
turning point to global peers
16

17. INVESTMENT PROCESS
MULTI-APPROACH DUE DILLIGENCE
4. CREDIT METRICS 5. LOCAL NETWORK 6.TECHNICAL ANALYSIS
In-depth analysis of the Company and/or country Careful analysis of entry and
Company/Country’s and Bond have to be checked through exit points, new issuance
structure. (leverage, debt profile, our local network of outlook and relative value
cash flow, ownership structure, etc.; contacts (sell and buy side)
Bond seniority, guarantees,
covenants, etc.)
7. GOLDEN RULE: It is fundamental that the cost of a company/country not
paying its obligations be “higher” than if it pays.
17

18. RISK MANAGEMENT
Galloway Global EM Galloway Latin America Galloway Brazil Biased
High Yield High Yield Investment Grade
Fixed Income Fund Fixed Income Fund Fixed Income Fund
● Limit of 20% for single countries ● Limit of 20% for single countries ● Minimum of 70% for Brazil
Country Risk ● Limit of 40% for Brazil, Russia, India ● Latam Countries Only ● Up to 30% on Other Countries
or China
● Limit of 5% per individual corporate ● Limit of 10% per individual corporate ● Limit of 10% per individual corporate
credit at cost credit at cost credit at cost
Corporate Risk ● Limit of 20% per individual Sovereign ● Limit of 20% per individual Sovereign ● Limit of 20% per individual Sovereign
Bond at cost Bond at cost Bond at cost
● High Yield ● High Yield ● Investment Grade
Credit Risk ● Average Credit Rating: B ● Average Credit Rating: BB ● Average Credit Rating: BBB
● Limit of 30% for any other currency ● Limit of 30% for any other currency ● Limit of 30% for any other currency
than USD than USD than USD
Currency Risk ● Non USD Bonds must settle via ● Non USD Bonds must settle via ● Non USD Bonds must settle via
Euroclear / Cedel Euroclear / Cedel Euroclear / Cedel
● Limit of 20% in less liquid bonds ● Limit of 20% in less liquid bonds ● Limit of 10% in less liquid bonds
Liquidity Risk (Issues size below USD 200 MM) (Issues size below USD 200 MM) (Issues size below USD 200 MM)
* All Bonds must be Euroclearable/ DTC/ Clearstream
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19. MAIN CHARACTERISTICS
Galloway Global EM Galloway Latin America Galloway Brazil Biased
High Yield High Yield Investment Grade
Fixed Income Fund Fixed Income Fund Fixed Income Fund
NAV Liquidity Monthly Monthly Monthly
Minimum Initial Investment USD 100,000 USD 100,000 USD 100,000
Additional Investment USD 25,000 USD 25,000 USD 25,000
Redemption Monthly with 15 days notice Monthly with 15 days notice Monthly with 15 days notice
Management Fee 1.5 % per year 1.0 % per year 0.5 % per year
Performance Fee 15% quarterly on a HWM basis 10% quarterly on a HWM basis 10% quarterly on a HWM basis
ISIN Code VGG3723N1024 VGG3723N1362 VGG3723N1446
Administrator SFT Fund Admin. Services SFT Fund Admin. Services SFT Fund Admin. Services
Custodian Pershing Pershing Pershing
Auditor Ernst & Young Ernst & Young Ernst & Young
19

20. TRANSPARENCY
FULL DISCLOSURE
Easy access to Portfolio Management team
and current portfolio ideas
Portfolio positions and trading history
disclosure upon client’s request
20

21. THE MANAGER

22. THE MANAGER
Galloway Capital is a global Emerging Markets asset
management company focused on active Fixed
Income High Yield strategies. Galloway counts today
with 19 professionals, managing over USD 400 Million
across a broad range of EM Fixed Income strategies.
With a solid and extensive research approach and a
performance-driven investment style, our team aims to
identify the most interesting opportunities around the world
to provide equity-like returns with fixed income risk
The investment committee members combine 50 years
of careers dedicated to Credit including: Trading, Sales,
Origination, Due Diligence and Execution.
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23. ASSET MANAGEMENT STRUCTURE
INVESTMENT COMMITTEE
Nathan Shor
Guillermo Bauder
Ulisses de Oliveira
3
RESEARCH & PM
Nathan Shor RISK MANAGEMENT COMPLIANCE OPERATIONS SALES & PRODUCTS
Guillermo Bauder João Ferrari Sergio Ravache Rogerio Crus André Simon
Ulisses de Oliveira
7 1 1 3 3
TRADING
João Paulo Vicente
3
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24. INVESTMENT COMMITTEE
Nathan Shor
Nathan Shor holds a BSBA from Boston University (Boston, USA) and a Masters degree in Finance from IESA (Instituto Estudios Superiores de
Administracion, Caracas, Venezuela). He began his professional carrier at The Nash Fund in 1998, being responsible for its Emerging Markets
Fixed Income area. In 2003, he joined forces with Convenção, a Brazilian Broker Dealer to develop their Emerging Markets Fixed Income desk.
Envisioning the future of the Emerging Markets Fixed Income market, Nathan decided to create Galloway Emerging Markets, providing Fixed
Income investment solutions to institutional investors and high net worth individuals. The creation of Galloway Capital Management in 2006 came
with the idea of an asset management company focused on their Emerging Markets Fixed Income expertise. Galloway Capital manages today a
broad range of Emerging Markets Fixed Income funds.
Guillermo Bauder
Guillermo studied business in the UNIMET (Universidad Metropolitana in Caracas-Venezuela). He began his career at Confimerca, the broker
dealer of Grupo Confinanzas in 1993. Starting as a floor broker in the Caracas Stock Exchange, he was later transferred to the Local Fixed
Income Area and finally ended at the International Fixed Income Area. In 1998 was a Foreign Associate in Peru for North American Institutional
Brokers covering US Equity institutional clients. In 2000 joined FTC Securities as Foreign Associate for Latin America, in charge of developing
Fixed Income and US Equity for institutional clients. In 2003, he joined forces with Convenção, a Brazilian Broker Dealer to develop their Emerging
Markets Fixed Income desk. Envisioning the future of the Emerging Markets Fixed Income market, Guillermo decided to create Galloway
Emerging Markets, providing Fixed Income investment solutions to institutional investors and high net worth individuals. The creation of Galloway
Capital Management in 2006 came with the idea of an asset management company focused on their Emerging Markets Fixed Income expertise.
Galloway Capital manages today a broad range of Emerging Markets Fixed Income funds.
Ulisses de Oliveira
Ulisses holds a Bachelor degree in Science of Finance and International Business from New York University, certified Series 7 and 66 registered,
FSA Rules an Regulations, Securities and Derivatives registered. He began his career in 1996 at then commodity house E D & F Man. Later he
joined Safra Bank of NY as Assistant Treasurer until 2000 when he joined Citigroup NY as a Relationship Officer, later he was Vice President of
Investments responsible for research, originating and marketing investment ideas directly to clients on a wide range of asset classes: emerging
markets and G-7 fixed income, equities, options, and structured products. At the beginning of 2009 Ulisses joined Galloway Capital as a partner
and senior portfolio manager responsible for its Emerging Markets Fixed Income funds.
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25. CONTACT & LEGAL INFORMATION
+55 11 4082-2250
galloway@gallowaycapital.com
www.gallowaycapital.com
This presentation has been prepared by Galloway Capital. This presentation is provided for informational purposes only and does not constitute or
should not be construed as an offer to buy or sell or solicitation of an offer to buy or sell any financial instrument or to participate in any particular
trading strategy in any jurisdiction. The information herein is believed to be reliable as of the date in which this material was issued and has been
obtained from public sources believed to be reliable. Galloway Capital does not make any representation or warranty, express or implied, as to the
completeness, reliability or accuracy of such information, nor is this presentation intended to be a complete statement or summary of the
securities, markets or developments referred to herein. Opinions, estimates, and projections expressed herein constitute the current judgment of
the analyst responsible for the substance of this presentation as of the date in which it was issued and are therefore subject to change without
notice. Prices and availability of financial instruments are indicative only and subject to change without notice. The financial instruments discussed
in this presentation may not be suitable for all investors, and it does not take into account the investment objectives, financial situation or particular
needs of any particular investor. Investors should obtain independent financial advice based on their own particular circumstances before making
an investment decision on the basis of the information contained herein and it is strongly recommended that investors read carefully the disclosure
document of the funds presented herein before making an investment decision. Foreign investments may involve greater risk than domestic
investments. If a financial instrument is denominated in a currency other than an investor’s currency, a change in exchange rates may adversely
affect the price or value of, or the income derived from, the financial instrument, and the reader of this presentation assumes any currency risk.
Income from financial instruments may vary and its price or value, either directly or indirectly, may rise or fall. Past performance is not necessarily
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