We are value investors. We seek to achieve superior long-term performance by acquiring equity securities of financially strong, well-managed companies run by capable managements at market prices significantly below our assessment of their business value. We sell stocks when they approach our appraisal. Our average holding period is five years, but this can extend to ten or more years as long as the value continues to grow faster than the stock price. Equities purchased at prices substantially less than their intrinsic worth protect capital from significant permanent loss and also appreciate substantially once the market recognizes the company's economic value.

We have pursued this philosophy since our inception in 1975. We established the Longleaf Partners International Fund in 1998 to partner with our clients in equity investments outside the United States. Japan has been the largest, most important non-U.S. market for Southeastern Asset Management ("Southeastern") since 1998.

For over 30 years, we have practiced partnership investing in the United States, Japan, and around the world. We partner with our clients by investing our private capital alongside our clients' capital. We partner with managements by selecting capable leaders who share our interest in their company's long-term success. We believe that managers who build value per share over long periods of time ultimately provide superior benefits to all stakeholders. We support managements when they pursue unpopular policies that cause short-term pain in exchange for long-term benefits. We do not seek conflict with managements, but we will exercise our fiduciary duty to protect our interests by opposing management policies that impair or detract from corporate value. In general, we prefer to partner with owner-operators who invest their own capital alongside ours in their company's common equity.

• We will treat your investment with Southeastern as if it were our own.
• We will invest for the long term, while always striving to maximize returns and minimize business, financial, purchasing power, regulatory, and market risks.
• We will choose our equity investments based on their discounts from our appraisals of their corporate intrinsic values, their financial strengths, their management, their competitive positions, and our assessments of their future earnings potential.
• We will concentrate our assets in our best ideas.
• We will consider closing to new investors if closing would benefit existing clients.
• We will discourage short-term speculators and market timers from joining us as the long-term investors.
• We will continue our efforts to enhance client services.
• We will communicate with our investment partners as candidly as possible.

We look for good businesses, run by good people, and selling for a good price.

To align our interests with those of shareholders and prevent conflicts of interest, our Code of Ethics requires all employees to limit their investments in publicly traded equities to Longleaf Partners Funds, unless granted clearance by a compliance committee. All employees must report their securities transactions quarterly. Boards of Trustees review the administration of the Code of Ethics annually, and receive reports of any violations.

The Independent Trustees of the Funds must obtain clearance before making personal securities investments to avoid conflicts of interest, and must invest in the Longleaf Funds an amount at least equal to their Trustees' fees. The employees and affiliates of Southeastern are collectively among the largest owners across the three Longleaf Funds.