About

1. GENERAL

1.1. This Environmental, Social and Governance Policy (hereinafter – Policy) shall lay down the main environmental, social and sustainable governance objectives that UAB “LORDS LB ASSET MANAGEMENT” (hereinafter – Management Company) shall aim to implement in order to contribute to public well-being, promote sustainable governance and the achievement or long-term investment goals.

2. TERMS

2.1. ESG – the main factors (environmental, social and governance), which help in determining the sustainability, ethical, social and environmental impact of an investment or a company. The issues of these areas include but are not limited to such criteria as effects of the environment, climate change, employee relations, tax evasion, corruption, good governance, remuneration of management, transparency. 2.2. Due Diligence – a procedure which is employed prior to the acquisition of investment assets, during which, considering the type of investment, the financial, commercial, tax, legal and technical aspects of the investment are evaluated in order to ensure that the planned investment is suitable and corresponds to the goals and investment strategy of the Fund. 2.3. Principles – United Nations supported Principles for Responsible Investment (UNPRI) which offer a menu of possible actions for incorporating ESG risks and opportunities into investment practice 2.4. Fund – an undertaking in collective investment managed by the Management Company. 2.5. Fund Manager – An employee of the Management Company, who has been appointed as the person who makes decisions concerning the Fund and its management by the decision of the Management Company board and operating according to the power of attorney issued by the Management Company, or the CEO. 2.6. Management Company – JSC “Lords LB Asset Management”. 2.7. RE – Real Estate.

3. MAIN PRINCIPLES OF THE POLICY

3.1. The Management Company aims to incorporate the following Principles into its investment and management processes: 3.1.1. Principle 1: We will incorporate ESG issues into investment analysis and decision-making processes. 3.1.2. Principle 2: We will be active owners and incorporate ESG issues into our ownership policies and practices. 3.1.3. Principle 3: We will seek appropriate disclosure on ESG issues by the entities in which we invest. 3.1.4. Principle 4: We will promote acceptance and implementation of the Principles within the investment industry. 3.1.5. Principle 5: We will work together to enhance our effectiveness in implementing the Principles. 3.1.6. Principle 6: We will each report on our activities and progress towards implementing the Principles. 3.2. When implementing the Principles and ESG objectives the Management Company shall aim: 3.2.1. To conduct assessments of environmental risks, social problems and expectations of stakeholders when evaluating potential investment opportunities. 3.2.2. To foster long term sustainability in investments and to make socially responsible decisions. 3.2.3. To employ sustainable governance, which would ensure sufficient control, risk management, alignment of interests and the management of conflicts of interests. 3.2.4. To provide a working environment which would provide safe working conditions, competitive wages and to respect the rights of employees. 3.2.5. To ensure that the requirements against money laundering and terrorist financing are met. 3.2.6. To respect human rights and to aim to ensure that no investments are made into companies that use child labour, forced labour, or employ discriminatory practices. 3.2.7. To provide information to investors of Funds managed by the Management Company in a timely manner and to aim to promote transparency in its activities.

4. EXCLUSIONS LIST

4.1. The Management Company and Funds that it manages will aim towards environmental protection and social well-being by not contributing to certain industry sectors. For this purpose, the Management Company shall draw up and make use of an exclusions list which shall define controversial investments in which the Management Company does not plan to invest any assets of its managed Funds. 4.2. The Management Company and its managed Funds shall abstain from investments into entities and sectors specified in the exclusion list.

5. APPLICATION OF THE POLICY TO INVESTMENTS

5.1. The Management Company undertakes to consider the main ESG aspect while making investments, conducting investment Due Diligence as well as while monitoring and evaluating the Fund assets managed without prejudice to the Management Company’s commitment to strive to the best returns for its investors and to always act in their best interests. 5.2. The Fund Manager fills out the ESG Assessment Form prior to making an investment decision.

Real Estate

5.3. Prior to making an investment into RE, during the due diligence phase the following aspects must be considered: 5.3.1. What ESG opportunities and risks does the RE object face; 5.3.2. How can ESG and climate change risks influence the RE investment value during its lifecycle; 5.3.3. Will there be a need to reconstruct the RE object due to legal requirements or physical deterioration during its lifecycle; 5.3.4. How can society moving towards the prioritisation of ESG goals influence the value of the object? 5.4. Prior to the purchase of an RE object and during its management (annually) at least these indicators related to the RE object shall be monitored: 5.4.1. Energy use (GW/h and kW/h/m2); 5.4.2. Assigned energy efficiency class; 5.4.3. Waste produced (t and t/m2) and the level of recycling (%); 5.4.4. Water use (m3 and m3/m2); 5.4.5. BREEAM and or other sustainability certificates. 5.5. After the acquisition of the RE object or prior to an investment into a greenfield RE project, an ESG plan must be drawn up, which would specify ESG goals and actions planned over the next year and which would include: 5.5.1. The main and quantitative goals to reduce the energy and water use and the waste created by the RE object during a specified period; 5.5.2. Planned steps to be taken in order to receive an appropriate suitability certificate for the RE object; 5.5.3. How will the tenants of the RE object be encouraged to aim towards ESG goals.

Private equity

5.6. The Management company will aim to incorporate an assessment of ESG opportunities and risks and the effect that they might have on the investment within the Due Diligence assessment done prior to a private equity investment as long as it does not prejudice the Management Company’s commitment to always act in the best interest of its investors. Prior to the investment at least these aspects are assessed: 5.6.1. Is the entity into which investment is planned related to the sectors specified in the exclusion list; 5.6.2. Have sanctions or disciplinary measures been applied the entity into which investment is planned during the last 5 years due to human right violations, serious environmental damage or non-compliance with anti-money laundering and terrorist financing measures; 5.6.3. How the investment can contribute to promoting ESG goals of the Management Company.

Exclusion list

The Management Company and Funds that it manages shall abstain from investments into the following sectors: Weapons – the sector undertaking in productions, sales or distribution of weapons, ammunition, combat vehicles, explosive devices or their parts. Tobacco – the sector undertaking in production, sales or distribution of tobacco and related products. Alcohol – the sector undertaking in production, sales or distribution of fermented or distilled alcoholic products. Gambling – the sector undertaking in gambling products or services, including related equipment, software or maintenance. Coal – the sector undertaking in extraction or sale of coal or and the coal energy sector. Nuclear energy – the sector undertaking in products or services of the nuclear industry, the generation or sale of nuclear energy.