Everest Babcock & Brown Opportunities Fund

The Everest Babcock & Brown Opportunities Fund (“EBBOF” or the “Fund”) is being managed to preserve value, realise assets where appropriate and return capital to unitholders, until the fund is in a position to be formally terminated. Based on information received from the underlying management of the remaining assets of the Fund, the aggregate value of the Fund’s assets is estimated to be approximately $0.0792 per unit as at 30 June 2011.

The Investment Portfolio

The original investment objective of the Fund was to invest in a diverse portfolio of private equity co-investments primarily originated by Babcock & Brown. Recognising market conditions and the demise of Babcock & Brown, the Fund is currently being managed to preserve value, realise assets where appropriate and return capital to unitholders. We are continuing to be involved in restructuring processes, as we seek to move the residual assets away from management entities associated with Babcock & Brown and into more sustainable capital structures. While these processes are now largely complete, restructuring initiatives generally have been difficult to implement given the Fund’s and other co-investors lack of financial capacity to inject additional equity to assist with discussions with lenders. The remaining assets in the portfolio remain under stress and a number are marked at a zero carrying value.