Quarterly Commentary 2Q 2021

EGA Innovation Strategy From the EGA Portfolio Management Team

Performance Recap And Portfolio Positioning The Innovation Strategy returned 14.7% (gross, est.)/14.5% (net, est.)* during Q2 and 18.1% (gross, est.) /17.8% (net, est.)* year-to-date. Individual portfolio returns may differ due to cash flows, tax management and other factors. Comparable period returns for the benchmark (Nasdaq Composite) were 9.7%, and 12.9% respectively. Starting Q2, we have revised the presentation of portfolio allocation. Based on the revised presentation, we allocate the portfolio using secular trends that will drive future growth. Before this revision portfolio allocation was presented based on the largest revenue segment of the portfolio. We believe the revised presentation is more forward looking and better represents underlying themes for which we own these companies. Importantly, however, this change in presentation did not result in a change in the underlying investments. For the purpose of comparability, we have shared below our current and revised portfolio themes. Based on the revised presentation, quarterly returns were led by investments in artificial intelligence, digital networks and cloud computing.

The Next 3 Years Are Unlikely To Get Any Better Than The past 3 Years In Q2 the Eagle Innovation strategy completed its third year with annualized return of 25.8% (gross, est.)/25.0% (net, est.). This return is significantly above our original goal of 15% annualized return. Based on current estimates of portfolio companies’ earnings growth rate of 15-20% for the next two years and higher than historical P/E ratio of the portfolio constituents, we have kept the goal of 15% annualized return unchanged. We advise clients to not extrapolate the performance of the prior 3 years into the next 3 years.

*See performance disclosures on p. 8 of this document.

Eagle Global Advisors, LLC 1330 Post Oak Blvd., Suite 3000, Houston, TX 77056 713-952-3550 www.eagleglobal.com 2Q 2021 principles of a smaller workforce, vertical integration, shared payload model (where smaller payloads are are payloads smaller (where model payload shared integration, vertical workforce, has smaller technology a the of industry satellite space principles the to of brought organizations miniaturization programs, Private opportunities. and business space new costs to of space launch the opened commercialization in decades, decrease vehicles, few launch last of the reusability Over adoption. broader largely was to industry impediment space commercial major The a was cost NASA. launch high Extremely applications. as related and technologies satellite such defense, on focused agency, federal a of supervision the under conducted were States United the in launches All monopoly. government a was space 1980s, early the Until The Democratization Of The Industry Space 2030.by more trillionor $1.4 of revenue generate expectedto is industry space global the cases, use new and adoption growing With companies. space 1,343 into made been has investment equity long for in travel tourism, space space and internet, manufacturing, broadband latency speed/low high as such cases use new to birth giving landscape, commercial the changing fundamentally is space of “democratization” or disruption barriers the down bringing reusability, and standardization simplification, promotes that culture development a and management flat players), defense and telecom legacy by owned typically payloads larger around packed - to Source: https://aerospace.csis.org/data/space Source: - entry and enabling access to space for a wider range of companies and organizations. This This organizations. and companies of range wider a for space to access enabling and entry The The Decline in Launch Cost has Accelerated in the DecadeLast - launch - distance flights on Earth. In the past ten years, $177.7 billion of of billion $177.7 years, ten past the In Earth. on flights distance - to - low

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The World’s Microscope 2Q 2021 2Q Currently, satellites and related technologies account for 88% of space revenues. Substantial innovation and lower costs have made the use of satellites more accessible and profitable. The first microsatellite was launched in 1981 and weighed

roughly 50 Kg. Today, the smallest satellites are 5000 times smaller. Commercial space companies are using a constella- tion of such satellites as the world’s microscope from hundreds of miles above to capture data in the form of images or radio frequency signals. The advancements in artificial intelligence now allow them to process huge volumes of this data for a myriad of uses such as detecting illegal deforestation, monitoring crops for growers, detecting pollution for environmental scientists, providing critical data to first responders and emergency management teams in a crisis or a natural disaster, and among other things keeping an eye on military mobilization of an adversary. The current trend towards larger constellations of smaller satellites is supported by advances in miniaturization and the progressive decreases in launch cost, which allows operators to launch up to a hundred small satellites at a time. Smaller satellites are easier to design, evolve, and mass produce. While the resolution of their instruments is comparatively low, it is possible to synthetize higher resolution measurements via software by stitching several small samples together similar to how smartphones can synthetize 360° panoramic shots from a camera panning. Right now, close to 3,000 active satellites are orbiting above Earth. This number is expected to skyrocket in the coming years. By 2025, experts predict a 230% increase in satellite launches per year.

Airbus Earth Observation Constellation

Source: https://www.intelligence-airbusds.com/imagery/constellation/

3 2Q 2021 what amounts to an orbiting network. The lower orbit dramatically reduces the lag that usually comes with comes usually that lag the reduces dramatically create orbit lower The to network. orbiting another an to one amounts what with communicate can constellation a within Satellites earth. above miles hundred of constellation low a into costs) launch launch low and miniaturization internet by justified costs (with satellite satellites small of generation next the on working Companies gaming. online or calls zoom as such applications support cannot latency of sort That Earth. the above miles 22,000 located (600 latency high from suffers high affordable delivers internet satellite generation next the but decades, two over for available been has internet Satellite Satellite Internet low. extremely iswhich propellant, the of that is cost primary the capability, high reuse ship has tanker On Mars. planet the low in spacecraft existing an refuel to windows) of cost the reduced have the companies minus spacecraft (essentially vehicles tanker leverage to plan launch companies Furthermore, exploration. space commercial rockets, a a reusable i.e. enable of vehicle launch evolution and a the landings requires With space soft rocket. into and anything Launching precise Moon. provide the on to presence capability human with sustained beyond and moon the to missions human (ISS), Station Space International the to missions orbit, earth’s into launches satellite small targeting well most the of one is vertical launch space The Railroads and Railcars of Space 80 in resulting satellite internet, Source: https://www.spacex.com/human Source: - pe, low speed,

- orbit refueling enables the transport of up to 100 tons all the way to Mars. And if the the if And Mars. to way the all tons 100 to up of transport the enables refueling orbit - latency internet to underserved regions of the world. Legacy satellite internet internet satellite Legacy world. the of regions underserved to internet latency SpaceX Proposed Schematic of Mission to Mars - – spaceflight/mars/index.html spaceflight/mars/index.html - 800 milliseconds) because the signal is transmitted via geostationary satellites satellites geostationary via transmitted is signal the because milliseconds) 800 150 Mbps of advertised download speed and 40 milliseconds of latency. of milliseconds 40 and speed download advertised of Mbps 150

- Earth orbit prior to departing for deeper space such as to to as such space deeper for departing to prior orbit Earth

- funded areas in commercial space. Launch players are are players Launch space. commercial in areas funded

- Earth orbit (LEO), a few few a (LEO), orbit Earth

4

Space Tourism

Several companies in the space launch vertical have announced plans for space tourism. As the name suggests, space 2021 2Q tourism aims to make space more accessible to the masses with a standardized launch process and reusable launch. Space tourism can be divided into two classes: a) suborbital and b) orbital flight depending on the altitude and flight speed.

In a sub-orbital flight, a spacecraft achieves maximum ascent velocity of ~ 2500mph, just enough to rise 100km above sea level and then follows a parabolic flight path down. The spacecraft does not reach the orbit, but the travel is deemed safer, easier and cheaper while allowing passengers to experience just a few minutes of weightlessness without the need of pressure suits or helmets. Two commercial space companies are scheduled to launch their sub-orbital flights in July 2021. In an orbital flight, as the name suggests, the spacecraft reaches an orbit (~300km above sea level) and must maintain what is known as orbital velocity of 17,500 mph. It is this incredibly high speed which makes orbital space flight technically complex and therefore expensive, but allows passengers to orbit around the earth in 90 minutes.

Flight Experience of a Suborbital Flight by Blue Origin

Source: Blue Origin

As an extension of space travel, the space launch vertical players are also looking to disrupt international long distance air travel. These flights would ascend to space and run at vastly increased speed without the friction of turbulence and weather (due to absence of earth’s atmosphere). Most international long distance trips would be completed in 30 minutes or less.

5 2Q 2021 substances that would normally be extremely challenging or impossible to mix evenly on Earth. As a result, result, a As Earth. on evenly mix to impossible or challenging extremely be normally of would that number substances any combine to researchers enables microgravity in sedimentation of absence The gravita- pull). weak tional very with conditions (i.e. microgravity of phenomenon the to due research for environment high for laboratories space as used on manufacturing, be will facilities these of astronauts, station train space space commercial to a commercial station being from the Aside life. building of end by nears (ISS) reality Station a Space International space the as in tomorrow work and life make to want companies These space. in operations and estate real the building on focused players of segment a is least not but Last Making Life And Work SpaceIn RealityA for manufacturing novel, high performancetoexamine Superalloys.the unique properties of refractory or processedmetals not easily easilystudied on Earthon Earth, due toand propertiestheirpresents higha significant thatmelting make points.theseopportunity materials In microgravity, attractivehigh container (their heat tungsten,niobium, andmolybdenum. These elements, instance,also called refractorya class of alloys metals, known are oftenas Superalloys employed inhigh providesor high anultrapure, contaminant Microgravity levitate to easy also makes it materials, eliminating containers. need for the Container arthritis, including areas therapeutic of andfibrosis, oncology. cystic osteoporosis, range sclerosis, multiple disease, cardiovascular a in development and discovery drug impact substantially to potential the have studies crystallization protein Microgravity crystallize. to able are they before solution than Earth defects their fewer with larger grow environment microgravity a in produced crystals Protein instance, for - stressenvironments, such as gas engine turbine blades, nuclear power reactors, and rocket engines. But the very - bound counterparts. This is likely because in microgravity, proteins do not sediment out of of out sediment not do proteins microgravity, in because likely is This counterparts. bound Source: https://www.nasa.gov/mission_pages/station/research/news/crystals https://www.nasa.gov/mission_pages/station/research/news/crystals Source: - orbit data storage, edge computing and cybersecurity. Space presents a unique physical physical unique a presents Space cybersecurity. and computing edge storage, data orbit Protein Crystals Grown on Earth and Microgravityin Space) (i.e. - freeenvironment for manufacturing or study of materials intheir molten state. For

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2Q 2021

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The EGA Innovation Strategy Team Strategy Innovation EGA The

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