Pear Tree Essex Environmental Opportunities Fund

For the Quarter ended March 31, 2023

The Pear Tree Essex Environmental Opportunities Fund’s Ordinary Shares (the “Fund”) underperformed] its benchmark, MSCI World Index (the “Index”). The Fund achieved a return of 5.80% at net asset value compared to 7.88% for the Index.¹

Market Conditions and Investment Strategies

For first quarter 2023 transactions, we trimmed Enphase Energy early in the quarter due to a stretched valuation, and deployed
the assets into SolarEdge Technologies, increasing the portfolio weight to 3.5%. Enphase and SolarEdge are in the same markets,
and we believe SolarEdge to be more attractively valued currently with greater exposure to faster growing markets like Europe and
commercial solar. We purchased Zurn Elkay Water Solutions, and trimmed Watts Water Technologies on January stock strength to
fund the new holding in the GEOS water theme. Zurn Elkay is the result of two significant corporate transactions in the past three
years. First, Zurn was spun out from Rexnord Corporation to separate Rexnord’s industrial assets from its water related assets.
And second, Zurn merged with Elkay Water Solutions in July 2022, expanding the geographical footprint and product offerings.
The combined company produces gears, seals and other components that are critical to water and wastewater infrastructure. We
believe the company can grow revenues while expanding company margins with merger efficiencies. In March, we increased our
position in Wolfspeed, the leader in silicon carbide production, utilized in power semiconductors for use in electric vehicles and
renewable energy inverters. Wolfspeed is expanding its manufacturing presence, and announced its second fabrication plant in
Saarland, Germany in February. Plant construction will begin in the second half of this year. We increased Strategy weights in
SunOpta, the alternative milk manufacturer, and Kornit Digital, the garment digital screen printing leader. SunOpta was trimmed
last October, and we added back to the position given strong guidance on fundamentals from management. Kornit stock has been
under pressure for a year, given growth concerns. We believe all the bad news and then some is reflected in the stock share price,
as the $940 million market cap company has a sound balance sheet with over $600 million in cash. The source of funds for the
adds were the sales of solar companies SMA Solar Technology and Sunrun. SMA was sold on valuation, and Sunrun due to our
concerns about the future path for business financing amidst the tighter credit market. Stationary energy storage firm Stem was
sold late in the quarter given financing pressures and a lack of execution, to make room for new renewable energy holding Cadeler.
Cadeler transports and installs offshore wind foundations and turbines using their fleet of jack-up installation vessels. Cadeler will
have the largest fleet of next generation wind turbine installation vessels, amidst a global fleet that is insufficient to meet offshore
wind growth and incapable of installing larger 15+ MW offshore turbines. We believe the high barriers to entry will enable Cadeler
to generate EBITDA margins greater than 60%.

Attribution (First Quarter 2023)

Top contributors:

Infineon Technologies AG (IFX GY): (+36.2%) continues its solid run after a very strong prior quarter. Infineon is in the
GEOS power technology theme, providing semiconductor solutions for several end markets, from industry to automotive and
communication. Infineon solutions are in power applications such as solar inverters, EVs and computer servers, enabling energy
efficiency and high performance in harsh environments.

TPI Composites (TPIC): (+28.7%) is in the GEOS renewable energy theme, building wind turbine blades for the global wind market.
TPI is expanding their business to constructing offshore wind blades, where we anticipate greater growth and profitability in this
expanding market.

Kingspan Group (KSP ID): (+26.9%) is in the GEOS clean tech & efficiency theme, providing highly efficient building materials from
its base in Dublin. Kingspan is a long-standing GEOS holding, manufacturing products such as insulated boards and panels for the
commercial market.

Keyence (6861 JP): (+24.3%) is also in the GEOS clean tech & efficiency theme, providing machine vision and sensor technologies
for factory automation applications. We believe factory automation technologies are well positioned currently, as they enhance
growth, productivity and profitability amidst increased labor and materials costs.

Sensata Technologies (ST): (+24.1%) is in the GEOS efficient transport theme, providing sensors for EVs and the stationary
storage markets. Sensata is well positioned for DC fast charging applications, and is increasingly providing operating controls for
industrial internet of things applications, and embedded sensors and data networking solutions for industrial equipment.

Underperformers:

Stem (STEM): (-41.0%) resides in the GEOS power technology theme, providing AI driven clean energy solutions. Stem was sold
during the quarter.

Aspen Aerogels (ASPN): (-36.8%) has historically provided high performance insulation gel to the chemical industry, to optimize
pipeline and process temperatures. The company is amidst a transition, leveraging this legacy intellectual property to move to
the stationary storage and electric vehicle markets. Aspen technology enhances battery performance while limiting the effects of
battery fires – a key safety issue in the electrification transition.

Enphase Energy (ENPH): (-20.1%) is in the GEOS power technology theme, designing and manufacturing microinverters and
related power technologies for the solar and power storage markets. Enphase is amidst a new product launch and is gaining
growth momentum in Europe.

Sunrun (RUN): (-16.2%) is a long-standing position in the GEOS renewable energy theme which was sold during the quarter based
on our concerns about declining profitability amidst an increasing cost of capital.

Kornit Digital (KRNT): (-15.6%) rests in the GEOS clean tech & efficiency theme, providing digital screen printing systems for
garment production which require no water and emit no harmful chemicals. We added to our Kornit position during the quarter on
price weakness and improving fundamentals.

Social Impact Management Update

The Intergovernmental Panel on Climate Change (IPCC) released the AR6 Synthesis Report in March, summarizing the main
findings of the previous six reports in this IPCC cycle. The IPCC reiterated that society needs to rapidly reduce global emissions
to avoid breaching 1.5- or 2-degrees Celsius warming. Immediate action on climate mitigation also has important implications
for the effectiveness of adaptation. Adaptation is critical to help society manage the impacts of climate change, but it is more
effective at lower levels of temperature warming. Finally, the IPCC explained that even if society were to overshoot 1.5 degrees or 2
degrees Celsius of warming, sustaining net negative global emissions for an extended period could return warming to below 1.5- or
2-degrees C. This would require a rapid scale up of carbon dioxide removal technology in addition to the deployment of existing low
carbon technologies.

While the final IPCC report from the Sixth Assessment cycle is a sobering portrayal of the reality of climate change, we believe
it showcases the benefits of near-term action using the commercial low carbon technologies available today. The time value of
carbon states that emissions abated now are more valuable than emissions abated in the future since temperature warming and
other negative climate impacts will continue as long as global emissions are net positive. Therefore, near term decarbonization is
most valuable. Thankfully, most of the technologies needed to reach net-zero emissions are cost competitive and viable today, but
for a select few technologies needed to decarbonize hard to abate sectors, such as heavy industry and long-haul transportation, and
facilitate carbon dioxide removal. Rapid deployment of solar, onshore and offshore wind, battery storage, smart grid technology,
electric vehicles, heat pumps, and other existing commercial low carbon technologies can catalyze society’s path to net-zero
emissions starting today. GEOS recognizes the urgency of the situation and invests in existing commercially viable technologies that
can be scaled today to enable a net-zero world.

The GEOS team recently engaged with Zurn Elkay Water Solutions to discuss their ESG progress. Zurn is a leading provider of water
management solutions and has significant growth opportunities associated with clean drinking water products. After closing the
acquisition of Elkay Manufacturing that brought more drinking water filtration products into their portfolio, the company made all
employees shareholders and eligible for an annual bonus to boost engagement and retention. Zurn’s management has also held
several town hall meetings to gain feedback from employees and boost employee satisfaction. Moving forward, we plan to track
Zurn’s product roadmap around PFAS filtration given the need to ensure drinking water is free from harmful contaminants.

Outlook

Despite the fits and starts of clean technology stock performance over the past year, the fundamentals of the companies behind
those stocks – the businesses are progressing. Certainly there are hurdles, from continued labor and supply chain stresses to
higher capital costs. We have emphasized the importance of financial discipline and look to a firm’s returns on investment. A
company which is struggling to scale may have to constantly find capital in the form of loans or equity offerings which dilute
shareholders. Ineffective capital discipline could cause excessive cash “burn”, which, when coupled with a technology which is
struggling to scale commercially will cause an excessive debt burden and leverage. Effective discipline leads to optimal allocations
of capital – a balance between investing for growth, such as research and development, or hiring, versus capital retention for
periods of uncertainty, such as longer sales cycles. Discipline can take the form of capital and financial discipline, but also strong
operational governance – knowing how to bring a new offering to the right market is key and avoids expensive missteps. Discipline
is all important at this time of tight capital.

Despite the many headwinds for our economy, our philosophy is well intact – certainly given all the commitments to net zero, SDGs,
and water conservation, players need solutions.

Renewables growth in the U.S. is apolitical – states are scaling renewables because of the economic vitality – costs are cheaper for
green electrons versus fossil fuels, with less risks and greater functionality. By 2027, we believe Texas could surpass California for
net new utility scale solar, and Texas is already the top state for wind production. Subsidies are catalysts for some industries within
our GEOS themes, but our primary criterium for GEOS is commercial and financial viability before we consider any incentives – that
is gravy.

 

¹The Fund is the successor to the investment performance of the Essex Environmental Opportunities Fund (“Predecessor Fund”) as a result of the reorganization of the Predecessor Fund into the Environmental Opportunities Fund on September 1, 2021. Performance information shown prior to the close of business on August 31, 2021 is that of the Predecessor Fund. 

²The priority of the Wilder-Hill Index is to define and track the Clean Energy sector: specifically, businesses that stand to benefit substantially from a societal transition toward use of cleaner energy, zero-CO2 renewables, and conservation. Stocks and sector weightings within the Wilder-Hill Index are based on their significance for clean energy, technological influence and relevance to preventing pollution in the first place. The Wilder-Hill Index emphasizes new solutions that make both ecological and economic sense and aim to stay the leaders in this field.

Disclosures:

This commentary is for informational purposes only. It does not constitute investment advice and is not intended as an endorsement of any specific investment. The opinions and analyses expressed in this commentary are based on Essex Investment Management LLC’s (“Essex”) research and professional experience and are expressed as of the date of its release. Certain information expressed represents an assessment at a specific point in time and is not intended to be a forecast or guarantee of future results, nor is it intended to speak to any future periods.  Accordingly, such statements are inherently speculative as they are based on assumptions that may involve known and unknown risks and uncertainties.