Hedge Fund Focus

Legg Mason and Permal Announce Launch of the Legg Mason Permal Tactical Allocation Fund

- Legg Mason’s First Mutual Fund Partnership with Permal -

BALTIMORE, April 14 /PRNewswire-FirstCall/ — Legg Mason (NYSE: LM) today announced the launch of the Legg Mason Permal Tactical Allocation Fund, a global multi-asset tactical allocation mutual fund, managed by its fund-of-hedge-funds affiliate, Permal Asset Management. Targeting institutional and retail taxable and tax-exempt investors, this will be the first Legg Mason 40-Act open-end mutual fund to be managed by Permal, one of the world’s leading Fund of Hedge Fund managers.

The Legg Mason Permal Tactical Allocation Fund is an opportunistic and diversified product which seeks to benefit from any market condition and to outperform a traditional 60/30/10 (equity/fixed income/cash) portfolio over a medium-term time frame. The asset allocation strategy seeks to exploit perceived inefficiencies or imbalances in equity, fixed-income or other asset classes in any region or country.

The Fund incorporates the top-down and bottom-up investment practices of Permal’s Investment Committee and its associated portfolio managers, alongside rigorous quantitative and qualitative analysis, in its asset allocation. It is designed to be forward-looking and flexible, reflecting the relative value opportunities in a constantly changing environment and will not be constrained by geography or investment style. The fund invests primarily in both passive and actively managed investment funds, to include specifically, affiliated and unaffiliated open-end mutual funds, unaffiliated closed-end mutual funds and exchange traded funds and notes, as well as cash equivalents and alternative investments.

Jim Hodge, Permal Asset Management’s Chief Investment Officer, commented: “By being both tactical and opportunistic, the Legg Mason Permal Tactical Allocation Fund is designed for these times. We are not only looking to generate alpha from today’s volatility, but also to be positioned to benefit from the recovery, which, perhaps still in the distance, will eventually occur. These are fundamental traders’ markets, where insight needs to be matched by analysis and self-belief, and the Fund looks to incorporate these attitudes.

“We believe that Permal brings to the table a virtually unparalleled view of global markets and the asset management industry, in both traditional and alternative asset classes, together with extensive quantitative and qualitative risk management practices. The Fund incorporates all these traits, which we believe will result in optimum fund positioning and allocation.”

Matt Schiffman, Head of Americas Retail at Legg Mason, added: “Permal has an expertise in asset allocation and a deep global perspective and we believe they can find opportunities in these markets to deliver value to our clients. This is an innovative way to bring their fund of hedge fund expertise to traditional asset classes in a mutual fund offering. We remain focused on leveraging the expertise of our affiliates to deliver new investment solutions that are responsive to the market environment.”

About Legg Mason

Legg Mason is a global asset management firm, with $698 billion in assets under management as of December 31, 2008. The Company provides active asset management in many major investment centers throughout the world. Legg Mason is headquartered in Baltimore, Maryland, and its common stock is listed on the New York Stock Exchange (Symbol: LM) .

About The Permal Group

The Permal Group, one of the oldest and largest alternative asset management firms, provides investment opportunities in directional and absolute return strategies across global financial markets. Permal offers access to independent investment managers worldwide through its multi-manager and single manager funds, separate accounts, and participation in structured products.

Important Information

In choosing open-end funds for investment, the Fund will invest in Legg Mason-affiliated funds when they offer access to an asset class or employs a strategy which Permal wishes to utilize and, in Permal’s judgment, the Legg Mason-affiliated fund can accommodate the Fund’s investments.

All investments are subject to risks, including the possible loss of principal. The Fund is a newly organized, open-end investment company with a limited history of operations. Specific risks of the Fund’s investments include the risks associated with equity securities, small-cap securities, fixed income securities, high yield securities, international securities, emerging market securities, derivatives, short selling, leverage, tactical asset allocation strategies, and alternative investments. Alternative investments are speculative and involve substantial risks. In addition to the Fund’s operating expenses, you will indirectly bear the operating expenses of the underlying funds. The portfolio managers’ judgment about the attractiveness, value, or potential appreciation of a particular security or sector may prove to be incorrect which could have a negative impact on the Fund’s performance. There can be no assurance that the Fund will achieve its investment objectives. Please see the prospectus for a more complete discussion of the Fund’s risks.

Diversification does not assure a profit or protect against market loss

Investors should consider a fund’s investment objectives, risks, charges and expenses carefully before investing. The prospectus contains this and other information about a fund. To obtain a free prospectus, please visit www.leggmason.com/individualinvestors. An investor should read the prospectus carefully before investing.

Legg Mason Investor Services, LLC. Member FINRA, SIPC.

Legg Mason Investor Services LLC and the Permal Group are subsidiaries of Legg Mason Inc.
Website: http://www.leggmason.com/individualinvestors/