Arden Fund Management LLC

Item 5 – Fees and Compensation
                                        Management Fee

       The specific manner in which fees are charged by Arden to a Fund is disclosed in each
Fund’s confidential private placement offering memorandum. By way of example, an investor in
Arden Industrial Partners, L.P. will bear a management fee that is generally payable quarterly in
advance following any applicable fee holiday period and that is based on the investor’s capital
commitment during the fund’s commitment period and, thereafter, on capital invested in portfolio
investments, in each case as such terms are defined in the Fund’s confidential private placement
memorandum; currently, the fee is 2.0% per annum during the commitment period and 1.5% per
annum thereafter for investors with capital commitments of less than $30 million, and 1.75% per
annum during the commitment period and 1.25% per annum thereafter for investors with capital
commitments of $30 million or more, as described in the Fund’s confidential private placement
memorandum.

        Each Limited Partner will pay its portion of the management fee for the initial calendar
quarter to the Fund on or prior to the date of the initial closing (which will be prorated on a daily
basis from the date of the initial closing of the Fund until the end of such fiscal quarter), with
certain exceptions as are more fully described in the Fund’s confidential private placement offering
memorandum. Thereafter, each Limited Partner will make an additional capital contribution to the
Fund in order to pay its portion of the management fee on or prior to the first business day of each
subsequent fiscal quarter.

                Performance Fee – Arden’s Profits Share (“Carried Interest”)

     The Performance Fee to be received by each Arden affiliate that acts as a general partner to a
Fund is a share of the profits earned on investments made by a Fund. For purposes of this
discussion, a controlled general partner entity established by Arden to manage a Fund shall be
referred to as a “General Partner.” Each Fund is subject to the terms and conditions of its
confidential private placement memorandum regarding these fees and the discussion in this Item
5 is only meant to be illustrative. By way of example, we again refer to Arden Industrial Partners,
L.P. With respect to the Fund, net cash available for distribution, including distributions
attributable to sales and refinancing proceeds, less capital reserves determined in the General
Partner’s discretion, will be determined on an aggregate basis and distributed at least quarterly,
subject to tax distributions, in each case as more fully described in the Fund’s confidential private
placement memorandum. Pursuant to the following distribution hierarchy:

       (a) first, to each Partner until such Partner’s Unpaid Priority Return has been reduced to
           zero;

       (b) second, to such Partner until such Partner’s Unreturned Capital Account balance has
           been reduced to zero;

          (c) third, (i) twenty percent (20%) to such Partner, and (ii) eighty percent (80%) to the
              General Partner, until the General Partner has received under this clause (c) an amount
              equal to such Partner’s Distribution Sharing Percentage of the General Partner’s
              Unapplied Annual Elective Roll-Forward Amount;

          (d) fourth, (i) twenty percent (20%) to such Partner, and (ii) eighty percent (80%) to the
              General Partner, until the General Partner has received under this clause (d) in the
              current and all prior Fiscal Years twenty percent (20%) of all distributions made
              pursuant to clause (a) in respect of such Partner and made or being made pursuant to
              this clause (d) in the current and all prior Fiscal Years; and

          (e) thereafter, (i) eighty percent (80%) to such Partner, and (ii) twenty percent (20%) to the
              General Partner.

Distributions made to the General Partner pursuant to clauses (d)(ii) and (e)(ii) are referred to as the
General Partner’s “carried interest.”

                Limits on the Carried Interest – the General Partner “Clawback”

          Using the same Fund as an example, upon liquidation and dissolution of the Fund or the
  General Partner’s interest in the Fund, the General Partner will be obligated to restore certain
  amounts received as Carried Interest distributions (including advance distributions to pay taxes
  attributable to future Carried Interest distributions) to the extent that, and only to the extent that,
  the Partners did not receive a return of all of their capital contributions plus the Preferred Return
  thereon over the life of the Fund and to the extent necessary to ensure that the General Partner did
  not receive Carried Interest distributions in excess of 20% of the profits of the Fund. In no event
  will the General Partner be required to restore more than its excess share of the Carried Interest
  distributions which it actually received; less income taxes attributable to such excess share.

    Other Fees and Expenses – Affiliate Service Fees and Subsidiary–Level Carried Interest

         In addition to the Management Fee and Carried Interest, affiliates of a Fund’s General
  Partner may be paid fees based on prevailing market rates in consideration for providing
  development, construction management, property management, leasing, sales, financing,
  marketing and other similar services to a Fund and the Subsidiary Entities and Joint Ventures.
  Arden also may receive a disposition fee upon the disposition of each Real EstateInvestment made
  by a Fund equal to 1% of the gross sales price of a Real Estate Investment.

          The General Partner of a Fund may also cause a Fund or a Subsidiary Entity to enter into a
  Joint Venture or other investment vehicle with one or more other partners, members or other
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Item 7 – Types of Clients

       Arden provides investment advisory services exclusively to private investment funds.