Bison Capital Asset Management LLC

FEES AND COMPENSATION

       The following is a general description of fees, compensation, and expenses of the Funds.
Differences exist from Fund to Fund, and certain Funds may not charge certain fees,
compensation, or expenses that other Funds charge. The Governing Documents of the Funds
describe fees, compensation and expenses in greater detail.

        With respect to the Funds, each General Partner generally receives a management fee and
a carried interest in connection with the provision of advisory services to its clients. The General
Partners or other Bison entities or affiliates receive additional compensation in connection with
management and other services performed for portfolio companies of the Funds and such
additional compensation may offset in whole or in part the Management Fees (as defined below)
and carried interest otherwise payable to Bison, as described in the Governing Documents.
Investors in the Funds also bear certain fund expenses, as described below.

Management Fees

       Generally, a Fund during its investment period will pay the applicable General Partner a
management fee (the “Management Fee”) between 1.5% and 2% on an annual basis of
aggregate Partnership investor capital commitments. Payment of the Management Fee will be
made quarterly in advance. Generally, investors participating in a closing after a Fund’s initial
closing date bear the Management Fee from the initial closing date, or other effective date, as
applicable, generally in addition to an interest component payable to Bison or an affiliate. The
Management Fee may be reduced upon the expiration of the investment period or earlier upon

the occurrence of certain other events as described in the applicable Governing Documents. The
Management Fee generally will be payable until proceeds from all portfolio investments are
disposed and/or distributed or until the General Partner’s relationship with the applicable Fund is
terminated for other reasons (as described in the Governing Documents). Installments of the
Management Fee payable for any period other than a full Management Fee determination period
are adjusted on pro rata basis according to the actual number of days in such period. As a
general matter, Management Fees will be payable during term extensions unless otherwise
agreed with investors.

         The Governing Documents set forth the full list of terms under which Management Fees
will be reduced, offset or otherwise be limited, and consequently investors should expect to bear
the full specified Management Fee rate in the Governing Documents until they are reduced in the
circumstances and on the date(s) specified therein.

         The Management Fee generally will be reduced by, or the applicable Fund will be
reimbursed to the extent of, all or a portion of the directors’ fees, financial consulting fees,
advisory fees, transaction fees, break-up fees and certain other fees paid by portfolio companies
to a General Partner, the Management Company or certain of their affiliates (“Supplemental
Fees”). To the extent that such an offset credit would reduce the Management Fee for a given
Management Fee determination period below zero, the credit generally will be carried forward
for future application against payable Management Fees. To the extent that any other Fund or
other entity (including a parallel investment vehicle) or individual co-invests (or commits to co-
invest) alongside a Fund in any portfolio company investment, any Supplemental Fees generally
will be allocated among the Fund and the other investors in proportion to the cost of the
investment or potential investment in the portfolio company held (or committed to be held) by
each. Accordingly, a Fund will, in most cases, only benefit from the Management Fee reduction
described above with respect to such Fund’s relevant portion of any such Supplemental Fee. As a
result, the Fund will not benefit from (and the Management Company and its affiliates are
expected to retain) the portion of any fee related to, among others, any other investor (which
could include the General Partner, fee-free investors, co-investment vehicles managed by the
Management Company, service providers (including suppliers, vendors, consultants, lenders, law
firms (including Fund or transaction counsel), transaction service providers and their respective
affiliates, personnel and related investment vehicles (together, "Service Providers"), third
parties, current or former portfolio company management or personnel, sellers or members of
management that have rolled their interest or reinvested proceeds in the portfolio company
and/or other owners), which have the potential to be substantial. Bison's ability to retain such
amounts provides it with an incentive to increase the portion of each relevant investment held by
such persons. The value of profits, participation or equity interests in or relating to the relevant
portfolio company, including interests owned by current or former portfolio company
management are not treated as Supplemental Fees and therefore do not offset or reduce the
Management Fee. Supplemental Fee offsets generally are performed on a net basis, after giving
effect to certain taxes and other expenses in connection with the receipt of such fees or the
provision of related services, and to the extent Supplemental Fees are paid in kind (including
through securities, option grants or other interests), the Management Company is permitted to
calculate the amount of offset based on the then-current value of the in-kind payment, rather than
the ultimate value of the interests as of a future date. Unless otherwise agreed with investors,
Supplemental Fees generally will be payable during term extensions, even if Management Fees

are reduced or eliminated during the extended term, thus reducing the amounts of Management
Fees actually offset. Supplemental Fees will be offset only to the extent they are paid during the
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TYPES OF CLIENTS

        Bison provides investment advice to Funds. Funds may include investment partnerships
or other investment entities formed under U.S. or non-U.S. laws and operated as exempt
investment pools under the Investment Company Act of 1940, as amended. The investors
participating in Funds generally include individuals, banks or thrift institutions, other investment
entities, university endowments, family offices pension and profit-sharing plans, trusts, estates or
charitable organizations or other corporations or business entities and often include, directly or
indirectly, principals or other personnel of Bison and its affiliates and members of their families,
Service Providers retained by Bison or a Fund, as well as executives of portfolio companies.

        The Funds generally have a minimum investment amount of $5 million for third-party
investors. Generally, investors must be “accredited investors” as defined under Regulation D of
the Securities Act of 1933, as amended, and may also be required to be either “qualified
purchasers” or “knowledgeable employees” as defined under the Investment Company Act of
1940, as amended. The General Partners may waive such minimum investment amounts and
qualification requirements.

             METHODS OF ANALYSIS, INVESTMENT STRATEGIES AND RISK OF LOSS

General

        Bison generally targets successful businesses that require capital for growth initiatives
such as capacity expansion, new product introduction, investment in sales and marketing, or for
other accretive purposes, such as financing an acquisition. Bison has historically avoided deals
where the primary use of proceeds is to cash out existing management / owners and focuses on
situations where its investments can help create value.

       The following is a summary of the investment strategies and methods of analysis
generally employed by Bison on behalf of the Funds. There can be no assurance that Bison will
achieve the investment objectives of the Funds and a loss of investment is possible.

Investment and Operating Strategy

        Bison’s “Structured Capital” approach to investing seeks to combine the contractual yield
and risk mitigation features of debt and preferred stock with the upside potential of growth
equity by employing hybrid investment structures that capture both sets of attributes. Bison
believes this approach allows it to participate in the significant capital appreciation potential of
lower middle-market growth companies while mitigating downside risk. Bison typically invests
in the following security types: convertible preferred stock, participating preferred stock,
convertible debt, debt with warrants, subordinated debt and common equity, often used in
combination with each other. Each Bison investment is a bespoke capital solution, reflecting the
attributes of each portfolio company as well as the specific needs and objectives of the
entrepreneurs and management teams with which Bison has partnered.
        However, almost all of Bison’s investments to date have shared the following
characteristics: (i) equity participation sufficient to drive potential risk-adjusted returns which
Bison compared favorably relative to traditional private equity and mezzanine investment
strategies, (ii) a preferred position in the capital structure, (iii) contractual yield or minimum
return resulting from interest, dividends or a liquidation preference, (iv) an significant “equity
cushion” beneath Bison’s securities, and (v) perceived modest use of third-party leverage senior
to Bison’s securities. Bison’s equity participation is typically achieved through the convertibility
features of debt or preferred stock securities, or through warrants and other forms of equity
participation, as opposed to buying common equity at the bottom of the capital structure. A key
element of Bison’s strategy is to make investments where the proceeds are primarily going to
fund accretive purposes, including growth capital, strategic M&A, and debt paydown / balance
sheet restructuring.
        Sourcing Capabilities. Bison believes its broad network of longstanding relationships,
well-established reputation, and differentiated Structured Capital approach facilitate the
origination of attractive investment opportunities outside of traditional auction processes. Bison
maintains an extensive network of operating executives, advisors, lawyers, accountants, regional
lenders, small brokers and intermediaries. Collectively, Bison’s partners have significant
experience in sourcing lower middle market transactions and have built origination relationships
with a wide range of professionals and institutions. As one of a small number of investment
firms focused exclusively on providing Structured Capital solutions to companies in the lower
middle market, Bison believes it has developed a reputation as a trusted source of flexible and
creative capital solutions for entrepreneurially owned and managed companies.
        Underwriting and Approval Process. Given Bison’s focus on structured transactions and
risk-adjusted returns, the firm’s due diligence combines a “top down credit analysis” with a

“bottoms up equity analysis” seeking to ensure that the investment has an appropriate
combination of equity upside, minimum returns and downside protection. This approach focuses
on gaining a strong understanding of the growth and profitability prospects of the company,
positioning within its industry, as well as assessing potential outcomes in a downside scenario.
Bison’s investments typically utilize a combination of the following rights and controls, though
there can be no assurance that any or all of these rights will be present in any investment: Board
seats, consent rights on key issues, springing board control upon events of default, maintenance
covenants and other performance features, restrictions on certain activities (e.g., distributions,
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