Corre Partners Management LLC

ITEM 5 - FEES AND COMPENSATION

Compensation received by Corre, or an affiliate of Corre, is comprised of fees based on a
percentage of assets under management (“Management Fees”) and annual performance allocations
(“Performance Allocation”).

The Funds pay Corre the Management Fees, calculated and paid as follows.

   (i)     With respect to the Qualified Master Fund, Management Fees are paid monthly in
           advance equal to 0.167% of net worth (2% per annum).

   (ii)    With respect to the Horizon Fund and Horizon II Fund (together the “Horizon Funds”),
           Management Fees are paid quarterly in arrears as of the last day of each calendar
           quarter equal to 0.4375% of net asset value excluding uncalled capital (1.75% per
           annum).

In addition, the Funds pay a Performance Allocation to Corre Partners Advisors, LLC (the
“General Partner”), if any, as follows:

   (i)     With respect to the Qualified Master Fund, Performance Allocation is paid to the
           General Partner at year-end or upon a withdrawal or redemption equal to 20% of the
           increase in net worth in a given year or year-to-date period, subject to a loss-carry-
           forward and an annualized 6.75% hurdle rate with full catch-up.

   (ii)    With respect to the Horizon Fund and Horizon II Fund, distributions are paid to the
           General Partner equal to 20% of aggregate distributions after having distributed total
           capital contributions plus 7.5% annualized preferred return with full catch-up to
           Limited Partners.

See the relevant Fund’s Private Placement Memorandum (“PPM”), which should be reviewed in
conjunction with other governing documents of such Fund before an investment is made. In
certain instances, Corre or the General Partner has, and may in the future, reduce or waive a
portion of the Management Fees or Performance Allocation.

With respect to co-investment opportunities, the fees and carried interest, if any, will be negotiated
by the Firm and the potential co-investor on a case-by-case basis. In addition, the Firm will
generally charge the co-investor its share of ongoing expenses related to the investment (including
research and travel) based on the pro rata portion of the investment held by the co-investor relative
to all of the Firm’s client accounts. See the Fund’s PPM for a description of all expenses for which
the co-investors are responsible.

In addition, the Funds are responsible for (among other relevant fund expenses as described in
each Fund’s PPM): organizational expenses, commissions and other brokerage expenses, custodial
fees, third-party research expenses, travel expenses related to research, interest and borrowing
charges on margin accounts and other indebtedness, bank expenses, consulting fees, expenses
relating to risk reporting services and trade management systems, other expenses directly or
indirectly related to the investment program, administrative expenses, legal expenses, compliance

and regulatory expenses that pertain to the Funds, audit and tax preparation expenses and taxes,
escrow expenses, insurance costs (including directors’ and officers’, errors and omissions, and
cyber insurance), expenses related to meetings of the Limited Partners, and expenses related to the
Advisory Committee and any meetings of the Advisory Committee. See also Item 12 - Brokerage
Practices.

Investors in the Qualified Master Fund may also be charged a redemption fee of 5% of the amount
redeemed if the redemption is not made at least one year after the relevant subscription. Such
redemption fee is payable to the Fund.

ITEM 7 - TYPES OF CLIENTS

As noted in Item 4, Corre provides investment advisory services directly to the Funds. The
investors in the Funds may include some or all of the following: high net worth individuals,
corporations, endowments, foundations, funds of funds and other businesses. Generally, an
investor in the Funds is required to be an “accredited investor” as defined under the Securities
Act of 1933, and a “qualified purchaser” as defined under the Investment Company Act of 1940.

Minimum investment amounts are set forth in each Fund’s governing documents. However,
Corre or the General Partner, at their discretion, may permit investments below the minimum
amounts set forth in the Fund’s governing documents.