D E Shaw Direct Capital LLC

Item 5:         Fees and Compensation

The Adviser’s compensation for advisory services includes a performance-based allocation (the
“Performance Allocation”) and an asset-based fee (the “Management Fee”), the terms of which are set
forth in the applicable Governing Document. DESDC enters into Performance Allocation arrangements
with clients that fall within the definition of a “qualified client” pursuant to Rule 205-3 under the Advisers
Act or as permitted under Section 205(b) of the Advisers Act. Management Fees are paid monthly in
advance based on net assets as of the beginning of the relevant month. The fee schedule for qualified
clients of the Adviser currently includes an annual asset-based fee of 0.75% and a performance-based fee
of 20% of realized net profits. A percentage of the Management Fee is deducted at the beginning of each
month from the applicable Fund. The Performance Allocation, which is subject to loss carryforward
provisions, is assessed monthly on realized net profits. The Governing Document of the applicable Fund
provides the definitive terms of such compensation. In general, if a Management Fee has been paid in full
in advance for a period in which either the advisory contract with the relevant client has been terminated,
the applicable portion of such Management Fee paid relating to the portion of the period after such
termination will be returned or credited to the client, subject to the terms of the applicable Governing
Document.

DESDC may negotiate fees and has negotiated other terms in certain cases. The Adviser from time to time
has entered into agreements with certain underlying investors in the Funds that may provide for terms of
investment that are more favorable than the terms set forth in the applicable Governing Document. Such
terms may include, among other things, the waiver, reduction, or rebate of Management Fees, Fund
expenses, and/or Performance Allocations; the provision of additional information or reports; more
favorable transfer rights; provisions regarding indemnification and/or the jurisdiction and choice of law
for disputes regarding the investment; provisions regarding the investor’s and/or the Adviser’s
confidentiality obligations; and “most-favored-nation” provisions covering one or more terms or
rights. No such agreement necessarily entitles any other Fund investor to the same terms of investment
as offered in such agreement.

Funds advised by DESDC may incur expenses in connection with custodial or brokerage services outlined
in Item 12. In addition, each Fund bears its operating costs and expenses as set forth in the applicable
Governing Document (including certain operating costs and expenses relating to services provided by
Arcesium, as outlined below). Furthermore, the Adviser is entitled under each such Governing Document
to be reimbursed for some or all expenses that it or its related persons incur on behalf of the relevant
client, including compensation and overhead costs attributable to certain personnel of the Adviser or its
related persons who provide services to the relevant client.

DESDC retains Stellus Capital Management, LLC (the “Sub-Adviser”) to serve as sub-adviser to DESDC,
providing certain non-discretionary investment advisory services to DESDC with respect to the Funds
(the “Services”). DESCO LP has entered into certain contractual arrangements with the Sub-Adviser
pursuant to which DESCO LP has a right to receive amounts calculated as a portion of the Sub-Adviser’s
revenues. This arrangement gives rise to a potential conflict of interest in DESDC’s choice of the Sub-
Adviser to provide the Services. However, no additional Management Fees or Performance Allocations
are charged to DESDC investors as a result of the sub-advisory arrangement; rather, in consideration of,

and as exclusive compensation for, the Services, DESDC pays or causes to be paid to the Sub-Adviser a
portion of each of the Management Fee and Performance Allocation DESDC receives with respect to the
Funds.

Neither the Adviser nor its supervised persons receives compensation for the sale of securities or other
investment products to clients or investors.

Services Provided by Arcesium LLC

The Adviser has engaged Arcesium LLC (“Arcesium”) to provide certain middle- and back-office
technology and services to the Adviser. Arcesium is a joint venture between a subsidiary of DESCO LP
and a third-party investor that holds a minority stake in Arcesium.

Arcesium provides certain technology and services with respect to the Funds related to various middle-
and back-office functions, including trade capture, asset servicing, margin and collateral monitoring,
trade and position reconciliation, pricing, investor relations, and compliance. In providing such
technology and services, Arcesium is subject to the overall supervision of the Adviser.

The Funds bear certain operating costs and expenses associated with services provided by Arcesium.
Such operating costs and expenses may reflect estimates of the time personnel of Arcesium devote to
providing such services and the compensation and overhead costs attributable to such personnel. Any
fees paid by a Fund to Arcesium do not reduce the Management Fee and/or any operating costs or
expenses of such Fund.

Arcesium has no portfolio management, investment advisory, or fiduciary responsibilities with respect to
any Fund. Arcesium does not manage, monitor, or oversee any trading decisions of any Fund, any Fund’s
compliance with its investment objectives, or any other aspects of the portfolio management activity of
any Fund.

Item 7:          Types of Clients

DESDC’s only clients are the Funds, which are structured as private investment companies that are
exempt from registration under Section 3(c)(7) of the Investment Company Act. A minimum dollar value
of assets and other conditions are typically imposed on investors in the Funds.