Hilco Investment Advisors LLC

FEES AND COMPENSATION

        In general, the Adviser will receive a management fee and a carried interest in connection
with advisory services. The Adviser or other Hilco entities or affiliates will receive additional
compensation in connection with management and other services performed for assets owned by
the Funds, and any such compensation will not be shared with the applicable Fund or applied to
offset management or other fees paid by such Fund. In addition, in certain circumstances, Hilco
will receive compensation for management and other services performed in connection with co-
investments made in assets of the Funds, and any such compensation will not be shared with any
Fund or applied to offset management or other fees paid by any Fund. Investors in a Fund also bear
certain expenses.

Management Fees

        The Funds will pay the Adviser, quarterly in advance, a management fee (the “Management
Fee”) equal to no less than 1.0% on an annual basis of aggregate investor capital contributions with
respect to certain Fund investments that have not been disposed of or written off (“Contributions”).

The Management Fee will be payable until all investments with respect to which the Management
Fee is payable are no longer held by the Fund, or until the Adviser’s relationship with the Fund is
terminated for other reasons (as described in the relevant Partnership Agreement). Installments of
the Management Fee payable for any period other than a full three-month period are adjusted on pro
rata basis according to the actual number of days in such period.

Acquisition Fees

        The Funds may pay the Adviser or an affiliate an acquisition fee with respect to certain
assets (the “Acquisition Fee”) payable on the closing date of any particular investment in which
the Fund invests. The amount of each Acquisition Fee, if any, will be negotiated on a deal-by-deal
basis.

Carried Interest

        Hilco is entitled to receive a carried interest with respect to the Funds in an amount that
varies depending on the compound preferred return earned by the investor in a Fund, as more fully
described in the Partnership Agreement. The carried interest distributed to Hilco is subject to a
potential giveback as set forth in the Partnership Agreement if Hilco has received excess
cumulative distributions.

       It is expected that any future Fund will have a similar fee structure.

        Where a Fund or vehicle through which the Fund invests has formed a joint venture with
one or more third parties, Hilco or an affiliate may be, in certain instances, entitled to receive
carried interest payments from such third parties.

Other Information

       It is expected that Hilco or its affiliate(s) will invest in or alongside the Funds. In instances
where a Hilco professional (or an affiliated entity thereof) invests in a Fund, such professional (or
such affiliated entity) and Hilco generally will be exempt from payment of the Management Fee,
Acquisition Fees and carried interest with respect to such Fund.

        The Funds generally invest on a long-term basis. Accordingly, investment advisory and
other fees are expected to be paid, except as otherwise described in the Partnership Agreement,
over the term of the relevant Fund.

         Principals or other current or former employees of Hilco or its affiliates generally receive
salaries and other compensation derived from, and in certain cases including a portion of, the
Management Fee, Acquisition Fees, carried interest or other compensation received by Hilco or its
affiliates. It is expected that the Adviser will enter into an agreement with certain of Hilco’s
affiliates, pursuant to which personnel from such affiliates will provide advisory and other services
to Hilco, the Funds and/or the investments held by the Funds.

          In addition to the Management Fee, Acquisition Fees and carried interest payable to Hilco or
its affiliates, each Fund bears certain expenses. As set forth more fully in the applicable Memorandum
and/or Partnership Agreement of each Fund, a Fund bears (either directly or through a reimbursement

to Hilco or its affiliates) all expenses, fees, costs and liabilities incurred in the conduct of the business
of Hilco or its affiliates in respect of the Funds (which may include the Funds’ allocable portion of
fees, expenses, costs and liabilities incurred on behalf of the applicable Fund and other Funds or
investment vehicles), including all out-of-pocket fees, expenses, costs and liabilities incurred in
connection with the operation of the Fund and its investments and the performance by Hilco or its
affiliates of their obligations under the applicable Partnership Agreement and investment
management agreement, including (i) the organization of any alternative investment vehicles, (ii) to
the extent an investment has been consummated, those incurred in connection with the
identification, structuring, negotiation, making, sourcing, researching, holding, monitoring,
development, ownership, operation, management, financing, sale, restructuring, proposed sale or
restructuring, other disposition or valuation of investments (actually consummated or considered,
including due diligence in connection therewith), including, but not limited to, legal, accounting,
audit, consulting, appraisal, travel (not exceed the cost of business class travel on a commercial
airline), lodging, transportation, meals, entertainment, hedging and other expenses (to the extent not
subject to reimbursement) and expenses and costs not reimbursed by a third party, including
expenses and costs that would have been allocable to co-investors had a proposed transaction or
investment been consummated if the amount allocable to such co-investors is not paid by such
parties, (iii) those incurred in connection with litigation, investigations, settlements or reviews of
the Fund, or other extraordinary events, the Fund’s allocable share of D&O liability and other
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TYPES OF CLIENTS

        Hilco provides investment advice to the Funds. The Funds may include investment
partnerships or other investment entities formed under domestic or foreign laws and operated as
exempt investment pools under the Investment Company Act of 1940, as amended. Each Fund has
a single outside investor, and such investor is a non-U.S. pension plan. In addition, certain affiliates
of Hilco, which invest in assets that are similar to those targeted by the applicable Fund, invest in or
alongside the applicable Fund. Certain principals or other employees of Hilco and/or its affiliates
(including owners with respect to Hilco or its affiliates) are expected to participate in or alongside
the Fund through their ownership in Hilco and/or its affiliates.

        The Funds may include alternative investment vehicles established from time to time in
order to permit one or more investors to participate in one or more particular investment
opportunities in a manner desirable for tax, regulatory or other reasons. Alternative investment
vehicle sponsors generally have limited discretion to invest the assets of these vehicles independent
of limitations or other procedures set forth in the organizational documents of such vehicles and
the related Fund.

       The Funds generally do not have a minimum investment amount applicable to third-party
investors. The Funds do not currently accept investments from third-party investors. In the event
that were to change in the future, Fund interests would be offered and sold solely to qualified
purchasers.

       METHODS OF ANALYSIS, INVESTMENT STRATEGIES AND RISK OF LOSS

General

        Hilco is a private investment firm focused on investing in a variety of assets, including
without limitation accounts receivable pools, retail and wholesale inventories, distressed debt,
commercial and industrial assets, real estate and real estate-related assets, patents and other
intellectual property-related assets or similar assets. Hilco’s investment advisory services consist
of identifying and evaluating investment opportunities, negotiating investments, managing and
monitoring investments and achieving dispositions for investments.

        Hilco focuses on investments that require equity capital of approximately $1 million to
$100 million, although the required capital may be greater or less than such amounts. When
evaluating potential investments, Hilco conducts due diligence, analyzing a variety of factors,
including but not limited to the value of the receivable pools, including cash flow performance
history and projected future performance.

        There can be no assurance that Hilco will achieve the investment objectives of any Fund
and a loss of investment is possible.

Investment and Operating Strategy

       The Funds pursue and transact in the areas of (i) charged-off and/or performing consumer
receivable pools, (ii) distressed debt and structured finance transactions primarily in the retail and
consumer industry, (iii) transactions involving the purchase, sale and operation of commercial and

industrial assets, (iv) transactions involving trademarks or other intellectual property, and (v)
special situations transactions in the United States. Each investment made by Hilco is approved by
an investment committee.

       Hilco’s managers have experience in sourcing and pricing (i) charged-off and/or
performing consumer receivable pools, (ii) distressed debt and structured finance transactions primarily
in the retail and consumer industry, (iii) transactions involving the purchase, sale and operation of
commercial and industrial assets, (iv) transactions involving trademarks or other intellectual
property, and (v) special situations transactions. In addition, Hilco has experience servicing loans,
debt, and managing the various classes of assets (including collecting accounts receivables) in
which the Funds invest.

Risks of Investment

        Each Fund and its investors bear the risk of loss that Hilco’s investment strategy entails.

        The risks involved with Hilco’s investment strategy and an investment in the Funds include,
but are not limited to:

       Business Risks. The Funds’ investment portfolio is expected to consist primarily of (i)
charged-off and/or performing consumer receivable pools, (ii) distressed debt and structured finance
transactions primarily in the retail and consumer industry, (iii) transactions involving the purchase, sale and
operation of commercial and industrial assets, (iv) transactions involving trademarks or other
intellectual property, and (v) special situations transactions, and operating results with respect to
such portfolios are difficult to predict. Such investments involve a high degree of business and
financial risk that can result in substantial losses.

         Risks of Receivable Recovery Values. The Funds investment portfolio will consist of assets
that have experienced significant fluctuation. The recovery value of the Funds’ investment assets
will depend on several factors, including but not limited to (i) changes in macroeconomic
conditions, (ii) changes in interest rates, (iii) promulgation and enforcement of governmental
regulations, (iv) availability of financing to debtors and potential purchasers of the Funds’
investment asset, (v) financial condition of debtors (vi) changes in statutory or case law that limits
or restricts the Funds’ ability to engage in such business and (vii) the Funds’ reliance on third-party
service providers to monetize the Funds’ investment assets.

        Investments in Distressed Assets or Non-Performing Debt. The Funds may make
investments in non-performing or other distressed assets which involve a high degree of financial
and other risks and are experiencing or are expected to experience severe financial or other
difficulties, which may never be overcome.

        Concentration of Investments. The Funds will participate in a limited number of
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