Industrial Opportunity Partners LLC

Fees and Compensation
The fees and expenses applicable to the Funds are set forth in detail in each of the Funds’ respective offering
documents (e.g., private placement memorandum, limited partnership agreement and subscription
agreement). A brief summary of fees and expenses is provided below.

Management Fees
The Funds pay a management fee to each Fund’s respective General Partner for investment advice. With
respect to IOP Fund IV, the management fee is billed semi-annually in advance in an annual amount equal
to 2.0% of the total subscriptions of all partners until the end of the investment period. Commencing on the
first day of the fiscal semi-annual period following the earlier of the termination of the investment period or
the initial drawdown of capital for a successor fund, the IOP Fund IV management fee is billed semi-annually
in advance in an annual amount equal to 2.0% based on invested capital. With respect to IOP Fund III, the
management fee was billed semi-annually in advance in an annual amount equal to 2.0% of the total
subscriptions of all partners until the end of the investment period. Commencing on the first day of the fiscal
semi-annual period following the earlier of the termination of the investment period or the initial drawdown
of capital for a successor fund (IOP Fund IV), the IOP Fund III management fee is billed semi-annually in
advance in an annual amount equal to 2.0% based on invested capital. With respect to IOP Fund II, the
management fee was billed semi-annually in advance in an annual amount equal to 2.0% of the total
subscriptions of all partners. Commencing on the first day of the fiscal quarter following the earlier of the
termination of the investment period or the initial drawdown of capital for a successor fund (IOP Fund III),
the IOP Fund II management fee is billed semi-annually in advance in an annual amount equal to 2.0% based
on invested capital. Effective July 1, 2024, the management fee ceased per terms of the partnership agreement
for IOP Fund II.

In any one calendar year, to the extent that directors’ fees, consulting fees, break-up fees, transaction fees,
monitoring and advisory fees or other remuneration (including any options, warrants, or other equity
securities) paid to the General Partner, to any member or affiliate of the General Partner or any officer or
employee of IOP shall be used first to offset any transaction expenses advanced by IOP and not reimbursed
by a Fund. For IOP Fund II and IOP Fund III, all or a portion of the management fee shall be reduced by
80% of the remaining portfolio company remuneration up to $500,000 and reduced by 100% of the remaining
portfolio company remuneration above $500,000. With respect to IOP Fund IV, all or a portion of the
management fee shall be reduced by 100% of the remaining portfolio company remuneration. The reduction
in management fee is allocated among the partners in the Funds based upon the proportional amount of
capital contributed. Please refer to the respective Fund limited partnership agreement for additional
information about fees.

Carried Interest
The General Partners may receive cumulative distributions (with respect to its carried interest) since the
inception of the Funds equal to 20% of a Fund’s cumulative net gain, provided that each limited partner has
received aggregate distributions since the inception of the partnership equal to the sum of its contributions
and its 8% preferred returns.

Fund Expenses
Expenses attributable to each Fund are described in the respective Fund’s offering documents. Fund expenses
may include, but are not limited to, the following: organizational expenses; liquidation expenses; any sales
or other taxes, fees or government charges which may be assessed against the Funds; commissions or
brokerage fees or similar charges incurred in connection with the purchase or sale of securities (including
any merger fees payable to third parties and whether or not any such purchase or sale is consummated)(please
refer to the Brokerage Practices section below); fees (if any) and expenses of members of the Advisory
Board (including travel-related costs and expenses); the costs and expenses (including travel-related
expenses) of hosting annual or special meetings for the partners of the Funds, or otherwise holding meetings
or conferences with partners of the Funds, whether individually or in a group; interest expense for borrowed
money (if any); all expenses relating to litigation and threatened litigation involving the Funds, including
indemnification expenses; expenses attributable to normal and extraordinary investment banking,
commercial banking, accounting, tax preparation, appraisal, legal, custodial and registration services
provided to the Funds and any expenses attributable to consulting services not described in Fund offering
documents, including in each case services with respect to the proposed purchase or sale of securities or
assets by the Funds that are not reimbursed by the issuer of such securities or assets (whether or not any such
purchase or sale is consummated); reasonable premiums for liability insurance to protect the Funds, the
General Partners, the partners or members of the General Partners, the partners, members, officers, directors
or employees of IOP and members of the Advisory Board and IOP Board in connection with the activities
of the Funds; and all other expenses properly chargeable to the activities of the Funds. Any income taxes
assessed against either the Funds or the General Partners in respect of the management fee shall be borne by
the General Partners. Expenses attributable at the portfolio company level are described in portfolio company
management services agreements.

Please refer to the Client Referrals and Other Compensation section below for additional expenses that may
be borne by the Funds, and additional compensation that may be received by IOP, the General Partners,
...

Types of Clients
IOP provides investment management and administrative services, as described above in the Advisory
Business section, to the Funds. Investment in the Funds is generally only available to institutional investors
and certain high net worth investors that are “accredited investors” and “qualified purchasers”, within the
meaning of the U.S. Securities Act of 1933, as amended and the U.S. Investment Company Act of 1940, as
amended, respectively.

The Funds have a specified minimum investment as set forth in their offering documentation. Investors in
the IOP Fund II, IOP Fund III and IOP Fund IV are generally required to make a minimum capital

commitment of $5 million. At its discretion, IOP or the General Partners may waive or lower the minimum
capital commitment amount. The Funds are closed to new investors.

Methods of Analysis, Investment Strategies and Risk of Loss
Methods of Analysis and Investment Strategies
As disclosed above, the primary purpose of the Funds is to seek to generate returns for its partners, principally
through long-term capital appreciation, by making, holding and disposing of primarily privately negotiated
equity and equity-related investments in middle-market manufacturing and value-added distribution
companies, with a particular focus on undermanaged businesses. As disclosed above, IOP manages the Funds
with support from Operating Principals. The Operating Principals have an exclusive arrangement with IOP
and: (i) advise and assist the General Partners in connection with the sourcing, selecting, and review of
investment opportunities; (ii) source key managers (as needed to replace or supplement management at
portfolio companies); and (iii) in many situations, directly manage or oversee Fund investments.

IOP focuses on making investments in a wide range of manufacturing and value-added distribution
businesses, generally with headquarters or base of operations in North America. While not limiting its
investment focus, IOP has direct experience in the following industries:

    •   Agricultural and construction equipment
    •   Automotive components
    •   Building products
    •   Capital and industrial equipment
    •   Commercial vehicle and engine components
    •   Electronics
    •   Foundry and casting products
    •   Health care, dietary and food products
    •   Plastic components
    •   Precision machining
    •   Recreational and sport vehicle components
    •   Stamped and fabricated products
    •   Steel or metal processing

Fundamental values are the core of IOP’s investing strategy. Underlying IOP’s investing strategy is IOP’s
fundamental values:

    •   Pursue investment opportunities where IOP can support management in stabilizing, growing and
        enhancing the value of their business
    •   Provide strategic, operational and financial resources to accomplish the goals of the business
    •   Partner with the management and employees of the business
    •   Fundamentally improve the performance of the business to the benefit of its employees, customers,
        suppliers and community, as well as shareholders
    •   Accomplish the foregoing while adhering to IOP’s standards of ethics and integrity

Utilizing the private equity and direct management experience among IOP’s investment team and Operating
Principals, IOP has developed its disciplined investment approach based on five key elements:

    •   Targeted investment strategy focused on operational improvement and sales growth opportunities of
        fundamentally sound businesses in the manufacturing and value-added distribution sectors
    •   Detailed, "hands-on" due diligence led by senior-level transaction and operational professionals

    •   Up-front development of operating plan (roadmap to value creation)
    •   Utilize strong key managers, decisive execution and active oversight
    •   Realize value through sales and earnings growth

IOP typically focuses on making investments with the following characteristics:

    •   Manufacturing or value-added distribution businesses
    •   Revenues generally between $50 million and $500 million
    •   Defensible market, customer and product positions
    •   Solid long-term industry fundamentals
    •   Identifiable and achievable improvement and/or growth opportunities
    •   Strong incumbent key managers preferred but not required
    •   Positive EBITDA preferred but not required
    •   Control equity investments generally between $15 million and $100 million
    •   Corporate divestitures, private sales, restructuring or bankruptcy situations

IOP has an Investment Committee comprised of the Principals, one Managing Director and three Operating
Principals. All portfolio company investments and dispositions are subject to Investment Committee
approval in accordance with each Fund’s limited partnership agreement.

Risks
All investing involves a risk of loss that the Funds and its partners should be prepared to bear. IOP cannot
give any guarantee that it will achieve a Fund’s investment objectives or that the Funds will receive a return
on their investments. The past performance of investment strategies such as those implemented by IOP is
not necessarily indicative of their future results. Investors should ultimately refer to their Fund's respective
offering documents for detailed risk disclosures that specifically address risks of each Fund’s investment
strategies, methods of analysis, and/or particular types of investments recommended. Below is a summary
of potentially material risks for each significant IOP investment strategy used, the methods of analysis used,
and/or the particular type of investment recommended.

    •   Lack of Liquidity – The Funds generally will invest in private companies, the shares of which are not
        publicly traded. Unless such a portfolio company subsequently succeeds in obtaining approval from
...