Redding Ridge Asset Management LLC

Fees and Compensation

The Adviser receives management fees in connection with the investment management services it
provides to Clients and also receives performance fees, carried interest or other incentive
compensation related to the performance of certain Clients. Such management fees, performance
fees, carried interest, or other incentive compensation generally are negotiable and established at the
beginning of the advisory relationship with each Client. Specific details of payment terms and
compensation, including its method of calculation, are set out in Client offering materials,
indentures, disclosure documents, Management Agreements and other governing documents. Such
compensation is sometimes negotiated with strategic partnerships, SMAs and other investors in
certain circumstances. Management fees (and other compensation described herein) are subject to
waiver or rebate at the Adviser’s discretion.

Management Fees

Management fees in CLOs are generally structured with a portion of such fee payable as a senior
management fee and a portion payable as a subordinated management fee. Management fees are
typically payable quarterly in arrears, deducted from each CLO’s account and dependent in part on
certain cash distribution constraints set forth in the governing documents for each CLO. Collateral
management fees for CLOs are payable only to the extent that funds are available in accordance with
the priority of payments described in the CLOs’ indentures. In lieu of subordinated management
fees, the Adviser could instead take the equivalent of such fees in the form of notes issued by a CLO.

Investors in the Adviser’s Funds are either charged annual management fees based on invested
capital, calculated and payable quarterly in arrears, or are charged monthly management fees based
on net asset value of the Fund, calculated monthly and payable monthly in advance. After the
investment commitment period, the management fee is typically based on the lower of aggregate net
asset value or net invested capital. For Funds, management fees are typically deducted from each
applicable Client’s account. SIFs and SMAs are generally charged management fees similar to (but
not necessarily the same as) those applicable to Funds. For SIFs and SMAs, management fees are
typically billed directly to the Client.

When the Adviser enters into a side letter or other agreement that offers preferential terms to a Client
or investor, that Client or investor will enjoy more favorable economic (or other) terms than its peers.
The Adviser is not obligated to inform other Clients or investors of any particular fee arrangements
or other preferential terms or offer similar arrangements or terms of any other Client or investor,
unless the Adviser has otherwise agreed to do so.

Performance-Based Compensation

The Adviser can also receive incentive fees, carried interest or other incentive compensation as set
forth in a Client’s governing documents. For CLOs, incentive fees are only payable to the extent that
funds are available for such purpose and certain performance hurdles are met on each payment date
in accordance with the priority of payments described in governing indenture. In lieu of incentive
fees, the Adviser could instead receive a profits interest in the form of notes issued by a CLO that
entitle it to receive a stream of income above a specified internal rate of return by the subordinated
debt holders of the CLO. For Funds, the Adviser is generally entitled to receive carried interest. For
certain Funds, carried interest is calculated based on a percentage of realized profits after a preferred
return to investors, while for other Funds it is calculated based on a percentage of the increase in net
asset value of the Fund after a preferred return to investors. For certain SIFs and SMAs, the Adviser
is entitled to performance-based compensation. All performance-based compensation payable to the
Adviser is consistent with the requirements of Section 205 of the Advisers Act and, as applicable,
Rule 205-3 thereunder. The timing for payment of performance-based compensation varies by Client
and is set forth in the Management Agreement and/or governing documents of the Client. For CLOs,
performance-based compensation is typically payable to the Adviser quarterly, or more frequently,
in arrears, and deducted from each applicable Client’s account and dependent in part on certain cash
distribution constraints set forth in the governing documents for each CLO. For Funds, performance-
based compensation is payable either in arrears on a quarterly basis or in advance on a monthly basis
as set forth in the governing documents for each Fund. For SIFs and SMAs, performance
compensation can be payable annually or less frequently.

CLO Warehouse Fees

As negotiated on a deal-by-deal basis, the Adviser can also receive management fees payable under
CLO Warehouse documents and/or structuring fees or “warehouse success fees” (collectively, “CLO
Warehouse Fees”). Frequently, and at its sole discretion, the Adviser foregoes charging any CLO
Warehouse Fees to facilitate the closing of the CLO. However, CLO Warehouse Fees can include
fees similar to the above-described management fees and incentive fees, as well as certain other fees
negotiated in connection with a CLO payoff of such warehouse facility, in each case as described in
the transaction documents for a warehouse facility.

SIF Fees

The Adviser has entered, and will continue to enter, into partnerships directly or indirectly with
investors through SIFs that invest in a number of Funds. The Adviser could grant certain preferential
terms to SIFs, including, by way of example, a waiver or reduction of Management Fees or
performance-based compensation rates and/or blended Management Fees or performance-based
compensation that result in lower fees than those applicable to other investors in the Funds in which
the SIFs invest.
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Types of Clients

As discussed above in Item 4, the Adviser provides investment advisory services to CLOs, CLO
Warehouses, Funds, SIFs, and SMAs. Investments in CLOs, CLO Warehouses and SMAs are
generally only available to: (i) qualified institutional buyers or institutional investors that are
“accredited investors” as defined in the Securities Act of 1933 (the “Securities Act”) and “qualified
purchasers” as defined in the 1940 Act; or (ii) non-US persons, (as defined in the Securities Act).
Investments in Funds are generally only available to (x) “accredited investors” as defined in the
Securities Act; (y) “qualified clients” as defined in the Advisers Act and (z) where applicable,
“qualified purchasers” as defined in the 1940 Act. The Adviser targets a broad range of investors,
including institutional investors, family offices, fund-of-funds, and high-net-worth individuals that
meet the criteria set forth above as well as related entities of the Adviser or the AGM Group. The
Funds are closed-end vehicles where each investor makes an up-front commitment to contribute a
stated amount of capital which is drawn over time by the Adviser for investment, and the investor
generally is not permitted to withdraw capital prior to the end of the stated multi-year term or lock-
up period of the Fund.