Silver Capital Management LLC

Item 5 - Fees and Compensation

   A. Our fees and compensation are described in the advisory contracts we enter into with our
      clients. Our fees and compensation are generally non-negotiable and will vary, but will
      typically consist of a percentage of assets under management, which percentage will vary
      depending on the type of assets managed. In addition, certain client accounts are subject
      to annual performance-based fees or allocations, as set forth below.

       For Retail Accounts

           Retail accounts are generally charged an annual fee of 1% of the market value for the
           account.

       For Institutional Accounts

           Institutional accounts are generally charged an annual fee of 1% of the market value
           for the account.

       For Private Investment Funds

           Investors are charged an annual fee of 1% of assets under management and a
           performance fee of 20% of net profits, subject to a high-water mark.

Silver Capital Management, LLC Form ADV: Part 2A                                               Page 4

   B. As described in more detail below, we generally deduct our management fees from client
      accounts quarterly in arrears, except for the private investment funds that we manage which
      pay management fees quarterly in advance. With respect to client accounts that are subject
      to performance-based fees or allocations, generally, we or our affiliates receive such
      performance-based fees or allocations from such client accounts on an annual basis in
      arrears and upon redemptions/withdrawals by investors.

   C. Clients that are private investment funds generally bear their own expenses, including the
      costs of the continuing offering of fund interests; investment and trading expenses,
      including brokerage, clearing and margin expenses and custodial fees; routine legal, tax,
      accounting, and auditing fees; travel expenses; and any extraordinary expenses. (See Item

Item 7 - Types of Clients

We primarily provide investment advice to clients who are private investment funds, high net worth
individuals, pension and profit sharing plans, individual retirement accounts and charitable
organizations. The investors in the private investment funds we manage are generally high net
worth individuals and institutional investors. Investors in our private investment funds are
generally required to qualify as “accredited investors” (as defined in Rule 501 under the Securities
Act of 1933, as amended) and “qualified clients” (as defined in Rule 205-3 under the Investment
Advisers Act of 1940, as amended (the “Advisers Act”)). Managed account clients that are subject
to performance-based fees or allocations must qualify as qualified clients. The minimum
investment in the private investment funds is generally $1,000,000, subject to our discretion to
accept lesser amounts. There is no minimum dollar requirement for establishing a separately
managed account, and we determine the minimum investment for a separately managed account on
a case by case basis.