Strategic Value Partners LLC

Item 5 – Fees and Compensation

       Client Funds

Our fees include asset-based fees generally ranging from annual rates up to 2% of a client’s net
asset value, invested cost or capital commitments, as applicable, plus performance-based fees or
allocations (typically a 20% performance/incentive allocation) payable to SVP and/or certain of
our affiliates, as well as certain other fees and expense reimbursements, as more fully described in
each Client Fund’s Offering Documents.

The fees, performance compensation and other fees, costs and expenses payable by each Client
Fund is generally summarized below and is described in more detail in the Offering Documents
for the applicable Client Fund.

SVP currently manages two primary types of Client Funds: (1) closed-ended fund structures,
which we refer to herein as the “Special Situation Funds.” and (2) closed-end fund structures,
which we refer to herein as the “Capital Solutions Funds”. SVP also manages a third category of
Client Funds that are closed-ended and primarily invest in a single underlying company and related
assets, which we refer to as the “Spurs Funds” and a fourth category of Client Funds, which were
opened-ended funds and which we refer to as the “Restructuring Fund”. The Restructuring Fund
is currently conducting an orderly disposition of its remaining portfolio positions.

       Special Situations Funds

Management Fee - Special Situations Funds I, II, III, IV, V, and VI

An affiliate of SVP is entitled to a management fee, payable quarterly in advance, calculated as
follows:

       (a)     during the investment period of the fund, after the fund’s initial capital call but prior
               to the first date on which at least 50% of aggregate commitments has been called
               by the fund, an amount equal to the Applicable Percentage (defined below) of 50%
               of aggregate capital commitments (whether or not then drawn); and

       (b)     during the investment period of the fund, on and after the first date on which at least
               50% of the aggregate commitments has been called by the fund, an amount equal
               to the Applicable Percentage of 100% of the aggregate capital commitments
               (whether or not then drawn).

For Special Situations Funds I, II, III, IV and V, after the investment period of the fund, an annual
amount equal to the Applicable Percentage of the limited partners’ capital contributions, minus (i)
any losses on permanently impaired investments and (ii) any distributions attributable to (a) the
cost of any realized investment and (b) fund expenses related to any such realized investment.

Notwithstanding the foregoing, the management fee charged after the investment period of the
fund shall not be less than the Applicable Percentage of 100% of the limited partner’s pro rata
share of the cost of investments held by the fund at such time (excluding the portion of the cost of
any current investment that is deemed to be permanently impaired), including that limited partner’s

pro rata share of operating expenses pertaining to such investments; provided, however that in no
event shall the management fee charged to a limited partner subsequent to the expiration (or during
a suspension) of the investment period be greater than the Applicable Percentage of 100% of
capital commitments of that limited partner.

For Special Situations Fund VI, after the investment period of the fund, management fees are an
annual amount equal to the Applicable Percentage of the lesser of a limited partner’s (x) Invested
Cost or (y) capital commitments. “Invested Cost” for purposes of Special Situations Fund VI
means, in respect of each limited partner, the total amounts attributable to investments made by
Special Situations Fund VI with respect to such limited partner (including, for the avoidance of
doubt, but without duplication, any amounts attributable to reinvestment, operating expenses and
hedges with respect to such investments) whether such amounts are or may ultimately be funded
through capital contributions, cash on hand or borrowings. Invested Cost is reduced by (1)
dispositions by the fund (with partial dispositions reducing Invested Cost by an amount calculated
by multiplying the Invested Cost (prior to such partial disposition) by the pro rata share of the
investment that has been disposed of), (2) written off investments, and (3) extraordinary
distributions from an investment (including dividends recapitalizations), solely to the extent that
following such distribution the remaining value of the applicable investment is less than the
Invested Cost attributable to such investment immediately prior to such distribution, in each case
as described in more detail in the applicable Offering Document. The management fee is subject
to adjustment for any intra-quarter activity including contributions, and dispositions.

“Applicable Percentage” means (a) with respect to Special Situations Fund I, an annual rate equal
to 2%, (b) with respect to Special Situations Fund II and III, the annual rate equal to (i) 2% for
limited partners with a capital commitment of less than $100 million, (ii) 1.75% for limited
partners with a capital commitment equal to at least $100 million but less than $200 million and
(iii) 1.5% for limited partners with a capital commitment equal to $200 million or greater, (c) with
respect to Special Situations Fund IV, the annual rate equal to (i) 1.75% for limited partners with
a capital commitment of less than $100 million, (ii) 1.55% for limited partners with a capital
commitment equal to at least $100 million but less than $200 million and (iii) 1.35% for limited
partners with a capital commitment equal to $200 million or greater, (d) with respect to Special
Situations Fund V, the annual rate equal to (i) 1.75% for limited partners with a capital
commitment of less than $100 million and (ii) 1.55% for limited partners with a capital
...

Item 7 – Types of Clients

SVP provides investment advice to pooled investment vehicles, which include the Restructuring
Fund and closed-ended “private equity” style fund structures, as well as funds-of-one.

We do not impose any minimum requirements on our pooled Client Funds. Such Client Funds,
however, generally impose minimum investment commitments on investors and require such
investors to satisfy certain suitability standards. We may impose account minimums on funds of
one clients.

SVP, as the investment manager for the Client Funds, reserves the right to adjust account size
minimums as deemed appropriate in light of the overall facts and circumstances and has agreed
and may in the future agree with investors in any Client Fund to alter the terms and conditions
applicable to such investor without the consent of any other investor in a “side letter” or similar
agreement.

If in the future we advise managed accounts, we may impose certain account minimums on
managed account clients. Any such minimums would be described in the written agreement
between SVP and the client. Any other requirements or restrictions would be specified in detail in
the specific agreement between SVP and such managed account client.