EDL Fund - Strictly Private & Confidential

European Direct Lending Investment Strategy and Objective

• Investment Strategy
̵ The European Direct Lending Fund (EDL) provides private credit to lower mid-market business in Northern and Western
Europe with focus on 'Beer countries’ rather than ‘Wine countries’
̵ EDL provides senior secured, unitranche to lower mid-market corporates with 2-5 years’ maturity and includes warrants as
equity kickers
̵ EDL employs a value-oriented approach to SME and special situations lending that incorporates opportunities throughout
the various stages of the credit cycle
̵ EDL concentrates on loan sizes of Euro 5 – 15 millions where there is a market coverage gap between traditional high street
bank lending, P2P lenders on the lower and private equity sponsors and investment banks on the upper part
̵ The team has an ability to identify cohorts of growth companies that offer the best risk adjusted return
̵ EDL will focus on core markets in Northern/Western Europe i.e. UK, Ireland, Germany, Austria, Switzerland, Netherlands
and Nordics, where there is solid lender friendly legislation with proven workout procedures and data availability
̵ EDL has ‘team members on the ground’ in UK, Germany and Switzerland

• Investment Objective
̵ Capital protection with generation of consistent, low volatility and superior risk-adjusted returns
̵ The strategy is designed to capitalize on the funding gap resulting from increased regulatory restrictions on banks and
provide investors with exposure to a market that requires specialized knowledge and is otherwise difficult to access
̵ Opportunity to build a highly scalable business in the European lower mid-market lending market

EDL Fund - Strictly Private & Confidential 2

Experienced Investment Team with Discipline Investment Philosophy and Process
• Combined over seventy years of knowledge and practice in analyzing and structuring lower mid-market loans in Europe for top
credit investment firms
̵ EDL Partners have proven experience investing in the European corporate loan and debt markets through numerous
market cycles
̵ EDL Partners have extensive working relationship with lower mid-market loan supply network in Europe
̵ EDL Partners has worked for and gained extensive experience from top tier debt and loan management firm in Europe,
such as Oaktree Capital, Allianz Investment, Pamplona Capital, Goldman Sachs, and Abbey National Treasury Services,
Prytania Investment Advisors (JP Morgan) and Moody’s KMV
̵ EDL Partners have complementary specialist skills
̵ Extensive expertise in analyzing and understanding European lower mid-market corporates and their credit risk

• Ability to to earn unlevered returns of 11% plus gross

̵ Investments in lower mid-market lending emphasizes rigorous credit analysis and team-driven evaluation process. Take an
active role in the underlying company to maximize returns
̵ Bottom-up approach to fundamental research
̵ Souring of sponsored and non-sponsored deal flow from extensive network of contacts across Europe
̵ Disciplined risk management policies
̵ Fast execution for borrowers with institutional grade due diligence

EDL Fund - Strictly Private & Confidential 3

Structural Changes for European Banks
• Banks Encouraged to Lend to SMEs
̵ In response to excesses that lead to the global financial crisis, politicians have sought to encourage bank lending as an instrument to
economic recovery
̵ Many banks have been criticized for not lending enough, especially as Central Banks have provided high levels of liquidity

• Banking Regulation Discourages such Lending

̵ At the same time, banking regulation has become more strict requiring more capital and discouraging investments that are less liquid
̵ Loans to SMEs/Lower Middle Market are both capital intensive and limited in liquidity
̵ Banks are starting to adjust their balance sheets in anticipation of Basel III in 2018

• Securitization and other Alternatives not Readily Available

̵ Prior to the financial crisis, there were other financing sources for corporations in Europe
̵ Some impetus has been given to revival of he securitization market by the creation of new European standards for “High Quality”
securitization. However, due to the extended period of inactivity in the market (displaced by the ECB), liquidity remains low. Moreover,
capital treatment of securitization, even HQS, has not been fully clarified under new capital requirements (better under Basel III, but
not really under Solvency II)
̵ Financial institutions are discouraged from investing in structured credit by increased capital charges under Basel III (for banks) and
Solvency II (insurance companies)
̵ The ECB has displaced other investors with its heavy asset buying programs

EDL Fund - Strictly Private & Confidential 4

Future BankLendingRestricted ByRegulation

Quarterly European Leverage Bank-led vs Institutional Loans Volume, Source: Dealogic Insights

Loans to European Corporations Over €1m as of October 2018 Source: ECBDatabank, Stone Mountain Capital Research
EDL Fund - Strictly Private & Confidential 5
SME Market
We lend to growing lower-mid market companies as we believe the
companies are underfinanced by both traditional and alternative lenders.
The need for capital is increasing as the number of SMEs and their growth
are increasing with availability of equity upside. EDL will focus on core
markets in Northern/Western Europe, where there is solid lender
friendly legislation with proven workout procedures and data availability.
EDL’s core market consists of more than 14 million corporates in UK &
Ireland, Belgium, Netherlands, Luxembourg, Germany, Switzerland, Austria, 0.02
Denmark, Sweden, Finland, Norway and Iceland.

Core Market

• Privately held lower

Senior mid-market 0.92
Secured, companies in
Northern/Western 5.7
Unitranche
Europe
lending
• Corporates with
revenues 25-100
million and EBITDA 2 -
25 million
Non-Sponsored Sponsoredloans
loans
• European and US
• Corporates private equity EDL’s core lending market and number of SMEs in millions, Source: ECB, KfW, Statista
• Debt advisors sponsors
• Corporate finance
boutiques • Smaller bank
• Investment banks syndication
• Accountants
• Lawyers
• Placement agents

EDL Fund - Strictly Private & Confidential 6

Secular Opportunity in SME Lending
• Credit funds are now the primary alternative to banks
̵ Despite public pressure banks face regulatory constraints in their ability to lend
̵ European capital markets remain underdeveloped vs. their US counterparts

̵ European-focused direct lending funds have raised $83.7 billion from 2013 to 3Q18
̵ The size of the alternative lending market in the US highlights the market potential for alternative lenders in Europe

US Europe

Non-Bank Non-Bank
25% Institutional 20% Institutional
Lenders Lenders
Bank Bank
75% 80%

Source: ECB, Bloomberg

• Broad sourcing and bespoke structuring
̵ To compete with the broad primary origination network of banks, investors in private debt must rely on a variety of
sources, such as debt advisors and other professionals
̵ Regional and/or sectoral focus define an opportunity set in terms of personal networks, phases in the economic cycle, as
well as jurisdiction for contracts and workouts
̵ Experience in structuring inter-creditor agreements and their use in workouts are key
̵ Investing gradually and minimizing idiosyncratic risk via diversification are also critical

EDL Fund - Strictly Private & Confidential 7

Market Segments
• Regional focus
̵ UK and Germany as growth
̵ Ireland, Austria, Switzerland, Benelux, Nordics
̵ Rest of Europe opportunistically

• Sector focus
̵ Healthcare
̵ Energy (oil & gas, also renewables)
̵ Business Services
̵ Manufacturing
̵ Consumer
̵ Real estate

• Legal systems
̵ “Beer vs wine countries”
̵ Proven bankruptcy regimes and workout procedures
̵ Tested inter-creditor agreements

• Senior Secured, Unitranche and Warrants (Equity Kickers)

• Structural alternatives
̵ Cash-flow based, real-estate collateralized
̵ Stretched senior and asset-backed facility
̵ Further diversification
̵ Limited admixture involving non-European, cross jurisdictional opportunities (e.g. assets in Europe, HQ elsewhere)
EDL Fund - Strictly Private & Confidential 8
Private Debt Market

Private Debt AuM, Forecast 2023, Source: Preqin Private Debt Fundraising 3Q18 by Fund Type, Source: Preqin

European Direct Lending Fundraising, Source: : Deloitte Alternative Lender

Deal Tracker Autumn 2018
European Private Debt AuM, Source: Preqin

Lending Activity in Europe, Source: Deloitte Alternative Lender Deal Leverage and interest rate coverage of European corporates, 2008-2Q18
Tracker Autumn 2018 Source: ICG

EDL Fund - Strictly Private & Confidential 9

Credit Spectrum Risk Return Profile – Attractive Risk Premium for European Direct Lending

Corporate Capital Stack Spectrum in US and EU, October 2018, Source: Barclays Research, Moody’s, Stone Mountain Capital Resea rch

EDL Fund - Strictly Private & Confidential 10

Experienced Management Team
EDL’s management team combines over 75 years experience in European credit markets with specialization in credit analysis, financial
structuring and portfolio management. The experience of the team extends to risk management, distressed workouts and financial
responsibilities.
Gregor is the Ma naging Pa rtner and the Co-CIO of the European Di rect Lendi ng Fund wi th base in London and Germany. Wi th over 25 years ’ experience in fi xed income
ma rkets , Gregor will be focusing on di rect lending i n pri va te ma rkets and deal sourci ng and s tructuring. He will be also responsible for credi t anal ysis and EDL’s portfolio
construction. As Oaktree Capi tal Ma nagement’s mos t senior London-based investment professional in Stra tegi c Credi t, he has most recentl y helped i n growing thei r
European pri va te debt business. Since joi ning the alterna ti ves mana ger in ea rl y 2013 a nd developi ng a va riety of al terna ti ve asset management franchises for the fi rm,
including CLOs and other forms of asset-ba cked finance, Gregor s tructured a number of credi t inves tments in European corpora tes. These ha ve included cash-flow-
based, but also real-es ta te-backed loans to SMEs . Previousl y, as member of the boa rd for Allianz Investment Management, he spent si x yea rs building the Allianz
Group’s al terna ti ve inves tment business, both i n terms of the alloca tions made and the execution of the i ndi vidual s tra tegies . His focus on fi xed income credi t included
Gregor Gruber the responsibility for making loans to corpora tes and infras tructure projects . Prior to tha t, Gregor spent seventeen years in credi t anal ysis, debt capi tal ma rkets
co-CIO ori gina tion, product development and management roles, pri ma ril y a t Goldman Sachs and Morgan Stanley. His most recent role in banking was as a member of the
Tel.: +44 7785 310 872 ma nagement commi ttee for BNP Pa ribas in Frankfurt, responsible for all financial ins titutions business. Subsequent to his undergradua te degree from Ha rva rd College
and work as a stra tegy consul tant for the Boston Consul ting Group, Gregor gra dua ted wi th an MBA in fi nance and opera tions from Stanford Uni versity. Gregor is also
non-executi ve chairman of the fi ntech sta rt-up Li feScale Ltd and a member of the boa rd a t Prime Collateralised Securi ties absl, a not-for-profi t industry group dedi ca ted
to revi vi ng the European s ecuritization market a fter the financial cri sis, i ncluding as a means of providing a dditional funding s ources for SMEs.

John is the Ma naging Pa rtner and the Co-CIO of the European Di rect Lending Fund. Prior to this, he was a Senior Advisor to Belgra ve Ca pi tal Mana gement, a member of
the investment committee of Bri dge Asset Management and Chief Investment Offi cer and a founding pa rtner of Pampl ona Ca pital Management LLP wi th $3.5 billion
under management. John has held a number of senior roles in the asset management and banking i ndus try, including Chief Investment Offi cer of Spyre Asset
Mana gement, a $500 million Fund of Hedge Funds Group, Head of Al terna ti ve Inves tments and Financing within Abbey Nati onal Treasury Servi ces and Principal Fund
Ma na ger and Managing Director of Gottex Asset Management.
John Haam
co-CIO
Tel.: +44 7740640259

Oli ver is Managing Pa rtner and CEO of Stone Mountain Ca pital Pa rtners, the general pa rtner of the European Di rect Lending Fund. He is managing pa rtner and CEO of
Stone Mountain Capi tal , a London and Swi tzerland based alterna ti ve investment advisor, providing al terna ti ve i nves tment resea rch, s tructuring and pla cement
solutions to hedge funds , pri va te debt, pri va te equi ty and corporate finance wi th Al ternati ve Assets under Advisory (AuA) of $51bn. He has over 20 yea rs of experience.
Prior, Oli ver was a Pa rtner and Member of the Executi ve Commi ttee of Pryta nia Inves tment Advisors , a credi t asset manager in London wi th $1.2 billion AuM seeded
and ma jori ty owned by JP Morgan. As Head of Ori gina tion & Client Mana gement he marketed the credi t fund ra nge to i nsti tuti onal investors gl oball y and developed
investment and risk advisory for legacy asset holders in bad banks , governmental agencies , central banks and insurers . Pri or, he was Head of Gl obal Business Soluti ons
a t Moody's Anal ytics in London. Here he developed client solutions around risk anal yti cs and advisory servi ces in the a rea of valua tion and risk assessment of structured
Oliver Fochler fi nance and deri va ti ves , credi t portfolio management, liquidi ty risk and Sol vency II. He ini tiall y covered Moody's KMV's global accounts in banking, insurance and asset
CEO ma nagement in relati on to credi t portfolio and risk management solutions . Prior, he was responsible for business development of s tra tegi c solutions encompassing
Tel.: +44 7922 436 360 Basel II credi t risk, s tructured products, ALM, and deri va ti ves in Reuters Trade & Risk Mana gement i n Zuri ch. Oli ver is a regula r speaker at international fi nance
conferences and semi nars and publishes a rti cles a round the topi cs al terna ti ve i nves tments , credi t, modelling, regula tion and quantita ti ve ris k mana gement. Oli ver is a
certi fied Fi nancial Risk Manager (FRM) of GARP. He holds a BBA from the Uni versi ty of Augsburg in Germany a nd an MBA and Li centiate in finance and computer
s ci ence with honors magna cum laude from the University of Zurich i n Switzerland, where he did his PhD studies (ABD) in quantitative finance.

EDL Fund - Strictly Private & Confidential 11

 Experienced Management Team

Alexander is CFO of the European Di rect Lending Fund and Senior Advisor for Financial Structuri ng in Stone Mountain Ca pital since 2014 wi th special focus on credi t
products and al terna ti ve i nves tments. He was Di rector for European sustainable infrastructure investments in the Energy Effi ciency team a t SUSI Pa rtners i n Züri ch,
s tructuri ng tailor-made financing solutions for i ts technology pa rtners whi ch included debt and equi ty s tructures . Prior, he was head of asset-based financi ng a t
MainFi rst Bank in Fra nkfurt and Zuri ch. He has more than 20 yea rs of experience in s tructuri ng and origi nating structured products . Prior to MainFi rst, Alex was
Pa rtner and Managi ng Di rector a t Aurelius Capi tal Management, an asset mana ger focused on s tructured credi t based in Vienna. Alex was in cha rge of client
solutions and portfolio management wi th over EUR 2 billion assets under management. Between 1994 and 2006, Alexander was with Bea r Stearns i n New York and
Alexander Rothlin London and HSBC in London, worki ng on va rious securi tiza tion transactions in Latin Ameri ca, Europe and Japan. During his time i n London, Alex was a boa rd
CFO member a t Tituliza ción de Acti vos (TdA) Sociedad Ges tora de Fondos de Tituliza ción SA, a joi nt venture between va ri ous Spanish sa vings banks and Bea r Stea rns
Tel.: +41 79 9625818 International. Al ex holds a Master of Arts i n Business Administration from the University of St Gallen, Switzerland.

Ashvi n is a Senior Credi t Researcher for European Di rect Lending Fund and focusses on company resea rch from a corpora te credi t perspecti ve of specifi c i ndus tries
and make credi t recommenda tions to management. As hvin is Senior Advisor for Research in Stone Mountain Ca pi tal since 2013. He has been invol ved in the anal ysis
of the interna tional automoti ve indus try since 1989 and is Mana ging Di rector of Intelligence Automoti ve Asia, whi ch provi des research, anal ysis and advisory servi ces
on developments in the global automoti ve indus try, wi th speci fi c focus on Asia and Asian companies . Main a reas of current research acti vi ties include the anal ysis of
provincial and ci ty level demand and competi ti ve dynami cs i n China ’s auto industry, luxury ca r market dynami cs in China, opportunities and challenges i n China ’s
Electri c Vehi cle (EV) ma rket, India’s auto industry developments including compa risons wi th China, gl obal opportuni ties and challenges for Japanese and Korean
brands and evolution of vehi cle markets in ASEAN region. Between 1992 and 2007, he advised at Global Insi ght (toda y IHS Global Insight), ini tially in the European
Ashvin Chotai auto-consulti ng pra ctice and then specialized in Asia. Between 1996 and 2007, he was the Head of Asian Automoti ve Research and pla yed an ins trumental role in the
Senior Credit Research development of Global Insight’s Asian and emerging ma rket automoti ve resea rch and anal yti cal capabili ties. He is frequentl y invi ted to make presenta tions a t
Tel.: +44 7740 823049
conferences and at ma jor corpora tions in North Ameri ca , Europe, and Asia . He has presented a t Inves tor Forum in Las Vegas, Shanghai , Hong Kong, Tokyo, San
Fra ncisco and New Delhi and conducted meetings with investors and automoti ve companies a cross the globe. He is also wi del y quoted in media on gl obal and Asian
automoti ve issues . Ashvin's ca reer sta rted in the oil explora tion i ndus try wi th Schl umberger, where he worked for nine yea rs , mainl y in Asia. He held a number of
positions, i ncluding Field Engineer, Opera tional Mana gement, Country Manager a nd Business Development i n several European a nd Asian countries , including
assignments in Indonesia, India , Taiwan, Philippines, China , Norwa y and the UK. Ashvi n holds a Bachelor of Science in Electroni c and Electri cal Engineering from Bristol
Uni versity, UK a nd has a n MBA from London Business School.

Alexandros is a Credi t Anal ys t in the European Di rect Lendi ng Fund with focus on assessing and performing due dili gence of transa ctions for the fund and credi t
resea rch. Alexandros is Anal ys t in Stone Mountain Capi tal since 2015 and focuses on quanti ta ti ve al terna ti ve investment anal ysis and product development. He
worked as a performance anal yst in Elen and has published a cademi c papers a round real esta te, life expectancy in insurance, the equi ty premi um puzzle in beha vioral
fi nance, portfolio theory and the effi cient frontier, a compa rison of fund of hedge funds against single manager hedge funds and other alternati ve inves tment and
corpora te fi nance related topi cs. Alexandros holds a Ba chelor of Science i n Accounti ng and Finance from Athens Uni versity of Economi cs and Business and a Mas ter of
Sci ence in Corporate Finance from ICMA Centre of the University i n Reading, UK.
Alexandros Kyparissis
Credit Analyst
Tel.: +44 7843 144007

EDL Fund - Strictly Private & Confidential 12

Experienced Team with Defined Areas of Responsibility

The team has been working together in different roles and capacities to structure and invest in European private lending deals for over 10
years.

Gregor Gruber John Haam Oliver Fochler

• co-CIO • co-CIO • CEO

• Co-head Investment Committee • Co-head Investment Committee • Member of Investment Committee
• Deal Structuring and Sourcing • Deal Structuring and Sourcing • Deal Sourcing
• Hybrid & subordinated debt • Hybrid & subordinated debt • SME/middle market and CRE debt
transactions with focus on Europe
• Complex, innovative structures • Complex, innovative structures
• Structuring
• Credit Analysis • Credit Analysis • Structuring investment vehicles across
• 25 years European credit • 25 years global and European capital structure
experience credit experience • Credit Analysis & Risk Management
• Portfolio Construction • Portfolio Construction • Single Obligor and Credit Portfolio
Management
• Strategic and tactical asset • Strategic and tactical asset
allocation allocation • Marketing & Investor Relations
• Fundraising from global institutional
investors

EDL Fund - Strictly Private & Confidential 13

Track Record

Gregor Gruber – co-CIO John Haam – co-CIO

• Most senior investment professional and deal structurer at • Pamplona Capital (2004 – 2007):
Oaktree Capital’s Strategic Credit platform in Europe AUM over $900m

• EDL deploys same investment strategy and approach for - Global Emerging Market: Annualised Return:
firms with lower EBITDA in European lower middle market 23.52% / Annualised Volatility: 6.39%

Oaktree Strategic - Diversified: Annualised Return: 10.86% /

Indices
Credit Composite Annualised Volatility: 4.24%
Statistics Credit
Citi High
Gross Net Suisse • Spyre AM, Subsidary of Abbey National (2002 – 2004):
Yield
Returns Returns Leveraged AUM over $500m
Capped
Loan
2012 (6months) 8% 6.3% 4.7% 7.4%
- Global Diversified: Annualised Return: 10.82% /
Annualised Volatility: 3.13%
2013 18.2% 14.4% 6.2% 7.2%
2014 0.8% -0.3% 2.1% 1.9% • Abbey National Alternative Investment and Financing
(1997-2002)
2015 -4.2% -5.2% -0.4% -5.5%
2016 16.3% 12.8% 9.9% 17.6% - European ABL, CLO, CDO, Property Backed Loans
and Collateralized Lending
2017 (3 months) 3.5% 2.7% 1.2% 2.4%
Cumulative Return • Gottex Asset Management (1992 – 1997)
48.3% 33.3% 25.6% 33.4% - Global Fixed Income Arbitrage Hedge Fund (AUM
since Inception
$350m)
Annualised Return
8.7% 6.2% 4.9% 6.2%
since Inception
Monthly Standard
1.5% 1.4% 0.7% 1.6%
Deviation
Sharpe Ratio 1.60 1.25 2 1.10

EDL Fund - Strictly Private & Confidential 14

Investment Process

We believe the value-added to investors comes from thorough and niche investment process.

Initial Deal Portfolio Risk

Deal Flow Term Sheet Due Diligence Closing Management
Screening Monitoring

• Deal originated • Corporate • Take lead role in • Qualitative and • Alignment of • Track actual • Board
from our team Overview transactions quantitative due transactions performance vs. representation
through existing diligence with projections giving us up-to-
relationships • Evaluation of • Determine yield, investment date information
management team maturity, seniority • Focus on the legal objectives • Filings (if public), and company
• Global network of aspect and laws of business update knowledge
financial advisors • Advanced Cash • Creditor protections every jurisdiction • Document and and press
and other flow analysis investment releases • Risk identification
relationships with • Covenants • Extensive research execution and mitigation
lawyers, banks, • Relative Value and partnering with • Monitoring
service providers, analysis and • Warrant on Equity rating agencies for • Monitoring payments, ratio • Stress testing
marketplace illiquidity premium data, analysis executed by compliance and
platforms with test • Currency hedging processes and analyst team collateral • Diversification and
underwriting scoring methods high rejection rate
capabilities, co- • Asset valuation • Financial & Legal • Align • Maintain
investments, club structuring • Background check, documentation fundamental • Measures to
deals • Financial modelling referrals and with valuations address liquidity
• Tax structuring interviewing investment and liabilities
• Deals focused on • Comparable credit management team exit objectives • Harmonised mismatch
lower mid-market analysis • Negative voting and BoD relationship with
and CRE-backed • Board service provider • Constraints on
lending in UK, • Legal and • Contractual • Analyse company’s representation Leverage
Germany, Nordics jurisdictional protection competitive • Purchase or sale
and analysis positioning and in open market or • Constraints on type
opportunistically in • Contingencies financial health private of investors
rest of Continental • Stress test transactions
Europe downside equity • Management based on market • Pre-defined risk
cushion representation inefficiencies limits
• Deals need to meet
initial requirements • Equity upside yield • Expertise in risk
for size, geography analysis monitoring
and sector
EDL Fund - Strictly Private & Confidential 15
Investment Process – Evaluation & Analysis

EDL operates within the context of top-down analysis of macro-economic and sectoral trends
• Macro-economic trends are evaluated on an ongoing basis to assess relative value and investment timing
• Sectoral trends and opportunities are assessed to direct sourcing priorities

Initial Screening of Opportunities

The team typically sees 3-5 interesting private market investment opportunities per week. These are subjected to a screening
process that focuses on:
• Assessment of relative value and sectoral priorities within the macro-economic context
• Initial financial analysis of company and its business model
• Evaluation of management and its business strategy

Detailed Credit Assessment

Those companies that pass the initial screening (typically 1-2 per week) are subject to more detailed credit analysis and an
assessment of the likely deal structuring requirements, which comprise:
• Proprietary Credit Scoring Framework, including cash flow dynamics, growth and margin analysis, assessment of collateral
value, current and projected interest and debt coverage
• Operational Due Diligence, including consultation with industry experts, management interviews and site visits
• Analysis of existing financing structure and legal arrangements vis-à-vis existing investors

EDL Fund - Strictly Private & Confidential 16

Investment Process – Risk and Portfolio Management

EDL monitors the portfolio investments and manages risk on a ongoing basis
• Actual vs projected performance monitored
• Diversification, concentration, and portfolio biases and changes monitored real time

Investment Risks Include

• Concentration risk・Illiquidity risk・Leverage ・Default risk ・Regulatory risk・Contractual risk・Country risk・Market risk
・Currency risk ・Dominant lenders and increased competition ・Legal and document risk

Idiosyncratic Risks Include

• Management team changes, underperformance, loss of direction
• Competitive disruption
• Fraud, diverted payments, lifestyle changes, history of payroll data

Risk Assessment Prior to Investment

• Use of FHR scoring method from Rapid Ratings
• Use of S&P Moody's, & Fitch Industry metrics and valuation analysis
• Advanced Cash Flow Modelling
• Stress Tests
• Collateral Analysis

EDL Fund - Strictly Private & Confidential 17

Investment Process – Risk and Portfolio Management (2)

Risk Management
• Diversification across borrowers and less in regards to sectors. Our sector specific knowledge and expertise partially
outweigh sector diversification
• Board level representation when appropriate
• Constraints on the type of investors
• Stringent credit assessment and high rejection rates
• Industry appropriate constraints on leverage
• Closed-end structure addresses assets-liabilities mismatch and redemptions

Risk Resolution
• Management Restructuring
• Reorganization
• Downsizing Payroll
• Sale of Part of Business
• External Assessment and Advisory
• Debt Restructuring, Debt for Equity, Extension, Convertible Structure
• Sale, Windup, Administration

EDL Fund - Strictly Private & Confidential 18

Investment Guidelines

Primary Characteristics
• Focus on senior secured, 1st lien, unitranche lending with equity kickers to SMEs and middle-market corporates
• Individual names not to account for more that 10% of target fund volume
• Cash flow lending, but loans may also be collateralized by real assets
• 5y + 1y + 1y term in closed end fund Lux AIF SCSp (GP / LP)

Regional and Sector Focus

• UK, Ireland, Germany, Austria, Switzerland, Holland, Nordics, Benelux, rest of Europe opportunistically
• Manufacturing, consumer durables (not retail or other cyclicals), health care, energy, commercial real estate
• Other countries and sectors only opportunistically—each category not to exceed 20% of target fund volume
• Pure real estate (i.e. non-corporate) lending not to exceed 20% of target fund volume

Target Performance
• Ultimate net portfolio return: 8-10% (including any equity kickers)

EDL Fund - Strictly Private & Confidential 19

Indicative Portfolio Characteristics

Summary of Portfolio Characteristics:

• Minimum Corporate Lending: 80%
• Senior secured minimum: 100%
• Industry Concentration Limits: 20%
• Geographic Concentration Limits: 30%
• Deal Size Targets: €5-15m
• Maximum Loan Term: 5 years
• Minimum Call Protection: 18 months

Target Pipeline by Sector Target Pipeline by Region

Industrial
10% 9%
5% Consumer 16% DACH
17% Business Services 35% UK & Ireland
Healthcare
20%
Energy 19% Nordics
19% TMT
Benelux
Real Estate
20%
30%

EDL Fund - Strictly Private & Confidential 20

EDL Fund – Terms
Provide credit to mid sized European businesses - Exploit funding gap resulting from increased regulatory restrictions on banks

Fund Structure & Terms

Investment Advisor Stone Mountain Capital Partners LLP

AIFM Carne Group Luxembourg AIFM

Administrator BNP Paribas

Auditor Price Waterhouse Coopers (PWC)

Swiss Representative First Independent Fund Services LTD

Legal Counsel Allen & Overy

Management Fees 1.5%

Performance Fee 15%

Structure Luxembourg AIF SCSp Closed-ended

Term 5y plus 1y + 1y extensions

Investment Period 3y

Target Size €250m-500m

Target Return 8%-10% Net

Minimum Investment €1m

EDL Fund - Strictly Private & Confidential 21

EDL Fund – Overview

Provide credit to mid sized European business - Exploit funding gap resulting from increased regulatory restrictions on Banks

Fund Overview Investment Focus

•Senior secured loans and unitranche

loans
Fund Size •EUR 250-500 million target Structure
•Opportunistic equity participation,
converts, warrants

•Providing new senior secured to

Strategy •Focus on medium and small businesses
European small and medium-sized
enterprises Borrowers •Revenues 25 million 100 million
•EBITDA 2 -25 million

•Focus on debt driven solutions

Event driven Situations •Loan size range 2-20 million
•M&A , growth, refinancing, opportunities
Loan Size/Tenor •Typical maturity 3-5 years
•Call protection of at least 18 months
•3-5 year target maturity
Hold to Maturity •Held to maturity typically
•Primary issuance with no trading •UK, Ireland, Germany, Austria,
Geographic Focus Switzerland, Benelux, Nordic region
•Pan-European opportunistic approach
•Top down sector analysis
Investment Process •Bottom up deep dive analysis
•Constant re-evaluation of opportunity set •High quality, cash flow generative non-
cyclical businesses
Industries
•Senior team with 75 years of investing •Industrial, healthcare consumer, retail,
experience TMT, financial services
Team/Origination
•Robust investment team with 15 year
track record
•First lien on operating or real assets
•Regulated Western European focused •Personal guarantees and or other
investment boutique Security covenants
EDL Fund •Board level representation when
•Origination, investment management,
distribution all in-house applicable

EDL Fund - Strictly Private & Confidential 22

 Disclaimer
• All presentation materials have been prepared solely as a preliminary document to provide investors with the opportunity to determine their potential
interest in European Direct Lending (the “Fund”), and may not be used for any other purpose, or relied upon to make any investment decision. All
material is qualified in its entirety by information which will be contained in a Confidential Offering Memorandum (the “Offering Memorandum”) of
the Fund, which should be read completely before considering an investment. In the event of a conflict between this material and the information
which will be contained in the Offering Memorandum, the information contained in the Offering Memorandum shall supersede this material. This
document and those materials governed by it (all materials distributed by partners, employees, or other affiliated persons of European Direct Lending
(the “Fund” its partners or affiliates) are CONFIDENTIAL and may not be reproduced or distributed to any other person without the express written
consent of EDL (European Direct Lending).
• An offer or solicitation for the Fund will only be made through the Offering Memorandum and subscription agreement, and will be subject to the terms
and conditions in such documents. This material is neither an offer nor a solicitation to sell or buy any securities and may not be used or relied upon in
connection with any offer or sale of securities. The information set forth herein does not purport to be complete. An investment in the Fund is
speculative and involves significant risks. Investors considering an investment in the Fund should understand these risks and have the financial ability
and willingness to accept them for an extended d of time. No assurance can be made that a full or significant recovery of an investment in the Fund
will be received. Investors may lose all or a substantial amount of their investment in the Fund. Fund expenses will offset Fund returns and the
deduction of management, performance and other fees from gross returns will reduce an investor’s return. Actual performance will vary depending on
the size of the commitment and applicable fees and expenses. Past performance may not be indicative of future results.
• The Offering Memorandum will contain information about the Fund that is important to any investment decision regarding the Fund, including its
investment objectives, terms and conditions, tax information, potential conflicts of interest and risk disclosures. Risk factors include: the loss of all or a
substantial portion of an investment due to hedging, leveraging or other speculative investment practices, illiquidity of the Fund’s investments, the
availability of investment opportunities, absence of information regarding valuations and pricing, delays in tax reporting, potential tax issues regarding
phantom income and less regulation and higher fees than mutual funds.
• Important Information for investors in the European Economic Area: In the European Economic Area, the information in this presentation is not to be
issued or distributed to, nor directed at, persons other than "qualified investors" within the meaning of Article 3(2)(a) of Directive 2003/71/EC, the
"Prospectus Directive". The information contained in this presentation must not be accessed by, acted on, or relied on by persons in the European
Economic Area who are not qualified investors. Within the European Economic Area, any investment or investment activity to which the information in
this presentation relates, is only available to qualified investors and will be engaged in only with qualified investors.
• This presentation has been prepared for investors who qualify to invest in funds that invest in the types of investments described in this presentation.
Generally, they would include investors who are “Accredited Investors” under the Securities Act of 1933 and “Qualified Purchasers” under the
Investment Company Act of 1940.
• Opinions and estimates constitute our judgment and are subject to change without notice, as are statements of financial market trends, which are
based on current market conditions and subjective opinions. We believe the information provided herein is reliable, but do not warrant its
completeness or the accuracy of our opinions. This presentation is not an advertisement and is not intended for public use or distribution.
• Sample transactions in this presentation have been selected as illustrative of EDL’s investment analysis and process and do not constitute the best or
worst performing investments in the Fund’s portfolio.

EDL Fund - Strictly Private & Confidential 23