Crescent Direct Lending Levered Fund, L.P. · PDF fileCrescent Direct Lending Levered Fund,...

CONFIDENTIAL – DO NOT DISTRIBUTE

Crescent Direct Lending Levered Fund, L.P.

Presentation to: City of Fresno Retirement Systems

April 21, 2015

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Timed Item: 10:00 am Joint Meeting of the Retirement Boards Meeting Date: 4/21/2015

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I. Crescent Capital Group Firm Overview

II. Crescent Direct Lending

- Executive Summary - Why Crescent Direct Lending - Direct Lending Market Opportunity - Sourcing / Underwriting / Portfolio Management

III. Exhibits

A. Prior Portfolio Investments & Asset Composition B. Select Case Studies

Table of Contents

2


The information contained in this presentation is being furnished on a confidential basis for the purpose of providing certain information about Crescent

Capital Group and its predecessor entities (the “Firm”). This presentation contains confidential information and may not be copied, nor may it be

transferred to any other third party without our prior written consent, and shall be returned at our request. This presentation contains information

which has been derived from a number of sources. While the information is believed to be reliable, no representation is made herein by the Firm’s

general partners or investment advisors as to the accuracy or completeness of such information.

Nothing in this presentation constitutes an offer to sell or the solicitation of an offer to buy securities. The information in these materials is provided

solely as reference material with respect to Crescent Capital Group, its people and advisory services business, as an independent asset management

company. Any offer to sell or solicitation of an offer to buy a security may only be made by a separate private placement memorandum with respect to

that security.

Footnotes contain important information about the definition of terms used herein, the composition of the portfolios presented and related

performance information as well as unrealized investment valuations and should be carefully reviewed. Market data and information included herein is

based on various published and unpublished sources considered to be reliable, but has not been independently verified and there is no guarantee of its

accuracy or completeness.

Performance information contained herein is based in significant part on unrealized investment valuations which may not be achieved. Past

performance does not guarantee future results.

Legal, tax and regulatory changes, as well as judicial decisions, both within and outside of the United States, could have an adverse impact on Crescent

Capital Group and its investments. Instability in the securities markets may increase the risk inherent in Crescent Capital Group's investments in that the

ability of issuers to refinance or redeem portfolio securities held by Crescent Capital Group may depend on their ability to sell new securities in the

market. Future periods of uncertainty in the U.S. economy and the economies of other countries of issuers of securities and loans in which Crescent

Capital Group may invest, and the possibility of increased volatility, default rates and deterioration in financial markets, may adversely affect the value

of Crescent Capital Group's investments.

All information is current as of March 31, 2015 unless otherwise noted. See appendix for Certain Risk Factors.

Notice to Prospective Investors

3


I. Crescent Capital Group Overview


• Leading independent credit investment firm, founded in 1991, with approximately $16 billion in assets under management

(1)

• Product specialist: primarily focused on below investment grade credit across five complementary strategies

• Investment professionals based in Los Angeles, New York, Boston and London

• Platform supported by a dedicated, industry-focused research team covering 14 core sectors(2)

Crescent Capital Group Platform

5

(1) AUM as of September 30, 2014. (2) Crescent maintains internal information barrier policies which may require analysts to avoid disclosing certain information broadly within the Firm.

Below investment grade credit platform

Capital Markets U.S. Direct Lending

European Specialty Lending

Mezzanine U.S. Special Situations

Bank loans and high yield bonds of U.S. and European

companies

Senior secured loans for U.S.-based

lower middle market companies

Private secured loans for

European middle market

companies

Subordinated debt with an equity component for

buyouts with global coverage

Distressed debt of U.S.-based companies


Group History – Methodical Approach to Growth

6

1. Effective July 2013, the Paris team relocated to the London office.

1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Founded with initial focus on investing in High Yield Bonds and U.S. Distressed Debt of middle market companies

Joined TCW and became TCW’s Leverage Finance Group

Spun-out of TCW on January 1, 2011

Mezzanine strategy established

Bank Loan product established

Alternative Credit product established

First European investment

First Asia Pacific investments

U.S. Direct Lending strategy established

European Specialty Lending strategy established

Los Angeles New York Paris1 London Boston


• Management Committee oversees over 130 employees

• Investment Team

– Over 65 team members

– Two Co-Founders / Managing Partners; 22 Managing Directors; 11 Senior Vice Presidents; 9 Vice Presidents

• Operations Team

– Over 60 team members

– Pursues highest standards with respect to compliance and risk management

– Seeks to provide best-in-class legal, human resources, finance/accounting and investor relations

Dynamic Organization

7

Strategies

Operations

Capital Markets

30 Team Members

Mezzanine

23 Team Members

Special Situations

3 Team Members

Direct Lending

10 Team Members


5 Team Members

Information is current as of October 7, 2014.

Investor Relations

10 Team Members

Finance & Accounting

16 Team Members

HR & Admin

28 Team Members

Legal, Compliance & Operations

7 Team Members


• Offer a flexible range of products via five complementary investment strategies

• Products target the entire debt capital structure enabling clients to deploy capital in a variety of strategies at different points in the credit cycle

Complementary Credit Strategies With Flexible Product Offering

8

(1) Leverage indicates use of borrowings to enhance returns rather than short-term borrowings or lines of credit for cash management reasons. Crescent’s Alternative Credit product has the ability to sell short to achieve investment objective when market conditions warrant.

Products Typical Securities Geography Redemption Frequency

Legal Structure Leverage(1)

Capital Markets

Bank Loans Bank loans U.S., Europe Monthly Open-End No

High Income Bank loans, high yield bonds, private debt U.S., Europe Quarterly Open-End No

High Yield High yield bonds U.S., Europe Monthly Open-End No

Alternative Credit Bank loans, high yield bonds, structured credit, long/short U.S., Europe Quarterly Open-End Yes

Private Debt Narrowly-syndicated debt; 144A for Life/Private Placements U.S. Quarterly Open-End No

Structured Products

Bank loan cash flow vehicles, structured credit U.S., Europe Varies Open-End /

Closed-End Optional

Mezzanine Mezzanine Privately negotiated mezzanine debt with equity participation Global coverage N/A Closed-End No



European senior secured, unitranche, 2nd lien, selected

subordinated debt Europe N/A Closed-End Optional

U.S. Direct Lending

U.S. Direct Lending Senior secured loans U.S. N/A Closed-End Optional

U.S. Special Situations

U.S. Special Situations Distressed debt U.S. N/A Closed-End No


Representative Public Plan Client List

9

Inclusion on this list should not be considered an endorsement of the investment advisor or services rendered.

AC Transit Employees Retirement Plan Manchester Employees' Contributory Retirement System

Anne Arundel County Retirement System Manhattan & Bronx Surface Transit Operating Authority

Arizona State Retirement System Maryland State Retirement and Pension System

Boynton Beach Firefighters' Pension Fund Massachusetts Bay Transportation Authority Retirement Fund

City of Delray Beach Police and Firefighters' Retirement System Massachusetts Pension Reserves Investment Management

City of Hollywood Firefighters' Pension Fund Metropolitan Transportation Authority of New York City

City of Kissimmee General Employees Retirement System Michigan Department of Treasury

City of Pittsburgh Comprehensive Municipal Pension Trust Fund New Castle County Employees Retirement System

City of Plantation Police Officers Pension Fund New Hampshire Retirement System

City of Winter Springs, Florida Oklahoma Police Pension & Retirement System

Employees' Retirement System of Baltimore County Orange County Employees Retirement System

Employees' Retirement System of the City of New Orleans San Jose Police & Fire

Florida State Board of Administration South Carolina Retirement System

Illinois Municipal Retirement Fund State of Oregon Treasury

Illinois State Board of Investment State-Boston Retirement System

Indiana Public Employees Retirement System Teachers' Retirement System of Louisiana

Killeen Firefighters' Relief and Retirement Fund Texas County and District Retirement System

LACERA (Los Angeles County Employees Retirement Association) Wayne County Employees' Retirement System

Los Angeles City Employees Retirement System


II. Crescent Direct Lending

CONFIDENTIAL – DO NOT DISTRIBUTE |

Crescent Direct Lending Executive Summary1

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Investment Strategy

• Invest in senior secured debt of private U.S. Lower Middle-Market companies • Primary focus on private equity-backed companies • Portfolio comprised of senior secured first lien, second lien and unitranche investments • “Credit focused” preservation of capital strategy

Competitive Advantages

• Formed 2005 - Experienced direct lending team with proven track record through 2008 / 2009 credit cycle • Well-established Lower Middle-Market private equity and other sourcing relationships • Between 2005-2010, invested a predecessor $225mm Lower Middle-Market senior secured loan fund • Strong investment track record with prior fund gross realized unlevered IRR’s of 9.8% (~2x LCD Loan Index) • Low credit loss history – 100% of prior fund loan investments had positive IRR’s

Current Product Offering

• Currently managing approximately $1.4 billion of total capital (including leverage) • Invested over $600 million to date across 3 funds plus SMA’s • Unlevered Direct Lending Fund: 7.5%-10.0% targeted net returns • Levered Direct Lending Fund: 12.0% - 13.0% targeted net returns (1.0x leverage) • Levered SBIC Direct Lending Fund: 14.0% - 15.0% targeted net returns (2.0x leverage)

Investment Considerations

• Attractive Asset Yields: 100-150bps yield premium to broadly syndicated loan market • Top of the Capital Structure Investing: Senior secured focus provides strong preservation of capital • Improved Structures: Less levered/stronger loan covenants than broadly syndicated loans • Lower Volatility: Private senior secured debt less volatile (low mark risk) vs. broadly syndicated loans • Inflation Hedge/Attractive Total Returns: Floating rate investments can offer inflation hedge and total return

upside in rising rate environment • Reduced Overlap Risk: Ability to create unique credit portfolios (no index names) reduces overlap risk

1. All historical references to Crescent’s direct lending team and track record prior to June 2012 are based on Crescent principals while at their previous investment firm, HighPoint Capital Management, LLC, from January 2005-May 2012.

Note: Past performance does not guarantee future results. Performance results include values of unrealized investments and there can be no assurance that the unrealized investments will, in fact, be realized at the presently anticipated valuations. Returns vary as the fund realizes gains or losses on its presently unrealized investments if and when they are sold. The information with respect to the competitive advantages and market opportunity, summarized on this page, represents the views only of Crescent Direct Lending.


Crescent Direct Lending Fundraise Update

12

Unlevered Fund (Target $300mm)

• Target net returns – 7.5% - 10% • No leverage • Over $380mm investor commitments closed (over $570mm including parallel

vehicles) • Final close September 4, 2014

Levered Fund (Target $150mm /

$300mm with leverage)

• Target net returns – 12% - 13% • Target 1.0x leverage • Approximately $250mm investor commitments closed ($500mm with leverage) • Final close estimated Q3 2015

SBIC Fund (Target $75mm /

$225mm with leverage)

• Target net returns – 14% - 15% • Use of 2:1 target leverage • $75mm investor commitments closed on September 3, 2014 ($225mm with

leverage) • Final close estimated Q2 2015

• Crescent Direct Lending (“CDL”) launched three concurrent fund offerings in 2013 which invest pro rata in the same senior secured loan investments of Lower Middle-Market companies

— Approximately $900mm investor commitments closed to date (approximately $1.4 billion with leverage)

— Over $600mm invested to date

• Multiple fund offering approach offers broad return profile opportunities to our LP’s

• Significant capital base benefits all LP’s and investors


Crescent Direct Lending Team & Track Record1

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Experienced Investment

Team

• Formed in January 2005 – five senior investment principals with over 100 years of combined lending experience

• Between 2005-2010 invested approximately $225mm of senior secured loan commitments in 25 private US Lower Middle-Market companies from prior fund

• Invested over $600mm to date from current Crescent Direct Lending vehicles • 80% of senior team are former FleetBoston Financial lenders providing continuity and

cohesiveness

Nationwide Origination Capabilities

• Nationwide network of sponsor, intermediary and other referral relationships to sponsor-backed Lower Middle-Market companies

• Over 5,000 leads since inception (average 400-500 per year) with significant recurring deal flow • Origination teams led by senior investment professionals who originate, underwrite and manage

portfolio investments

Strong Underwriting & Low Credit Loss History

• Highly selective credit model – fund less than 5% of transactions reviewed • No payment defaults since inception in January 2005 • 100% of loan investments with positive IRRs • Low annual loan loss rate (less than 20bps/year)2

Strong Investment

Returns1

• Gross realized unlevered senior loan IRR3 of 9.8% vs. S&P LCD Senior Leveraged Loan Index of approximately 5.4% January 2005- March 2013

• Almost 2X senior loan market index returns • 100% of prior fund loan investments fully-realized

1. All historical references to Crescent’s direct lending team and track record prior to June 2012 are based on Crescent principals while at their previous investment firm, HighPoint Capital. Management, LLC, from January 2005-May 2012. Gross unlevered IRR’s are after realized losses, but before management fees, from January 2005-March 2013. Net returns after management fees will be lower.

2. $3.2 million cumulative realized loan losses on $224.1 million cumulative loan commitments between January 2005 – March 2013. 3. Gross IRRs are before management fees and include unrealized investments. Actual Gross IRRs when fully-realized may be less. Net IRRs after management fees will be lower. The gross IRR calculations are made

on the basis of the actual timing of investment inflows and outflows, aggregated at least monthly and annualizing the resulting return. An IRR is a function of the length of time from the initial investment to ultimate realization and, for a given dollar amount realized, the IRR will decrease as the investment holding period increases. The gross IRR calculation measures investment-level returns and does not reflect the deduction of fees and expenses, or timing differentials between investor cash flows and investment cash flows. The net IRR for an investor will be reduced by the annual management fee, the incentive fee and by any other expenses that are incurred in the management of an account, and the difference between gross IRR and net IRR can be substantial.


Crescent Direct Lending Investment Team

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John Bowman – Managing Director and Member Investment Committee (Industry: 30 yrs) • HighPoint Capital Management – President (2005 – May 2012) • FleetBoston Financial (1998-2003) - Boston Head of High Yield and Mezzanine Loan Structuring • Donaldson, Lufkin & Jenrette (1994-1998) - Senior Vice President Leveraged Finance • Lehman Brothers, Drexel Burnham, State Street Bank, Kidder Peabody (1984-1992) - Investment Banking - Leveraged Finance • M.B.A. Harvard / B.S. Business Northeastern

Scott Carpenter – Managing Director and Member Investment Committee (Industry: 25 yrs) • HighPoint Capital Management – Executive Vice President (2005 – May 2012) • Bank of America Business Capital / Fleet Capital (2000-2004) - Northeast Head of Business Development • Fleet Bank (1996-1998) - VP of Originations & Portfolio Manager and PNC Business Credit (1998-2000) - Vice President & Office Head

(opened Boston office) • Joan Fabrics (1990-1996) – Vice President of Finance and International Sales Manager • Bank of Boston (1982-1985) and Bank of New England (1985-1990) - Vice President, Loan Originations and Portfolio Manager • B.A. Economics Tufts

Mike Rogers – Managing Director (Industry: 30 yrs) • HighPoint Capital Management – Managing Director (2008– May 2012) • Bank of America Securities, LLC (2004-2008) - Relationship Manager • Fleet Securities (1997-2004) - Co-Head of Loan Structuring and Syndications • Fleet Bank (1988-1997) - Multiple Lending and Management roles, including team leader in Fleet’s loan workout group during early 1990s • Manufacturers Hanover Trust Company (1984-1988) – Lending Officer • A.B. History Holy Cross

Jonathan Cignetti – Senior Vice President (Industry: 14 yrs) • HighPoint Capital Management – Director (2005 – May 2012) • Fidelity Research & Management Company (2004) – Bank/High Yield bond Research Associate • FleetBoston Financial (2000-2004) - Associate Leveraged Finance • B.S. Finance Babson

Jake Garmey – Managing Director (Industry: 16 yrs) • HighPoint Capital Management – Managing Director (2005 – May 2012) • MCG Capital Corporation (1998-2005) - Vice President senior/mezzanine lending - MCG grew from $200 million to $900 million in assets

during this period - several Board representation roles • Lehman Brothers (1994-1997) - Credit Analyst • M.B.A. Georgetown / B.A. Economics Hobart


Crescent Direct Lending Investment Team (Cont.)

15

Austin Parker – Analyst (Industry 2 yrs) • Fidelity Research & Management Company (2013-2015) – Research Associate • B.S. Finance Bentley University

Brian Ferguson – Associate (Industry 3 yrs) • NewStar Financial (2012- 2015) – Associate • B.S. Finance and Economics Boston College

Hayes Olofson – Vice President (Industry: 8 yrs) • Maranon Capital, L.P. (2010 – 2012) – Associate • Houlihan Lokey (2007-2010) – Financial Analyst • M.B.A. Kellogg School of Management at Northwestern University/ B.B.A. Finance University of Iowa

Jake Hixon – Associate (Industry 3 yrs) • NewStar Financial (2012 – 2014) – Associate • B.S. Finance and Economics Bentley University

Gia Heimlich – Vice President (Industry: 10 yrs) • HighPoint Capital Management (2007 – 2012) – Associate • Pricewaterhouse Coopers LLP (2005 – 2007) – Associate • B.S.B.A. Accounting and Finance University of Richmond • CFA, CPA


Prior Fund Track Record & Loan Loss Experience1

• January 2005-March 2013 -Gross realized unlevered IRRs of 9.8% vs. senior loan market returns of approximately 5.4% 1,2

• Consistent return profile with no payment defaults and 100% of loans with positive IRRs

1. All historical references to Crescent’s direct lending team and track record prior to June 2012 are based on Crescent principals while at their previous investment firm, HighPoint Capital Management, LLC, from January 2005-May 2012. Gross unlevered IRR’s are after realized losses, but before management fees, from January 2005-March 2013. Net returns after management fees will be lower.

2. Market returns based on S&P LCD Senior Leveraged Loan Index from January 2005-March 2013.

3. Includes upfront fees amortized over three years.

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($$ Millions) Date Date Amount Yield Value at 3/31/13 Equity Return EquityInvestment Invested Realized Invested at Close (3) Realized Unrealized Total Multiple Gross IRR

Realized InvestmentsVertex Fasteners 08/04/05 08/29/08 2.5$ 7.4% 3.1$ -$ 3.1$ 1.26x 9.2%Hamer 09/01/05 09/19/11 12.7 7.2% 15.5 - 15.5 1.22x 8.6%Antaya Technologies 09/22/05 03/01/07 2.8 8.8% 3.2 - 3.2 1.13x 11.0%Action Legal/IVIZE/AMFS 01/03/06 12/17/10 13.1 11.3% 15.0 - 15.0 1.15x 4.8%National Display 04/21/06 05/03/10 16.6 9.9% 20.5 - 20.5 1.23x 10.7%Solidscape 06/08/06 03/31/08 7.0 10.9% 8.0 - 8.0 1.14x 13.0%Wearwell 06/29/06 09/26/07 5.4 12.6% 6.3 - 6.3 1.18x 16.7%Double E Company 09/18/06 05/07/10 5.6 11.3% 7.4 - 7.4 1.32x 9.8%JSI Store Fixtures 09/22/06 12/28/07 7.5 11.0% 8.6 - 8.6 1.15x 14.7%Gateway EnviroServices 12/28/06 08/19/09 4.0 9.8% 4.8 - 4.8 1.20x 8.9%MilesTek Corporation 01/23/07 01/20/12 3.3 12.0% 4.3 - 4.3 1.34x 9.5%Winchester Electronics 04/16/07 07/25/12 7.5 9.1% 10.0 - 10.0 1.33x 7.5%Belt Power 08/10/07 08/14/09 6.1 11.1% 7.1 - 7.1 1.17x 9.9%Utrecht Art Supplies 08/30/07 10/31/11 8.5 12.4% 11.4 - 11.4 1.34x 8.7%Titan Fitness 12/31/07 06/30/11 4.0 9.8% 5.5 - 5.5 1.36x 11.0%Fairchild 01/24/08 11/17/11 7.5 9.5% 9.5 - 9.5 1.27x 9.8%Insource 01/29/08 07/30/12 12.0 9.3% 17.0 - 17.0 1.42x 11.0%Connect-Air 03/06/08 11/15/11 8.5 8.4% 10.9 - 10.9 1.28x 10.9%The Outsource Group 03/31/08 01/21/11 13.6 9.1% 17.1 - 17.1 1.26x 10.6%MooreCo 04/30/08 09/30/10 8.4 8.0% 9.5 - 9.5 1.13x 7.1%Precision Manufacturing Group 06/05/08 11/22/11 9.0 9.0% 12.2 - 12.2 1.35x 11.9%Copernicus Group 10/08/08 02/09/11 8.3 10.4% 10.3 - 10.3 1.25x 13.3%Thorne 06/23/10 02/01/12 12.0 8.2% 13.7 - 13.7 1.14x 10.2%Lazer Spot 09/01/10 05/25/12 12.3 8.0% 14.1 - 14.1 1.15x 10.2%Mallet 09/29/10 03/13/13 8.3 9.4% 10.0 - 10.0 1.20x 10.5%Total Realized Investments 206.1$ 9.6% 254.8$ -$ 254.8$ 1.24x 9.8%

Gross IRR on Realized Loans 9.8%


CDL Levered Fund: 11.7% Levered-Equivalent Yield (1)

U.S. Middle Market Yield Premium

• Overall leveraged loan market continued to see yield compression during most of 2014 with yields increasing in late 2014

• Recent leverage loan yield trends and other factors may be positive for overall 2015 yield outlook

– LCD Leveraged Loan index increased to 5.4% end 2014 from 4.9% end 2013

– Increased regulatory scrutiny of banks and reduced capital access for BDC’s should be a positive

17

LIBOR Floor + Spread +OID (3-yr)

Source: Thomson Reuters LPC. (1) Assumes 1:1 Leverage and a 3.0% cost of funds. Portfolio yield (including fees) for investments in Crescent Direct Lending Levered Fund, L.P. at March 31, 2015. Note: Past performance does not guarantee future results


Strong recovery rates vs. unsecured / subordinated asset classes

Recovery Rate

Low

High

High Low Priority in Capital Structure

Default Recovery by Asset Class (1987 – 2011)

Senior Secured Loans

80.7%

56.5%

41.7%

23.1%

16.3%

0%

20%

40%

60%

80%

100%

Sr. SecuredLoans

Sr. SecuredBonds

Sr. UnsecuredBonds

Sr.Subordinated

Bonds

OtherSubordinated

Bonds

Source: Standard & Poor’s. Average of mean and median discounted recovery rates on defaulted recovery rates on defaulted bank debt and bonds 1987 – 2011.

18


• Although Middle-Market loans continue to use more conservative structures/less leverage than broadly syndicated loans, senior leverage levels are being pushed in the market due to lower interest costs and higher interest coverages

– CDL has maintained its conservative structuring discipline with 3.7x senior by 4.6x total leverage levels vs. the overall Middle Market

Average Debt Multiples: Large Corporate vs. Middle Market

Large Corporate is $50M or more of EBITDA, Middle-Market is less than $50MM of EBITDA Total Sources/adjusted Pro Forma Trailing EBITDA Source: Standard and Poor’s LCD

19

Large Corporate LBO Loans Middle Market LBO Loans

4.6x - CDL Levered Total Lvg 3.7x – CDL Levered Sr Lvg


($ in millions) Transaction Amount Senior TotalDate Investment Business Description Sponsor Security Type Invested Revenue EBITDA Leverage Leverage Yield LTV

Unrealized Investments:

Jun-13 AAMP Auto aftermarket accessories Audax Group First Lien $10.0 $77.3 $14.0 3.7x 3.7x 6.6% 49.5%Sep-13 SCT/Bullydog Auto aftermarket engine calibration Global Environment Fund First Lien/Last-Out 22.1 44.2 13.4 2.6x 2.6x 9.2% 38.6%Sep-13 4Refuel Mobile onsite refueling in Canada Kelso Unitranche 4.8 67.4 24.5 5.3x 5.3x 9.0% 53.1%Oct-13 SQAD Media tracking business Clarion Capital First Lien 25.1 22.3 12.1 3.6x 5.1x 6.9% 47.8%Nov-13 Hubbardton Forge Manufacturer of lighting fixtures Bunker Hill First Lien 9.5 34.8 6.8 2.9x 4.4x 6.5% 32.3%Dec-13 Astrodyne Electronic power supplies/filters Audax Group First Lien 22.0 134.0 23.1 3.5x 5.1x 7.1% 47.0%Feb-14 E.l.f. Value-priced cosmetics TPG First Lien 10.0 120.0 29.4 3.6x 4.9x 6.6% 38.5%Feb-14 Phoenix Children's Academy Daycare services Audax Group First Lien 9.4 146.2 17.4 3.2x 4.1x 6.3% 38.3%Mar-14 Beneco 401k benefit services Alpine Investors First Lien 22.0 11.9 6.3 3.5x 5.0x 8.2% 40.9%Mar-14 Xtend Healthcare Healthcare RCM West View Capital First Lien 21.0 46.2 11.0 3.8x 3.8x 7.6% 54.2%Mar-14 Van Pool Transportation Special needs transportation Fort Point Capital First Lien 16.3 21.8 5.3 3.0x 4.0x 7.3% 36.8%May-14 Industrial Magnetics Industrial magnets & process equip. River Associates First Lien 10.0 38.7 10.1 2.8x 2.8x 6.5% 39.8%May-14 Eptam Plastics High precision plastics mfg New Heritage Capital Unitranche 22.5 24.4 5.4 4.6x 4.6x 9.2% 51.0%Jun-14 American Residential Services Residential HVAC/Plumbing Charlesbank First Lien 20.0 690.6 53.2 3.3x 4.7x 5.7% 48.3%

Second Lien 4.5 690.6 53.2 3.3x 4.7x 9.3% 63.6%Jul-14 Wind River Environmental Commercial/Res'l Environ. Svcs. RFE Investment Partners Unitranche 49.3 65.7 11.5 4.6x 4.6x 8.8% 56.9%Jul-14 Injured Workers Pharmacy Workers Comp Home Del Pharm ACON Investments First Lien 7.5 134.6 25.6 3.9x 4.9x 5.6% 46.5%

Second Lien 4.5 134.6 25.6 3.9x 4.9x 8.8% 58.1%Aug-14 Tate's Bake Shop Baked Goods/Specialty Cookies The Riverside Company First Lien 7.5 25.1 7.0 3.8x 5.3x 6.1% 26.5%Aug-14 RESA Electrical/switching products Audax Group First Lien 11.9 72.3 12.3 3.0x 4.3x 7.3% 43.3%Sep-14 United Recovery Systems Collections/revenue cycle management Audax Group First Lien 14.8 235.9 61.2 3.0x 3.9x 5.7% 39.1%

Second Lien 15.0 235.9 61.2 3.0x 3.9x 9.8% 48.8%Nov-14 ECRM Consumer Vendor Conferences Boston Ventures Unitranche 10.0 40.9 11.4 5.0x 5.0x 8.3% 62.2%Dec-14 Summit Labs Consumer Products-Deodorants One Rock Capital Partners First Lien 12.0 78.7 20.0 4.0x 5.5x 5.8% 49.7%Dec-14 Unite Private Networks Wireless networks Ridgemont Equity Partners First Lien 7.4 40.2 23.7 3.9x 5.6x 5.5% 43.0%

Second Lien 8.5 40.2 23.7 3.9x 5.6x 9.3% 60.0%Dec-14 Survey Sampling Survey/Market Research firm HGGC, LLC First Lien 12.0 214.5 52.5 3.9x 5.7x 6.3% 42.7%

Second Lien 17.0 214.5 52.5 3.9x 5.7x 10.7% 61.8%Dec-14 DISA Employee Drug Screening Court Square First Lien 18.7 101.9 26.0 4.5x 6.4x 5.8% 34.2%Dec-14 Taylor Consumer Kitchenware Products Centre Partners First Lien 15.0 182.8 40.6 3.8x 5.2x 5.8% 46.9%Jan-15 Yellowstone Landscape Leading Commercial Landscaping CIVC First Lien 12.0 93.8 11.2 4.1x 4.1x 5.8% 49.8%Feb-15 ERC AR Mgmt & BPO Services RLJ Equity First Lien 30.0 72.2 9.3 3.0x 3.0x 8.2% 45.0%Feb-15 TriMech 3D Printing McCarthy Capital First Lien 14.0 51.3 6.7 2.3x 2.3x 7.7% 35.4%Feb-15 Paris Presents Branded beauty and bath products Wasserstein & Co First Lien 9.0 129.0 24.5 3.7x 4.9x 5.8% 36.0%

Second Lien 7.0 129.0 24.5 3.7x 4.9x 9.9% 47.7%Feb-15 Epic Healthcare Pediatric home health provider Webster Capital First Lien 12.0 442.6 51.6 3.5x 4.4x 6.1% 47.8%

Second Lien 15.0 442.6 51.6 3.5x 4.4x 9.6% 58.7%Feb-15 Abracon Distributor of Timing Devices Evergreen Pacific Partners First Lien 27.5 46.9 14.3 4.0x 4.7x 7.3% 53.3%Total $566.7 $118.8 $20.9 3.6x 4.5x 7.5% 47.2%

Unrealized Portfolio Statistics:Blended CDL Unlevered Portfolio Yield: 7.5% Senior Leverage: 3.6xLCD Levered Loan Index - March 31, 2015: 5.2% Total Leverage: 4.5xCDL Portfolio Yield Premium: 2.4% LTV: 47.2%

Crescent Direct Lending Total Investment Summary(1)

20

(1) Includes investments in all Crescent Direct Lending Funds and parallel investment vehicles at March 31, 2015. Amounts invested in CDL Levered Fund are presented on an unlevered basis. (2) Unrealized portfolio yield (including fees) at March 31, 2015. Note: Past performance does not guarantee future results.

(2)


As of March 31, 2015($ in millions) Transaction Security Amount Senior Total Unlevered LeveredDate Investment Business Description Sponsor Type Invested Revenue EBITDA Leverage Leverage Yield Yield (2) LTV

Unrealized Investments:

Nov-14 United Recovery Systems Collections/revenue cycle management Audax Group First Lien $3.7 $235.9 $61.2 3.0x 3.9x 5.7% 8.3% 39.1%Second Lien 3.8 235.9 61.2 3.0x 3.9x 9.8% 16.5% 48.8%

Nov-14 ECRM Consumer Vendor Conferences Boston Ventures Unitranche 6.5 40.9 11.4 5.0x 5.0x 8.3% 13.7% 62.2%Nov-14 Astrodyne Electronic power supplies/filters Audax Group First Lien 5.5 134.0 23.1 3.5x 5.1x 7.1% 11.2% 47.0%Dec-14 Summit Labs Consumer Products-Deodorants One Rock Capital Partners First Lien 7.5 78.7 20.0 4.0x 5.5x 5.8% 8.7% 49.7%Dec-14 American Residential Services Residential HVAC/Plumbing Charlesbank First Lien 5.7 690.6 53.2 4.5x 4.7x 5.8% 8.5% 48.3%Nov-14 Unite Private Networks Wireless networks Ridgemont Equity Partners First Lien 3.5 40.2 23.7 3.9x 5.6x 5.5% 8.0% 43.0%

Second Lien 4.0 40.2 23.7 3.9x 5.6x 9.3% 15.5% 60.0%Dec-14 Survey Sampling Survey/Market Research firm HGGC, LLC First Lien 3.1 214.5 52.5 3.9x 5.7x 6.3% 9.7% 42.7%

Second Lien 4.4 214.5 52.5 3.9x 5.7x 10.7% 18.3% 61.8%Dec-14 Taylor Consumer Kitchenware Products Centre Partners First Lien 7.5 182.8 40.6 3.8x 5.2x 5.8% 8.7% 46.9%Dec-14 DISA Employee Drug Screening Court Square First Lien 7.5 101.9 26.0 4.5x 6.4x 5.8% 8.7% 34.2%Jan-15 Yellowstone Landscape Leading Commercial Landscaping CIVC First Lien 7.5 93.8 11.2 4.1x 4.1x 5.8% 8.7% 49.8%Jan-15 Wind River Environmental Commercial/Res'l Environ. Svcs. RFE Investment Partners Unitranche 11.3 65.7 11.5 4.6x 4.6x 8.8% 14.6% 56.9%Feb-15 ERC AR Mgmt & BPO Services RLJ Equity First Lien 11.3 72.2 9.3 3.0x 3.0x 8.2% 13.3% 45.0%Feb-15 TriMech 3D Printing McCarthy Capital First Lien 6.6 51.3 6.7 2.3x 2.3x 7.7% 12.3% 35.4%Feb-15 Paris Presents Branded beauty and bath products Wasserstein & Co First Lien 7.5 129.0 24.5 3.7x 4.9x 5.8% 8.7% 36.0%Feb-15 Epic Healthcare Pediatric home health provider Webster Capital First Lien 7.5 442.6 51.6 3.5x 4.4x 6.1% 9.2% 47.8%Mar-15 RESA Electrical/switching products Audax Group First Lien 1.4 72.3 12.3 3.0x 4.3x 7.3% 11.7% 43.3%Total $115.6 $158.3 $27.1 3.7x 4.6x 7.4% 11.7% 47.4%

Unrealized Portfolio Statistics:Blended CDL Levered Portfolio Yield: 11.7% Senior Leverage: 3.7xLCD Levered Loan Index - March 31, 2015: 5.2% Total Leverage: 4.6xCDL Portfolio Yield Premium: 6.6% LTV: 47.4%

Crescent Direct Lending Levered Fund, L.P. Investment Summary(1)

21

(1) Investments in Crescent Direct Lending Levered Fund, L.P. through March 31, 2015. (2) Levered equivalent yield assuming 1:1 leverage and 3.0% cost of funds. Note: Past performance does not guarantee future results.

(2)


Unitranche, 15.3%

Second Lien, 17.0%

First Lien, 67.7%

Crescent Direct Lending Levered Fund, L.P.–Portfolio Composition

22

Industry Asset Allocation

Blended unlevered yield = 7.4%(2) Total Investments = $115.6 million(1)

(1) At cost before fees/OID as of March 31, 2015. (2) Including fees. Levered- Equivalent yield of 11.7% assumes 1:1 leverage and 3.0% cost of funds.

8.6% yield

6.5% yield Business Services,

22.7%

Environmental Industries, 16.2%

Chemicals, Plastics, & Rubber, 6.5%

Consumer Goods: Durable, 6.5%

Consumer Goods: Non-Durable, 6.5%

Healthcare Services, 6.5%

Telecommunications, 6.5%

Media: Advertising, Printing & Publishing,

6.5%

Capital Equipment, 6.0%

High Tech Industries, 5.7%

Media: Diversified & Production, 5.6%

Consumer Services, 4.9%

9.8% yield



Illustrative Transaction – Wind River Environmental

TRANSACTION OVERVIEW

Business: Non-hazardous waste management services

Date: July 2014 (Original) / January 2015

Sponsor: RFE Investment Partners

Investment: $2.0mm Revolver Commitment $2.0mm Capex Line Commitment $6.5mm Delayed Draw Term Loan $49.2mm Unitranche Term Loan

Yield(1): 8.9%

Cap. Structure: 4.6x Senior and Total Leverage 43% equity capitalization

INVESTMENT RATIONALE

• Highly recurring/non-cyclical revenue stream (Residential septic systems/commercial grease systems)

• Leading market position within Northeast U.S. – Kline’s acquisition strengthens market position in Pennsylvania

• Low customer concentration/attrition rates

• Strong historical financial performance

• Strong management team and sponsor

HIGHLIGHTS

• Lead Agent and sole-lender to highly diversified, recurring customer environmental services business with a non-cyclical waste-stream service offering.

• Significant downside protection in the capital structure. EBITDA can decline by approximately (43%) and still maintain a fixed charge coverage ratio of 1.0x.

23


Who We Are – Why Crescent Direct Lending

24

Top of the Capital

Structure Focus

• “Capital Preservation Focus”- senior secured loans to Lower Middle-Market and Middle-Market companies

• Typically first lien loans (including unitranche) or second lien loans secured by company collateral

• Higher recoveries in default than unsecured or mezzanine assets

Strong Sourcing Allows for

Credit Selectivity

• Strong sourcing capabilities (average 400-500 leads/year) provides foundation for highly select credit model and “credit first” mentality

• Deep, longstanding lower middle-market private equity firm relationships established since 2005

Highly Select Credit Screen

• Historically funded less than 5% of all transactions reviewed • Focus on recurring revenue business models with strong management, sponsorship, and long

track record of proven financial results • Avoid story credits, turnarounds, cyclical, technology, fashion-driven and event risk borrowers • Careful evaluation of management teams and private equity sponsors

Conservative Investment Structuring

• Conservative senior and total leverage multiples-typically less levered than broadly syndicated loans

• Structure investments with strong covenant package protection (not “covenant lite”) • Underwrite with multiple cushions to provide downside protection

Strong Portfolio Management

• Weekly, monthly, quarterly and annual reporting systems in place • We seek to identify problems early and influence corrective action • Significant “in-house” experience on identifying and restructuring problem credits


Preliminary Term Sheet: Levered Direct Lending Fund1

Investment Objective: High current income with strong preservation of capital from investments in senior secured loans of private U.S. Lower Middle-Market companies

Targeted Equity: $150mm

Leverage Utilized: $150mm (1.0x)2

Total Fund Size: $300mm of Total Capital

Investment Period: 2.5 years

Term of Partnership: 5 years; two optional one-year extensions

Management Fees: 1.35% of invested equity capital

Preferred Return: 7.0%

Incentive Fees: 10.0%

Targeted Net Return:3 12.0% - 13.0%

Geography: Primarily U.S. borrowers

Legal Counsel: Dechert LLP

Auditors: Ernst & Young LLP

1. Neither Crescent Capital Group, nor its affiliates, partners, employees, agents or representatives (collectively, “CCG”) make any representation or warranty, express or implied, as to the accuracy or completeness of the information contained herein, and nothing contained herein shall be relied upon as a promise or a representation as to past or future performance. Past performance is not indicative of future results.

2. Leverage utilized will vary with market conditions and terms of the Fund’s leverage facility. 3. The information herein includes targeted yields and internal rates of returns (“IRR”), which are based on a variety of factors and assumptions and involves significant elements of subjective judgment and analysis.

Targeted yields and IRRs are being presented because they provide insight into the level of risk that the manager is likely to seek with respect to the relevant product. The targeted yields and IRRs are a measure of relative risk of a portfolio of investments, with higher targets reflecting greater risk, and are not intended to be promissory in nature. Targeted yields and IRRs are estimates based on a variety of assumptions regarding, among other things, current and future asset yields for such investments and projected cash flows related thereto, current and future market and economic conditions, prevailing and future interest rates, including the cost of use of leverage, where applicable, historical and future credit performance for such investments, and other factors outside of CCG’s control. The targeted yields and IRRs are subject to uncertainties and are based upon assumptions which may prove to be invalid and may change without notice. Other foreseeable and unforeseeable events, which were not taken into account, may occur. Investors should not rely upon the targeted yields or IRRs in making an investment decision. Although CCG believes there is a sound basis for such targets, no representations are made as to the accuracy of such targets, and there can be no assurance that such targets will be realized or achieved. Additional information concerning the assumptions used in connection with the target returns is available upon request.

25


Direct Lending Opportunity - Why We Focus on Lower Middle-Market

26

• Middle-Market direct lending is typically less competitive and offers significant yield premiums to broadly syndicated loans

• Middle-Market opportunity created by bank consolidation and increased regulation (Basel III / increased regulation regarding leveraged loans) forcing banks to focus on larger companies

– We believe Lower Middle-Market is the least efficient segment of Middle-Market lending

• We believe Lower Middle-Market offers better yields and reduced risk (better structures and covenants) than Upper Middle-Market

Lower Middle-Market / Middle-Market Competitive Landscape (Non-Bank)1,2

1. Represents select competitors of Crescent Direct Lending for illustrative purposes. 2. Several Middle-Market lenders were dislocated during economic downturn including Allied, Cratos, Dymas, First Light, Friedberg Milstein, MFC, ML Capital, Patriot, and Tygris


• Established lender to Lower Middle-Market companies nationwide

‒ Significant network of sponsor, intermediary and other referral relationships

‒ Market to approximately 500 sponsors with 200 priority relationships

‒ Generated over 5,000 financing leads since 2005 inception

‒ Over 100 Sponsors have show us five or more deal opportunities

‒ Funded deals with over 40 different private equity sponsors

• Nationwide calling effort by region across broad referral source network

‒ Senior, credit-trained investment professionals lead regional calling efforts

‒ Priority sponsor coverage strategy focused on high quality sponsors and repeat deal flow

‒ Use of industry associations / conferences to efficiently cover multiple sponsor relationships

• Combination with Crescent enhances deal flow and provides significant West Coast presence

‒ Generated over 1,600 leads since joining Crescent in June 2012

Sourcing Overview and Capabilities

27


Select Target Financial Sponsor Relationships1

1. Represents select existing and target sponsor relationships. *Closed transaction in prior or current fund.

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Northeast: Northeast (continued): Mid-West: Southwest: WestCoast:

Altus Capital RFE Investment Partners* Baird Capital Partners CapStreet Group Alpine Investors LP*Audax Group* Riverside Partners, LLC* Blue Point Capital CIC Partners, LP Altamont Capital PartnersBoston Ventures Investment Partners* Saw Mill Capital CIVC Partners* Cotton Creek Capital Bertram Capital Management LLCBrynwood Sentinel Capital Cressey and Company Gauge Capital Caltus EquityBunker Hill Capital* Southfield Capital Flexpoint Ford Insight Equity Centre Partners*Capital Partners Spire Capital Frontenac Company Levine Leichtman Century Park Capital Partners, LPCastanea Partners Summit Partners Geneva Glen Capital Pharos Capital ClearLight Partners LLC*Catterton Sverica International Golder Hawn Johnson and Morrison Trinity Hunt Partners Crimson InvestmentCharlesbank Capital Partners LLC* Tenex Capital Management Grey Mountain Partners Trive Capital DW Healthcare PartnersCI Capital Partners Topspin Partners LP* Lasalle Capital Group, L.P. Encore Consumer CapitalCIP Capital Wafra Partners LLC Linsalata Capital Southeast: Evergreen Pacific Partners*Clarion Capital Partners, LLC* Wasserstein & Co* Merit Capital Excellere PartnersClearview Capital Watermill Ventures* Pfingsten Partners BB&T Capital Partners* Frazier Healthcare VenturesCorinthian Capital Group, LLC Webster Capital* Prairie Capital Blue Sea Capital GESD Capital PartnersDFW Capital Partners* WestView Capital Partners* Prospect Partners LLC Carousel Capital Gores Group, TheDominus Capital Shoreview industries Falfurrias Capital Partners Industrial Growth PartnersFort Point Capital* Mid-Atlantic: Silver Oak Services Partners, LLC Gen Cap America* Insignia Capital GroupGemini Investors* Stone Arch Harren Equity Partners LLC JH PartnersGridiron Capital Acon Investments LLC* Svoboda Capital ICV Partners* Pharos Capital Group, LLCH.I.G. Capital Argosy Capital* The Riverside Company - MicroCap* MSouth Equity Partners Platform PartnersHamilton Robinson LLC Arlington Capital Tonka Bay Equity Partners Pamlico Capital Platte River EquityHammond, Kennedy, Whitney & Co. Eureka Growth Capital Waud Capital Partners Pine Tree Equity Revelstoke Capital PartnersHigh Road Capital Partners Global Environment Fund* Wynnchurch Capital Quad C Rosewood Capital/Glenbrook CapitalHousatonic Partners Graham Partners Ridgemont Equity Partners* Sorenson CapitalKinderhook Industries Guardian Capital Partners River Associates Investments, LLC* Tower Arch CapitalLeeds Equity Partners* Halifax Group Summit Park Vincente Capital PartnersLineage Capital, LLC Incline Equity Partners Trivest Partners, L.P. Windjammer CapitalMcCarthy Capital Corporation* Inverness Graham InvestmentsMorgenthaler LLR PartnersNautic Partners Milestone PartnersNew Heritage Capital* PNC RiverarchOne Rock Capital Partners* RLJ Equity Partners*PWP Growth Equity (Perella Weinberg)


Crescent Direct Lending employs a proven sourcing and investment process

Disciplined Investment Process

29

Sponsors Investment & Commercial

Banks CCG / Other

Initial Review

Committee

“Round Table”

Capital Commitment <5% of transactions received

• Transaction Sourcing Review 400-500 hundred transactions

annually sourced from private equity sponsors and financial intermediaries

• Initial Review by Transaction Teams Provide thoughtful, timely feedback to

sponsors and intermediaries regarding level of interest and key diligence items

• “Round Table” Reviews Thoroughly assess investment thesis

and structure the transaction with senior partners and the deal team

• Committee Approval Process Unanimous vote required


• Weekly and monthly financial reporting by our borrowers through electronic flash reports provides “early warning” approach to portfolio monitoring

‒ Flash reports reviewed weekly during pipeline meetings ‒ Monthly tear sheet credit analysis including forward-looking covenant default

risk analysis

• All credits rated initially at close and reviewed (formal write-ups) quarterly for covenant compliance and possible ratings changes

‒ Quarterly ratings recommendations circulated to Investment Committee

• Senior investment principals responsible for generating monthly (electronic) and quarterly (write-ups) reporting to Managing Director of Portfolio Management

‒ Weekly Portfolio Flash Update (new portfolio company financials received) ‒ Monthly Portfolio Flash Report

• Quarterly valuations and annual valuations (reviewed by Ernst & Young) on all Direct Lending investments

‒ Low quarterly valuation volatility for private senior debt asset class

Portfolio Monitoring – Weekly, Monthly, Quarterly, and Annual Reporting Procedures

30


Appendix A. Prior Fund Investment Summary B. Investment Case Studies


Appendix A - Prior Fund Portfolio Composition

32

Crescent Direct Lending has historically employed a conservative senior secured lending strategy • Primarily a senior secured first lien and second lien lender • Below market senior leverage multiples and disciplined

approach to total leverage multiples – Cumulative investments 2005-20101 at 2.5x Senior Debt /

EBITDA and 3.4x Total Debt / EBITDA multiples – Significantly below overall Middle-Market senior/total

leverage multiples – Average initial portfolio yields at closing of 9.6% (coupon

plus fees amortized over three years)

1. Represents Crescent Direct Lending principals’ prior portfolio investments from calendar 2005-2010 while at HighPoint Capital Management, LLC. No predecessor portfolio investments were made after calendar 2010.

2. Market multiples represent Standard & Poor’s LCD (Middle-Market senior and total leverage multiples).

CDL Cumulative Portfolio Composition1

CDL Senior Leverage Multiples vs. Market1,2

4.7x 4.7x

5.6x

4.5x

3.6x 3.7x

2.6x

3.5x 3.4x 3.8x

2.7x 3.0x

0.0x

1.0x

2.0x

3.0x

4.0x

5.0x

6.0x

2005 2006 2007 2008 2009 2010

Middle Market Crescent Direct Lending

3.4x 3.7x

4.0x 3.6x

2.5x

3.1x

1.9x

2.4x 2.7x 2.7x

1.0x

2.5x

0.0x

0.5x

1.0x

1.5x

2.0x

2.5x

3.0x

3.5x

4.0x

4.5x

2005 2006 2007 2008 2009 2010

Middle Market Crescent Direct Lending

CDL Total Leverage Multiples vs. Market1,2


Appendix A: Prior Fund Investment Summary1

• Attractive loan portfolio with significant yields and conservative multiples at underwrite

1. Represents historical investments by Crescent’s direct lending team while at their previous investment firm, HighPoint Capital Management, LLC from January 2005 – May 2012. 2. AMFS was a division of Action Legal / Ivize. 3. Original Hamer loan of $4.0 million on 9/1/05, refinanced to $10.0 million on 9/7/07. 4. Original Winchester loan of $5.0 million on 4/16/07, plus add-on of Kings on 5/8/07 of $2.5 million. Leverage calculations are pro forma for Audax $2.5 million. 5. Excludes $18.0 million unfunded Revolver commitments at close.

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LTM Financials Net Debt / EBITDAEquity Funding Original at Close at Close Pricing

Portfolio Company Business Sponsor Date Loan Revenue EBITDA Senior Total Coupon Only Incl. Floors

Action Legal/IVIZE 2 Litigation document services Mt. Auburn Partners 1 /3/06 $8.8 $23.7 $6.0 2.4x 3.1 x L+71 9 L+994AMFS2 Provider of medical expert witnesses Mt. Auburn Partners 5/24/07 4.4 4.5 2.0 1 .9x 1 .9x L+750 L+750Antaya Technologies Electrical components & equipment to auto industry Commonwealth 9/22/05 2.8 1 0.0 2.5 0.9x 0.9x L+500 L+500Belt Power Distributor conveyer belt parts Food Service Industry Gen Cap America 8/1 0/07 6.1 1 4.9 2.1 2.8x 4.9x L+525 L+525Connect-Air Electronic cable and cable assembly provider Wincove Capital 3/6/08 8.5 26.2 3.4 2.3x 3.5x L+600 L+875Copernicus Independent Institutional IRB DFW Capital Partners 1 0/8/08 8.3 1 5.9 8.2 2.0x 4.1 x L+700 L+975Double E Company Manufacturer Web Conversion Components Prairie Capital 9/1 8/06 5.6 1 9.1 2.8 2.7x 4.4x L+550 L+550Fairchild Industrial Industrial Controls Manufacturer Hampshire 7/24/09 7.5 1 9.2 6.2 1 .0x 2.7x L+650 L+925Gateway EnviroServices Construction and Debris Recycler Gemini Investors 1 2/28/06 4.0 40.1 9.8 2.8x 3.7x L+488 L+488Hamer3 Manufacturer plastic bag filling equipment Tuckerman Capital 9/7/07 1 2.7 1 7.0 4.8 2.0x 2.0x L+400 L+675Insource On-premise staffing contract services Colville Capital 1 /29/08 1 2.0 45.9 5.8 2.6x 4.3x L+700 L+975JSI Store Fixtures Manufacturer high end grocery store fixtures Champlain Capital 9/22/06 7.5 1 4.8 3.3 2.6x 2.6x L+51 3 L+51 3Lazer Spot Outsourced distribution yard management services Sterling 9/1 /1 0 1 2.3 60.0 1 0.5 2.4x 3.6x L+550 L+700Mallet Release agents, ingredients, and machines to baking industry ICV Partners 9/29/1 0 8.3 39.0 5.6 2.9x 3.1 x L+650 L+825MilesTek Corporation Distributor of cables & assemblies Castle Island Partners 1 /23/07 3.3 1 4.8 2.5 2.6x 3.4x L+600 L+600MooreCo Manufacturer of furniture products Webster Capital 4/30/08 8.4 44.6 7.1 3.2x 3.9x L+425 L+425National Display LCD flat panel monitors for hospitals Riverside Partners 9/1 0/08 1 6.6 1 1 5.0 1 6.3 2.7x 4.0x L+648 L+648Precision Manufacturer of bellows and assemblies Argosy & Anvil 6/5/08 9.0 1 5.0 3.9 2.3x 3.5x L+550 L+800Solidscape Manufacturer Rapid Prototyping Systems Tuckerman Capital 6/8/06 7.0 1 2.1 4.2 1 .4x 3.7x L+525 L+525The Outsource Group Healthcare-only collections company ClearLight Partners 3/31 /08 1 3.6 59.1 1 2.0 3.4x 3.7x L+550 L+850Thorne Manufacturer of nutraceutical dietary supplements WestView Capital 6/23/1 0 1 2.0 29.8 4.6 2.3x 2.3x L+550 L+725Titan Fitness Gold's Gym fitness clubs WestView Capital 1 2/31 /07 4.0 1 8.4 3.0 3.2x 4.0x L+625 L+900Utrecht Art Supplies Specialty retailer college fine art supplies TopSpin 8/30/07 8.5 48.8 5.0 3.4x 3.4x L+634 L+634Vertex Fasteners Master distributor industrial fasteners Watermill Ventures 8/4/05 2.5 47.5 4.7 1 .9x 4.2x L+350 L+350Wearwell (Tenn Mat) Manufacturer industrial floor padding n/a 6/29/06 5.4 27.3 4.9 3.0x 3.1 x L+675 L+675Winchester Electronics4 Manufacturer electrical connectivity solutions Audax Group 5/8/07 7.5 95.1 1 2.2 2.9x 3.9x L+550 L+675Total Fundings5 $206.1Weighted Average (O/S and Exited) $39.9 $6.8 2.5x 3.4x L+581 L+725


1. Reflects the blended coupon of the first lien and second lien.


Appendix B: Illustrative Transaction – Epic Healthcare


Business: Pediatric home health services for severely disabled children

Date: October 2013 / February 2015

Sponsor: Webster Capital

Investment: $12.0mm First Lien Term Loan

$15.0mm Second Lien Term Loan

Yield(1)(2): 8.0%

Cap. Structure: 3.5x First Lien Leverage 4.4x Total Leverage 41% equity capitalization


• #1 provider of pediatric home care in the U.S.

• Superior value proposition and lower cost of care

• Stable reimbursement environment – home health services for disabled children a protected reimbursement space

• Strong free cash flow generation

• LCA add-on in February 2014 further diversifies the Company's pediatric footprint to 10 states

HIGHLIGHTS

• Attractive club loan which allowed CDL to enhance LP returns by blending both first lien and second lien senior secured loans to enhance overall yields

• Non-discretionary and non-cyclical services generate strong, consistent free cash flows with good downside protection

34


Appendix B: Illustrative Transaction – Xtend Healthcare


Business: Outsourced billing/collections services for hospitals

Date: March 2014

Sponsor: WestView Capital

Investment: $1.5mm Revolver Commitment

$21.0mm Senior Secured Term Loan

Yield(1): 7.6%

Cap. Structure: 3.8x Senior and Total Leverage 46% equity capitalization


• Recurring revenue business model (1-3 year contracts) with high renewal rates

• Backlog of booked revenue providing near-term deleveraging

• Attractive health care end-market (defensive) with positive industry tailwinds

• Strong cash flow generation

• Strong management team and sponsor

HIGHLIGHTS

• Joint-lead club loan which allowed CDL to achieve better pricing/fee economics for Fund investors.

• Since our investment, revenue and EBITDA have increased 29.2% and 20.9%, respectively resulting in leverage declining from 3.8x to 3.1x.

• Strong backlog as the Company continues to benefit from growth in healthcare expenditures, increasing complexity in the payor system, regulatory coding changes, and mandatory EMR systems implementations and changeovers.


35


Certain Risk Factors Nature of Debt Securities. Debt and structured equity investments in highly leveraged companies involve a high degree of risk with no certainty of any return of capital. The debt securities in which Crescent Funds and strategies (“Crescent Funds”) invest may be unsecured and subordinated to substantial amounts of senior debt, all or a portion which may be secured, may not be protected by financial covenants or limitations on additional debt, may have limited liquidity and may not be rated by a credit rating agency.

Financial Markets. Instability in the securities markets may increase the risk inherent in Crescent Funds’ investments in that the ability of portfolio companies to refinance or redeem debt and structured equity securities held by Crescent Funds may depend on their ability to sell new securities in the market.

Conflicts of Interest. Crescent and its affiliates manage multiple funds and accounts. Key personnel will devote some business time to managing those other funds and accounts. Obligations to certain funds and accounts could in certain circumstances adversely affect the price paid or received for investments by Crescent Funds or the size or the portion of investments purchased by other Crescent Funds.

Interest Rate Fluctuations. Interest rate fluctuations may negatively impact Crescent Funds’ investment opportunities and the rate of return on invested capital. An increase in interest rates would make it more expensive for portfolio companies to finance operations and indirectly affect the credit quality of Crescent Funds’ investments. Lack of Diversification and Reliance on Portfolio Company Management. Crescent Funds may invest in a limited number of investments and may be concentrated in only a few industries. Therefore, the aggregate return of Crescent Funds may be adversely affected by the negative performance of a relatively few investments. The manager monitors portfolio company performance; however, it is primarily the responsibility of portfolio company management to operate a portfolio company on a day to day basis and there is no assurance that such management will perform in accordance with Crescent Funds’ expectations.

No Market for Interests in Crescent Funds and Restrictions on Transfer. Crescent Funds’ interests (“Interests”) have not been registered under the United States Securities Act of 1933, as amended (the “1933 Act”), the securities laws of any state or the securities laws of any other jurisdiction, and, therefore, cannot be resold unless they are subsequently registered under the 1933 Act and other applicable securities laws or an exemption from registration is available. It is not contemplated that registration of Interests under the 1933 Act or other securities laws will ever be effected. There is no public market for the Interests, and none is expected to develop. An investor in a Crescent Fund is generally not permitted to assign its Interests without the prior written consent of Crescent, and any such assignment is subject to the terms and conditions of the operative documents of the relevant Crescent Funds . Investors must be prepared to bear the risks of owning their Interests for an extended period of time and the risk of loss of the entire investment.

Competitive Debt Environment. Crescent Funds compete with the public debt and equity markets and with other investors for suitable investment opportunities. There can be no assurance that Crescent Funds will be able to locate and complete investments, fully invest its committed capital or satisfy its rate of return objectives. Foreign Investments. Investments in non-U.S. companies involve risks not typically associated with the more developed U.S. capital markets, including risks relating to currency exchange, differences between the U.S. and foreign securities markets, differences in corporate and creditors’ rights laws and economic, and political risks.

Dependence Upon Key Personnel. Decisions with respect to the investments and management of Crescent Funds will be made exclusively by the Crescent management team. Investors generally have no right to take part in the management of Crescent Funds and do not have an opportunity to evaluate the specific investments made by mezzanine funds or their terms. The success of Crescent Funds depends significantly upon the skill and expertise of the principal members of the Crescent management team. The departure of any of those principal members could have a material adverse effect on mezzanine funds.

No Assurance of Investment Return. There can be no assurance that Crescent Funds will be able to generate returns for its investors or that the returns will be commensurate with the risks of investing in the type of companies and transactions described herein. Accordingly, an investment in Crescent Funds should only be considered by persons who can afford a loss of their entire investment. Past activities or investment return results of investment entities associated with the Crescent management team or its principal members, including their prior funds, provide no assurance of future success or return results. The fees and expenses charged in connection with an investment in Crescent Funds may be higher than the fees and expenses of other investment alternatives and may offset profits. Use of Leverage. Certain Crescent Funds may leverage the cost of its investments. To the extent Crescent Funds purchases securities with borrowed funds, its net assets will tend to increase or decrease at a greater rate than if borrowed funds are not used. If the interest expense on borrowings were to exceed the net return on the portfolio of securities purchased with borrowed funds, Crescent Funds’ use of leverage would result in a lower rate of return than if Crescent Funds were not leveraged. Overall, the use of leverage, while providing the opportunity for higher returns, also increases volatility and the risk of loss. No Regulatory Approval. The Crescent Funds have not been approved or disapproved by any securities regulatory authority of any state, by the Securities and Exchange Commission, or any similar authority in another jurisdiction.

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