PANGAEA: BUSINESS BACKGROUND

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PANGAEA BUSINESS BACKGROUND

• Pangaea Asset Management, LLC
• April 2008

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Pangaea Asset Management, LLC

• Pangaea Asset Management, LLC was founded in
  February 2007 by Barry Shear, David Schmuck and
  Michael King.
• Norwest Equity Partners, along with management,
  have made an initial 75mm equity commitment to
  the company
• Norwest Equity Partners has over 3 billion in
  capital under management. Wells Fargo has been a
  major limited partner in Norwest Equity Partners
  for over 40 years.
• The founding partners have broad experience in
  the leveraged loan market and working with
  private equity sponsors
• Barry Shear was a founding partner in 1996 of
  Antares Capital which became a market leader in
  arranging syndicated middle-market sponsored
  loans.
• Barry Shear and David Schmuck were members of the
  Investment Committee at Antares Asset Management,
  formed in 1999, which became a market leader in
  managing loan portfolios with significant
  investments in middle-market debt.
• Michael King was head of Credit Underwriting at
  Antares Capital.

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Pangaea Asset Management, LLC

• Over its nine year life Antares Capital
• Was 80 owned by MassMutual and 20 by
  management. The three principals at Pangaea were
  part of the ownership team at Antares.
• Became recognized as a leader in providing debt
  financing to middle-market companies controlled
  by private equity firms.
• Grew assets under management at a compound annual
  growth rate of approximately 60.
• Successfully built and managed a stressed debt
  joint venture with a well-known hedge fund.
• Created Antares Asset Management, which was
  responsible for management of approximately 2
  billion in debt investments (see Appendix A).
• Antares Capital and its wholly-owned subsidiary
  Antares Asset Management were sold to General
  Electric Capital Corporation (GECC) in 2005.
• Managed approximately 3.5 billion in loans at
  the time of its sale.(1)
• (1) General Electric Co. Form 8-K dated January
  20, 2006.

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Pangaea Asset Management, LLC

• After the sale to GECC, Antares Capital was
  merged with the GE middle-market sponsor finance
  business and the combined unit was renamed GE
  Antares.
• Barry Shear became President of GE Antares.
• Michael King became head of Credit Underwriting
  for GE Antares.
• Dave Schmuck became Managing Director and CLO
  Portfolio Manager at GE Asset Management.
• The GE Antares middle-market lending business
  doubled in size to approximately 8 billion in
  assets under management after this combination.
  (1)
• (1) Crains Chicago Business article dated
  October 11, 2005.

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Pangaea Asset Management, LLC

• Pangaea Asset Management, LLC has grown its
  managed investment portfolio to over 1 billion
  since March 2007.
• Closed on a strategic Sourcing Alliance with GE
  Antares.
• Pangaea CLO 2007-1 Ltd., a 300 million portfolio
  of performing senior secured loans, closed in
  August 2007. The estimated cash-on-cash yield
  for the next 12 months to an equity investor that
  paid par is approximately 25.0.
• In addition, Pangaea acquired the portfolio
  manager for Sargas CLO I Ltd., a 314 million
  portfolio of performing senior secured loans.
• Pangaea was also appointed sub-servicer by 250
  Capital, LLC for the 400 million portfolio of
  performing senior secured loans in the Merrill
  Lynch CLO 2007-1 Ltd. transaction.
• Appendix C contains a summary of these
  transactions.
• A significant capital base positions the company
  well for further growth.
• Our strong track record and excellent market
  reputation has enabled Pangaea to build a
  talented team. We are comfortable with our
  ability to add future talent as needed in support
  of growth.

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Timeline



Antares Capital Founded
Antares Asset Mgmt. Founded
GECC Purchases Antares Capital
Pangaea Founded
Antares Funding CLO
Nova CDO 2001
Navigator CDO 2003
Navigator CDO 2005
Pangaea CLO 2007-1
Navigator CDO 2004
Navigator CDO 2006
CS Advisors LLC Acquired Subservicing Agreement
for Merrill Lynch CLO 2007-1
Mariner CDO 2002
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Pangaea Organization Chart
Investment Committee
Barry N. Shear Senior Managing Director and
President (30 years)
Teri Marus Office Manager
David R. Schmuck Senior Managing Director (24
years)
Michael P. King Senior Managing Director (14
years)
Bruce Saewitz Managing Director (33 years)
Thomas J. Bax Chief Financial Officer (27 years))
Ryan Metcalfe Director (9 years)
Ross Van Drunen Senior Analyst (11 years)
Sean Treanor Director of Operations (10 years)
Kristin Clark Senior Analyst (9 years)
Matt Nels Senior Analyst (10 years)
John Thies Operations Analyst (7 years)
Mark Maglaya Senior Analyst (9 years)
Nathan Harrell Associate (4 years)
Seth Friedman Operations Analyst (4 years)
James Jago Associate (2 years)
Matt Tuchband Analyst (8 years)
Numbers in parentheses represent years of
experience
Jeff Cupples Associate (4 years)
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Investment Philosophy

• Due diligence will analyze free cash flow and
  fundamental business value. Investment
  underwriting will cover the following
• Diversity of products, customers, suppliers, and
  geographic markets.
• Raw material risk.
• Historical and projected financial performance.
• Industry/business economic cycle risk.
• Level of equity sponsor involvement for smaller
  private companies.
• History of capital market access for larger
  companies.
• Experience of management team and managements
  ability to communicate key factors for business
  success.
• Structural and legal analysis.

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Investment Sourcing

• Broad proprietary deal flow will be one key to
  the success of the Company
• Pangaea will utilize our significant market
  experience and long-standing relationships to
  generate and screen investment opportunities.
• Analyst team is in constant contact with other
  institutional debt investors and agent banks due
  to managing debt investments in over 275
  non-investment grade companies.
• Bruce Saewitz has a disciplined calling effort on
  the private equity community. Knowledge gained
  will also help Pangaea identify attractive
  investments.
• Pangaea currently manages debt investments in
  companies owned by over 100 sponsor groups.
• Members of the Investment Committee will also
  source investment opportunities based on
  long-standing relationships with sponsors, agent
  banks, and investors.
• Private equity firms will value Pangaeas
  ownership of debt in their controlled companies.
  
• Our strong relationship with GE Antares Capital,
  as evidenced by a contractual Sourcing Alliance,
  will generate middle-market deal flow.

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Private Equity Firms
Pangaea is engaged in ongoing dialogue with over
250 private equity firms. Pangaea has purchased
debt investments in transactions sponsored by
many of these private equity firms. A
representative listing of these private equity
firms follows
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Investment Monitoring

• Active participant with forward looking analysis
• Bank meetings, lender calls, management
  presentations, equity sponsor updates, industry
  conferences, investor dialogue, and trade
  publications.
• Pangaeas proprietary investment monitoring model
  (PARM) will be utilized to monitor portfolio
  investments
• Forward looking model.
• Assesses risk of payment default, borrower
  fundamentals and potential recovery values.
• In addition, analysts will follow these other key
  variables
• Cash flow forecast, covenants, market position,
  key personnel, and loan to value.
• Buy/Sell/Hold recommendation by analyst with
  Pangaea Investment Committee oversight and
  approval.

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Portfolio Management

• Transparency, accessibility, and accountability.
• Quarterly investment manager report.
• E-mail, telephone, and in-person updates.
• Password protected investor portal via Pangaea
  website.
• Members of the Pangaea team have managed
  portfolios for over 50 different institutional
  investors, both within and outside the US.

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Appendix A - Pangaea Management Team Experience
Members of the Pangaea team, prior to joining
Pangaea, have managed portfolios across 7
different CLO vehicles and three separate
accounts from 1999 to the present. The team also
had significant management responsibility for the
Antares Capital Corporations on balance sheet
portfolio.

• In 2005, General Electric Capital Corporation
  (GECC), an affiliate of GE, acquired Antares
  Capital Corporation (ACC) and Antares Asset
  Management, Inc. (AAM). Prior to the
  acquisition, ACC and AAM closed the following CDO
  transactions Antares Funding L.P., Nova CDO
  2001, Ltd., Mariner CDO 2002, Navigator CDO 2003,
  Navigator CDO 2004, Navigator CDO 2005.
• Separate accounts managed included a stressed
  debt fund and two loan funds.
• Navigator CDO 2006 is a transaction managed by GE
  Asset Management. Dave Schmuck was a Managing
  Director and portfolio manager and member of the
  bank loan team at GE Asset Management before
  joining Pangaea (1).

(1) Pangaea is not affiliated with GE Asset
Management and has no current management
responsibility with respect to the CLO vehicles
listed above.
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Appendix B - Summary of Assets Under Management
PANGAEA CLO 2007-1
MERRILL LYNCH CLO 2007-1
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Appendix C - Summary of Assets Under Management
SARGAS CLO I