8/9/2019 e Mails Between Magnetar and Ischus

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. - - - - - From:.Sent:To:Cc:

Prusko , James [ @magnetar.comjFriday , September 08, 200610;07 PMAndrew Shook

Subject: Fees

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Had a long discussion with Dave Snyderman. We feel strongly that the arb won 't support higher fees . Also ,manager fees are coming down , each deal we 've done has been at progressively lower fees and we believe thistrend will continueAll that being said , I can do 10bp senior, 2.5bp sub . and 20% of excess cash flow after cumulative equity 18%IRR. Our goal is to partner with managers and do a series of deals. there are two managers with whom we arealready on our third deal (and the most recently inked of those was done at 10 senior only plus incentive) . I thinkthe cumulative business will be worthwhile even if you feel the first deal is too skinny .Appreciate your consideration of our position. hope we can work something out.I'm around this weekend to discuss.R e g a ~ d $ Jim

From: Andrew Shook [maHto: _ .__ .@IschusCapital.com)sent: Friday, September 08, 20064:40 PMTo: Prusko. JamesCc:Subject: callJimDo you have time to do a call this afternoon?ThanksapsAndrew P. ShookPresident & Chief ( n v e ~ t m e n t Officer(schl.l$ Capital Management. LLC712 5th Ave. 10th FloorNew York. NY 10019

8/25/2009

8/9/2019 e Mails Between Magnetar and Ischus

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Re :Deal status Page 1 01'3

From: Prusko, James [ @magnetar,comlSent: Friday, September 29 , 20068:12 PMTo:Cc:Subject:

Andrew Shook;@sgcib .comR'E : Deal status

Attac'hments: Ischus-portfolio sg 3.xls

@sgcib ,com@sgcib .com : @sgcib .com :

Seems like we're about ready to go, I just want to make sure we're all on board as far as the target portfolio, Thecompromise we made was to do a 100% synthetic deal for ease of execution in exchange for getting the feestructure we required . One of the benefits of this is that it gives us great flexibility in the construction of theportfolio. We think the recent dramatic widening in spreads has created an excellent environment for ramping adeal and want to make sure that we take full advantage of this.The original portfolio target spreadsheet that' have, and I missed the last team call SO I'm probably a generationbehind, had a strangely low spread target. That of course would not at all be beneficial to us . I have attached thetarget portfolio that I would like for this deal with target spreads that I believe are very achievable in the currentmarket Given the breadth of collateral to choose from in a synthetic deal . I'm sure this will work for everyoneAppreciate all the work to date and looking forward to a great deal.Have a nice weekend everyone.-JimPS I'd like to call the deal Hydrus 06-1 .

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From: Prusko, James [. @magnetar .com}Sent: Tuesday, October 03,20065:59 PMTo: Andrew ShookCc: @Sgcib .com ; @Sgcib.comSubject: RE: Spread Levels

Of course, the actual security selection is totally your purview . I just wanted to make sure the overall portfoliocharacteristics worked for our strategy .I look forward to starting right away.Thanks for working thru this with me.-Jim

From: Andrew Shook [mailto: @JsChusCapital.com]Sent: Tuesday, October 03,20065:33 PM.To: Prusko, Jamescc: @sgcib.com; @sgcib.comSUbject: Spread LevelsJimSorry for the delay ... ..1have been slammed all day. I just rang and rolled into \loice mail.We performed much analysis regarding execution . We have a comfort level surrounding the 160 WAS targetThat said, I want to make sure we all understand and are comfortable witl1 the Resource Americallschusphilosophy .Simply put, Ischus will buy credits. not spreads . Relative value? Yes . Will we take a view? Yes But we will notassemble a portfolio we are not proud of and feel strongly about in the name of a spread target.If we are all in agreement on this, we should push ahead 100%. If not. we should rethink the trade .We are ready to roll if you are .Regards,Ap$

Andrew P. ShookPresident and CIOIschus capital Management, U.c712 FIflt1 Avenue10th ~ I o o r New Vorl(, NY 10019

8/25/2009