Objective: The primary objective for the Direct Investment Program is to generate returns for investors that exceed private equity industry benchmarks and are commensurate with asset class risk by constructing portfolios of opportunistic, highly performing private equity investments.

Investment Strategy: Mesirow Financial Private Equity's Direct Investment strategy includes the following key components:

• Proactively source outstanding private equity investment opportunities, including investments sourced through Mesirow Financial Private Equity's fund manager relationships and investments sourced independently through Mesirow Financial Private Equity's investment network
• Execute independent, rigorous investment analysis, emphasizing a comprehensive due diligence program for each portfolio company investment while leveraging, where appropriate, the due diligence activities of the sponsoring co-investor
• Actively apply Mesirow Financial Private Equity's operating skills, experience and resources to drive value creation for the Direct Investment Fund's portfolio companies and closely monitor potential exit opportunities
• Construct a diverse portfolio of co-investments in high quality operating companies

Portfolio Construction: Mesirow Financial Private Equity's investment team employs a disciplined portfolio construction process in order to build portfolios of opportunistic investments in transactions across the broad spectrum of the private equity asset class. Direct Funds are expected to be diversified by:

• Private Equity Sub-Asset Class, including:
  • Venture Capital
  • Growth Equity
  • Buyouts
• Company Size and Stage Development:
  • Portfolio may include investments in early-stage and emerging growth companies, and various sized acquisitions ranging broadly from pre-revenue start-ups to established multi-billion dollar industry leaders
• Industry:
  • Investments are expected to be made in multiple industry sectors
• Geography:
  • Investments are expected to primarily be made in U.S. domiciled operating companies
  • Mesirow Financial Private Equity's global network of leading private equity managers may introduce select opportunities to co-invest in companies with significant operations outside of the U.S., particularly in Western Europe
• Vintage Year:
  • Initial investments in portfolio companies are expected to be made over a three- to four-year period

Investment Process: The Firm's broad private equity network is utilized to source co-investment opportunities, monitor industry trends, generate market intelligence on specific sectors and technologies, and develop acquisition and pricing strategies. Prospective direct investments are evaluated against the following key criteria:

• High-quality management team
• Sustainable competitive advantage
• Clear and growing market opportunity
• Clear path to value creation and realization
• Quality and experience of investment partners
• Capital-efficient business model
• Acceptable financial risk profile
• Attractive initial valuation