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February 12, 2009

Dear Investor,

At the end of last year, Citadel decided to suspend redemptions from Wellington and Kensington.
This decision reflected the highly uncertain financial markets we faced, and the need to manage
those Funds from a position of strength and financial flexibility for the benefit of all of our investors.

Given that the world’s financial system has seen only modest improvement since year-end, we
believe that it is necessary to continue to suspend redemptions. However, as our balance sheet
continues to strengthen and the liquidity of our investment portfolio continues to improve, we
intend to initiate a “Distribution Program,” and make periodic distributions to investors who desire
liquidity. We believe that this plan will allow us to maximize the value of our portfolio holdings and
capitalize on opportunities in the marketplace while we continue to generate liquidity for our
investors. Of note, we have significantly reduced our holdings of illiquid assets, and will continue
to do so from a position of strength, in a manner that protects the interests of our investors and the

Under the Distribution Program:

• Each quarter, we will determine whether a distribution will be made, and if so, the amount
available for distribution, by reference to a schedule that sets forth an aggregate capital
threshold level required for Wellington and Kensington on a post-distribution basis. All
investors in the Funds will be provided notice of the amount anticipated to be available for
distribution, if any, and shall have the opportunity to participate in the distribution.

• The capital threshold levels will decline over time, reflecting our analysis of the likely time
required for the Funds to prudently generate liquidity and the commercial constraints the
Funds face both as investment grade entities and in our contractual agreements with

• Each quarter, the amount available for distribution will be allocated among investors electing
to participate in distributions pro rata in accordance with their respective investments in the

We believe that this approach is in the best interests of all our investors as we navigate this
extraordinary period. We will, of course, resume redemptions in the ordinary course as soon as we
believe it is prudent to do so. We hope that this information will be of value in assisting you with
your asset allocation and cash flow planning.

We have endured a period of unprecedented financial distress. Our team is focused on recouping
the painful losses all of us have incurred, and on maximizing the value of your investment. We
very much appreciate the constructive feedback many of you have provided to us in recent weeks.
We are deeply grateful for your continued support.


Ken Griffin