Trading Update

T2 Income Fund Limited
29 May 2007

                             T2 Income Fund Limited



                         Company Trading Update Report



                               As of May 15, 2007



T2 Income Fund Limited ('the Company') was launched in August 2005 when it
raised net proceeds of £36.7 million of equity.  As of 31 December 2007, the
Company had invested assets of approximately £54 million.  We are pleased to
report that as of 15 May 2007, the Company has invested assets of approximately
£95 million.  This means that the Company is fully invested and has continued to
leverage its assets to make new investments.



As of 15 May 2007, the investments in the portfolio, on a weighted average
basis, bore an interest rate of approximately 430 basis points over LIBOR.  The
total number of investments as of 15 May 2007 is 28, with an average investment
size of £3.4 million.  The portfolio distribution as of 15 May 2007 consists of
approximately 84% 1st Lien and 16% 2nd Lien loans with a weighted average
maturity of approximately 6 years.



On 25 October 2006 the Company established a credit facility of up to
approximately £101 million with Merrill Lynch Capital Corporation.  Through a
newly formed special purpose entity, Merrill Lynch has made this credit facility
available for the purpose of making new investments.  The credit facility bears
interest at LIBOR plus 50 basis points.  As of 31 March 2007, the Company had
drawn £56.3 million under the facility and as of 15 May 2007, the Company had
drawn £68 million under the facility.



Since the establishment of the Merrill Lynch credit facility, the Company has
been able to accelerate its rate of deploying capital.  During the first quarter
of 2007, the Company made approximately £36.9 million of new investments.  So
far for the second quarter of 2007 the Company has funded and allocated
approximately £23.8 million of additional capital for new investments.



T2 Advisors, the Company's Investment Manager, believes that the current
environment for providing investment capital affords it a positive outlook going
forward.



Key statistics


Assets Under Management                                   £95 million

Number of Investments                                     28

Average Investment Size                                   £3.4 million

Weighted Average Spread                                   Libor + 430

Weighted Average Maturity                                 6 years

% 1st Lien                                                84%

% 2nd Lien                                                16%


T2 Income Fund Diversity Overview              %          T2 Income Fund Diversity Overview             %
(Moody's)                                                 (Moody's)
Automobile                                     4.8%       Automotive                                    4.8%
Buildings & Real Estate                        1.1%       Brokers                                       4.8%
Containers, Packaging & Glass                  1.6%       Building & Development                        1.1%
Ecological                                     2.8%       Business Services                             9.0%
Electronics                                   23.9%       Containers and Glass Products                 1.6%
Finance                                        9.0%       Ecological services & equipment               2.8%
Farming & Agriculture                          2.7%       Electronics                                  23.9%
Healthcare, Education & Childcare              5.9%       Financial Intermediaries                      4.2%
Hotels, Motels, Inns & Gaming                  5.9%       Farming & Agriculture                         2.7%
Insurance                                      2.3%       Healthcare                                    4.3%
Manufacturing                                  3.2%       Insurance                                     2.3%
Oil & Gas                                      4.8%       Lodging & Casinos                             5.9%
Printing & Publishing                          6.9%       Oil & Gas                                     4.8%
Telecommunications                            20.9%       Publishing                                    6.9%
                                             100.0%       Telecommunications                           20.9%
                                                                                                      100.0%



T2 Income Fund Limited


Company                   Amount           Headquarters/Areas of Operations             S&P Industry
Attachmate                £4.6 million     Seattle, Washington.                         Electronics
                                           Europe, Middle East and Africa.
Audatex                   £2.2 million     Zurich, Switzerland.                         Insurance
                                           Zeist, The Netherlands.
Cavalier Telephone        £6.1 million     Richmond, Virginia.                          Telecommunications
CBA Group                 £3.5 million     Conklin, New York.                           Electronics
                                           The Netherlands.
Corel Corporation         £6.0 million     Ottawa, Canada.                              Electronics
                                           Europe, Middle East and Africa.
Data Transmission Network £2.5 million     Omaha, Nebraska.                             Farming & Agriculture
Express Energy            £4.6 million     Houston, Texas                               Oil & Gas
Ford                      £4.6 million     Dearborn, Michigan.                          Automotive
                                           Global.
InfoNXX                   £2.5 million     New York, New York.                          Telecommunications
                                           France, Italy, Ireland and Switzerland.
Infor Global New          £3.0 million     Berlin, Germany.                             Electronics
                                           Switzerland and Luxembourg.
Investools                £4.6 million     Draper, Utah.                                Brokers
Merrill Corporation       £4.6 million     St. Paul, Minnesota.                         Publishing
Metrologic Instruments    £3.0 million     Blackwood, New Jersey.                       Business Services
                                           Europe, Middle East and Africa.
MR Default                £1.0 million     Roswell, Georgia.                            Building & Development
National Processing       £4.0 million     Louisville, Kentucky.                        Financial Intermediaries
Company
Nova Analytics            £2.7 million     Weilheim, Germany.                           Ecological services and
                                                                                        equipment
Nuvox                     £3.0 million     Greenville, South Carolina.                  Telecommunications
One Communications        £2.5 million     Rochester, New York.                         Telecommunications
Paetec                    £2.5 million     Fairport, New York.                          Telecommunications
Peacock Engineering       £1.5 million     Geneva, Illinois                             Containers and Glass
                                                                                        Products
Peer 1 Networks           £3.2 million     Vancouver, Canada.                           Telecommunications
Pegasus                   £5.6 million     Dallas, Texas.                               Lodging & Casinos
                                           London and Singapore.
Prodigy Health            £4.0 million     Amherst, New York.                           Healthcare
ProQuest                  £4.6 million     Bethesda, Maryland.                          Business Services
                                           Global.
Sirsi                     £0.9 million     Huntsville, Alabama.                         Business Services
                                           United Kingdom, Germany, Spain, France and
                                           Denmark.
Stratus Technologies      £3.5 million     Maynard, Massachusetts.                      Electronics
                                           Europe, Middle East and Africa.
Workflow Management       £2.0 million     Greenwich, Connecticut.                      Publishing
X-rite Incorporated       £2.0 million     Grandville, Michigan.                        Electronics
                                           Regensdorf, Switzerland.
Total                     £95.1 million




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