42 AM LLC

Item 5: Fees and Compensation

42 AM is compensated for its advisory services pursuant to the applicable Governing Documents, and in the
case of SMAs, the investment management agreement. Fee arrangements may differ depending on whether
the client is an SMA or Fund, and may vary based on the applicable strategy, structure, scope of services,
and other negotiated terms. The discussion below is a summary only and is qualified in its entirety by the
applicable governing documents.

Management Fees
Clients may be charged a management fee. Such fee is generally payable quarterly in advance, based on the
methodology, calculations, and terms set forth in the applicable Fund Governing Document or SMA
investment management agreement. The amount of the management fee and the basis on which it is charged
may vary by vehicle.

Carried interest
42 AM Holdco, or the Managing Member of the Funds, may be entitled to receive carried interest (typically
up to 20%) of the realized appreciation of the applicable Fund, subject to the satisfaction of applicable return
hurdles and other terms set forth in the relevant Governing Documents. The timing, methodology, and
conditions applicable to any such carried interest are described in the Governing Documents for the
applicable Fund.

Other fees
42 AM may be entitled to receive portfolio monitoring fees, loan servicing fees, administration expense
reimbursement or fees, director’s fees, organizational or set-up expense reimbursement, commitment fees,
consulting fees, advisory fees, a skim (or share) of a loan’s original issue discount, and other similar fees in
connection with the purchase, monitoring or disposition of investments or from unconsummated transactions
in respect of portfolio companies of the Funds. As defined in the Governing Documents, 100% of such fees

received by 42 AM benefit the Clients by way of a management fee offset. 42 AM has not received any such
fees to date, but retains the right to do so at the discretion of 42 AM.

These fees are disclosed in the Funds’ Governing Documents and SMAs’ investment management
agreements. The Firm and all supervised persons do not receive any other compensation for the sale of
securities or other investment products, other than what is disclosed herein.

Investors should refer to the relevant management agreement for a complete understanding of expenses and
fees. The information herein is qualified in its entirely by such documents.

42 AM calls capital from the Funds to pay for expenses that are permitted in the respective Funds’ Governing
Documents. Such expenses include but are not limited to: organizational and offering costs; administration,
fund account and investor reporting services; audit, tax preparation and compliance filings; legal fees and
expenses; insurance premium fees; custodial, consulting, and other professional fees; compliance costs; costs
associated with winding up and liquidating the Fund; costs associated with due diligence and monitoring of
portfolio investments; valuation services; and other expenses as laid out in the Governing Documents.

For SMAs, the Client is responsible for all fees, costs, expenses and liabilities attributable to the account and
its investment activities (collectively, “Account Expenses”), and such amounts are payable directly by the
Client. To the extent 42 AM or any of its affiliates advances any Account Expenses on behalf of the account,
the client is required to reimburse such amounts promptly upon request, following notice from 42 AM.
Account Expenses generally include, among other things, account establishment and implementation costs;
legal, accounting, tax and other professional fees; costs and expenses incurred in connection with the
sourcing, evaluation, negotiation, acquisition, holding, monitoring, valuation, restructuring and disposition
of investments, including related travel and out-of-pocket expenses; appraisal, valuation, rating,
administrative agent and collateral agent fees; indemnification obligations; consultant and operational
improvement costs in connection with workouts and restructurings; entity formation expenses; taxes and
governmental charges; administration, books and records, reporting and communication costs; expenses
relating to amendments, waivers, enforcement matters, litigation, audits, inquiries and account termination;
know-your-customer compliance costs; market data and research expenses; and other expenses attributable
to the account’s activities. The client does not bear the ordinary operating and overhead expenses of 42 AM,
such as employee compensation, rent, benefits and general office expenses, which are the responsibility of
42 AM.

Unless otherwise stated in the applicable Governing Documents or investment management agreement,
management fees for the Funds are payable quarterly in advance based on the methodology described in the
Governing Documents, and Fund carried interest, if any, is calculated in accordance with the distribution
waterfall after return hurdles are met. SMA advisory fees are billed quarterly in arrears based on the fee base
specified in the investment management agreement.

Neither 42 AM nor its supervised persons are compensated for the sale of securities or other investment
products.

Item 7: Types of Clients

42 AM provides investment advisory services to Funds, to which Cient’s commit capital and make pro-rata
contributions based on total committed capital. The majority of Clients are high net worth individuals or
institutional family offices. Clients must meet the minimum standards of an “Accredited Investor” under
Rule 501A of the Securities Act of 1933, as amended (“Securities Act”). Minimum investment amounts for
Funds and SMAs are set forth in the applicable offering and governing documents and may vary by vehicle.

42 AM also manages a separate account for an insurance company. Required minimum investment amounts
for SMAs are negotiated and may differ substantially.

In addition, the Fund’s manager from time to time enters into side letter agreements or other similar
arrangements (collectively, “Side Letters”) with one or more members without the approval of any other
member that have the effect of establishing rights under, or altering or supplementing the terms of the
Governing Documents of the Funds as they apply to a particular member. As a result of such Side Letters,
certain members from time to time receive additional benefits that other members will not receive, including
without limitation management fee or carried interest breaks. The other members will have no recourse
against the Funds, 42 AM or any of its affiliates in the event that certain members receive additional or
different rights or terms as a result of such Side Letters.