Anchor Bolt Capital LP

– Fees and Compensation

Anchor Bolt receives a management fee and its affiliated General Partner receives an incentive
allocation as compensation for providing investment advisory services to the Funds. A Fund’s
management fees, incentive allocations and other compensation payable to Anchor Bolt and the
General Partner are established by Anchor Bolt at the time of the establishment of the relevant
investment vehicle and are negotiated with participating investors prior to making their investment.
The following is a general description of fees, compensation and expenses of the Funds. Differences
exist from Fund to Fund, and certain Funds may not be charged certain fees, compensation or
expenses that other Funds are charged. In addition, the General Partner is permitted, in its sole
discretion, to waive or reduce an investor’s management fee or incentive allocation. For example, no
management fee is charged with respect to the capital account of the General Partner, its principals,

employees or affiliates of Anchor Bolt. Some principals or other employees of Anchor Bolt receive a
portion of the management fees, incentive allocation or other compensation, if any, received by
Anchor Bolt or the General Partner. Investors in the Funds also bear certain expenses, as described
below. Investors should refer to the Governing Documents of the applicable Fund for a complete
understanding of how Anchor Bolt is compensated for its advisory services; the information contained
herein is a summary only and is qualified in its entirety by such documents.

Anchor Bolt receives management fees from investors in the Main Fund, and the Long Fund.
Management fees are calculated after taking into account any expenses at the respective Fund levels,
are deducted from each investor’s capital account and are payable regardless of the overall success or
income earned by the Funds. If an investment is redeemed at any time other than at the end of a
fiscal year, any accrued expenses will be paid to the Investment Manager at such time. In addition,
most Funds contain lock up and redemption provisions as further described in such Fund’s Governing
Documents.

For the Main Fund’s general share class, in consideration for the investment management services
provided to the Funds, the Feeder Funds on behalf of each Fund’s investors pay to Anchor Bolt a
monthly management fee of up to 0.125% (1.5% annually) of the Feeder Fund’s net asset value payable
in arrears as of the end of each month. The fee is prorated for partial periods equal to a percentage
of the net asset value of each class of stock corresponding to an investor’s capital account in the Fund.
Other share classes exist for the Main Funds for which investors may qualify, which pay lower
management fees than the general share class.

For the Long Fund’s general share class, in consideration for the investment management services
provided to the Funds, the Feeder Funds on behalf of each Fund’s investors pay to Anchor Bolt a
monthly management fee of up to 0.104166% (1.25% annually) of the Feeder Fund’s net asset value
payable in arrears as of the end of each month. Another share class exists for the Long Fund for
which investors may qualify, which pays lower management fees than the general share class.

For the Third-Party Private Funds, in consideration for the investment management services
provided, such investors pay to Anchor Bolt a monthly management fee of 1.0% - 2.0% per annum,
depending on the client, in arrears as of the end of each month.

Each of the Main Fund and Long Fund investors share in all of its respective Fund’s expenses, as
well as such Fund’s pro rata share of the Master Fund’s operating and other expenses (which differ
across Funds), including, but not limited to: investment-related expenses (e.g., brokerage
commissions, clearing and settlement charges, custodial fees, interest expenses, fees and expenses
relating to investments in exchange-traded funds, expenses related to currency exchanges, research-
related expenses, including, without limitation, news and quotation equipment and services (Anchor
Bolt’s brokerage arrangements entered into on behalf of the Funds are discussed in Item 12 of this
Brochure)); legal and compliance expenses (including expenses relating to FACTA, as well as
compliance or regulatory filings made with respect to a Fund’s assets); costs and expenses in
connection with the formation, operation and liquidation of special purpose vehicles through which

a Fund may invest; legal expenses; accounting, audit and tax preparation expenses, and expenses of
similar third-party non-investment professionals; organizational expenses; expenses relating to the
offer and sale of the interests/shares; remuneration to members of the advisory committee and board
of directors; expenses relating to obtaining insurance for the officers of the Investment Manager, the
General Partner and the members of the advisory committee and board of directors; fees to the Funds’
administrator; expenses related to the maintenance of the Funds’ or the Master Funds’ registered
office; corporate licensing; extraordinary expenses and other similar expenses related to each
respective Fund. (Note, any expenses attributable to investments in “new issues” will be paid pro rata
only by those investors eligible to participate in such investments.)

The Funds’ investors also bear the costs of certain products and services received by the Investment
Manager that constitute “brokerage and research services” under Section 28(e) of the U.S. Securities
Exchange Act of 1934, as amended (“the Exchange Act”), as described in Item 12 below. The Funds
typically pay for these products and services directly and/or through “soft dollar” or client
commission arrangements that fall under the safe harbor for such services established by Section 28(e).

The expenses of the Third-Party Private Funds are separately negotiated with such clients and
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– Types of Clients

Each Fund generally limits its investors to persons who are both “accredited investors” as defined in
the Securities Act of 1933 (“Securities Act”) and either “qualified purchasers” or “knowledgeable
employees” as defined in the Investment Company Act. Interests in the Funds are not made available
to the general public. Investors in the Funds must meet certain suitability and net worth qualifications
prior to making an investment in the Funds. Minimum contributions for investment in each Fund
are generally $1 million. Commitments of less than the specified minimum amounts are also accepted
at the sole and absolute discretion of the Investment Manager and the applicable Fund’s board of
directors. More information about each Fund’s minimum commitment amount, and available share
classes of each Fund, is available in such Fund’s Governing Documents.

Investors in the Funds include, by way of example, high net worth individuals, corporate pension and
profit-sharing plans, charitable institutions, foundations, endowments, municipalities, trust programs,
foreign and sovereign wealth funds and other U.S. institutions. In addition, employees and other
persons associated with Anchor Bolt are also investors in the Funds.

         – Methods of Analysis, Investment Strategies and Risk of Loss

Anchor Bolt’s investment objective is to build an equity business focused on the global industrial and
energy markets that seeks to generate sustained above-average, long-term, risk-adjusted results.
Fundamental research is the foundation of the Investment Manager’s investment strategy, and a
disciplined investment process is used to position the team for success. Within the industrial and
energy world, the Investment Manager focuses on investments across at least 53 unique subsectors
within at least four key categories: basic materials; capital equipment and consumer goods; energy;
and transportation and leisure.

The Main Fund and the Third-Party Private Funds’ investment portfolio will seek to generate long
and short alpha in three specific ways: (i) relative stock picking within subsectors; (ii) subsector relative
calls; and (iii) with the exception of one Third-Party Private Fund, concentrated long positions in
stocks exhibiting what Anchor Bolt believes to represent significant absolute value. The Long Fund’s
investment portfolio will seek to generate alpha solely in concentrated long positions in stocks
exhibiting what Anchor Bolt believes to represent significant absolute value. The Third-Party Private
Funds’ investment portfolio will seek to generate alpha by investing in the same investable universe
as the Main and Long Fund, however with different gross and net exposures than the Main Fund and
their trading is subject to a restricted list.

The Investment Manager is focused on the process of incorporating fundamental research insights
from its investment team into an optimized Funds’ investment portfolio. The Investment Manager
seeks to accomplish this goal by utilizing proprietary investment infrastructure and effective team
communication. With this disciplined investment process, the Investment Manager seeks a very
proactive approach to portfolio management.

The following investment strategies are relevant with respect to the Main Fund and the Third-Party Private Funds:

Opportunities within subsectors are based on many considerations, including: relative management
strength; future growth opportunities/allocation of capital; sustainability of cash flows; return on
capital; financial and operating leverage; and valuation.

Industry relative trades seek long exposure in subsectors with improving near-term fundamentals
and/or positive secular forces and short exposure in subsectors with deteriorating near-term
fundamentals and/or secular headwinds. Anchor Bolt’s subsector relative valuation analysis provides
an objective framework for how sectors within the industrial and energy world trade relative to one
another.

Concentrated absolute value long positions seek to identify the greatest risk/reward opportunities
across the Funds’ investable universe, focusing on names that typically exhibit greater than 2.0x upside
versus downside based on the Investment Manager’s bottom-up upside/downside price targets. Such
stocks will generally be weighted towards companies with greater idiosyncratic growth rates that can
be purchased at a reasonable price and/or companies that are trading at significant discounts to

intrinsic value where Anchor Bolt has a constructive view on management’s allocation of capital.
(Note, this risk factor is not applicable for one of the Third-Party Private Funds).

Subsector relative opportunities and industry relative trades collectively make up a market neutral
portfolio while the overlay of the long portfolio will result in a portfolio that in most cases operates
net long. Portfolio construction is a dynamic and disciplined process; the Investment Manager seeks
to optimize sources of alpha, while at the same time seeks to manage risk through disciplined levels
of financial leverage and net exposures.

Risk Factors

An investment in a Fund or Third-Party Private Fund entails substantial risks, including, but not
limited to, the possibility of a complete loss of the amount invested. Current and prospective Anchor
Bolt investors should carefully consider the following factors, among others, in determining whether
an investment in a Fund or Third-Party Private Fund is suitable for them. Different or new risks not
addressed below may arise in the future and, therefore, the following list is not intended to be
exhaustive. There are many market-related and other factors – some of which cannot be anticipated
– that could result in an investor losing a major portion or all of its investment in a Fund, or prevent
a Fund from generating profits. No investor should invest in the Funds unless the investor is fully
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