Avista Capital Holdings LP

FEES AND COMPENSATION

        In general, Avista Capital Holdings receives a management fee (“Management Fee”) from
the Funds in connection with advisory services it provides them. Avista Capital Holdings or other
Avista entities or affiliates receive additional compensation in connection with management and
other services performed for portfolio companies of the Funds (e.g., the General Partners receive
carried interest, discussed in detail below) and such additional compensation can offset in whole
or in part the Management Fee otherwise payable to Avista Capital Holdings. Limited partners
in the Funds also bear certain fund expenses, as set forth in each Fund’s Limited Partnership
Agreement.

Management Fees

        All investors and prospective investors should review the Limited Partnership Agreement
of the relevant Fund in conjunction with this Brochure for complete information on the fees and
compensation payable with respect to a particular Fund. In certain circumstances, different Funds
are subject to different Management Fees and performance-based compensation arrangements.
Avista reserves the right to exempt certain parties, including employees, affiliates and related
parties from all or a portion of the Management Fee. In limited circumstances, the advisory fees
payable to Avista by individual investors in the Funds may be negotiable. All clients are “qualified
purchasers” as defined in Section 2(a)(51) of the Investment Company Act of 1940, as amended
(the “Investment Company Act”), and therefore Avista has not included specific fee information
in response to this Item. Where the Limited Partnership Agreements calculate Management Fees
based on the amount of commitments or the amount of investment contributions, the amount of
Management Fees generally will not be reduced based on reductions in investment value, except
where specified by the relevant Limited Partnership Agreements. As a general matter,
Management Fees will be payable during term extensions unless otherwise agreed with investors.

       As is typically the case in private equity funds, Management Fees will be calculated and
charged on a basis that generally is not based on the respective Fund’s then-current net asset value.
Subject to the Limited Partnership Agreements, from the effective date of the relevant Fund until

a date specified in the Limited Partnership Agreements (the “Stepdown Date”), Management Fees
generally will be calculated based on a percentage of the relevant Fund’s aggregate commitments.
After the Stepdown Date, Management Fees generally will be calculated based on the amount of
investment contributions (including, where applicable, the amount of any capitalized Portfolio
Company Fees and transactional fees and other similar amounts (collectively, “Capitalized
Fees”)) or expenses (including certain costs of Strategic Executives) made by the relevant Fund
with respect to investments that have not been disposed. Due to differences in the criteria set forth
in their respective governing documents, in the event where more than one Fund participates in an
investment, there is the possibility that such investment will become an Impaired Value Investment
(as defined below) for purposes of one Fund’s governing documents but not those of one or more
other Funds.

        Under the Limited Partnership Agreements, where the fair market value of an investment
exceeds the total amount of investment contributions relating to such investment, post-Stepdown
Date Management Fees will not be calculated based upon such appreciated value, and will instead
continue to be calculated based on the amount of investment contributions with respect to
investments that have not been disposed. Conversely, the Limited Partnership Agreements do not
require Management Fees to be reduced or refunded following the occurrence of a decrease
(including a significant decrease) in fair value, except in the case of investments that were written
off or permanently written down (such investments, “Impaired Value Investments”). Where
there has been a partial distribution or partial sale of an investment and the fair market value of
such investment following such event is equal to, or greater than, the total amount of unreturned
investment contributions relating to such investment, the Limited Partnership Agreements do not
require Management Fees after the Stepdown Date to be reduced. If the fair market value of an
Impaired Value Investment is less than the total amount of investment contributions relating to
such Impaired Value Investment, then such investment will be deemed to be partially disposed
based on the ratio of the fair market value of such Impaired Value Investment as compared against
the amount of total investment contributions relating to such Impaired Value Investment. For
purposes of calculating the unreturned investment contributions, any return of investment
contributions in connection with a recapitalization of any investment or a temporary write-down
shall be disregarded, except to the extent that the fair market value of such investment (after giving
effect to such recapitalization) is less than the capital contributions in respect of such investment.

       As a result, and is generally the case for private equity funds, the amount of Management
Fees typically will not correspond with fluctuations in the net asset value of individual investments
or of a Fund, including following the relevant investment period, and will not be reduced in
connection with any write downs, except in the case of Impaired Value Investments.

        In many circumstances, the Management Fee base of such post-Stepdown Date
Management Fees will include capitalized transaction-specific fees and expenses of unrealized
investments, including certain fees (such as Capitalized Fees) and expenses paid to Service
Providers, Strategic Executives or their affiliates. Further, Management Fees typically will not be
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TYPES OF CLIENTS

        Avista Capital Holdings provides investment advice solely to its clients, and references
throughout this Brochure to “clients” and to Avista Capital Holdings’ related duties to and
practices on behalf of its clients and/or investors should be construed accordingly. Private
Investment Funds generally include investment partnerships or other investment entities formed
under U.S. or non-U.S. laws and operated as exempt investment pools under the Investment
Company Act. The investors participating in Private Investment Funds generally include
individuals, banks or thrift institutions, other investment entities, university endowments,
sovereign wealth funds, family offices, pension and profit-sharing plans, trusts, estates or
charitable organizations or other corporations or business entities and often include, directly or
indirectly, principals or other personnel of Avista Capital Holdings and its affiliates and members
of their families, Strategic Executives or other Service Providers retained by Avista Capital
Holdings, as well as executives of portfolio companies.

       AHP I, AHP II and AHP III are closed to new investors.

             METHODS OF ANALYSIS, INVESTMENT STRATEGIES AND RISK OF LOSS

General

        Avista intends to primarily focus on making private equity and equity-related investments
in growth-oriented companies primarily in the healthcare sector. Avista focuses on platform
companies that it believes have ongoing capital requirements to pursue growth and acquisition
opportunities. The Funds seek to generate significant long-term capital appreciation primarily
through investments in companies in a variety of transactions, including, leveraged and
unleveraged acquisitions, recapitalizations, restructurings, workouts, structured financings, growth
equity and other related transactions. The Funds may make controlling equity interest or a minority
investment in portfolio companies.

       There can be no assurance that the Advisers will achieve the investment objectives of the
Funds and a loss of investment is possible.

Investment and Operating Strategy

       Leveraged Buyouts. Avista generally seeks businesses that it believes are market leaders,
have distinct and defensible competitive advantages and enjoy solid growth potential. Avista’s
professionals also consider under-managed or under-capitalized divisions of larger businesses,
small public companies that are overlooked or poorly understood, family-owned companies with
succession considerations and other opportunistic situations. Avista structures buyouts with an
amount of leverage in order to increase returns, and seeks to maintain the financial flexibility to
fund growth opportunities and withstand market downturns.

       Growth Capital. Avista’s professionals have a particular focus on providing established
and well-managed platform companies with the capital to pursue various objectives to create value
through the implementation of consolidation strategies, broadening of their geographic footprint
or enhancement of their product offerings, among others. When executing growth capital
investments, Avista seeks to implement financing structures that are consistent with these
companies’ growth requirements while maintaining an appropriate level of control through
governance and control rights for the purpose of managing risk.

        Structured Equity. To capitalize on investment opportunities that arise when companies
have limited access to the financial markets, Avista seeks to structure private securities that provide
the appropriate balance between downside protection and the potential for significant equity
appreciation. Avista believes that these opportunities typically result from market dislocations or
the financial distress of a mature business. When reviewing structured equity investments, Avista’s
professionals generally analyze the stability and defensibility of the cash flows to ensure
appropriate credit coverage, while also considering the ability to create equity returns through
revenue growth or margin improvement.

       Partnership and Minority Investments. Avista may selectively consider entering into
partnership and minority equity opportunities in situations where the economic returns are
compelling. In such cases, Avista typically negotiates certain limited control rights, including

board seat representation, tag-along rights upon sale of the company, registration rights,
supermajority vote approval for major corporate events, put rights upon change of control and
preemptive rights. Typically, Avista’s professionals take an active role in the portfolio companies
to create value post investment including seeking the right to designate a member to the board of
the portfolio company.

        Post-Acquisition Value-Added. Avista’s professionals take an active role in assembling
management teams and working with portfolio companies to develop strategic plans and seek to
enhance organic growth, pursue accretive acquisitions and increase efficiencies. The Strategic
Executives provide strategic insight, counsel and operational oversight and help develop and refine
the strategic direction of the Funds’ portfolio companies. The professionals typically seek the right
to designate board members in all of their investments.

        Avista’s professionals actively monitor and advise management teams, oversee strategic
plans for expansion, growth and profitability, and methodically measure performance against these
plans and other metrics. Avista’s professionals typically serve on the boards of its portfolio
companies, providing ongoing monitoring of the portfolio companies’ progress. Avista’s
professionals also have significant experience in strengthening management teams and, when
necessary, replacing a company’s CEO, CFO or other executives.

        Exit Strategies. Avista’s professionals analyze exit scenarios and strategies before making
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