B-29 Advisors LLC

Fees and Compensation
B-29 Advisors has entered into advisory services contracts with each Private Fund to which it
provides investment advisory services. Each advisory services contract provides for payment of
an annual fixed fee (the “Fee”) that represents each Private Fund’s anticipated pro-rata share of
expenses incurred by B-29 Advisors in providing the advisory services.

The Fees are evaluated and adjusted quarterly to ensure that the Fees cover the expenses incurred
by B-29 Advisors. The Fees are payable quarterly in advance. To the extent Fees are paid in
advance and a client cancels its advisory agreement with B-29 Advisors before the end of such
period, B-29 Advisors pro-rates any fees received through the end of such period and returns any
paid but unearned fees to the client.

In addition to the Fees, B-29 Advisors may charge its clients hourly or fixed charges, depending
on the services provided (outside the scope of the advisory services contract) on an individually-
negotiated basis.

B-29 Advisors or its affiliates may receive compensation from portfolio companies in the Funds,
depending on the services provided on an individually-negotiated basis. These services include but
are not limited to portfolio company operating management, equipment rental and sales, water
management and infrastructure services, oilfield-related retail product and pipe sales, property tax
and ad valorem tax consulting services, business incentive consulting services, aviation services,
accounting support services, IT support, legal services, sub-leasing arrangements, and purchase or
resale of natural gas, natural gas liquids, and crude oil. In most cases, B-29 seeks to negotiate such
services on an arm’s length basis in accordance with market prices. However, the terms of any
transaction involving the provision of goods or services to the Funds or any of its portfolio
companies will be determined by B-29 in its sole discretion and may differ significantly from the
terms that may be obtained in an arm’s length transaction between unaffiliated parties.

Performance-Based Fees and Side-By-Side Management

The general partners of the Private Funds and, in certain cases, other entities specifically formed for
the purpose of acting as a carried-interest vehicle, may receive carried-interest distributions
depending on the returns generated by the Private Funds’ investments. Carried-interest distributions
typically are 20% of the gains realized on the disposition of investments after returning invested
capital, management fees, and other expenses and priority returns to the investors. Notwithstanding
the foregoing, Sunray Capital, LP does not impose a performance-based fee to its limited partners.

As the sole owner of B-29 Advisors, Schmitz & Schmitz may have an incentive to take increased
investment risk with respect to accounts which are charged performance-based fees. B-29 Advisors
has policies and procedures in place designed to address this conflict and to ensure allocation of
investments to client accounts on a fair and equitable basis, taking into account factors such as the
client’s size, investment objectives, risk tolerance, return targets, diversification considerations, and
the liquidity needs of each client. In addition, Schmitz & Schmitz has an indirect financial stake in
each of the Private Funds that B-29 Advisors advises, which we believe better aligns the interest of
Schmitz & Schmitz and our clients and reduces the risks related to charging performance fees.

Types of Clients
B-29 Advisors provides advisory services to Private Funds that make private equity investments.
As noted, these Private Funds are B-29 Advisors’ clients. Underlying Investors in such funds will
generally be institutional investors, including, high-net-worth individuals, trusts, estates,
corporations, limited partnerships, limited liability companies, or other entities. Underlying
Investors generally will not be obligated to make a formal minimum commitment in a Private Fund.

Methods of Analysis, Investment Strategies, and Risk of Loss
The Private Funds invest in small to middle market companies in the energy market, typically
investing one million dollars to twenty-five million dollars in companies with enterprise values that
are typically between one million dollars and one hundred million dollars.

With respect to energy investments, B-29 Advisors’ investment strategy includes identifying and
investing in companies in the energy sector that B-29 Advisors believes have innovative and
technologically-focused management teams that are able to persevere in all commodity cycles.

Investment decisions are reviewed at multiple levels within B-29 Advisors. Each potential
investment is reviewed by one or more investment professionals who make an initial determination
regarding the suitability of each potential investment. Investment opportunities that pass this initial
review are then assessed by B-29 Advisors’ investment committee.

Following an investment in a portfolio company, the investment team responsible for such
investment continues to have a primary responsibility for monitoring the portfolio company’s
performance. Material events, along with acquisition, divestiture and disposition opportunities, are
discussed at B-29 Advisors’ monthly investment committee meetings.

All investments in the Private Funds involve a high degree of risk of loss that investors should be
prepared to bear, including risk of complete loss. B-29 Advisors does not provide individualized
advice to the Underlying Investors in the Private Funds that it advises regarding the suitability of
an Underlying Investor’s investment in any private fund, in the context of its total portfolio.
Underlying Investors are responsible for determining what an appropriate allocation of their total
investment portfolio should be for an investment in the Private Funds (if any) and B-29 Advisors
bears no responsibility for such determination by an Underlying Investor.

A brief summary of some of the risks associated with an investment in one of the Private Funds is
set forth below. This summary is not, nor is intended to be, a comprehensive listing of all of the
risks, potential conflicts of interest and the tax, legal and regulatory considerations that an investor
should consider before making any decision to invest in a private fund. Underlying Investors are
advised that they should consult with their own legal, financial, tax and other professionals before
deciding to make any investment decision.

Despite B-29 Advisors’ efforts to identify promising investment opportunities for the Private
Funds, an investment in a private fund entails a high degree of risk. These risks include, but are not
limited to, the following:

   1. No Assurance of Return. There can be no assurance that the Private Fund’s investment
      objectives will be achieved or that there will be any return of capital.
   2. Lack of Diversification. The Private Funds will make relatively few investments, so poor
      performance by any one investment could have a materially adverse effect on the Private
      Fund.
   3. Illiquidity and Long Holding Periods. Interests in private funds are highly illiquid, and
      Underlying Investors generally may not withdraw capital from the Private Funds.

4. Dependence on Key Individuals; No Right to Control the Private Funds’ Operations. Under
    each Private Fund’s governing documents, investors will have no rights with respect to the
    control of the Private Fund’s day-to-day operations or of the Private Fund’s business,
    including investment and disposition decisions. To protect their limited liability from the
    liabilities and obligations of any Private Fund, investors must rely entirely on the Adviser
    or its affiliates to conduct and manage the Fund’s affairs. The success of any Private Fund
    is expected to be dependent significantly upon the expertise of certain key persons. There
    can be no assurance that the Adviser’s current personnel will continue to manage any
    Private Fund throughout its term. The loss of the services of one or more of these
    individuals could have a material adverse effect on the performance of any Private Fund
    and the value of an investment in the Private Fund.
5. Leverage. The Private Funds may use leverage in connection with making investments, and
    their portfolio companies may incur a significant amount of leverage. The leverage
    increases exposure to adverse economic factors and could result in permanent loss of
    capital.
6. No Hedging. The Private Funds do not enter into hedging arrangements to establish, in
    advance, a price for the sale of the oil and natural gas produced from the Private Funds’
    properties, and the Private Funds do not intend to enter into such arrangements in the future.
    As a result, the Private Funds may realize the benefit of any short-term increase in the price
    of oil and natural gas, but the Private Funds will not be protected against decreases in price,
    and if the price of oil and natural gas decreases significantly, the Private Funds’ business,
    results of operation and cash available for distribution may be materially adversely affected.
7. Tax Risks. Tax consequences to investors in private funds are complex, and the structure of
    the Private Fund’s investments could result in different tax consequences for different
    Underlying Investors.
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