Capital Z Asset Management LLC

Fees and Compensation
The Funds have separate classes of interests or units (each, a “Class”) of limited liability company
interests with varying distribution rights. CZAM is entitled to receive an annual management fee
from the Funds structured as a profits interest in the Funds entitling CZAM to 3% of the value of
all of the classes of the Fund’s outstanding limited liability company units (“Management Profits
Interests”). The annual management fee is paid quarterly in advance. CZAM in turn pays the Sub-
Adviser an annual fee pursuant to the Services Agreement.

In addition to the distributions of cash and other assets, the Funds pay their own operating expenses
including, but not limited to, expenses related to the offering of interests, filings, administration and
audit expenses, any and all fees for research and analytics, research materials and research-related
travel and due diligence, interest on margin accounts, legal, accounting and professional fees,
insurance costs, consulting fees, custodial fees, trustees fees, bank service fees, interest on loans
and debit balances, any taxes applicable to the Funds on account of their operations and/or
investments, and any and all expenses related to the management and operation of the Funds as well
as the purchase, sale or transmittal of assets, as the Sub-Adviser shall determine in its discretion.
The Funds are also responsible for organizational fees and expenses.

Performance Based Fees and Side-by-Side Management

CZAM does not receive compensation in the form of a performance-based fee.

Types of Clients
CZAM’s only client is N2. Most of the investors in N2 are either (a) private investment funds
managed by PSP, (b) former employees of CZAM and (c) current and former member of its Board
of Managers. CZAM has entered into a Services Agreement with the Sub-Adviser for the Sub-
Adviser to act as administrator and investment sub-manager to the Funds, whereby the Sub-Adviser
is responsible for the day-to-day management of the Funds and for all investment activities of the
Funds.

Methods of Analysis, Investment Strategies and Risk of Loss
The investment strategy of the Funds is to invest in diversified ownership interests in alternative
asset managers through the provision of sponsorship capital.

Investing in the Funds involves a number of risks. An investment in the Funds may be deemed a
speculative investment and is not intended as a complete investment program. It is designed for
sophisticated investors who fully understand and are capable of bearing the risk of an investment in
the Funds. No guarantee or representation is made that a Fund will achieve its investment objective
or that limited partners will receive a return on their capital. The description below is a brief
overview of different material risks related to a Fund’s investment strategy:

General Business and Management Risk. Investments in portfolio companies subject the Funds
to the general risks associated with the underlying businesses including market conditions, changes
in regulatory requirements, reliance on management at the company level, interest rate and currency

Form ADV Part 2 Brochure | Capital Z Asset Management, LLC

fluctuations, general economic downturns, domestic and foreign political situations, and other
factors. With respect to management at the portfolio company level, many portfolio companies rely
on the services of a limited number of key individuals, the loss of any one of whom could
significantly adversely affect the portfolio company's performance. While in all cases Funds will
monitor portfolio company management, management of each portfolio company will have day-to-
day responsibility of such portfolio company.

Liquidity Issues. The investments in portfolio companies selected for the Funds may be illiquid,
due to transfer restrictions, the size of an interest held in a particular portfolio company or for other
reasons. As a result, it may be necessary to hold these investments for an indefinite period of time.
Generally, a less liquid investment bears more risk than a more liquid one. For example, if the Funds
are unable to liquidate an investment as its value declines, the Funds will be unable to limit losses.
Similarly, if the Funds are unable to liquidate an investment at a time when cash is needed, the Funds
may miss other investment opportunities or be forced to sell other investments at unfavorable times.

Financial Services Sector Risk Factors. The portfolio companies that the Funds will invest in will
be involved in the financial services industry. Companies involved in the financial services industry
are affected by many factors including domestic and political conditions, trends in business and
finance, legislation and regulation affecting the national and international business and financial
communities, monetary and fiscal policies, interest rates, inflation, currency values, market
conditions, the availability and cost of short-term or long-term funding and capital, the credit
capacity or perceived creditworthiness of customers and counterparties, and the level and volatility
of trading markets. Such factors can impact customers and counterparties of financial services
companies and may impact the value of financial instruments held by financial services companies.

Cybersecurity Risk The computer systems, networks and devices used by CZAM and our service
providers employ a variety of protections designed to prevent damage or interruption from computer
viruses, network and computer failures and cyberattacks. Despite such protections, systems,
networks and devices potentially can be breached. Cyberattacks include, but are not limited to,
gaining unauthorized access to digital systems for purposes of corrupting data, or causing
operational disruption, as well as denial-of- service attacks on websites. Cyber incidents may cause
disruptions and impact business operations, potentially resulting in financial losses, the inability of
us or our service providers to trade, violations of privacy and other laws, regulatory fines,
reputational damage, reimbursement costs and additional compliance costs, as well as the
inadvertent release of confidential information.

Investment and Due Diligence Process. Before making investments, CZAM and/or the Sub-
Advisor will conduct due diligence that it deems reasonable and appropriate based on the facts and
circumstances applicable to each investment. When conducting due diligence, CZAM may be
required to evaluate important and complex business, financial, tax, accounting and legal issues.
When conducting due diligence and making an assessment regarding an investment, CZAM will
rely on the resources reasonably available to it, which in some circumstances, whether or not known
to CZAM at the time, may not be sufficient, accurate, complete or reliable. Due diligence may not
reveal or highlight matters that could have a material adverse effect on the value of an investment.

Service Providers. Service providers or affiliates of service providers (including lenders, brokers,
attorneys, and investment banking firms) of CZAM and/or the Sub-Advisor and the Funds may be
in a position to provide certain services to employees of CZAM and/or the Sub-Advisor with respect

 Form ADV Part 2 Brochure | Capital Z Asset Management, LLC

 to non-CZAM matters. The receipt of services with respect to non-CZAM matters may influence or
 have the appearance of influencing CZAM’s decision whether to select such service provider for
...