Carlson Capital LP

Item 5        FEES AND COMPENSATION

Management Fees

The Funds: Generally, Carlson is paid asset-based fees (“Management Fee”) at an annual rate of
between 0% to 2.0% of the net asset value of each Fund investor’s investment in a Fund. Securities
of each Fund are issued in more than one series certain of which have a different Management Fee
applicable to it.

Management Fees charged to the Delaware-domiciled feeder funds are generally calculated and
payable in advance as of the first business day of each calendar quarter. In the event an investor is
admitted to a Delaware-domiciled feeder fund subsequent to the first day of a quarter or withdraws
from a Delaware-domiciled feeder fund prior to last day of a quarter, the Management Fee paid to
Carlson with respect to such investor will be prorated to reflect the number of months in the calendar
quarter during which such investor was a limited partner in the feeder fund. Management Fees charged
to the Cayman Islands-domiciled feeder funds are generally calculated and payable in arrears as of the
end of each month before accrual of any Performance Allocation (as described below).

The Management Fee charged to a Fund is generally not negotiable. Carlson may, however, waive or
reduce the Management Fees charged to certain investors, and has waived Management Fees for
investors in the Funds that are affiliated with Carlson and its affiliates, including, without limitation,
their respective partners, employees, and similar persons. Carlson may pay and has paid all or part of
the Management Fees to third parties for services rendered in connection with the placement of
interests and/or shares in the feeder funds or for other services.

The Managed Accounts: The amount and terms of payment of any management fees payable by the
owners of the Managed Accounts to Carlson vary and are established in the Governing Documents
of the Managed Accounts. Depending on the structure, size of investment and other factors, Managed
Accounts may and in certain instances do offer more favorable fee terms than an investment in other
Clients.

Performance Allocation and Fees

The Funds: CCGP or Carlson generally receives a special allocation of profits or a special profits fee
(collectively, a “Performance Allocation,”) each year with respect to each of the Funds. The amount

of the Performance Allocation may and has historically varied between Funds and series offered. As
of the date of this Brochure, the amount of the Performance Allocation is equal to 20% of each limited
partner’s or shareholder’s share of the net profits (including realized and unrealized gains) of each
feeder fund, if any (after taking into account expenses of the feeder fund, including any Management
Fees). In certain instances, the Performance Allocation is subject to achievement of a “hurdle” rate,
which may be based on the absolute outperformance of an index. In addition, the Performance
Allocation may be subject to being reduced by the amount of any Management Fees paid. The
Performance Allocation is generally calculated and applied on an annual basis and is accrued on a
monthly basis based on the net profits (or losses) of each Fund. Although the Performance Allocation
is accrued on a monthly basis, it is not credited to CCGP or Carlson until the occurrence of a
crystallization event, which is generally the end of each calendar year, the withdrawal or redemption
of a limited partner or shareholder from a feeder fund, a transfer of an investment in a feeder fund
that results in a change of a majority in interest of the beneficial ownership of the investment (unless
the transferor and transferee have the same investment adviser exercising investment discretion over
the transfer on behalf of both the transferor and transferee) and/or the conversion of an investment
in a feeder fund to another series that results in a change in the manner in or rate at which the
Performance Allocation is made or to another feeder fund in a different Fund group. The Performance
Allocation is allocated to CCGP as general partner of each Delaware-domiciled feeder fund and special
shareholder of each Cayman Islands-domiciled intermediate fund. In the case of each Delaware-
domiciled feeder fund, the Performance Allocation is calculated and applied separately for each
memorandum account established by the fund for each capital contribution by a limited partner. In
the case of Cayman Islands-domiciled feeder funds, the Performance Allocation is calculated and
applied separately for each sub-series of shares created by the fund for each subscription by a
shareholder.

The Performance Allocation is calculated in accordance with each Fund’s Governing Documents and
is subject to a high-water mark or loss carry-forward, which generally requires that prior un-recouped
net losses be made up before the Performance Allocation is credited. As noted above, certain
Performance Allocation calculations include a “hurdle” rate, which may be based on the absolute
outperformance of an index and, therefore, result in a Performance Allocation being made even if a
particular memorandum account or series has not achieved absolute gains. In the case of a partial
withdrawal, partial redemption, partial transfer of an investment in a feeder fund that results in a
change of a majority in interest of the beneficial ownership of the transferred investment (unless the
transferor and transferee have the same investment adviser exercising investment discretion over the
transfer on behalf of both the transferor and transferee), partial conversion of an investment in a
feeder fund to another feeder fund in a different Fund group, or distribution in respect of an
investment in a feeder fund, the amount of net losses that must be recouped will generally be reduced
in proportion to the amount withdrawn, redeemed, transferred, converted or distributed, as applicable.
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Item 7         TYPES OF CLIENTS

As noted in Item 4 (Advisory Business) above, Carlson provides investment advice to the Funds and
the Managed Accounts.

Delaware feeder fund interests are only available to be purchased by U.S. taxable investors that are
either: (i) both an “accredited investor” as defined in Regulation D under the Securities Act of 1933,
as amended (the “Securities Act”) and a “qualified purchaser” as defined in Section 2(a)(51) of the
Investment Company Act of 1940, as amended (the “Investment Company Act”); or (ii) a
“knowledgeable employee” as such term is defined in Rule 3c-5 under the Investment Company Act,
with respect to such Fund. In general, Cayman Islands feeder fund shares are only available to be
purchased by persons that are either: (i) not a “U.S. Person” (as defined under Rule 902(k)
promulgated under the Securities Act); or (ii) a U.S. Person that is either: (A) both an accredited
investor and a qualified purchaser; or (B) a knowledgeable employee with respect to such Fund.
Minimum Fund investments vary from $250,000 to $5,000,000, although such minimum amount may
be and has been waived under certain circumstances at the sole discretion of Carlson. A higher
minimum investment requirement may be and has been imposed on certain series of interests or shares
in some feeder funds that may offer and has resulted in more favorable fee terms than other series of
interests or shares offered, which in certain cases depends on the performance of the Fund.

The Managed Accounts generally are owned by large institutional investors. The eligibility
requirements for opening a Managed Account vary from time to time, but generally a Managed

Account holder must be both an accredited investor and a qualified purchaser. Minimum investment
amounts for Managed Accounts are negotiable.

Additional details on investor eligibility requirements are set forth in each Client’s Governing
Documents.

Please see Item 4 (Advisory Business) above.