Coastal Investment Company LLC

Item 5 – Fees and Compensation

Investors in the Funds are generally “accredited investors” as that term is defined in
Regulation D under the Securities Act of 1933, as amended (the “Securities Act”), and/or
“qualified clients” as defined in the Advisers Act or “qualified purchasers” or “knowledgeable
employees,” each as defined in the Investment Company Act of 1940, as amended (the
“Investment Company Act”). Investors and prospective investors should refer to the
applicable offering documents and/or agreements that govern the operations of the Fund
(the “Governing Documents”) for a detailed description of the fees associated with
investments in the applicable Fund.
A.     Fee Schedule
The fees and compensation payable to the Firm are negotiable and vary among its Clients.
However, the range of compensation is generally as follows:
       1.      Management Fee
From the Funds, the Firm typically receives a management fee calculated as a percentage of
the capital commitment received from the applicable Fund’s sponsor, payable annually. The
management fee is generally between 1% and 5%.

       2.      Expense Allowance
From the Funds, the Firm typically receives 1-2.5% of total proceeds raised for each Fund for
all fees and expenses incurred that relate to the applicable Fund’s reasonable and ordinary
business operations (the “Expense Allowance”).
Personnel that a Fund needs to employ or contract with other than management of the Firm
including employees, consultants, certified public accountants, legal counsel or others shall
be entitled to compensation for services performed on behalf of a Fund as determined by the
Firm in its sole discretion. Expenses relating to an offering and the reasonable and ordinary
expenses incurred to operate a Fund’s business shall be paid by the Firm from the Expense
Allowance it receives. Any other expenses a Fund incurs that exceed the Expense Allowance
shall be the sole responsibility of the Firm and will not be reimbursed except for expenses
that relate to any litigation, regulatory matter, or other extraordinary event that involves a
Fund and is outside the ordinary day to day business operations (“Extraordinary Event”)
including any claim for indemnification provided by for in the Governing Documents or
available under applicable law. Expenses advanced by the Firm or other party for any
Extraordinary Event will be reimbursed by the applicable Fund without interest from
distributions received upon submission of an invoice, receipt or other proper documentation.

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                                                     Coastal Investment Company, LLC Brochure

       3.      Performance-Based Fees
From the Funds, the Firm generally receives a carried interest equal to 23.5% of the
distributable proceeds in excess of unpaid capital contributions which is typically made upon
the sale or other disposition of a real estate project or venture capital investment.
The incentive allocation will only be charged to accounts of those Investors who are “qualified
clients” as defined in Rule 205-3 of the Investment Advisers Act of 1940, as amended
(“Advisers Act”), in accordance with applicable law.
B.     Payment of Fees
Management fees, expense allowance, performance-based fees, and third-party fees
(discussed below) are deducted from Client assets. Management fees are paid from income
as received by a Fund. Otherwise, Management fees are paid in arrears and withdrawn at the
end of each year or may be accrued and paid upon the sale or other disposition of the Fund
assets. Performance-based fees are determined upon the sale or other disposition of the Fund
assets.
C.     Third-Party Fees
Clients shall pay such costs and expenses as the Firm shall reasonably determine to be
necessary, appropriate, advisable or convenient to carry on its business and realize its
objective, including but not limited to: (i) management fees; (ii) the Expense Allowance; and
(iii) any extraordinary expenses, among other expenses.
The Firm’s fees are exclusive of brokerage commissions, transaction fees, and other related
costs and expenses which shall be incurred by the Clients. Such charges, fees and
commissions are exclusive of and in addition to the Firm’s management fee, and the Firm
shall not receive any portion of these commissions, fees, and costs.
Please see Item 12 of this Brochure regarding brokerage.
D.     Prepayment of Fees
The Firm will pro rate the management fee for Fund Interests held for less than a full month
or quarter as the case may be as a result of subscribing for interests other than on the first
business day of the month or quarter. Prepaid but unearned fees are refunded to the Clients
and/or Investors, as the case may be.
The Firm generally does not permit Fund Investors to withdraw amounts from their capital
accounts.
E.     Outside Compensation for the Sale of Securities
Neither the Firm nor its supervised persons accept compensation for the sale of securities or
other investment products outside of its association with the Firm.
The foregoing discussion in Items 5 represents the Firm’s basic compensation
arrangements. Fees and other compensation are negotiable in certain circumstances

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                                                       Coastal Investment Company, LLC Brochure

and arrangements with any particular Investor may vary. Although the Firm believes
its fees are competitive, lower fees for comparable services may be available from
other investment advisers.

Item 7 – Types of Clients

The Firm provides investment advice and management to the Funds.
The Firm may in the future provide the same or similar services to other privately placed
investment funds and/or separately managed accounts.
Prospective Investors in the Funds must meet eligibility criteria and are subject to certain
withdrawal limitations. Prospective Investors are encouraged to thoroughly review a Fund’s
Governing Documents, which set forth all the terms in detail. Though the Clients generally
pursue the same strategy, offering terms may differ.
Each Investor generally must be an “accredited investor” (as defined in Regulation D under
the Securities Act of 1933). Certain Funds may require a prospective investor to be a
“qualified client” as defined in Rule 205-3 of the Investment Advisors Act of 1940 (“Advisors
Act”) as amended in accordance with applicable law or a “qualified purchaser” (as defined in
Section 2(a)(51) of the U.S. Investment Company Act of 1940, as amended) and an Investor

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                                                       Coastal Investment Company, LLC Brochure

who is eligible to enter into a performance fee arrangement under state and/or federal law,
as applicable. The Governing Documents of each Fund may require certain additional criteria
to be met. The minimum initial investment is $100,000, subject to waiver at the discretion of
the Firm.