DVSM LP

Item 5. Fees and Compensation

Compensation

Except in the case of the Employee Funds (as described further below), Endeavour is compensated
through the payment of management fees by the Endeavour Funds (“Management Fees”). The specific
terms relating to the Management Fees paid by each Endeavour Fund are negotiated by the Investors in
such fund at the time of its formation and, as such, vary from fund to fund. Generally speaking:
    •   The Endeavour Funds pay the Management Fees in cash quarterly in advance, with fees for any
        period shorter than a full quarter being prorated for such quarter.
    •   The annual amount payable by an Endeavour Fund during its investment period is a percentage
        (generally 2.0%) of total Investor capital commitments to such Endeavour Fund. Investors
        participating in a closing after an Endeavour Fund’s initial closing date bear the Management Fee
        from the initial closing date, and, with respect to any such Investor participating in a closing that
        occurs after a specified grace period, generally an interest component in addition thereto payable
        to Endeavour or an affiliate. Following the end of an Endeavour Fund’s investment period, or
        upon the date Endeavour first receives or begins to accrue Management Fees with respect to a
        new Endeavour Fund in accordance with the applicable Governing Documents (the “Stepdown
        Date”), the fee transitions to a declining percentage (generally decreasing at a rate of 0.2% -
        0.25% per year but not below 1.5% per year) of either capital commitments or capital
        contributions to the Endeavour Fund used to make investments (including, where applicable, a
        fund borrowing component and the amount of any capitalized transaction or other fees or
        expenses, including expenses of the Partner Support Group (as defined below)) for investments
        that have not been disposed of or permanently written down under U.S. GAAP. Except where the
        Fund’s Governing Documents expressly provide to the contrary, Management Fees will not be

        reduced (in whole or in part) in the case of partial sales or dispositions, distributions (e.g., those
        resulting from a dividend recapitalization) or reorganizations, restructurings, roll-over
        investments, extraordinary dividends or similar transactions or in circumstances where one or
        more other Endeavour Fund(s) divest their respective investment(s) in the relevant portfolio
        company, whether in whole or in part. In many circumstances, the post-Stepdown Date
        Management Fee base will include capitalized transaction-specific fees and expenses of
        unrealized investments, including certain fees and expenses paid to third parties, Endeavour or its
        affiliates. Endeavour and its affiliates have incentives to capitalize such amounts into a
        transaction, not only to avoid having portfolio companies pay such amounts out of available
        operating cash, but also to increase the base on which future Management Fees will be calculated.
        These incentives run counter to Endeavour’s incentives to reduce the amount of fees, expenses
        and costs borne by the Endeavour Funds’ investments in light of the effect of these amounts on
        the Endeavour Funds’ carried interest calculations.
    •   The Management Fee obligation of an Endeavour Fund will typically be terminated at the end of
        the Endeavour Fund’s initial term and will not be charged during any extension period without
        the consent of such fund’s limited partner advisory committee or limited partners.
    •   In instances where the Management Fee has been waived in relation to an Endeavour Fund, any
        supplemental fees received subsequent to such Management Fee waiver date by Endeavour
        and/or its related persons from third parties that would otherwise be required to offset the
        Management Fee (as described below) will be retained exclusively by Endeavour and/or its
        related persons and, as such, will not benefit the applicable Endeavour Fund or its Investors. If
        the obligation were terminated mid-quarter, Endeavour would be obligated to return a pro-rated
        portion of the Management Fee to the applicable Endeavour Fund in connection with its
        dissolution.
Endeavour deducts Management Fees directly from each Endeavour Fund’s account with its qualified
custodian.
In connection with facilitating investments in an Endeavour Fund program by Endeavour, its employees
and/or their respective related persons, Endeavour has organized, and may in the future organize, one or
more Endeavour Funds for such purposes (such Endeavour Funds, the “Employee Funds”). The
Employee Funds do not, and are typically expected not to, pay any Management Fees or performance-
based fees. Endeavour is permitted to exempt certain “affiliated partner” Investors in certain Endeavour
Funds from payment of all or a portion of Management Fees and/or carried interest, including Endeavour
and any other person designated by Endeavour, such as “friends and family” of Endeavour or its current
or former personnel, service providers (including lenders and law firms) or other Investors meeting
certain qualification requirements based on commitment size or other strategic or relationship factors.
The relevant General Partner reserves the right to make any such exemption from Management Fees
and/or carried interest by a direct exemption, a rebate by Endeavour and/or its affiliates, or through an
Employee Fund or other Endeavour Funds which co-invest with such Endeavour Fund.
In addition, Endeavour or the General Partners are entitled to certain break-up, topping, investment
banking, transaction, monitoring, directors’, advisory, consulting or other similar fees in connection with
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Item 7. Types of Clients
As described in Item 4, Endeavour and the General Partners provide advice solely to the Endeavour
Funds, which are generally formed as limited partnerships. The Endeavour Funds invest capital
contributed to them by one or more high net worth individuals, pension and profit-sharing plans, trusts,
estates, charitable organizations, pooled investment vehicles, and other entity investors that are
“accredited investors” (as defined in Regulation D under the Securities Act) and qualified clients to the
extent required under Rule 205-3 of the Investment Advisers Act of 1940, as amended (the “Advisers
Act”).
There is no minimum commitment for an Investor of an Endeavour Fund. In addition, the Endeavour
Funds have entered, and may in the future enter, into separate agreements, commonly referred to as “side
letters,” with certain Investors, granting such investors certain rights (such as the right to have
representation of the applicable Endeavour Fund’s limited partner advisory committee) that are not
offered to other Investors in such Fund.