Edwards Capital LLC

Item 5 – Fees and Compensation

In return for services provided to a Fund, such Fund pays a management fee and a performance-based
fee (as described in Item 6 below). In addition, the Funds pay directly, or indirectly through portfolio
companies, certain supplemental fees and expenses as more fully discussed below. The Funds are also
responsible for bearing certain expenses as detailed below and in each Fund’s Governing Documents.
Further, the portfolio companies reimburse Flexpoint and the Funds for certain expenses advanced
on their behalf. The following is a summary of how Flexpoint is compensated for its advisory services.
Differences in fees and expenses exist from Fund to Fund: certain Funds do not charge certain fees,

and different Funds charge compensation or expenses in different amounts or do not charge certain
compensation or expenses. Investors should refer to the Governing Documents of the applicable
Fund for a complete understanding of how Flexpoint is compensated for its advisory services.

Management Fees

As compensation for investment advisory services rendered to the Funds (and not the Co-Investment
Funds, which do not pay management fees), each Fund pays the management company or an affiliate
a management fee (each, a “Management Fee”). The calculation of Management Fees is described
briefly below and is more specifically detailed in the Governing Documents of each Fund.

Generally, an annual Management Fee percentage of up to 2% is paid to the management company
or its designated affiliate. Management Fees billed to and received from the Funds vary by Fund and
are payable either on a semi-annual basis, partially in advance and partially in arrears, or quarterly in
arrears. To calculate the fee, such percentage is applied to one or a combination of the following,
depending on the Fund and its life-cycle: (i) aggregate commitments, (ii) aggregate investment
contributions made with respect to portfolio investments that have not been disposed of or completely
written-off, (iii) aggregate acquisition costs or the portion thereof not disposed of or completely
written off, (iv) net asset value and/or (v) outstanding indebtedness for borrowed money used to
make investments, in each case depending on the Fund and subject to other factors, as detailed in the
relevant Governing Documents. For certain Funds, borrowings are taken into account for purposes
of calculating the Management Fee, as provided in each Fund’s Governing Documents.

For some Funds, there are separate and different Management Fee calculations for the investment
period and the post-investment period, while for other Funds the calculation remains the same when
the investment period ends. In particular, where the Management Fee is calculated based on the
valuation of an investment, or a determination of whether an investment has been written-off or
otherwise permanently impaired, Flexpoint will have an incentive to make determinations that result
in the continued payment of, or a higher, Management Fee. For Funds that calculate the Management
Fee based on aggregate investment contributions which have not been disposed of or completely
written off, the post step-down Management Fee base will include capitalized transaction-specific fees
and expenses of unrealized investments, including, if applicable, transaction fees charged by Flexpoint
in connection with the investment. If assessed, this would pose a conflict of interest and result in a
higher Management Fee than if such transaction fees and expenses were not capitalized into the asset
base. In situations where the Management Fee is not calculated based on the valuation of an
investment, or a determination of whether an investment has been written-off or permanently
impaired (e.g. when based solely on aggregate commitments), the Management Fee generally will not
be reduced based on reductions in investment value. Valuation and permanent write-down
determinations are made in the discretion of the valuation committee in accordance with the relevant
Fund Governing Documents and Flexpoint’s valuation policy. Absent bad faith or manifest error,
valuation determinations in accordance with the relevant Fund Governing Documents and Flexpoint’s
valuation policy will be conclusive and binding. Moreover, because Flexpoint will determine in its

discretion the value of any such assets, Flexpoint will have an apparent conflict of interest in making
that determination, given the potential impact of such valuations on a Fund’s performance results.
Management Fees are payable during term extensions unless otherwise notified to investors.

The precise amount of, and the manner and calculation of, the Management Fees for each Fund are
established by Flexpoint as modified by negotiations with investors in the applicable Fund during its
fundraising period and are set forth in each Fund’s Governing Documents, in each case as received
by each investor prior to investment in a Fund. Flexpoint is authorized, in its sole discretion, to waive
or reduce a portion of the Management Fee. To date, with the exception of the Co-Investment Funds,
which do not pay Management Fees, fees have been the same for all investors in the Funds.

For certain Funds, as per the Governing Documents, Flexpoint is permitted to waive or reduce all or
a portion of the Management Fee payable by such Fund in exchange for a reduction in the cash capital
contribution obligation of the Fund General Partner to invest in and alongside the Fund. Certain
waived portions of the Management Fee are treated by the Governing Documents as deemed capital
contributions by the relevant General Partner, which is effectively invested in the relevant Fund on
such General Partner’s behalf and operates to reduce the amount of capital the applicable General
Partner would otherwise be required to contribute to the Fund. Investor capital contributions are
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Item 7 – Types of Clients

Flexpoint provides investment advisory services directly to the Funds, subject to the direction and
control of the General Partner of each such Fund. Interests in the Funds are offered pursuant to
applicable exemptions from registration under the Investment Company Act of 1940, as amended
(the “Investment Company Act”). The Funds limit their investors to “accredited investors” as defined
in the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder (the
“Securities Act”) and either “qualified purchasers” or “knowledgeable employees,” each as defined in
the Investment Company Act. Interests in the Funds are not made available to the general public and
are privately placed to qualified investors. Qualified investors include individuals or entities to which
Fund interests are permitted to be sold, which generally includes (i) in the United States, people or
organizations who meet certain net worth, income and/or financial sophistication requirements as
described above or (ii) in other countries, as permitted by the relevant securities laws in such
jurisdiction and in compliance with any foreign offering provisions applicable to Flexpoint and/or the
Funds. Investors in the Funds are required to meet certain suitability and net worth qualifications
prior to making an investment in the Funds. Investors participating in the Funds include, among
others, high net worth individuals, banks, thrift institutions, pension and profit-sharing plans, trusts,
estates, charitable organizations, university endowments, corporations, fund of funds, limited
partnerships and limited liability companies or other entities. In addition, employees and other
persons associated with Flexpoint and/or its affiliates are investors in the Funds.

The Main Funds (in aggregation with the applicable Overage Funds) and Asset Funds have minimum
commitment thresholds as established in each such Fund’s Governing Documents. There is no
minimum commitment amount for the Alternative Investment Vehicles, as these vehicles are
organized primarily for tax purposes. Similarly, there is no minimum commitment amount for the

Co-Investment Funds, as these vehicles are established based on the funding needs of the portfolio
company or portfolio investment in which such investment is made. The General Partner of each
Fund has, in its sole discretion, permitted investments below the minimum amount set forth in a
Fund’s Governing Documents.

On occasion, Flexpoint offers co-investment opportunities for certain investors to invest alongside a
Fund in a Fund portfolio company or portfolio investment. As referenced in Item 4 above, in certain
cases co-investments have been structured either as (i) a separate and dedicated co-investment fund
(such as the Co-Investment Funds managed by the Firm) or (ii) a direct investment by certain investors
into a portfolio company or its holding or operating company. When structured as a co-investment
fund, Flexpoint considers the investment to be a Fund client, identifies the co-investment fund in its
Form ADV Part 1, Schedule D, Section 7.B.(1), obtains an audit for the Fund, may choose to assess
a Management Fee and/or Carried Interest on the co-investment fund (although no Management Fee
or Carried Interest has been charged on co-investment funds to date) and includes the amount of
assets of such Funds in the Firm’s regulatory assets under management. In the case of direct co-
investments, Flexpoint does not consider the investment to be a Fund or a client, does not act as the
investment manager to the co-investment portion of the investment, does not charge Management
Fees or Carried Interest to the investment, does not have custody of the investment or include the
amount of assets of the co-investment in the Firm’s regulatory assets under management. In such
direct co-investment opportunities, Flexpoint will perform management, advisory and other services
for the portfolio companies in which these co-investors invest, generally at no cost to such co-
investors except portfolio company fees and expenses (which such expenses are recorded at the
portfolio company).

In its sole direction, Flexpoint permits certain investors (generally Fund investors) to participate in a
co-investment opportunity either alongside a Fund or Funds through a Co-Investment Fund or by
making an investment directly in the portfolio company. The Firm will usually only consider a co-
investment opportunity in the event a Fund investment is too large for such Fund(s) and Flexpoint
believes the Fund will benefit from the participation of the co-investor(s). Such determinations are
based on the provisions of the applicable Governing Documents, side letter agreements, agreements
with lenders and such other factors as Flexpoint considers in its sole discretion, including those
specified in its policies on investment allocation and co-investments. Subject to any restrictions
contained in the Governing Documents of the relevant Fund or any side letter or other terms
negotiated with respect to such Fund, in general no investor has a right to participate in any co-
investment opportunity. Certain individuals who source transactions or provide financing have in the
past and expect to in the future negotiate co-investment rights or co-investment priority rights as a
component of their compensation or other arrangements with the relevant Fund(s). In certain cases,
determinations to allocate such amounts or investment opportunities to vendors or service providers
will be made prior to the determination of the availability of opportunity for other co-investors, and
as such generally will decrease the amount of co-investment opportunities available. Flexpoint’s
exercise of discretion in allocating co-investment opportunities will not always result in proportional
allocations among such co-investors and such allocations can be more or less advantageous to some
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