Farallon Capital Management LLC

Item 5: Fees and Compensation

A. Fees and Compensation

Management Fees

Management fees payable to Farallon vary by Farallon Fund and are established pursuant to
the Farallon Funds’ respective constituent documents. Management fees charged to the
Farallon Funds typically are calculated as a percentage of capital under management (except
with respect to certain Farallon Funds structured as designated-term private investment funds
where management fees may be based on capital commitments or invested capital), generally
range up to 1.0% per annum, but in certain cases are higher, and are typically payable and
deducted from the assets of each such Farallon Fund quarterly in advance. From time to time,
management fees may be paid to a Farallon Adviser as set forth in the relevant investment
management agreement or constituent document of a Farallon Fund.

Management fees based on capital under management will generally be prorated for any
subscriptions or withdrawals by an investor that are effective other than as of the first or last
day of the quarter. In the event of a distribution or withdrawal prior to the end of a quarter,
Farallon will reimburse to the respective Farallon Fund a pro rata share of such management
fees charged with respect to the distributed or withdrawn amount.

Management fees for any managed account are established pursuant to any such managed
account’s investment management agreement.

Farallon has waived or reduced and may, in the future, waive or reduce management fees for
certain classes or investors, including employees and affiliates of Farallon as well as their
family members and trusts or other entities established for the benefit of such persons or their
families, in its discretion.

Incentive Compensation

Incentive fees payable to Farallon or incentive allocations allocable to FPLLC vary by Farallon
Fund and are established pursuant to the Farallon Funds’ respective constituent documents.
For most open-ended Farallon Funds, incentive fees and incentive allocations generally are
charged at year-end (or on an intra-year withdrawal date, if applicable) at a rate of 20% of net
annual profits to such Farallon Fund, or to capital accounts maintained by such Farallon Funds
for their investors. For this purpose, with respect to investments that are not Special
Investments (as defined below), net profits generally include both realized gains and losses and
unrealized appreciation and depreciation of securities held in the Farallon Funds’ portfolios,
and with respect to Special Investments, net profits generally include only realized gains and
losses and not unrealized appreciation and depreciation. For most open-ended Farallon Funds,
incentive allocations generally will be charged at a rate of 10% instead of 20% for periods after
an unrecovered loss year, which is a year over which net losses have been incurred in an
investor’s capital account, until such investor’s capital account has recovered 250% of the net
losses allocated to such account over such year, subject to certain adjustments, e.g., for
withdrawals. One strategy-specific open-ended Farallon Fund charges an incentive allocation

in excess of the return on a specific index (including on negative performance in excess of the
index).

Other Farallon Funds have different arrangements relative to incentive compensation. Certain
investment-specific and strategy-specific closed-end Farallon Funds have distribution
waterfalls whereby FPLLC is entitled to a 20% carried interest only after investors have
received distributions equal to their capital contributions as of the time of distribution. Certain
Farallon Funds have various preferred or threshold return hurdles that must be reached before
FPLLC is entitled to such incentive compensation. Carried interest may be calculated on an
investment-by-investment basis in respect of certain investment-specific Farallon Funds. From
time to time, the carried interest allocable to FPLLC in respect of certain non-U.S. dollar-
denominated investments may be calculated in the applicable foreign currency.

All incentive compensation for managed accounts are subject to negotiation and established
pursuant to each account’s investment management agreement.

Farallon or FPLLC has waived or reduced and may, in the future, waive or reduce incentive
fees and allocations for certain classes or investors, including employees and affiliates of
Farallon, as well as their family members and trusts or other entities established for the benefit
of such persons or their family members. Farallon or FPLLC has also waived or reduced and
may, in the future, waive or reduce in its discretion incentive fees and allocations in respect of
certain investors in connection with certain netting arrangements that they may have across
multiple Farallon Funds.

B. Payment of Fees

Management fees typically are payable quarterly in advance and may be deducted from the
assets of, or distributions payable by, a Farallon Fund, and incentive or performance-based fees
or profit allocations are generally paid or allocated annually (or upon intra-year withdrawal
dates) from the assets of the Farallon Funds or capital accounts maintained for their investors,
or for certain Investment Partnerships which are structured as designated-term private
investment funds, made as a distribution of proceeds or current income when available. Certain
closed-end Farallon Funds also have the ability to call capital for the payment of fees.

C. Additional Fees and Expenses

To the extent permitted under the Farallon Funds’ constituent documents, the Farallon Funds
are obligated to pay for all legal, auditing and accounting fees and expenses, tax preparation
and tax compliance expenses, investment expenses (including, without limitation, the Farallon
Funds’ share of costs and expenses attributable to sourcing, acquiring, evaluating, holding,
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Item 7: Types of Clients

Farallon provides investment advice to the Farallon Funds, as described above in Item 4,
managing equity capital for institutions such as endowments, foundations, charitable
organizations and state and municipal government entities, and for high net worth individuals.

The constituent documents for each Farallon Fund may set minimum amounts for investment by
prospective investors. Farallon has waived, and reserves the right to modify or waive, the
minimum investment amounts for the Farallon Funds from time to time. Minimum investment
amounts for managed accounts will be determined on a case-by-case basis.