Formentera Partners LP

ITEM 5 - FEES AND COMPENSATION

Fund Fees. The fees to be paid to Formentera (and/or its affiliates) by the Fund are generally expected to
include (i) a quarterly “Management Fee,” equal to a percentage of non-affiliated investor Fund
commitments or investment contributions, as applicable, and (ii) a performance-based distribution, or
“carried interest,” generally equal to a portion of the distributions made to the investors in the Fund, after
the investors have received a return of their invested capital and allocable expenses, plus any agreed upon
preferred return, as described in “Performance-Based Fees and Side-by-Side Management” below. The
calculation, timing and amount of such compensation, as well as any adjustments to be made to such
amounts, will be agreed upon by the applicable Fund and Formentera, and set out in such Fund’s Governing
Documents and/or in the investment management agreement between such Fund and Formentera (in the
case of any Management Fee) and in such Fund’s Governing Documents (in the case of any carried interest).

Formentera generally is permitted to waive, modify or reduce the Management Fee with respect to any
investor or class of investors in a Fund, including Formentera’s affiliates, employees or officers.

The Management Fee will be paid by the applicable Fund, and is permitted to be called from investors or
paid out of cash that is otherwise distributable to the investors in such Fund set out in such Fund’s
Governing Documents, including cash held by such Fund after the disposition of an investment and before
the proceeds are distributed to investors (i.e., deducted from the assets of such Fund), or from other cash
reserves or income streams held by such Fund. The Management Fee with respect to a Fund is paid in
advance on a quarterly basis.

As is generally the case in private equity funds, the Governing Documents provide that a Fund’s
Management Fees will be calculated and charged on a basis that generally is not tied to the Fund’s then-
current net asset value. As further specified in the Governing Documents, from the effective date of the
relevant Fund until a date specified in the Governing Documents (generally representing the earlier of the

end of the Fund’s defined investment period and the date the relevant General Partner (or an affiliate
thereof) first begins receiving or accruing management fees from another Fund meeting certain criteria)
(the “Stepdown Date”), Management Fees generally will be charged based on a formula tied to the amount
of the relevant Fund’s aggregate Commitments. Further, after the Stepdown Date, Management Fees
generally will be charged and calculated based on a formula tied to the amount of investment contributions
(including, where applicable, the Fund borrowing component and the amount of any capitalized Transaction
Fees (as defined below) or expenses, including expenses of the Formentera Operating Company (as defined
below) made by the relevant Fund that have not been realized or completely written off for U.S. federal
income tax purposes (such investments, “Impaired Value Investments”). The fact that the post-Stepdown
Date Management Fee is generally expected to be calculated based on a Fund’s investment contribution
creates incentives for the relevant General Partner to hold an investment longer, defer realization of
portfolio investments, delay determining or recognizing when an investment should be treated as impaired
or written down for purposes of calculating Management Fee, make more speculative investments and/or
seek to deploy the Commitments in portfolio investments at an accelerated pace, in each case, than it
otherwise would have if Management Fees were based solely on the relevant Fund’s aggregate
Commitments.

Under the Governing Documents, where the fair market value of an investment exceeds the total amount
of investment contributions relating to such investment, post-Stepdown Date Management Fees will not be
calculated based upon such appreciated value, and will instead continue to be calculated based on the
amount of such investment contributions. However, where there has been a partial sale or disposition,
reorganization, recapitalization (including recapitalizations involving dividends), roll-over investment in
connection with a sale or dividend distribution, except in the case of investments meeting the relevant
Impaired Value Investment standard, the Governing Documents do not require Management Fees after the
Stepdown Date to be reduced. For the avoidance of doubt, following the Stepdown Date, if the fair market
value of an Impaired Value Investment is less than the total amount of investment contributions relating to
such Impaired Value Investment, then the amount of Management Fees otherwise payable relating to such
investment will be reduced solely based on the ratio of the fair value of each relevant remaining
investment(s) as compared against the amount of total investment contributions relating to such
investment(s).

As a result, the amount of Management Fees generally will not correspond with fluctuations in the net asset
value of individual investments or of a Fund, including following the relevant investment period, and will
not be reduced in connection with any write downs (whether temporary or permanent), except in the case
of Impaired Value Investments. Except where the 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 in each case in circumstances that do not
result in the complete disposition of the relevant Fund’s interest therein, and even in cases where the value
of the Fund’s investment or the Fund’s ownership percentage in such investment has been reduced
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ITEM 7 - TYPES OF CLIENTS

Formentera provides investment advice solely to its Fund clients, and references throughout this Brochure
to “clients” and to Formentera’s related duties to and practices on behalf of its clients and/or investors
should be construed accordingly. The Funds generally include investment partnerships or other investment
entities formed under domestic or foreign laws and operated as exempt investment pools under the
Investment Company Act.

Interests in the Funds will be offered privately to a limited number of sophisticated investors, including
institutional investors, pooled investment vehicles, privately-owned businesses, trusts, family offices and
high net worth individuals and such investors may from time to time include, directly or indirectly,
principals or other employees of Formentera and members of their families, or other service providers
retained by Formentera. Fund investors generally must qualify as (i) “accredited investors,” within the
meaning of Rule 501 of Regulation D under the Securities Act of 1933, as amended, and (ii) “qualified
clients,” within the meaning of Rule 205-3 under the Advisers Act.

The relevant General Partner also generally is permitted from time to time to establish Funds that are
alternative investment vehicles in order to permit certain investors to participate in one or more particular
investment opportunities in a manner desirable for tax, regulatory or other reasons. Alternative investment
vehicle sponsors generally have limited discretion to invest the assets of these vehicles independent of
limitations or other procedures set forth in the organizational documents of such vehicles and the related
Fund.

A Fund generally has a minimum investment amount of $2 million for third-party investors. Formentera
generally is permitted to waive such minimum investment amount.

The relevant General Partner is permitted to enter into Side Letters with certain investors in the Funds,
which would have the effect of establishing rights under, altering, or supplementing the terms (including
the economic terms) of the Governing Documents of the applicable Fund, in a manner more favorable to
such investor than those applicable to other investors in such Fund. Such rights or terms pursuant to such
agreements may include, without limitation, access to additional information, more favorable liquidity

and/or transfer terms, or other rights or terms deemed necessary in light of particular legal, regulatory or
tax characteristics of an investor.