Friends & Family Capital Management LLC

Item 5 – Fees and Compensation
Friends & Family Capital charges a management fee in accordance with its offering
documents as compensation for its services. The management fee varies by each Fund or
SPV and ranges from 0% to 2.5% and is described in the Governing Document of each Client
as applicable. Management fees paid at the beginning of a fiscal quarter will be prorated for
partial periods. Friends & Family Capital may, in its sole discretion, reduce, waive or calculate
differently the management fee and carried interest (discussed below) with respect to any
investors in a Fund or an SPV.

Investors in a Fund or SPV will pay a carried interest equal to a percentage of all realized net
profits, generally 20% to 30%, as described more fully in the Governing Documents of such
Fund or SPV. The carried interest is generally subject to a claw-back at the end of life of
each Fund or SPV if the general partner of a Fund or managing member of an SPV (each, a
“General Partner”) has received excess cumulative distributions.
Management fees are payable by each Fund to its General Partner quarterly, in advance.
The management fee is allocated to the capital accounts of the limited partners and assigned to
the Firm by the General Partner. Each Fund or SPV will pay carried interest in accordance with
the terms of its Governing Documents.
Expenses borne by each Client are described in detail in the applicable Governing
Documents. Organizational expenses borne by the Firm may be allocated to Clients in the
Firm’s sole discretion, up to an amount specified in the Governing Documents. In addition,
each Client typically will pay (or reimburse the applicable General Partner or the Firm)
charges for services by third parties and other expenses, including (but not limited to)
expenses related to: (i) costs of marketing/placing interests in the Client (other than actual
fees paid to a placement agent, if any); (ii) ongoing legal, accounting, administration, audit,
book keeping, consulting, custodial, research, data, valuation, and other professional fees
(including the fees of attorneys, accountants, consultants, brokers, advisors and other third
parties and reasonable costs of in-house legal and tax professionals employed by the General
Partner or the Firm to the extent they provide services that otherwise would have been
provided by third party attorneys or accountants); (iii) virtually all out-of-pocket costs
associated with identifying, acquiring, monitoring, improving and disposing of investments
(including costs of travel, banking, brokerage, syndicate, broken-deal, registration, finders,
depositary, and similar fees); (iv) costs of hedging against changes in the value of Client
assets or obligations; (v) costs incurred in acquiring, holding, and selling portfolio securities,
including taxes imposed on the Client; (vi) insurance premiums, indemnifications, and
litigation costs; (vii) costs of preparing Client financial statements, tax returns and other
reports; (viii) costs of Client, General Partner and Firm compliance with applicable laws and
regulations; and (ix) costs of Client meetings. In addition to Friends & Family Capital’s
management fees, carried interest, and other expenses outlined in the Clients’ Governing
Documents, certain Clients may pay management fees, carried interest, and other expenses
to the general partners or managing members of the underlying funds in which the Client are
invested, and the Investors will bear such expenses indirectly through their investment in
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such Clients. A portion of these expenses may be shared with other investment entities and
will be allocated between entities in accordance with the relevant limited partnership
agreements. See the applicable Governing Documents for a complete list.

Clients invest in the securities of private companies on a long-term basis. Accordingly, all
fees are paid during the term of each Fund or SPV, and Investors are generally not permitted
to withdraw or redeem Interests.

Neither Friends & Family Capital nor its supervised persons accept compensation for the
sale of securities or other investment products outside of its association with Friends &
Family Capital.
The foregoing discussion in Item 5 represents Friends & Family Capital’s basic compensation
arrangements. The management fees and incentive allocations described above are
structured to comply with Rule 205-3 under the Investment Advisers Act of 1940, as
amended. Certain circumstances and arrangements with any particular Investor may vary.

Item 7 – Types of Clients
Friends & Family Capital provides investment advice and management to its Clients and may
in the future provide the same or similar services to other privately placed investment funds
and/or other Clients.
Friends & Family Capital will offer Interests in a Client only through private placements in
order to maintain their exclusion from “investment company” status under the Investment
Company Act of 1940, as amended. The Funds may engage in general solicitations to the
public, consistent with Rule 506(c) under the Securities Act of 1933, as amended (the
“Securities Act”). The Funds will only accept accredited investors and will confirm an
Investor’s accredited investor status before placing an Interest with the Investor. Other
Clients will not be permitted to engage in general solicitation, consistent with Rule 506(b)
under the Securities Act.
Prospective Investors in a Client must meet eligibility criteria and are subject to certain
withdrawal requirements and limitations. Prospective Investors are encouraged to
thoroughly review a Client’s Governing Document, which set forth all of the Client’s terms in
detail. Though the Clients generally pursue the same strategy, offering terms may differ.
Terms for Clients which are SPVs formed primarily to invest in a specific target company can
be negotiated on a case-by-case basis and generally differ from those of each Fund.
Each Investor generally must be an “accredited investor” (as defined in Regulation D under
the Securities Act) and a “qualified client” (as defined in Rule 205-3 under the Advisers Act)
and must meet other criteria as specified in the Governing Documents. The minimum initial
investment varies by Client but is generally in the range of $1 million and is subject to waiver at
the discretion of the General Partner.

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