Hammond Kennedy Whitney & Company Inc

FEES AND COMPENSATION

        In general, HKW receives a management fee and a carried interest in connection with the
provision of advisory services to its clients. HKW receives additional compensation in connection
with management and other services performed for portfolio companies of Funds, and a portion of
such additional compensation will offset the management fees otherwise payable to HKW, in each
case as described in the relevant Partnership Agreement and generally summarized below. Limited

partners in a Fund also bear certain expenses.

Management Fees

        Generally, the Funds will pay HKW, quarterly in advance in accordance with the relevant
Partnership Agreement, a management fee (the “Management Fee”) generally equal to 2.0% on
an annual basis of aggregate limited partner capital commitments (“Commitments”), but
generally excluding Commitments of certain affiliated limited partners, as further described in the
relevant Partnership Agreement. As further described below, limited partners participating in a
closing after the initial closing date bear the Management Fee and an additional amount calculated
at the prime rate plus 2% per year from the initial closing date. Upon the earliest to occur of (i)
the date when all of a Fund’s Commitments have been invested or otherwise used to pay expenses
of such Fund, (ii) the end of the commitment period specified in the relevant Partnership
Agreement or (iii) certain other events specified in the relevant Partnership Agreement, the
Management Fee will be reduced and generally will equal 2.0% on an annual basis of (a) the
aggregate funded Commitments used in connection with making investments in portfolio
companies (or paying expenses related thereto), as reduced by (b) permanent write downs and
distributions constituting returns of capital, as adjusted in the case of certain recapitalizations. In
addition, with respect to Fund V, after the 10th anniversary of the effective date of Fund V, the
Management Fee will be further reduced on an annual basis pursuant to a schedule specified in
such Fund’s Partnership Agreement. The Management Fee will be payable until all portfolio
investments are distributed or until HKW’s relationship with the Fund is terminated for other
reasons (as described in the relevant Partnership Agreement). Installments of the Management
Fee payable for any period other than a full quarterly period are adjusted on pro rata basis
according to the actual number of days in such period. Where the Partnership Agreements calculate
Management Fees based on the amount of Commitments or the amount of investment
contributions, the amount of Management Fees generally will not be reduced based on reductions
in investment value, except where specified by the relevant Partnership Agreement. As a general
matter, Management Fees will be payable during any term extensions unless otherwise agreed with
investors.

       HKW Capital Partners IV-B, L.P. does not pay a Management Fee. As of July 2025, each
of HKW Capital Partners IV, L.P. and HKW Capital Partners IV-A, L.P. no longer pays a
Management Fee. Although HKW may negotiate a Management Fee with respect to prospective
co-investors and/or co-investment vehicles, it is generally expected that any co-investment vehicle
or other prospective co-investor will not be subject to the Management Fee with respect to any
amounts co-invested.

        In accordance with the relevant Partnership Agreement, a Fund’s Management Fee
generally will be reduced by a portion of certain fees and other amounts paid by a portfolio
company or prospective portfolio company of a Fund to HKW or its partners or employees,
generally including, without limitation, directors’ fees, monitoring fees and transaction fees, as
well as break-up fees paid in connection with unconsummated transactions (such fees,
“Supplemental Fees”). With respect to HKW Capital Partners V, L.P. and as further described in
its Partnership Agreement, all of such Fund’s share of Supplemental Fees are offset against the
Management Fee. Other Funds have different Management Fee offset provisions, and

Management Fees, offsets and related Fund terms generally vary from Fund to Fund. For example,
as further described in the Partnership Agreement for HKW Capital Partners IV, L.P., such
Supplemental Fees generally were offset against the Management Fee as follows: (i) 50% with
regard to limited partners with Commitments below a specified threshold, and (ii) 60% with regard
to limited partners with Commitments above the specified threshold, in each case until HKW
received and retained a specified amount in fees, after which such Supplemental Fees were offset
against the Management Fee by 100%. For each relevant Fund, the remaining portion of
Supplemental Fees not subject to an offset against the Management Fee is retained by HKW. To
the extent that an offset credit would reduce the Management Fee for a given quarterly period
below zero, the credit will be carried forward for future application against payable Management
Fees, and any Management Fee offsets which have not been applied as of the date of a Fund’s final
distribution of assets would be distributed to the limited partners of such Fund, in accordance with
the relevant Partnership Agreement. With respect to any Funds that do not pay a Management Fee,
the relevant portion of Supplemental Fees that otherwise would have been offset against the
Management Fee is generally shared with such Fund via a distribution to the applicable Funds.
Unless otherwise agreed with investors, Supplemental Fees generally will be payable during term
extensions, even if Management Fees are reduced or eliminated during the extended term.

        Certain Partnership Agreements permit HKW to waive a portion of the Management Fee
and have such waived portions of the Management Fee treated by the Partnership Agreement as a
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TYPES OF CLIENTS

        HKW provides investment advice solely to its Fund clients, and references throughout this
Brochure to “clients” and to HKW’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 of 1940, as amended. The limited partners
participating in the Funds generally include individuals, banks or thrift institutions, insurance
companies, financial institutions and other investment entities, university endowments, sovereign
wealth funds, family offices, pension and profit-sharing plans, trusts, estates or charitable
organizations or other corporations or business entities and from time to time include, directly or
indirectly, partners or other employees of HKW and its affiliates and members of their families,
or other service providers retained by HKW, as well as executives of Fund portfolio companies.

       The Funds generally have a minimum investment amount of $5,000,000 for third-party
limited partners, and Fund interests are offered and sold to qualified purchasers and accredited
investors that are also qualified clients (or qualified knowledgeable HKW personnel). HKW
generally is permitted to waive such minimum investment amount.

            METHODS OF ANALYSIS, INVESTMENT STRATEGIES AND RISK OF LOSS

General

        HKW is a private investment firm focused on acquiring control positions primarily in
privately-held companies in the lower end of the middle market that are headquartered primarily
in the United States or Canada as set forth in the relevant Memorandum and/or Partnership
Agreement. These investments are made through managed buy-outs and other equity-related
investments. HKW also seeks to maintain a diversified portfolio of companies in various industries
relative to the amount of capital committed in each Fund. The investment by a Fund in any one

portfolio company may not exceed a specified percentage or amount of Commitments of such
Fund, as set forth in the relevant Memorandum and/or Partnership Agreement. HKW seeks
opportunities from a broad range of industry sectors but from time to time will focus on certain
favored industries.

        In addition to the company characteristics, HKW considers management to be a crucial
component of its companies. HKW thus seeks companies that have an experienced management
team that is willing to invest in the company on the same terms as HKW and to establish a true
partnership and work collaboratively with HKW in formulating clear, common objectives and a
clear vision for value creation.

        HKW regularly reassesses and refines its investment criteria to reflect the lessons learned
from its investment and management experience. HKW’s investment decision-making framework
currently comprises its investment criteria (divided into three categories: company criteria,
management criteria and deal criteria), the diligence process and the monitoring of its portfolio
companies. Each is discussed in turn below.

       Investment Criteria

       HKW targets investments with the following company criteria:

               •   Revenues and EBITDA (i.e., earnings before interest, tax, depreciation and
                   amortization) within a targeted range;
               •   Stable and predictable cash flows;
               •   Power in its market niche as evidenced by margins and/or market leadership;
               •   Sustainable competitive advantage;
               •   Low risk of competition from low wage countries; and
               •   Low risk of technological obsolescence.

       In addition, HKW assesses the existing management team, and typically avoids investing
in companies with insufficient or departing management teams. In evaluating management teams,
HKW focuses on the following factors:

               •   Talent and work ethic of existing personnel;
               •   Skill and experience of existing personnel in relation to the skill needed by the
                   company to execute based on HKW’s investment thesis;
               •   Willingness of management to devote a substantial or meaningful portion of
                   their net worth to purchase equity in the company; and
               •   Willingness of management to interactively work with HKW to create value.

       Finally, HKW typically assesses the transaction terms based on whether the companies:

               •   are underwritten in a way that has potential to achieve returns on par with
                   HKW’s overall historical performance;
               •   are underwritten in a way that demonstrate conservative fixed charge coverage
                   ratios;

               •   have an attractive entry EBITDA multiple relative to current market
                   conditions for similarly situated companies; and
               •   have potential for expansion of the EBITDA multiple upon exit.

        While HKW believes that companies in the lower end of the middle market represent
significant opportunities for a variety of reasons, it also acknowledges that such companies often
face challenges. HKW approaches these challenges in three main ways: (i) in analyzing new deals,
HKW seeks to identify and prioritize areas for improvement during the due diligence process; if
there are too many areas identified as requiring improvement, it passes on the proposed investment;
(ii) HKW and target company management define value creation objectives and an execution plan
up front and (iii) HKW has a dedicated team who is principally focused on portfolio company
management and operations.

        There can be no assurance that HKW will achieve the investment objectives of any Fund
and a loss of investment is possible.

Investment and Operating Strategy
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