HEP Partners LLC

Item 5 - Fees and Compensation

A. Below is a general overview of how the Adviser and its affiliates generally are compensated in
   connection with providing advisory services to a Fund. The Adviser may enter into different
   fee or compensation arrangements on a Fund by Fund (and investor by investor) basis in its
   sole discretion. With respect to each Fund, the specific fees, compensation and other
   remuneration that are paid or payable to, or received by, the Adviser or an affiliate thereof are
   set forth in the applicable Governing Documents. As a result, investors should carefully review
   and rely on the applicable Governing Documents for a description of the fees and compensation
   (and expenses) applicable to a Fund.

    Capital Commitments

    Each Fund will seek capital commitments (“Commitments”) from investors in one or more
    closings up to an amount stated in the Fund’s Governing Documents. Capital calls with respect
    to Commitments may be required from time to time for a period stated in each Fund’s
    Governing Documents (the “Commitment Period”). Commitments generally will be drawn
    down pro rata based on original Commitments on an as needed basis to fund investments and
    pay expenses and costs of each Fund. Thereafter, the limited partners generally will be released
    from any further obligation with respect to their undrawn Commitments, except to the extent
    necessary to; (i) cover or pay the expenses and liabilities of the Fund, including any
    management fees and indemnification obligations; (ii) complete investments by the Fund in
    respect of transactions that were in process as of the end of the Commitment Period; (iii) make
    follow-on investments in portfolio companies in an aggregate amount of up to a stated
    percentage of the total Commitments; and (iv) fund portfolio company guarantees or pay loans
    that exist as of the end of the Commitment Period. In no event will a limited partner be required
    to make a capital contribution in an amount in excess of its unfunded Commitment (except to
    the extent required by law or permitted pursuant to the Governing Documents).

    Management Fees

    Subject to the terms and conditions set forth in the applicable Governing Documents of a Fund,
    we are or may be entitled to receive annual management fees (the “Management Fee”) of up to
    two percent (2%) of total capital contributions, payable quarterly in advance from the date of
    the initial closing of such Fund until certain conditions are met as specified in such Fund’s
    Governing Documents. The General Partner may assign Management Fees to the Adviser
    and/or its affiliates. As disclosed below, Management Fees may be subject to offset or reduction
    in certain instances pursuant to the terms of the applicable Governing Documents.

    Carried Interest

    With respect to each Fund, net proceeds attributable to the disposition of an investment in a
    portfolio company, together with any dividends or interest income with respect to that
    investment (“Disposition Proceeds”), generally will be distributed to the applicable partners
    participating in that investment as set forth in the applicable Governing Documents. Generally,
    with respect to a Fund, the General Partner generally is entitled to receive a share of investment
    proceeds of up to twenty-five percent (25%) of the realized profits relating to the realized
    investments of such Fund, after; (i) a return of capital to participating investors equal to their
    capital committed to fund the investment and pay for fund expenses relating to that realized

    investment; and (ii) in some cases, the payment of a stated preferred return to participating
    investors. These distributions to the General Partner are referred to as the “carried interest.”

    Distributions; Clawback

    Distributions to the investors will be subject to certain adjustments and reserves as stated in
    more detail in each Fund’s Governing Documents.

    Upon the final liquidation of a Fund and distribution of its remaining assets, the applicable
    General Partner typically is required to restore amounts to the Fund for distribution to the
    limited partners (up to the amount of its cumulative net after-tax carried interest) to the extent,
    if any, that the amount previously distributed to the General Partner as its carried interest
    exceeds the aggregate amount due to the General Partner as its carried interest on a cumulative
    basis.

    Management Fees and the carried interest generally are negotiable, and the General Partners
    have entered into and may in the future enter into side letters with certain investors pursuant to
    which the General Partners have agreed to reduce or waive the Management Fees and/or the
    carried interests applicable in connection with their investments in the Funds.

    Transaction and Oversight Fees

    In connection with the investments of certain Funds, various “Transaction Fees” and
    “Oversight Fees” (and similar types of fees) are paid or payable or may be paid or payable to
    affiliates, officers, consultants or agents of the Adviser or an affiliate thereof by a portfolio
    company or other third parties, as disclosed in the applicable Governing Documents.

    Transaction Fees typically include any fees and reimbursement of expenses received in
    connection with the consummation, disposition or termination of an investment attributable to
    the Fund and/or any fees received from a portfolio company, such as break-up fees,
    commitment fees, investment banking fees, termination fees, portfolio company management
    fees, directors’ fees, and other similar fees.

    Oversight Fees typically include fees paid in exchange for; assisting portfolio companies in the
    definition and implementation of business strategy; oversight of results; evaluation of business
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Item 7 - Types of Clients

As mentioned in Item 4, the Adviser provides investment advisory, management and supervisory
services on a discretionary basis to affiliated pooled investment partnerships (the Funds) investing
in private equity transactions. The Adviser may from time to time in the future provide advisory,
management and other services to other types of clients, ventures, vehicles, accounts, programs and
companies.

Generally, there is no stated minimum for Commitments to a Fund. The General Partner of each
Fund has the sole discretion to accept Commitments that it deems to be in the best interests of the
Fund.

Each investor generally is required to represent that it is, among other things, an “accredited
investor,” as such term is defined in Rule 501(a) of Regulation D of the Securities Act of 1933, as
amended, and/or a “qualified purchaser,” as such term is defined in Section 2(a)(51)(A) of the
Investment Company Act of 1940, as amended.