HIG Capital LLC

FEES AND COMPENSATION

        In general, H.I.G. Capital receives management fees (the “Management Fee”) from the
Funds in connection with advisory services it provides to such Funds. H.I.G. Capital or other
H.I.G. entities or affiliates receive additional compensation from portfolio companies of the Funds
in connection with professional operational management consulting and other tailored professional
and/or operational services intended to drive operational improvements performed for portfolio
companies of the Funds and such additional compensation may offset in whole or in part the
Management Fee otherwise payable to H.I.G. Capital. The Limited Partners in the Funds also bear
fund expenses, as further described below and in the Funds’ governing documents.

Management Fees and Expenses

        The Funds generally pay H.I.G. Capital an annual Management Fee, payable quarterly in
advance, based on a percentage of aggregate capital commitments or on invested capital.
Installments of the Management Fee payable for any period other than a full three-month period
are generally adjusted on a pro rata basis according to the actual number of days in such period.
The Management Fee generally commences as of the effective date of the respective Fund,
regardless of when a Limited Partner is actually admitted. The Limited Partners who participate in
closings after a Fund’s initial closing date are typically assessed Management Fees retroactive to
the respective Fund’s effective date, and, in addition, are generally charged interest payable to

H.I.G. Capital or its affiliates on such amounts where so provided under the applicable Limited
Partnership Agreements. The Management Fee is usually paid out of current income and, to the
extent necessary, from drawdowns which will reduce unfunded commitments. As more fully set
forth in the applicable Limited Partnership Agreements of the Funds, the Management Fee paid
by the Limited Partners may be offset by a specified percentage of certain directors’ fees and other
fees received by H.I.G. Capital or its affiliates. The Funds’ General Partners and their affiliates are
typically permitted to retain all corporate services fees and all investment banking fees, which fees
are not applied to reduce the Management Fee.

         Certain of the Funds’ Management Fees will be calculated and charged on a basis that
generally is not tied to then-current value of the Fund’s portfolio investments. As further specified
in the applicable Limited Partnership Agreements of the relevant Funds, from the effective date of
the relevant Fund until a date specified in the applicable Limited Partnership Agreement (generally
representing the end of the relevant Fund’s defined investment period (the “Stepdown Date”)),
Management Fees generally will be charged based on a formula tied to either (i) the amount of the
relevant Fund’s aggregate commitments, or (ii) the aggregate acquisition cost of the relevant
Fund’s investments less permanent write-downs (such permanently written-down investments,
“Impaired Value Investments”). Further, after the Stepdown Date, Management Fees generally
will be charged and calculated based on a formula tied to either (i) the aggregate amount of capital
contributions minus distributions to Limited Partners constituting a “Return of Capital” (i.e.,
distributions other than Net Realized Profits or Net Short-Term Profits (each as defined in the
relevant Fund’s Limited Partnership Agreement) or for the avoidance of doubt, pursuant to any
recapitalization of a portfolio company including, without limitation, the borrowing or issuance of
new debt by a portfolio company, irrespective of whether such recapitalization, or a part thereof,
is treated as a return of investor capital or distribution in excess of basis under GAAP or for income
tax purposes or other reporting or accounting standards as determined by the relevant General
Partner in its sole discretion) and Impaired Value Investments to the extent distributions have not
been made with respect thereto, or (ii) the aggregate acquisition cost of the Funds’ investments
less Impaired Value Investments to the extent distributions have not been made with respect
thereto. As a result, the amount of Management Fees generally will not correspond with
fluctuations in the value of the relevant Fund’s portfolio investments, including following the
investment period, and will not be reduced or refunded in connection with any write-down,
decrease (including a significant decrease) in fair value or other event not constituting a complete
realization, such as a 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 under the relevant
Fund’s Limited Partnership Agreement or a distribution constituting a Return of Capital. The
Management Fee base of such post-Stepdown Date Management Fees will include fees and
expenses incurred by the relevant Fund, including such Fund’s costs and expenses attributable to
acquiring and holding investments, and thus will also reflect the indirect effects of fees and
expenses borne by the relevant portfolio companies, including certain fees (such as supplemental
fees as described below) and expenses payable or reimbursable to third parties, H.I.G. Capital or
its affiliates. Further, Management Fees generally will not be reimbursed or refunded under the
applicable Funds’ Limited Partnership Agreements in the event of realizations, dispositions or
write-downs that occur partway through the relevant calculation period.

        H.I.G. Capital expects to receive a Management Fee payable monthly in arrears from the
Private Equity Evergreen Funds based on a percentage of the month-end net asset value
attributable to investor units of the Private Equity Evergreen Funds.
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TYPES OF CLIENTS

        H.I.G. Capital provides investment advice solely to its Fund and Managed Account clients,
and references throughout this Brochure to “clients” and to H.I.G. Capital’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 U.S. or
non­U.S. and operated as exempt investment pools under the Investment Company Act of 1940,
as amended. The Limited Partners participating in Funds generally include individuals, banks or
thrift institutions, 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 often include, directly or indirectly, Principals or other
personnel of H.I.G. Capital and its affiliates and members of their families, operating advisors or
other Service Providers retained by H.I.G. Capital or a Fund. Interests in the Funds are sold solely
to qualified purchasers or accredited investors who are also qualified clients (or qualified
knowledgeable H.I.G. personnel) within the meaning of the rules promulgated under the U.S.
Securities Act of 1933, as amended (the “Securities Act”). It is expected that any Managed
Accounts will only be established for investors that are qualified purchasers.

    METHODS OF ANALYSIS, INVESTMENT STRATEGIES AND RISK OF LOSS

General

        H.I.G. is a global private investment firm with a family of funds which includes private
equity, growth capital, debt/credit, infrastructure and real estate. With a team of approximately
533 investment professionals with substantial operating, consulting, technology and financial
management experience, H.I.G. focuses its investments in the lower middle-market and in
distressed and underperforming companies primarily throughout North America, South America,
and Europe. Since inception, H.I.G. and its affiliates have completed more than 350 control
platform investments, in addition to a significant number of add-on acquisitions.

        As further described in the section above entitled “Advisory Business - H.I.G. Capital
Investment and Business Strategies”, H.I.G.’s principal investment strategies include private
equity, growth capital, debt/credit, infrastructure and real estate. The Funds will also consider other
investments on an opportunistic basis which present a risk/reward profile consistent with the
relevant Fund’s principal strategy. There can be no assurance that the Advisers will achieve the
investment objectives of the Funds and a loss of investment is possible.

Risks of Investment and Conflicts of Interest

        Risks Applicable to All Funds. The following risks of investments and conflicts of
interest are generally applicable to investments in each of the Funds, including any Managed
Accounts and co-investments:

        Portfolio Company Risk. The Funds invest in a limited number of investments. Hence, the
aggregate return of the Funds may be affected by the performance of a few holdings. To the extent
that less capital is raised than targeted, the Funds may make fewer investments and thus be less
diversified. It is possible that the Funds will never be fully invested if not enough quality
investments are available or identified by the General Partners due to intense competition or the
marketplace. However, the Limited Partners will be required to pay annual Management Fees
based on the entire amount of their capital commitments (except for those Funds that are charged
Management Fees based on invested capital).

        Concentration of Investments. The Funds participate in a limited number of investments
and may seek to make several investments in one industry or industry segment. Certain Funds
expect to concentrate their investments in select industries, which may involve risks greater than
those generally associated with broadly diversified acquisition funds, including significant
fluctuations in returns based on market perception of the selected industries. The identification of

attractive investment opportunities is difficult and involves a high degree of uncertainty, and there
can be no assurance that H.I.G. will be able to identify a sufficient number of attractive
opportunities to meet the investment objectives of the Funds. As a result, the Funds’ investment
portfolio could become highly concentrated, and the performance of a few holdings may
substantially affect its aggregate return. Furthermore, to the extent that the capital raised is less
than the targeted amount or a Fund requires an extended period of time to raise such capital
commitments, such Fund may not be able to implement its investment strategy or achieve its
investment objectives in the intended manner or on the intended timeline. Such Fund will likely
invest in fewer portfolio companies and/or decline certain investment opportunities if there is
insufficient capital available, and thus be less diversified. Additionally, a Fund's organizational
expenses could be higher if its fundraising period continues for an extended period.

         Leverage. Certain of the Funds are permitted to incur indebtedness, including in the form
of capital call facilities, asset-backed or net asset value (“NAV”) facilities, letters of credit, swap
and hedging obligations and similar obligations, on a joint, several or joint and several basis, cross-
collateralized or otherwise, directly or through one or more borrowing subsidiaries or special
purpose vehicles, in each case for any purpose relating to the activities of the relevant Fund
(including, for instance, to make investments, make distributions to Limited Partners and/or pay
Fund expenses including the Management Fee and to reimburse H.I.G. for expenses incurred on
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