Insignia Capital Group LP

Item 5 – Fees and Compensation

As further described below, Insignia is compensated for advisory services by a “management fee”
based on capital invested with Insignia and by a share of capital appreciation on each Fund’s
investments (commonly known as “carried interest”). The carried interest is received by the
General Partners. This compensation is negotiated separately with each Fund. Each investor in
each Fund is a “qualified purchaser.”

Management Fees
Fund I pays Insignia a management fee of 2.0% per annum of aggregate capital commitments
during the investment period, as defined in the Fund’s limited partnership agreement, and will
thereafter pay a management fee of 1.5% per annum of invested capital as of the end of the
investment period, subject to the provisions of the advisory agreement between Insignia and each
fund. Fund II, Parallel Fund II, Fund III and Parallel Fund III pay Insignia a management fee of
2.0% per annum of aggregate capital commitments initially and of invested capital thereafter
following certain triggering events, as defined in each fund’s limited partnership agreement and
subject to the provisions of the advisory agreement between Insignia and each fund. The
management fee is payable quarterly in advance. In the event the advisory agreement is
terminated, Insignia shall refund any overpayment of the management fee (computed on the basis
of the number of days elapsed). Any amount of Organizational Expenses (see definition below)
borne by the Funds in excess of limit stated in each entity’s Fund Documents, if any, will reduce
the management fee otherwise payable by an identical amount. The management fee is negotiable
and established at the time of the closing of an investment commitment by an Investor.

Carried Interest
The General Partners have 20% carried interest in the Fund, Fund II, Parallel Fund II, Fund III and
Parallel Fund III. Subject to any necessary withholdings, the distribution of proceeds from any
portfolio investment will be as follows. Proceeds are first allocated to all Limited Partners and the
General Partners based on their respective percentage interests with respect to each portfolio
investment. The share of proceeds allocated to each Limited Partner (“Limited Partner
Allocation”) is then further allocated as follows:
        (i)     First, 100% to the Limited Partners until they have received distributions from such
                portfolio investment and all realized portfolio investments that have been disposed
                of (“Realized Investments”) equal to (i) their capital contributions for all Realized
                Investments plus net losses from write-downs and (ii) their capital contributions for
                organizational expenses, management fees and partnership expenses allocable to
                the Realized Investments.
        (ii)    Second, 100% to the Limited Partners until the cumulative distributions of proceeds
                represent an 8% compounded annual rate of return on the Limited Partner’s capital
                contributions attributable to Realized Investments.
        (iii) Third, 100% to the General Partners until the cumulative distributions to the
                General Partners from the Limited Partner Allocation equal 20% of the cumulative
                distributions to both the Limited Partners and the General Partners from the Limited
                Partner Allocation.
        (iv)    Thereafter, 80% to the Limited Partners and 20% to the General Partners.

Neither Insignia nor any of its supervised persons accepts compensation for the sale of securities
or other investment products.

The Parallel Fund is subject to different fees and terms that have been individually negotiated with
the investors in the Parallel Fund.

Other Fees
Insignia or its affiliates may receive certain fees from portfolio companies or prospective portfolio
companies, such as directors’ fees, transaction fees, monitoring fees, consulting fees, closing fees,
topping fees, break-up fees or similar fees, in connection with activities performed on behalf of
the Funds, and in some instances 100% of such fees paid to Insignia or its affiliates, net of expenses
related to the activities leading to the receipt of such fees, will reduce the management fee paid by
the Funds dollar for dollar. The management fee shall also be reduced by all placement fees which
includes any private placement or finder’s fees paid to placement agents, finders or other third-
parties performing similar services in connection with the organization or funding of the private
fund (but not including any out-of-pocket costs and expenses incurred by such persons).

It is important that Limited Partners refer to the applicable Fund Documents for a complete
understanding of how Insignia and the General Partners are compensated for services. This
is particularly true with respect to performance-based compensation. The information
contained herein is a summary only and is qualified in its entirety by such documents.

Expenses
The General Partners, Insignia and their affiliates, but not the Funds or any Limited Partner,
primarily bear and are charged with the following costs and expenses of the Funds’ activities: (a)
any costs and expenses of providing the office overhead necessary for the Funds’ operations and
(b) the compensation of the General Partners’ and Insignia’s personnel. In addition, the General
Partners, Insignia or their affiliates may, at their option, elect to pay all or any portion of
Partnership Expenses (see definition below).

Subject to the Fund Documents, the Funds bear and are charged with the following expenses
(collectively, the “Partnership Expenses”):

       (i)     fees, costs and expenses for outside tax advisors, accountants, third-party
               administrators, attorneys, auditors, custodians, consultants, brokers, agents,
               valuation firms and other professionals and service providers;
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Item 7 – Types of Clients

Insignia provides investment advisory services to pooled investment vehicles operating as private
investment funds. Investors in such vehicles include pension plans, endowments, investment
companies, trusts, foundations, family offices and high net worth individuals.

The Funds offer interests only to certain qualified investors who meet qualification requirements
under applicable securities laws and other laws. The Funds are not offered to the general public.

The Fund Documents set forth the minimum capital commitment for investors in the Funds;
however, Insignia may, in its discretion, accept commitments below that minimum.