JF Lehman and Company LLC

Item 5 Fees and Compensation
Management Fee:

         Private Equity Funds. Under the limited partnership agreements (each, an “LPA”) for the Equity Funds and
Parallel Funds, JFLCO generally is entitled to receive an annual management fee equal to a percentage of the
aggregate capital commitments to the Fund, commencing on the date of the initial drawdown of the Fund and
continuing until the end of the Fund’s investment period or the date on which JFLCO begins receiving management
fees from a successor Fund (whichever is earlier). “Aggregate capital commitments” generally means the aggregate
amount contractually committed to a Fund by its limited partners (the “Limited Partners” or “Investors”). Thereafter,
JFLCO generally is entitled to receive an annual management fee calculated as a percentage of the net invested
capital of the Fund. “Net invested capital” generally means the amount of capital contributions of the Limited
Partners used to fund the cost of portfolio investments held by the Fund as of the relevant fee calculation date,
subject to certain adjustments. Certain Private Equity Funds (namely, the Executive Funds and Co-Invest Funds) do
not pay management fees.

        Credit Funds. Under the LPAs for the Credit Funds, the Relying Adviser, receives an annual management
fee throughout such Credit Funds term equal to a percentage of the net invested capital (as described above) of the
Fund.

        Continuation Funds. Under the LPAs for the Continuation Funds, JFLCO receives an annual management
fee throughout such Continuation Fund’s term equal to a percentage of either: (i) the net invested capital (as
described above) of the Fund or (ii) for certain Continuation Funds, the lesser of net invested capital and the net
asset value of the applicable portfolio company.

        For all Funds, management fees generally are payable quarterly, either in advance or in arrears, and are
 subject to certain reductions as provided in the applicable LPA. Such reductions include, among other things,
 offsets of amounts corresponding to certain fees paid to the Firm by portfolio companies of the Fund, as further
 described in “Other Fees” below. For certain Funds, the annual management fee rate can also be subject to
 reduction for certain periods during which the Fund’s term has been extended. The Firm, in its sole discretion, has
 waived or reduced management fees for certain Investors in the Funds, including for employees and affiliates of
 the Firm, and for others pursuant to side letter agreements.

         The net invested capital in respect of a portfolio investment (which forms the basis for certain management
fee calculations, as described above) is determined based on a variety of factors. Capital contributions made by
Investors that are, in turn, used by a Fund to acquire and consummate an investment in a portfolio company (and
thus are comprised in “net invested capital” for purposes of management fee calculations) can be used by the
portfolio company (or intermediary holding entity) to pay fees and expenses associated with the acquisition of the
portfolio investment by the Fund, including amounts attributable to services provided by various parties involved in
the transaction (e.g., investment banking, accounting, legal and consultant fees). Such costs can, and in some
circumstances do, include transaction-related fees ultimately received by the Firm or its affiliates. While such
transaction fees paid to the Firm or its affiliates may partially offset the management fee at the time such transaction
fees are paid pursuant to the applicable Fund’s LPA (as described in “Other Fees” below), there will be no similar
offset corresponding to the management fee derived on an ongoing basis in respect of net invested capital that might
indirectly be attributable to the amount of such transaction fees. Further, the net invested capital associated with a
portfolio investment generally will not be reduced based on a decrease (including a significant decrease) in the then-
current valuation of portfolio investment held by a Fund at the time of a management fee calculation, unless the
relevant General Partner determines that the portfolio investment has suffered a significant and permanent
impairment in value (which is made in the relevant General Partner’s sole discretion). In addition, net invested
capital generally will not be reduced by certain events that do not constitute a disposition, such as a reorganization,
restructuring, roll-over investment in connection with a sale, or a dividend distribution.

Distributions and Carried Interest:

          Under the LPAs of the Funds (other than Executive Funds and Co-Invest Funds), amounts received by a
Fund (including from the sale or other disposition of a portfolio investment, dividends, interest or other income from
or in respect of a portfolio investment) are initially distributed to the Limited Partners up to an amount corresponding
to 100% of their aggregate capital contributions to the Fund plus a specified preferred return per annum,
compounded annually on such aggregate capital contributions. Then, amounts received by the Fund are distributed
to the General Partner until it has received a specified percentage of the amounts distributed to the Limited Partners
in excess of their aggregate capital contributions to the Fund. Thereafter, proceeds are distributed based on a
specified (and in some cases, tiered) percentage allocation between the Limited Partners, on the one hand, and the
General Partner, on the other hand. The amounts received by the General Partner described in this paragraph are referred
to as its “carried interest” and constitute a form of performance-based compensation, as discussed in Item 6 below.

        Upon termination of a Fund, generally the General Partner would be required to return to the applicable
...

Item 7 Types of Clients
         The Firm provides investment management services exclusively to Funds, the Firm’s clients. Each Fund is
a limited partnership, limited liability company or other entity formed under U.S. or foreign laws and operated
pursuant to one or more exemptions from registration under the Investment Company Act of 1940 (the “Investment
Company Act”). Funds typically include feeder entities, special purpose vehicles and/or parallel structures
established for tax, regulatory or other considerations.

        Certain of the Funds have minimum commitments required to invest in the Fund the General Partner can
waive. Generally, each Fund would have assets greater than $1,000,000.