KBIT Management Ltd

Item 5 – Fees and Compensation

A.      Fee Schedule
The fees and compensation payable to Kbit are negotiable and vary among its Clients. However,
the range of compensation is generally as follows:
        1.      Management Fee
Kbit typically charges a management fee to Investors in the Funds (typically on a quarterly basis,
as further described in each Fund’s Governing Documents). The management fee received from
the Funds may be up to one percent (1%) per annum of the of the net asset value per share of each
share as of the first day of each calendar quarter.

        2.      Performance Allocation

Kbit generally receives a performance allocation from each Fund equal to (i) thirty percent (30%)
of the increase in the Net Asset Value per Shares of each series of such participating shares until
such Shares have increased in Net Asset Value per Share by thirty percent (30%) (the
“Hurdle”),calculated net of Management Fees, for the applicable calendar year and (ii) forty percent
(40%) of the increase in the Net Asset Value per Share of such participating shares for such calendar
year thereafter. (the “Performance Allocation”).

The Performance Allocation is also subject to a “high water mark” such that the Performance
Allocation is taken only to the extent net profits allocated to that Investor exceeds any cumulative
losses that were allocated to that Investor for earlier periods and that have not been recovered. The
performance allocation will be crystalized quarterly despite the Hurdle being measured (and re-set)
on a calendar year basis.
Kbit will only charge a Performance Allocation in accordance with all applicable laws and
regulatory requirements, and only to those Investors who qualify as “Qualified Clients” as defined
in Rule 205-3 under the Investment Advisers Act of 1940, as amended (the “Investment Advisers
Act”).
The Management Fees and Performance Allocations described may be waived in Kbit’s discretion
for investors that are members, employees, or affiliates of Kbit, as well as for relatives of such
persons.
        3.      Fee Comparison
The fees charged to Clients, including the management fee and Performance Allocation, may
constitute a higher percentage of average net assets than would be found with other investment
advisers.
B.      Payment of Fees
Management fees, Performance Allocations, and third-party fees (discussed below) are paid by
Clients directly to Kbit or an affiliate of Kbit.

Management fees, which are generally paid in advance, are charged and paid at the beginning of
the applicable period. Performance Allocations are charged as of the last day of the calendar year
and as of any date on which an Investor makes a withdrawal or receives a distribution from the

Fund. Performance Allocations are also only charged to those Investors in Funds who qualify as
“Qualified Clients” as defined in Rule 205-3 under the Investment Advisers Act.

C.      Third-Party Fees

Each Fund shall pay such costs and expenses as Kbit shall reasonably determine to be necessary,
appropriate, advisable or convenient to carry on its business and realize its objective, including but
not limited to: (i) management fees and performance fees for private funds; (ii) all general
investment expenses (i.e., expenses which Kbit reasonably determines to be directly related to the
investment of the Funds’ assets); (iii) all operating, administrative, legal, accounting, auditing,
record-keeping, tax form preparation, brokerage commissions, clearing fees, borrowing charges,
interest on margin and other borrowings, withholding and transfer taxes, compliance and consulting
costs and expenses; (iv) fees, costs and expenses of third-party service providers that provide such
services; (v) such other expenses as may be set forth in each Funds’ Governing Documents; and,
(vi) any extraordinary expenses, among other expenses.
Kbit’s fees are exclusive of brokerage commissions, transaction fees, and other related costs and
expenses which shall be incurred by Funds. Such charges, fees and commissions are exclusive of and
in addition to Kbit’s management fee and Performance Allocation, and Kbit shall not receive any
portion of these commissions, fees, and costs.
D.      Prepayment of Fees
Management fees are generally payable quarterly in advance. If an Investor in a Fund was permitted
to withdraw capital on a date other than the end of calendar quarter, as applicable, the management
fee will not be refunded to such Investor.
E.      Other Compensation
Neither Kbit nor its supervised persons accept compensation for the sale of securities or other
investment products outside of its association with Kbit.
The foregoing discussion in Items 5 represents Kbit’s basic compensation arrangements. The
management fees and Performance Allocation described above are structured to comply with
Rule 205-3 under the Advisers Act and applicable state laws. Fees and other compensation
are negotiable in certain circumstances and arrangements with any particular Investor may
vary. Although Kbit believes its fees are competitive, lower fees for comparable services may
be available from other investment advisers.

Item 7 – Types of Clients

Investors in the Funds are generally “accredited investors” within the meaning of Rule 501(a) under
the Securities Act of 1933, as amended, “qualified clients” within the meaning of Rule 205-3 under
the Investment Advisers Act, and/or “qualified purchasers” within the meaning of Section 2(a)(51)
of the Investment Company Act of 1940, as amended (the “Investment Company Act”). The Funds’
interests may generally be offered to institutional investors, high- net worth individuals and families,
charitable organizations, trusts, estates, and businesses. Kbit provides discretionary investment
advisory services with respect to the Funds it advises, and Investors have no ability to accept or
reject investment advice.