Lumos Capital Group LLC

Item 5 - Fees and Compensation

         In general, the Adviser receives a management fee from each of the Funds that it manages as
compensation for the investment advisory services rendered to the applicable Fund. The Adviser also
typically receives performance-based compensation or carried interest pursuant to the applicable
Governing Documents for such Fund; see also Item 6. “Performance-Based” below.

       The Adviser or its affiliates may receive additional compensation in connection with
management and other services performed for portfolio investments of the Funds, and such additional
compensation generally will offset in whole or in part the management fees otherwise payable to the
Adviser in accordance with the relevant Governing Documents. Investors in a Fund also bear certain
expenses, as set forth in the Governing Documents of such Fund.

       The precise amount, the manner of calculation and the manner and timing of payment of any
such management fee, carried interest, or performance-based compensation for each such Fund are

established by the Adviser, as modified by negotiations with Investors in the applicable Fund, and are
set forth in such Fund’s Governing Documents provided to each Investor prior to investment in such
Fund. Nonetheless, the structure of the management fee and carried interest which the Adviser
currently employs and which the Adviser expects to employ with respect to future Funds going forward
is summarized below.

        Management Fees

 The Fund will pay to the Advisor an annual management fee (the “Management Fee”) as follows: (i)
 prior to the end of the commitment period, the Management Fee will equal 2.0% of the capital
 commitments of the Fund’s Limited Partners and (ii) following the end of the Commitment Period,
 the Management Fee will equal 2.0% of the Fund’s Net Invested Capital. For purposes hereof, the
 term “Net Invested Capital” means capital contributions used to fund the cost of, and remain invested
 in, investments, less any write-downs of any investment (net of any writeups of the same investment).
 Net Invested Capital will be increased quarterly by any capital contributions used to fund investments
 that are made during such period and decreased quarterly by amounts distributed to partners as a
 return of capital. The Management Fee will be payable in advance on a quarterly basis. The
 Management Fee may be paid out of monies otherwise available for distribution or out of capital
 calls.

         The Firm or its affiliates may charge portfolio investments, prospective portfolio investments
or their affiliates various fees (i.e., monitoring fees, consulting fees). To the extent these fees are
charged in respect to the assets of any Fund, they will reduce the amount of management fees charged
to such Fund’s investors on a dollar-for-dollar basis. The Firm and/or its affiliates may elect not to
collect certain of the fees described below.

          Each Fund is generally responsible for all organizational expenses incurred by the Firm and its
affiliates in connection with the formation and organization of such Fund and the appliable General
Partner. In addition to the Management Fee and carried interest allocable to the Adviser, the Funds will
pay all other fees, costs, expenses, liabilities, and obligations relating to the Funds and their activities,
business or actual or potential investments (to the extent not borne or reimbursed by a portfolio
investment) (such expenses, “Partnership Expenses”). The Partnership shall be liable for, and shall
pay, the following expenses, which shall include: (i) the Management Fee of the Management
Company; (ii) except as otherwise provided herein, out-of-pocket investment costs, such as investment
banking fees and brokerage and underwriting commissions, transfer taxes and finder’s commissions;
(iii) all out-of-pocket expenses of the Partnership relating to sourcing, investigating, acquiring,
monitoring, distributing and disposing of Investments (including, without limitation, reasonable travel
and other out of pocket expenses); (iv) domestic and foreign taxes payable by the Partnership and all
other taxes, stamp and other duties and other governmental charges payable by or on behalf of the
Partnership; (v) fees and disbursements of outside auditors relating to any audit of, or accounting
services with respect to, the books and records of the Partnership including, without limitation, the
preparation of the periodic reports required to be delivered; (vi) fees and disbursements of attorneys,
consultants, accountants, third party appraisers, fund administration service providers and valuation
experts (to the extent third party appraisal services or valuation services are contemplated by the
Limited Partners hip Agreement) and other professionals (including, without limitation, legal fees in
connection with the legal opinions required to be delivered pursuant to the Limited Partners hip
Agreement; (vii) interest expenses on borrowings permitted by the terms of the Limited Partners hip

Agreement and all expenses incurred in negotiating, entering into, effecting, maintaining, varying and
terminating any borrowing or guarantee permitted to be incurred by the Limited Partners hip Agreement
(including, without limitation, any promissory note issued to a Limited Partner pursuant to the terms of
the Limited Partners hip Agreement); (viii) for Lumos Fund I LP and Lumos Fund I-A LP: up to
$750,000 in reimbursement or payment of Organizational Expenses; (ix) Placement Fees; (x) all
Broken Deal Expenses; (xi) expenses of members of the Advisory Committee; (xii) the amounts
required to be paid to any Indemnitee or other Person; (xiii) expenses incurred in connection with
meetings of the Partnership; (xiv) all insurance premiums or similar expenses incurred by the
Partnership, the General Partner, the general partner of the General Partner or the Management
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Item 7 - Types of Clients

         As described in “Item 4 - Advisory Business”, the Adviser provides investment advisory
services only to Funds, which are investment partnerships, or similar entities, which are exempt from
registration under the Investment Company Act. The Investors participating in the Funds may 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 may include, directly or indirectly, Principals or other
employees of the Adviser and its affiliates and members of their families, and Consultants or other
service providers retained by the Adviser.

        The Governing Documents for each Fund sets forth a minimum capital commitment of
$5,000,000, subject to reduction at the discretion of the relevant General Partner.

Item 8 - Investment Strategies, Investment Philosophy and Risk of Loss

         As more fully described in the Governing Documents of each of the Funds, the Funds will
principally seek to acquire minority interests of generally between 10% to 40% in HCD companies for
which Lumos has a well-defined growth strategy, and where Lumos’s Principals will play an active
role in executing that strategy. At the discretion of the Firm, the Fund may also purchase majority
interests. While HCD companies are growing rapidly in every geography, Lumos will focus mainly on
companies in North America, with at least 70% of the capital to be deployed in companies domiciled
in North America.

         The Fund’s investment process is rigorous and systematic. Lumos utilizes an investment
process that is based on being proactive at each stage of the investment lifecycle: sourcing investments,
deal negotiation and structuring, value enhancements, and realizations. From time to time, the
Investment Team may utilize a third-party industry consultant to assist in segment-specific or company-
specific due diligence. Every transaction opportunity is vetted by the investment committee of Lumos
throughout the deal sourcing, term sheet negotiations and final due diligence stages, as well as by a
partner of Lumos who is the transaction sponsor on behalf of the Fund.

        Lumos conducts thorough due diligence and valuation analysis, which typically includes
analyses around markets, competitors, customers and products. Fund investments require a unanimous
vote of support from its investment committee to consummate a transaction. A member of the
Investment Team will serve as a Director on the Board of the portfolio company and/or as an observer
of the Board for each portfolio company.

         Investing in a Fund is speculative and involves significant risks, including the risk of total loss
of invested capital, and should be considered only by sophisticated investors able to meet drawdown
obligations and assume the risks of loss and illiquidity inherent with an investment in the Fund. The
following risks and conflicts, as well as the risks and conflicts described elsewhere in this Brochure,
are not intended to be an exhaustive list of all the risks and conflicts associated with Lumos’s business
or an investment in a Fund, which are set forth in greater detail in the respective Governing Documents
of the Funds. Before investing in a Fund, prospective investors should carefully review such Fund’s
Governing Documents, including, in the case of each Fund, the additional risks and conflicts set forth
in the Governing Documents of such Fund. Further, the Firm’s business and the investment strategies
of the Funds may evolve in light of existing market conditions and investment opportunities, and this
evolution may involve additional risks and conflicts depending upon the nature of the assets in which
it invests and its ability to finance such assets on a short or long-term basis.

Risks Involved with an Investment in a Fund and Portfolio Investments

Nature of Fund’s Investments

An investment in the Fund requires a long-term commitment, with no certainty of return. Although
investments by the Fund may generate some current income, the return of capital and the realization of
gains, if any, from an investment will generally occur only upon the partial or complete disposition of

such investment. While an investment may be sold at any time, it is generally expected that this will
not occur for a number of years after an investment is made. Generally, the Fund will acquire securities
that cannot be sold except pursuant to a registration statement filed under the 1933 Act or in a private
placement or other transaction exempt from registration under the 1933 Act.

Since the Fund may only make a limited number of investments, poor performance by a few
investments could severely affect total returns to Limited Partners.

The General Partner expects the Fund to have book losses for the first few years of its operations and
believes that most private equity funds (whether or not they ultimately have good performance) with
similar investment objectives would also expect book losses during the first few years of their
operations. The General Partner’s expectation of losses in the early years is based upon the following
factors: (i) it often takes two or more years for a portfolio company to demonstrate successful execution
of its business plan, although underperformance can become apparent in less time; (ii) valuation
policies with respect to private investments are more conservative about recognizing unrealized
appreciation than unrealized depreciation; and (iii) expenses for organization of the Fund and their
investment activities tend to be incurred before appreciation of the investments has been recognized.
As a result of the foregoing factors, the amount of capital a Limited Partner would receive if the Fund
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