Meghalaya Partners LP

Fees and Compensation
Meghalaya charges Clients a management fee based on a percentage of assets under management
and a performance-based fee. The Funds issue different tranches or series of interests or shares,
which subject investors to different early redemption charges, management fee rates, and
performance fee rates. Each Fund’s governing documents set forth in detail the fee structure
relevant to each Fund. Investors should review all fees charged by Meghalaya and related entities
to fully understand the total amount of fees to be paid by a Fund and, indirectly, by Investors.

Management fees and performance fees are waived, reduced or calculated differently with respect
certain investors, including, without limitation, investors who subscribed early to the Funds,
investors that are officers, directors, members, partners, or employees (collectively the
“Employees”) of Meghalaya, members of the immediate families of such persons, and trusts or
other entities for their benefit, in each case in Meghalaya’s sole discretion.

Meghalaya’s fee schedule is omitted as this brochure is only being provided to qualified
purchasers as defined in section 2(a)(51)(A) of the Investment Company Act of 1940, as amended
(the “Investment Company Act”). Clients separately incur costs associated with custody,
brokerage and trading activities. Clients should refer to Item 12 for additional information about
Meghalaya’s brokerage practices.

In addition to the fees and costs discussed above, Clients are generally responsible for the
organizational and operating expenses described in relevant governing documents. For separately
managed account Clients, the types of fees and expenses are negotiated with the Client in the
investment management agreement. The types of fees and expenses for the Funds generally
include the following non-exhaustive list: compliance, accounting, tax reporting, audit and legal
expenses; administrator expenses; regulatory filing expenses made in connection with managing a
Fund’s portfolio; initial ongoing and offering expenses; restructuring expenses; investment
expenses such as brokerage commissions, hedging costs, mark-ups on investments, and trading
costs; research fees and expenses (including research services, research subscriptions and
research-related travel); costs relating to the use of order management and execution systems;
interest on debit balances or borrowings; custody fees; director fees; and the costs of any liability
insurance obtained on behalf of the Funds or the Registrant. Meghalaya may invest a portion of
Client's assets in shares of mutual funds or other investment companies, including exchange
traded funds. Assets invested in such investment companies will be included in computing the
management fees paid to Meghalaya. The same assets will also be subject to additional advisory
and other fees and expenses, as set forth in the prospectuses of those investment companies, paid
by the investment companies, but ultimately borne by Clients. Investors are also subject to an
early redemption charge in the event they redeem prior to the end of an initial period specified in

the governing documents. Meghalaya may, in its sole discretion, choose to absorb any such
expenses incurred on behalf of the Funds.

Please refer to the governing documents for a full description of Fund expenses.

Performance Based Fees and Side-by-Side Management
Clients pay Meghalaya a performance allocation that is based on a percentage of net profits of the
account. The fact that Meghalaya is compensated based on trading profits may create an incentive
for Meghalaya to make investments on behalf of Clients that are riskier or more speculative than
would be the case in the absence of such compensation. In addition, the performance based fee
received by Meghalaya is based primarily on realized and unrealized gains and losses. As a result,
the performance based fee earned could be based on unrealized gains that Clients may never
realize. Meghalaya does not allocate investments to Clients based on the fees paid by such Client.
Clients are generally allocated investments on a pro-rata basis subject to certain exceptions such
as regulatory restrictions, Client-imposed restrictions, and to avoid odd lots, among other
exceptions.

Types of Clients
Meghalaya provides advisory services to private investment funds and separately managed
accounts. The Funds are generally organized in a “master-feeder” structure, where the Onshore
Fund and Offshore Fund invest substantially all of their assets into the Master Fund, although the
feeder funds may make direct investments for tax, legal, or regulatory reasons.

Subject to the discretion of Meghalaya to accept less, the minimum investment threshold accepted
for the Funds is $1,000,000. The Registrant evaluates the minimum investment amount for the
Funds, as well as separately managed accounts, on a case-by-case basis.

Interests in the Funds are not registered under the Securities Act of 1933, as amended, and such
Funds are not registered under the Investment Company Act. Accordingly, interests in the Funds
are offered and sold exclusively to investors satisfying the applicable eligibility and suitability
requirements either in private transactions within the United States or in offshore transactions.

Meghalaya enters into agreements (“Side Letters”) with one or more investors or shareholders of a
Fund which provide such investor with additional and/or different rights (including, without
limitation, with respect to management fees, the performance allocations, withdrawals, access to
information, minimum investment amounts and liquidity terms) than such shareholders or
investors have pursuant to general terms of such collective investment vehicle. Meghalaya will
not be required to notify any or all of the other investors or shareholders of any such written
agreements or any of the rights and/or terms or provisions thereof, nor will Meghalaya be required

to offer such additional and/or different rights and/or terms to any or all of the other investors or
shareholders.

Methods of Analysis, Investment Strategies and Risk of Loss
Meghalaya’s primary investment objective is to achieve attractive risk-adjusted returns over the
credit cycle with long/short credit exposure across the ratings spectrum of high yield and
distressed debt and cross-capital structure capability in the equities of high yield issuers. The
Registrant employs a rigorous fundamental earnings-centric approach combined with a strong
event orientation to find credit alpha on both sides of the book and exploit the spread dispersion
between longs and shorts. Clients invest broadly, long and short, across the entire high yield credit
universe. Principal investment categories consist of (i) performing debt, (ii) stressed/distressed
debt, and (iii) credit-related equities, in each case both long and short. Importantly, the Clients’
net exposure is highly variable across the credit cycle, with higher net credit exposure in wider
spread environments and lower net credit exposure in tighter spread environments, with the ability
and willingness to have minimal net credit exposure as market conditions warrant.

Investing in sub-investment grade instruments and other securities involves the risk of loss that
Clients and investors should be prepared to bear. Below is a summary of the material risks
associated with the Registrant’s investment strategy and types of investments. Prospective
investors in the Funds should refer to the Fund’s governing documents for a full description of
risks.

Special Situations. Clients may have investments in issuers involved in (or the target of)
acquisition attempts or tender offers or issuers involved in work outs, liquidations, spin offs,
reorganizations, bankruptcies and similar transactions. In any investment opportunity involving
any such type of business enterprise, there exists the risk that the transaction in which such
business enterprise is involved will be unsuccessful, will take considerable time or will result in a
distribution of cash or a new security the value of which will be less than the purchase price to the
Client of the security or other financial instrument in respect of which such distribution is
received. Similarly, if an anticipated transaction does not in fact occur, the Client may be required
to sell its investment at a loss.

Fixed Income Investments. The value of fixed-income securities in which a Client invests will
change in response to fluctuations in interest rates. In addition, the value of certain fixed-income
securities can fluctuate in response to perceptions of creditworthiness, political stability or
soundness of economic policies. Fixed-income securities are subject to the risk of the issuer’s
inability to meet principal and interest payments on its obligations (i.e., credit risk) and are subject
to price volatility due to such factors as interest rate sensitivity, market perception of the
creditworthiness of the issuer and general market liquidity (i.e., market risk).The fixed income
investments of Clients are subject to credit, liquidity and interest rate risk.

Bank Loans. Loans may become nonperforming or impaired for a variety of reasons. Such
nonperforming or impaired loans may require substantial workout negotiations or restructuring
that may entail, among other things, a substantial reduction in the interest rate and/or a substantial
write-down of the principal of the loan. In addition, because of the unique and customized nature

of a loan agreement and the private syndication of a loan, certain loans may not be purchased or
sold as easily as publicly traded securities, and, historically, the trading volume in the loan market
has been small relative to other markets. Loans may encounter trading delays due to their unique
and customized nature, and transfers may require the consent of an agent bank and/or borrower.
Risks associated with bank loans include the fact that prepayments may generally occur at any
time without premium or penalty.

High-Yield Debt Securities and Lower Rated Loans. Risks of high-yield debt securities may
include (among others): (i) limited liquidity and secondary market support, (ii) substantial market
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