Nexus Capital Management LP

Fees and Compensation

In consideration for Nexus’ investment advisory and other services, Nexus and/or certain of its
affiliates generally are entitled to receive management fees, and may receive performance
allocations, with respect to the Funds. While the fees and compensation applicable to each Fund
are described in detail in the applicable governing documents, side letters and/or fee agreements,
an overview of Nexus’ basic fee schedule is summarized below. A potential investor should read
and review all governing documents in their entirety before making any investment decisions.

Fee Schedules
Sponsored Private Funds

Management Fees: In consideration for its advisory services to the Sponsored Private Funds,
Nexus receives a “Management Fee” from each respective Sponsored Private Fund. The specific
payment terms and other conditions of the Management Fees available to Nexus are set forth in
the applicable Sponsored Private Funds’ governing documents, side letters and/or fee agreements.
The Management Fees are generally a percent of the Sponsored Private Funds’ investors aggregate
capital commitments or a percent of the Sponsored Private Funds’ total invested capital, on the
appraisal date, payable quarterly or monthly in advance or in arrears. Management Fees are
generally paid to Nexus in one of two ways: by deducting such fees from the applicable Sponsored
Private Fund or directly billing the Sponsored Private Fund. Upon the termination of Nexus’
Management Agreement with a Sponsored Private Fund, Nexus will refund to the Sponsored
Private Fund the pro-rated portion of any Management Fee already received by the Sponsored
Private Fund for the period following the effective date of such termination. Generally, the
Sponsored Private Funds’ General Partner and investors who are affiliates, employees or other
designees of the General Partner or Nexus will not be subject to such Management Fees.

Nexus and its affiliates will benefit from Nexus’ relationship with and its receipt of Management
Fees from the Sponsored Private Funds. Such Management Fees and relationship will enhance
the value of Nexus, and the Sponsored Private Funds’ investors (other than those investors holding
direct or indirect interests in Nexus) will not participate in any increase in the value of Nexus.

Performance-Based Compensation: In addition to the Management Fee, the General Partner for
each respective Sponsored Private Fund may receive a “Performance-Based Fee” (e.g., carried
interest) a percent of net profits, subject to loss carryforward provisions (and, in some cases, a
“performance hurdle”). The specific payment terms and other conditions of the Performance-
Based Fees available to a General Partner are set forth in the applicable Sponsored Private Fund’s
governing documents, side letters and/or fee agreements. Generally, Performance-Based Fees
payable to the applicable General Partner are payable annually in arrears. All Performance-Based
Fee payable to a General Partners will be consistent with the requirements of Section 205 of the
Advisers Act and Rule 205-3 thereunder.

The size of the Performance-Based Fee varies and depends on a number of factors including, but
not limited to, the level of Management Fee charged and the use of performance hurdles. Investors
in a Sponsored Private Fund are allocated their pro rata share of Performance-Based Fees for the
time period they are invested in the Sponsored Private Fund. These fee arrangements are more
thoroughly described in the relevant Sponsored Private Fund’s governing documents, side letters
and/or fee agreements. Generally, the Sponsored Private Funds’ General Partner and investors
who are affiliates, employees or other designees of the General Partner or Nexus will not be subject
to such Performance-Based Fees.

Performance-Based Fees payable to a General Partner on investment gains may create an incentive
for the General Partner’s affiliate, Nexus, to cause the Fund to make investments that are riskier
or more speculative than would be the case if a performance-based compensation arrangement
were not in effect. The Performance-Based Fees may create an incentive for Nexus to time
investments, and the realization of investments, so as to maximize Performance-Based Fees rather
than the returns of the Sponsored Private Fund. See Item 6 – Performance-Based Fees and Side-
By-Side Management of this Brochure for more information about Performance-Based Fees.

Nexus’ Management Fees and Performance-Based Fees are not inclusive of all fees. Please see
below herein “Other Fees and Expenses”.

The applicable General Partner and/or Nexus generally may have the unilateral discretion to waive
or modify the application of certain provisions of the governing documents for a Sponsored Private
Fund with respect to an investor (including those related to fees, performance allocations,
transparency, and withdrawals) without obtaining the consent of any other investor. The
applicable General Partner of a Sponsored Private Fund may, in its sole discretion, charge lower
Management Fees and/or Performance-Based Fees or waive account minimums based on certain
factors the General Partner deems relevant.

The General Partner, on behalf of a Sponsored Private Fund, may enter into side letter agreements
with one or more Sponsored Private Fund investors providing for revised economic terms,
including, but not limited to, distribution provisions with respect to such Sponsored Private Fund
investor that differ from those set forth in the Sponsored Private Fund’s governing documents. A
conflict may arise where some Sponsored Private Fund investors receive more favorable overall
economic terms and other Sponsored Private Fund investors will not participate in such terms.

As of the date of this Brochure, Nexus manages fifteen (15) Sponsored Private Funds for which it
receives Management and Performance-Based Fees.

Separate Accounts
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Types of Clients

As discussed in Item 4 of this Brochure, Nexus provides discretionary portfolio management and
investment advisory services to large institutions and high net worth individuals, including but not
limited to, corporate pensions, endowments and foundations, regional banks and family offices
mainly through privately offered pooled investment vehicles (i.e., the Funds).

Information about the Funds, and the particular investment objectives, strategies, restrictions,
guidelines and risks associated with an investment in a Fund, is described in the respective Funds’
private placement memorandum, offering memorandum, offering circular, limited partnership
agreement, or other similar disclosure/offering or governing documents, which are made available
to investors only through Nexus, the Fund’s primary investment adviser, or another authorized
party. In the future, Nexus may provide discretionary (or non- discretionary) portfolio
management and investment advisory services (directly or indirectly through a sub-advisory
arrangement with the client's primary investment adviser) to institutional separately managed
accounts or other pooled investment vehicles. Nexus advises both U.S. and non-U.S. Clients. The
Funds advised (or sub-advised) by Nexus may be organized as domestic or offshore (e.g., non-
U.S.) companies, limited partnerships, limited liability companies, corporate trusts, or other legal
entities, as determined appropriate by Nexus or the Fund’s primary investment adviser.

Generally, investors participating in a Fund are required to meet certain suitability and net worth
qualifications, such as (i) an “accredited investor” within the meaning of Rule 501 of Regulation
D under the U.S. Securities Act of 1933, as amended (the “Securities Act”) or (ii) a “qualified
purchaser” as defined in Section 2(a)(51) of the 1940 Act. As such, the Funds Nexus manages are
exempt from registration as an investment company through the exemption provided by Sections
3(c)(1) or 3(c)(7) of the 1940 Act. Typically, each investor in a Fund that is exempt from the
registration requirements under Section 3(c)(7) of the 1940 Act is required to qualify as a
“qualified purchaser” within the meaning of Section 2(a)(51) of the 1940 Act and is required to
certify that it is at least an “accredited investor” within the meaning of Rule 501 of Regulation D
under the Securities Act and non-U.S. investors are required to certify that they meet the
requirements of the Regulation S safe harbor under the Securities Act; however, where Nexus does
not charge Performance-Based Fees to a particular Client, investors will only be required to qualify
as an “accredited investor” within the meaning of Rule 501 of Regulation D under the Securities
Act. As noted above in Item 6 of this Brochure, if Nexus collects performance related
compensation, investors will be required to meet the requirements of Rule 205-3 under the
Advisers Act and certify that they are at least a “qualified client.” A potential investor in a Fund
should read and review all governing documents in their entirety for specific investor qualifications
and before making any investment decisions.

To help the U.S. Government fight the funding of terrorism and money laundering activities,
Nexus may seek to obtain, verify, and record information that identifies each investor who invests

in a Client. In this regard, when an investor seeks to open an account with Nexus or invest in a
Fund managed by Nexus (including a separately managed account), Nexus may ask for a
completed Form W-8/W-9, as applicable, which includes the name, address, Tax ID/Employer ID
number (or any other registration number issued in the jurisdiction of location or incorporation)
and other reasonably required information that will allow Nexus to identify the investor. Nexus
may ask for information and documentation regarding the source of funds to be invested. Nexus
also reserves the right to ask for more information regarding the individuals who are beneficial
owners of the investor and/or exercise control over the investor. Nexus may ask for the names of
such beneficial owners and may also ask for address, date of birth, and other information that will
allow Nexus to identify such beneficial owners. Nexus may also request such other information
as may be necessary to comply with applicable law. Furthermore, Nexus may verify any of the
aforementioned information using third-party sources and may share that information as required
by applicable law or in connection with the execution of trades on behalf of that investor. For
certain investors, Nexus may rely on the investor’s broker-dealer, administrator, transfer agent,
custodian or placement agent to obtain, verify and record the required information.

With respect to separately managed accounts, the minimum investment is determined on a case-
by-case basis. Each Fund’s minimum investment amount is stated in each respective Fund’s
governing documents. Nexus would not determine the minimum investment amount for Clients
that is advises in a sub-advisory capacity. A potential investor in a Fund should read and review
all governing documents in their entirety for specific investor qualifications and before making
any investment decisions.

            Methods of Analysis, Investment Strategies and Risk of Loss

The following is a summary of the investment strategies and methods of analysis employed by
Nexus on behalf of its Clients. This summary should not be interpreted to limit in any way Nexus’
investment activities. Nexus may offer any advisory services, provide advice with respect to any
investment strategies and make any investments, including those that may not be described in this
Brochure, that Nexus considers appropriate, subject to each Client’s investment objectives and
guidelines. Specific descriptions of such strategies and methods are included in each Client’s
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