Nokomis Capital LLC

Item 5 - Fees and Compensation

     Our firm or one of our affiliates typically receive two types of compensation from our
     clients – an asset-based management fee and performance-based compensation.

     With respect to our fund clients, we deduct the asset-based management fee from the
     master fund’s account quarterly at the beginning of each quarter. The asset-based
     management fee is generally equal to an annual rate of 1.0% of the capital sub-account
     balances subject to the asset-based management fee, calculated and payable quarterly in
     advance. Additionally, the performance-based compensation for the fund clients is made
     as an allocation at the master fund level to the capital account of our affiliate who serves
     as one of the general partners of the master fund and is generally made at the end of each
     year. Such allocation is generally 20% of the net profits (including realized and unrealized
     appreciation or depreciation) of the capital sub-accounts subject to the performance-based
     allocation for each year, subject to a “high water mark” limitation.

     For the fund clients, the asset-based management fee and performance-based allocation are
     calculated and determined utilizing memorandum capital sub-accounts (“sub-accounts”) in
     the master fund that relate to the capital accounts or series of shares, as applicable, of
     investors in the feeder funds. The offering documents of the feeder funds contain further
     details of the calculation and determination of the asset-based management fee and the
     performance-based allocation.

     While the fund clients themselves do not negotiate fees, with respect to investors in our
     fund clients, we have the general discretion to modify or waive all or a portion of the asset-
     based management fee and/or the performance-based allocation, and have done so in the
     past and may do so in the future. Any such reductions or waivers of fees have effectively
     reduced, and may in the future reduce, the aggregate fees charged to fund clients.
     Occasionally we enter into side letter arrangements with certain investors, in which we
     grant them different or preferential terms. Our firm and our affiliates do not pay the asset-
     based management fee or the performance-based allocation. Additionally, non-qualified
     investors in our feeder funds are not subject to the performance allocation, per Rule 205-3
     of the Investment Advisers Act of 1940, as amended.

     The managed account client is a qualified purchaser and pays an asset-based management
     fee and a performance-based fee as described in its managed account agreement. We bill
     the managed account client for the asset-based management fee promptly following the
     end of each calendar quarter and for the performance-based fee generally at the end of each

calendar year. The managed account client generally satisfies such fees by causing them
to be deducted and paid from its account. We have the general discretion to modify or
waive all or a portion of the managed account client’s asset-based management fee and/or
the performance-based fee.

We generally do not need to provide fee refunds to the investors in our fund clients before
the end of a billing period, because they do not pay a fee in excess of what they owe given
that the investors generally can only withdraw from our fund clients as of the end of a
quarter (during which advisory services are rendered). However, if our fund clients are
dissolved and liquidated during a quarter, they (and ultimately their investors) will
automatically receive a refund equal to a pro rata portion of the asset-based management
fee based on the months remaining in the quarter. Likewise, if certain illiquid investments
made by our fund clients, which are designated as special investments, are realized during
a quarter, any investors that are invested only in such realized special investments (and
have no other investment in our fund clients) will automatically receive a refund equal to
a pro rata portion of the asset-based management fee based on the months remaining in the
quarter, to the extent any such investors are bearing the asset-based management
fee. Neither the performance-based compensation owed by our fund clients nor any of the
fees owed by our managed account client is payable in advance.

In connection with our hedge fund advisory services, our fund clients bear all of their own
organizational and operational expenses. The list below details some of these expenses,
but does not include every possible expense our fund clients could incur.

    •   legal fees (including settlement costs);

    •   costs of any litigation or investigation involving our fund clients’ activities;

    •   accounting costs (including tax preparation and audit expenses);

    •   administration costs, including the cost of the administrator;

    •   insurance;

    •   costs associated with reporting and providing information to existing and potential
        investors;

    •   any governmental fees imposed on our fund clients; and

    •   withholding and/or transfer taxes.

These fund clients also pay for expenses related to the investment of their assets, such as:

    •   proxy expenses;

    •   interest and commitment fees on loans and debit balances;

    •   borrowing charges on securities sold short;

    •   custodial fees;

    •   brokerage commissions;

    •   trade processing fees, including clearing and settlement charges;

    •   research fees and materials (including online news and quotation services);

    •   costs of any outside appraisers, accountants, attorneys or other experts or
        consultants engaged in connection with specific transactions;

    •   bank charges; and

    •   other ordinary miscellaneous research and trade-related expenses.
...

Item 7 - Types of Clients

      Our fund clients are hedge funds (i.e., pooled investment vehicles) that rely on certain
      exclusions from the definition of “investment company” in the Investment Company Act
      of 1940, as amended. Accordingly, none of our fund clients are registered as investment
      companies with the Securities and Exchange Commission.

      Investors in our fund clients must generally make a minimum investment of $1,500,000.
      We have the discretion to, and on occasion accept investments for a lesser amount.

      We also provide investment advisory services to a separately managed account for an
      institutional client. We decide whether to open a separately managed account on a case by
      case basis.

      This firm brochure is not an offer to invest in our fund clients.