Reckoner Capital Management LLC

ITEM 5 – FEES AND COMPENSATION

Management and Incentive Fees

In general, Reckoner will receive a management fee (“Management Fee”) and/or a performance-
based compensation (“Incentive Fee,” and together, with the Management Fee, the “Fees”) from
Clients. Reckoner does not maintain a fixed fee schedule for Clients, though Management Fees
typically will not exceed 200 basis points. Fees are negotiable and vary across Clients based on
the type of services provided, size of the account, and the overall relationship between Reckoner
and the Client. Fees charged can vary among Investors in the same Fund, other than a Registered
Fund, based on such factors as size of relationship with firm and amount invested, among other
factors. Reckoner, in its sole discretion, has the authority to reduce, waive, or calculate differently
the fees with respect to any Investor through Client Documentation.

Reckoner will generally receive Fees for managing Funds and SMAs. The amount of the
Management Fee will be based on a percentage of either the net asset value of a Client, the gross
asset value of Client, or such other reference amount as negotiated with a Client. The calculation
of the Fees will be dependent on several factors which are described in more detail in the applicable
Client Documentation. Reckoner expects to deduct the Management Fee directly from the Client
accounts or otherwise bill Clients on a quarterly basis in arrears and expects to generally prorate
such fees for a period that is less than a calendar quarter. Asset-based management fees can create
conflicts of interest to the extent that any Client is charged a higher fee and/or uses leverage, as
Reckoner would have an incentive to favor such a Client over others. For example, when Reckoner
controls the amount and/or timing of leverage, the use of leverage provides additional capital that
allows Reckoner to acquire additional assets on the Client’s behalf – thereby increasing the fee
base. Reckoner maintains an Allocation Policy (described in Item 11—Code of Ethics,
Participation or Interest in Client Transactions, and Personal Trading), reasonably designed to
mitigate this conflict.

In addition, certain Clients will be assessed Incentive Fees based on the net profits allocable to the
Client during a particular performance period, which can be quarterly, annually, or could extend
for the duration of the advisory relationship. Such Incentive Fees are expected to be subject to
certain specified preferred returns or hurdle amounts. Reckoner’s receipt of Incentive Fees will be
set forth in the applicable Client Documentation that is provided to prospective Clients. Incentive
fees will be structured in accordance with the Investment Advisers Act of 1940, as amended (the
“Advisers Act”), as applicable to each Client. See Item 6—Performance Based Fees and Side by
Side Management for additional information about incentive fee arrangements.

Additional Fees

Reckoner has discretion to charge SMA Clients additional fees such as subscription fees,
commitment fees, and/or exit or other fees in addition to the Fees mentioned above, each as agreed
in the relevant Client Documentation. Reckoner, in its sole discretion, can elect to reduce, waive,
or calculate differently the fees with respect to any Client.

The one-time subscription fee is typically a mutually agreed upon fixed amount, which will be

payable one time in connection with the opening of an SMA. This fee is designed to compensate
Reckoner for the costs of establishing the SMA. The one-time fee varies from Client to Client
based upon the type of services provided, the size of the account, and the relationship between the
Client and Reckoner.

Other possible fees include a mutually agreed upon fixed amount, which will be payable on a
monthly, quarterly, or annual basis pursuant to the Client Documentation. These fees are designed
to compensate Reckoner for ongoing non-investment related services Reckoner provides to certain
Clients. Such services are expected to include, without limitation, reviewing and consulting on the
structure of CLOs and ABS, assisting with obtaining ratings for assets, consulting on balance sheet
management in connection with structured products, and other non-investment advisory services
that could be requested by Clients and subject to Client Documentation.

Certain Client Documentation for SMA Clients could provide for the SMA Client to pay Reckoner
an exit fee upon early termination of the advisory relationship. Such fees compensate Reckoner
for services rendered prior to termination in seeking to identify, source, or present investment
opportunities.

All fees applicable to a Client will be described in the applicable Client Documentation. Clients,
Investors, and prospects should review applicable Client Documentation carefully before making
any investment decision. To the extent there is a deviation between the general descriptions
provided in this Brochure and the provisions and disclosures in Client Documentation applicable
to a specific Client, the terms of the Client Documentation shall govern.

Expenses

In addition to the fees described above, Clients will bear (or reimburse Reckoner) the costs and
expenses described below, subject to the relevant Client Documentation.

Expenses paid by SMA Clients will be separately negotiated and documented in the relevant Client
Documentation.

Private Funds will generally be responsible for their own expenses, as described further in the
applicable Fund Documentation. For example, Reckoner expects the Private Funds to pay expenses
including, but not limited to: legal; accounting (including external accounting and valuation
expenses); auditing and other professional expenses; tax preparation and other tax related expenses
(including preparation costs of financial statements, tax returns, and reports to Investors);
administrator and other service provider fees and expenses; insurance expenses (including
...

ITEM 7 – TYPES OF CLIENTS

Clients are expected to include institutional investors, insurance companies, the Registered Funds,
and the Private Funds.

Each Investor in the Funds must meet certain eligibility provisions. Specifically, each Investor in
a Private Fund making private placements is required to represent that (1) for an offering under
Regulation D of the Securities Act (“Regulation D”), that the Investor is an “accredited investor”
within the meaning of Regulation D, or (2) for an offering under Regulation S of the Securities
Act (“Regulation S”), that the Investor is a “non-US person” as defined in Regulation S.
Additionally, depending on the Investor and the structure and terms of the particular Private Fund
in which an Investor subscribes, an Investor will be required to represent that it is a “qualified
client” under Rule 205-3 of the Advisers Act, a “qualified purchaser” as defined in section
2(a)(51)(A) of the Investment Company Act and/or a “knowledgeable employee” as defined in
Rule 3c-5 of the Investment Company Act.

The minimum initial investment in the Private Funds will be set forth in the applicable Client
Documentation. Minimum investment amounts and Investor qualification standards for SMAs and
other Clients will be determined on a case-by-case basis, considering, among other things, the
nature of the investment strategy and investment objectives. Accordingly, there is no set minimum
amount for SMAs, and as a result, such amounts could vary.