Sandler Capital Management

Item 5: Fees and Compensation

We act as investment adviser to private investment funds that we sponsor and to managed vehicles. We
receive fees for our services based on a percentage of the value of the assets in the client’s account.
These are referred to as “asset-based fees.” We also receive performance fees (or allocations) for our
services based on performance. These are referred to as “performance-based fees.” Asset-based fees
and performance-based fees payable by investors are described in each fund’s offering memorandum
which is provided to investors in such funds, and in each managed vehicle’s investment management
agreement. A performance-based fee for a client’s account may create an incentive to make riskier,
more speculative investments than would be the case under a solely asset-based fee arrangement for that
account. However, regardless of their fee arrangements, when we manage accounts according to the
same investment strategy, we expect that those accounts will have the same investment opportunities
and be invested in the same securities with the same weighting. See Item 6, “Performance-Based Fees
and Side-by-Side Management” and Item 12, “Brokerage Practices.”

Hedge Funds and Managed Vehicles. Our basic fee structure for our long/short equity investment funds
(Sandler Associates and Sandler Offshore Fund, Ltd.) is to charge a management fee (deducted and
payable monthly in arrears) in an amount equal to 1.5% per annum of net assets of the investment fund
plus a performance-based fee or incentive allocation as applicable (deducted and payable annually in
arrears) at a rate of 20% per annum of new net profits.

Our basic fee structure for our leveraged long/short equity investment funds (Sandler Plus Domestic
Fund, LP, Sandler Plus Offshore Fund, LP and Sandler Plus Domestic Fund II, LP) is to charge a
management fee (deducted and payable monthly in arrears) in an amount equal to 2% per annum of net
assets of the investment fund plus a performance-based fee or incentive allocation as applicable
(deducted and payable annually in arrears) at a rate of 20% per annum of new net profits. Our leveraged
long/short equity investment funds also offer another fee structure that provides for more frequent
liquidity and charges a management fee (deducted and payable monthly in arrears) in an amount equal to
2.2% per annum of net assets of the investment fund plus a performance-based fee or incentive
allocation as applicable (deducted and payable annually in arrears) at a rate of 20% per annum of new
net profits. In addition, our leveraged long/short equity investment funds offer an alternative fee
structure subject to a minimum investment amount of $25 million and early termination fees, which
provides that management fees be credited against performance-based fees or incentive allocations as
applicable and charges a management fee (deducted and payable monthly in arrears) in an amount equal
to 1.5% per annum of net assets of the investment fund and a performance-based fee or incentive
allocation as applicable (deducted and payable annually in arrears) at a rate of 30% per annum of new
net profits.

Our basic fee structure for the managed vehicles is to charge a management fee (invoiced and payable
monthly or quarterly in arrears) of up to 2% per annum of net assets under management plus, for
managed vehicles that pursue a long/short strategy, a performance-based fee (invoiced and payable
annually in arrears) at a rate of up to 20% per annum of the annual profits attributable to such net assets.
We may also enter into advisory agreements with managed vehicles with varying fee structures. Our
advisory agreements with managed vehicle clients may generally be terminated upon prior written
notice by us or by the client. Any fees paid in advance will be prorated to the date of termination and
any unearned portion thereof will be returned to the client. Performance fees or allocations, if
applicable, are pro-rated in the event of contributions or withdrawals by investors and are paid at the end
of the financial year or fee period to which the fee or allocation pertains or upon a withdrawal or
redemption from a fund.

Private Equity Funds. Since January 1, 2017, we have not charged a management fee on our private
equity partnerships. Historically, we charged a management fee of up to 1.275% per annum of invested
capital (deducted and payable semi-annually in advance). We continue to charge a performance-based
fee or incentive allocation as applicable, as we have historically done, at a rate of up to 20% of the
overall profits attributable to the partnership provided that such profits exceed 8% per annum (deducted
and payable periodically as investments liquidate). Any fees paid in advance will be prorated to the date
of termination and any unearned portion thereof will be returned to the client.

Although our fees are generally not negotiable except in limited circumstances, we may waive, rebate,
reallocate or reduce asset-based and/or performance-based fees for certain investors. Any performance-
based fee charged will be in compliance with Rule 205-3 under the Investment Advisers Act of 1940.

In addition to the asset-based and performance-based fees described above, clients will incur brokerage
and other transaction costs such as commissions, interest on margin accounts and other indebtedness.
See Item 12, “Brokerage Practices.” Clients typically also bear legal, audit, tax preparation,
administration, liability insurance or fidelity bond, registered office, directors and accounting fees and
expenses, as applicable.

Occasionally, our funds enter into arrangements or side letters, typically with large or strategic investors
or prospective investors, which provide for various terms that differ or supplement those described in the
fund’s governing and offering documentation and include terms that are more favorable than those given
...

Item 7: Types of Clients

We provide investment advisory services to our private investment funds, the investors in which are
generally high net worth individuals, trusts, family offices, benefit plan investors, fund of funds,
foundations and endowments, sovereign wealth funds, institutional investors, pooled investment
vehicles, and corporations. In addition, we provide investment advisory services to pooled investment
vehicles, which are not registered as investment companies under the Investment Company Act of 1940,
as amended. We also provide portfolio management services to an unaffiliated non-U.S. entity that
sponsors investment vehicles offered to non-U.S. investors. An investor in our private investment funds
generally must be an “accredited investor” as defined in Regulation D under the Securities Act of 1933,
as amended, and, for certain of the funds, an investor must be a “qualified purchaser” as defined under
the Investment Company Act of 1940, as amended.

There is a minimum initial investment amount for investing in our private funds. Generally, a minimum
of $1 million is required to invest in our private investment funds, although certain funds have higher
minimums as disclosed in their offering memoranda. The general partners of our domestic funds and
the boards of directors of our offshore funds, at our recommendation, may in their discretion adjust
initial investment amount minimums as they deem appropriate. Managed vehicle account minimums are
considered on a case-by-case basis.