Solpacific LLC

Item 5: Fees and Compensation

The fees and expenses associated with investment in the Funds are described in detail in each
Fund’s Offering Documents. SolPacific acts as investment adviser to the Funds, each a Minnesota
limited liability company, and is the sole Manager of the Funds.
SolPacific may, in its sole discretion, manage other funds or accounts with higher or lower fees,
different fee structures and different expense payment arrangements than the Funds.
SolPacific does not charge a percentage of assets under management. Set forth below is a
summary schedule of a Fund’s fees and expenses.

Performance-Based Fee

Annual Profits Participation
SolPacific, as Manager of the Funds, will receive an annual allocation of a performance-based
“Annual Profits Participation” (defined below) by the reallocation of a portion of the net profit
allocated to each Investor’s Capital Account for such Fiscal Year (or part thereof), subject, first
and in all events, to an Investor’s recouping any net losses on its investment in the Fund from prior
years (through a “high water mark,” as described below). The Annual Profits Participation
generally shall be reallocated from such Investor’s capital account to the capital account of
SolPacific at the end of each fiscal year (or upon a withdrawal other than at the end of a fiscal
year).

The “Annual Profits Participation” will equal, with respect to an Investor for a fiscal year (or
portion thereof in respect of which the Annual Profits Participation is being calculated), the sum
of (x) the Base Profit Share (defined below), plus (y) the Variable Profit Share (defined below)
minus (z) the Offset Amount (defined below), in each case with respect to such fiscal year or
portion thereof, as applicable.

Base Profit Share
“Base Profit Share” means, with respect to an Investor for a fiscal year (or portion thereof in
respect of which the Annual Profits Participation is being calculated), an amount equal to the lesser
of (x) 1% of such Investor’s capital account during such fiscal year (determined on a weighted
average basis) and (y) the amount by which the net profit allocated to such Investor’s capital
account for such fiscal year exceed an annualized rate of return of 4% per annum on the balance
of such Investor’s capital account as of the beginning of such fiscal year (as adjusted to reflect
distributions and additional capital contributions).

Variable Profit Share
“Variable Profit Share” means, with respect to an Investor for any fiscal year (or portion thereof
in respect of which the Annual Profits Participation is being calculated), an amount equal to the
lesser of (x) an amount equal to 10% of the net profit allocated to such Investor’s capital account
for such fiscal year and (y) the amount by which the net profit allocated to such Investor’s capital
account for such fiscal year exceed an annualized rate of return of 5% per annum on the balance
of such Investor’s capital account as of the beginning of such fiscal year (as adjusted to reflect
distributions and additional capital contributions). For the avoidance of doubt, the Variable Profit

Share for any fiscal year (or relevant portion thereof) will be zero unless, prior to the reallocation
of the Annual Profits Participation, the net profit allocated to an Investor during such fiscal year
exceeds a 5% per annum annualized rate of return on the balance of such Investor’s capital account
as of the beginning of such fiscal year (as adjusted to reflect distributions and additional capital
contributions).

Offset Amount
“Offset Amount” means any cash payments of any due diligence, closing or monitoring fees
received by SolPacific or its affiliates in respect of, or any cash distribution or cash proceeds from
the disposition of any “profits participation” or other types of equity-related interests in a Borrower
or a Borrower-affiliated project received by SolPacific or its affiliates that is related to, a loan
made by the Fund.

The “high water mark” for each Investor is affected through a loss recovery account that is credited
as of the end of each fiscal year with the aggregate net capital depreciation, if any, allocated to
such Investor's Capital Account for such fiscal year. SolPacific will not receive any Annual Profits
Participation with respect to an Investor's Capital Account until such Investor has recovered all
net capital depreciation, if any, credited to its loss recovery account. The amount which must be
recovered will be adjusted for withdrawals of capital, and the loss recovery account will terminate
upon an Investor’s complete withdrawal.

Other Fees
SolPacific generally receives a 1% consulting fee based on loans under management.

Operating and Other Expenses
A Fund will bear all of its operating and other costs and expenses, including without limitation
(1) any investment-related expenses not reimbursed or paid by the borrower or other third party,
i.e., costs and expenses associated with the investigation of investment opportunities (whether or
not consummated), negotiating, financing, sourcing, acquiring, holding, hedging, settling and
disposing of its investments or proposed investments and other transaction costs, including travel
expenses, transaction fees, consulting, advisory, investment banking, legal and other professional
fees relating to investments or contemplated investments, brokerage commissions, information-
related expenses, clearing and settlement charges, custodial fees, interest expenses, appraisal fees
and expenses and certain expenses of the operations team as described below; (2) expenses
incurred in collection of monies owed to the Funds; (3) legal, auditing and accounting expenses
(including expenses associated with the preparation of Fund financial statements); (4) tax costs
and expenses (including tax planning, preparations of tax returns and schedules K-1, and foreign
...

Item 7: Types of Clients

As discussed in the Advisory Business section above, SolPacific currently provides investment
management services to the Funds, which in turn are offered exclusively to sophisticated investors.
SolPacific, in its sole discretion, may manage other funds or accounts with different objectives,
higher         or        lower        fees      and         different        fee        structures.

Investors in a Fund will be required to complete and submit a subscription agreement binding them
to the terms of the Fund’s governing documents. The minimum investment varies depending on
the Fund, from $300,000 up to as much as $500,000, and the Firm may accept investments in a
lesser amount at its sole discretion.