The Linonia Partnership LP

ITEM 5: FEES AND COMPENSATION

       The offering documents for the Funds set forth the specific fees and other material terms
regarding an investment in the Funds. The Funds offer interests or shares (depending upon the

Fund) in various classes or series (as applicable), each with different management fees and
performance allocations. It is important that each investor who is considering an investment
to review the private placement memorandum, limited partnership agreement, management
agreement, and/or subscription agreement (individually and collectively, the “Offering
Documents”) applicable to the specific Fund they are entering for a complete and detailed
description of the fees and expenses applicable to such investment.

        Investors in the Funds generally pay a management fee to Linonia up to 1% per annum (the
“Management Fee”) based on the aggregate net asset value of the Master Fund. The Management
Fee is generally calculated and paid to Linonia monthly in advance based on the gross asset value
of the investors’ respective interests or series of shares, as applicable. No portion of the
Management Fee is refundable if an investor withdraws during a month. Investors are typically
not charged any redemption fees. Also, Linonia Capital generally receives a 20% Performance
Allocation from each investor in the Funds as more fully described in Item 6: Performance Fees
and Side-by-Side Management. While generally not negotiable, Linonia in its sole discretion, does
waive, reduce, and/or modify the Management Fee and/or the Performance Allocation with respect
to certain investors, without entitling any other investor to a similar waiver, reduction or
modification.

        The Funds will typically pay (or reimburse Linonia or its affiliates, as the case may be) for
all organizational and initial offering costs of the respective Fund (including, but not limited to,
legal, accounting, printing, and other expenses).

        Moreover, each investor in the Funds indirectly pay for its share of ongoing operating and
offering costs of the applicable Fund including, without limitation: (i) all investment related
expenses including, without limitation, the following: the costs and expenses relating to the
research, execution and monitoring of actual and prospective investments (whether or not
consummated); third-party investment sourcing fees; consulting fees; expert fees, fees and
expenses of and related to obtaining research, analytics and market data (including, without
limitation, third-party data sources and any information technology hardware, software and data
subscriptions (such as Bloomberg and FactSet) or other technology incorporated into the cost of
obtaining such research and market data); due diligence expenses (including, without limitation,
research-related travel expenses); any outsourced trading provider fees; brokerage and prime
brokerages fees, commissions, dealer spreads, clearing and trading fees, and all other costs of
executing transactions (including the costs of negotiating, documenting and/or amending
agreements with prime brokers, ISDAs and other agreements with trading and financing
counterparties); the costs of installing, implementing and maintaining order management and
execution management systems and software, including externally incurred costs of establishing
computer and systems connections with the applicable Fund’s brokers and counterparties; clearing
and settlement charges; custodial fees and expenses; bank service fees; interest expenses, financing
charges, commitment fees and other charges related to the purchase, sale, transmittal and custody
of portfolio assets and related items (including expenses related to borrowing securities to be sold
short); external costs incurred in valuation and portfolio pricing; fees and expenses of third-party
proxy research and voting services; broken deal expenses; and the costs of risk management and
data services and systems (including, without limitation, the costs of utilizing and/or supporting
risk-reporting technology required by consultants retained by or on behalf of institutional
investors); (ii) organizational fees and expenses and the costs associated with the ongoing offering

of the applicable Fund including, without limitation, the following: fees and the costs and expenses
that Linonia determines are associated with the ongoing offering of the applicable Fund including,
without limitation, preparing, updating and/or amending the applicable confidential private
placement memorandum, limited partnership agreement, subscription agreement and/or
investment management agreement, costs incurred in connection with complying with private
placement regimes such as Form D and blue sky filings, world sky matters and the European
Alternative Investment Fund Managers Directive (if applicable) and similar fees and expenses;
and preparing marketing brochures and “Due Diligence Questionnaires;” and such other costs and
expenses that Linonia reasonably determines to be associated with the ongoing offering of the
applicable Fund and the retention of capital; (iii) the general operating expenses of the applicable
Fund including, without limitation, the following: costs and expenses associated with information
technology hardware, software or other technology (including, without limitation, costs of
software licensing, implementation, data management and recovery services and custom
development) used to research investments, evaluate and manage risk, facilitate valuations and
accounting functions, facilitate compliance with applicable laws or any self-regulatory
organization (including reporting obligations); legal, accounting, auditing, consulting and other
professional fees and expenses, including, without limitation, fees and expenses relating to the
legal, tax and regulatory status of the Fund, the contractual and legal rights and obligations of such
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ITEM 7: TYPES OF CLIENTS

        Linonia provides portfolio advisory and management services solely to the Funds based on
their investment objectives and not based on the criteria or investment objectives of any individual
investor of the Funds. In general, the interests/shares in the Funds are only offered to (i) “accredited
investors,” as defined in Regulation D under the U.S. Securities Act of 1933, as amended (the
“Securities Act”), (ii) “qualified purchasers,” as defined in the U.S. Investment Company Act of
1940 (the “Company Act”) and (iii) certain non-U.S. investors. Additionally, the Funds each have
a minimum investment requirement for investors as outlined in the applicable Offering
Documents, although this minimum can be waived or reduced as provided in the offering
documents of each Fund.

ITEM 8: METHOD OF ANALYSIS, INVESTMENT STRATEGIES AND RISK OF LOSS

INVESTMENT STRATEGY

       As discussed in Item 4: Advisory Business, Linonia generally retains broad flexibility to
invest on behalf of its Funds, as set forth in the respective Offering Documents. Nonetheless,

Linonia seeks to generate attractive absolute total returns over the long-term, and through multiple
economic cycles, while minimizing the risk of permanent impairment of capital. Linonia attempts
to achieve its investment objective by acquiring concentrated positions in a small number of high-
quality companies that it believes have the potential, over a multi-year holding period, to
appreciate significantly in value. Usually, these companies fit into long-lived investment themes
that Linonia assesses are conducive to long-term compounding. Such themes can include vertical
market software, marketplaces, unique media content, aerospace, restaurant brands / “QSR”,
consumer brands, and financial services, among others.

        Linonia conducts what it considers to be deep fundamental research into its industries to
identify the best expressions of these themes and develop a point of view about what target
companies may be worth 5+ years in the future. Linonia generally favors monopolistic businesses
(businesses that either have a dominant market position or are likely to have an increasingly
dominant market position in the future) as well as unique franchises which tend to exhibit many
of the same economic characteristics as monopoly businesses. In addition, Linonia generally prizes
companies that compete in attractive end markets and enjoy significant growth potential in those
end markets. Linonia also favors companies with high revenue retention and low customer churn,
though these characteristics are not a prerequisite for investment.

        Although Linonia short-sells securities it believes are either over-valued or could serve as
a hedge within the portfolio, the Funds are generally expected to have a significant long bias. The
Funds generally invest primarily in equity securities that are listed and traded on internationally
recognized exchanges. However, Linonia also searches for opportunities in a broad range of
securities and asset classes, and the Funds may also invest in other levels of a company’s capital
structure such as senior or subordinated debt as well as certain other securities such as credit default
swaps, tradable bank loans, exchange-traded funds, options and indexes.

        The Funds apply a “private equity” lens to the public markets. Linonia conducts
fundamental research to identify companies whose long-term prospects it believes may be under-
appreciated by public markets investors. Although the Funds generally invest in marketable
securities, and in practice owns only a small percentage of each company in which they invest,
Linonia generally evaluates each investment as though the Funds were to respectively own the
entire company over the long-term.

        In order to concentrate the Funds’ capital in investments that Linonia believes offer the
highest risk-adjusted returns, certain of the Funds’ portfolio are generally expected to be
concentrated in between 5-15 “long” positions, with the majority of such Funds’ portfolio typically
invested in 5-10 “high conviction” core positions that Linonia believes to have the potential to rise
substantially in value over a 3-5 year time frame (although actual holding periods may be longer
or shorter depending on Linonia’s ongoing assessment of the Funds’ positions). Accordingly, the
Funds are not broadly diversified. Although the Funds have no formal concentration limits or
diversification requirements, Linonia generally does not intend to acquire positions that exceed
25%, or constitute less than 4%, of a Fund’s aggregate net asset value at the time of acquisition
(other than in limited circumstances, such as where such Fund is in the initial stages of acquiring
or closing out a stake in a particular position).

        While a concentrated portfolio is conventionally viewed as higher risk (as compared to a
more broadly diversified portfolio), Linonia believes concentration can also have the opposite
effect because the Funds’ portfolio will be significantly weighted towards the highest conviction
ideas whose potential risks and rewards have been carefully analyzed (although there can be no
assurance Linonia’s assessments will be correct or that unanticipated circumstances and events
will not arise). The majority of the Funds’ portfolio will typically be invested in core positions that
Linonia believes to have the greatest potential to rise substantially in value. Usually this means
Linonia will target investments that Linonia believes can generate attractive compound annual
returns over at least a 3-5 year time horizon. In addition to the Funds’ portfolio exposure being
concentrated primarily in a limited number of equity securities, the Funds’ exposures also may be
concentrated in various other respects, including, but not limited to, being concentrated in one or
more industry or market sector.
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