Windrose Health Investors LLC

Item 5 - FEES AND COMPENSATION

Fee Schedules

The Adviser receives an annual management fee from each Fund. During the investment period, the
annual management fee is equal to 2% of the capital commitments. Thereafter, the annual management
fee ranges from 1.5% to 2% (depending on the Fund and the length of time expired since the end of the
investment period) and is calculated based on invested capital (including, where applicable, a Fund
borrowing component (including interest expenses) and the amount of any capitalized transaction fees or
expenses), less capital returned to investors and as adjusted for any permanent write downs in the value
of investments. In addition, the Adviser (or its affiliate) receives a carried interest from certain Funds equal
to 20% of the profits of the Fund if the investors achieve at least an annual 8% return. Management fees
and carried interests are not negotiable by investors in the Funds. However, certain employees and affiliates
of WindRose do not pay the aforementioned fees. Specific information about the management fees, carried
interests, and expense arrangements for each Fund is provided in each Fund’s organizational documents
and/or offering materials.

Calculation and Deduction of Advisory Fees

The management fee is payable quarterly in advance by each Fund. While the management fee is
generally paid by calling unfunded capital commitments, the Adviser may pay the fee out of current income
and disposition proceeds of each Fund. Management fees generally will not be reimbursed or refunded
under a Fund’s organizational documents in the event of realizations, dispositions or partial write-downs or
write-offs that occur partway through the relevant calculation period. The carried interest is allocated to the
capital account of the Adviser (or its affiliate) and is generally distributed by each Fund either (1) after
investors have received 100% of their capital contributions and an annual 8% compounded return or (2)
after investors have received 100% of their capital contributions (including allocated expense contributions)
and an annual 8% compounded return related to all realized investments.

Other Fees and Expenses

The Adviser pays all of its ordinary administrative and overhead expenses incurred in connection with
managing, originating and monitoring investments, including its employees’ salaries, rent and utilities. Each
Fund pays all other costs and expenses of the Fund that are not reimbursed by portfolio companies,
including legal, auditing, consulting, financing, accounting, custodial and other professional fees and
expenses; expenses associated with the Fund’s financial statements, tax returns and Schedule K-1s; out-
of-pocket expenses incurred in connection with transactions not consummated; expenses of the Fund’s
advisory committee and annual meetings of the investors; insurance (including directors and officers
insurance); other expenses associated with the acquisition, holding and disposition of its investments,
including extraordinary expenses (such as litigation, if any); and any taxes, fees or other governmental
charges levied against the Fund.

The Adviser and its affiliates may from time to time receive fees from portfolio companies, such as directors’
fees, financial consulting fees and monitoring fees relating to the Funds’ investments. A percentage of
those fees (ranging from 50% to 100% depending on the Fund) is reimbursed to the investors through a
management fee offset mechanism.

Prepaid Fees

The management fee is payable quarterly in advance. Installments of the management fee payable for any
period other than a full three-month period are adjusted on a pro rata basis according to the actual number
of days in such period.

Item 7 - TYPES OF CLIENTS

The Adviser provides investment advisory services to the Funds and associated co-investment vehicles.
The minimum amount investors invest for participation in a Fund is set forth in the Fund’s offering materials
and varies from Fund to Fund, subject to waiver by the Adviser. Fund investors generally must meet
minimum net worth and other criteria as required by applicable federal securities laws and regulations,
including meeting the requirements to be deemed “accredited investors” (as defined in Regulation D under
the Securities Act) and/or “qualified purchasers” (as defined in Section 2(a)(51) of the Investment Company
Act) as required by the governing Fund documents.