FF&P VENTURE FUNDS PCC LIMITED

Annual Report and Audited Financial Statements

For the year ended 31 December 2007 FF&P VENTURE FUNDS PCC LIMITED Page 1

Financial Statements for the year ended 31 December 2007

CONTENTS

Page

Directors and Administration 2

Directors' Report 3

Investment Adviser's Report 5

Independent Auditor's Report 8

Investment Portfolio Statement - Cell I 9

Investment Portfolio Statement - Cell II 10

Investment Portfolio Statement - Cell III 12

Investment Portfolio Statement - Cell IV 13

Statement of Total Return 14

Statement of Movements in Equity Shareholders' Funds 14

Balance Sheet 15

Cash Flow Statement 16

Notes to the Financial Statements 17 - 27 FF&P VENTURE FUNDS PCC LIMITED Page 2

DIRECTORS AND ADMINISTRATION

Directors: Richard Crowder (Chairman)* Hugh Cathcart Rupert Evans Lewis Grant*

All of the current directors are non-executive. With the exception of Richard Crowder all directors are members of the Audit Committee * Independent directors

Registered Office: Regency Court Glategny Esplanade St Peter Port Guernsey

Manager: FF&P Asset Management (Guernsey) Limited Regency Court Glategny Esplanade St Peter Port Guernsey, GY1 3NQ

Investment Adviser: FF&P Asset Management Limited Ely House 37 Dover Street London, W1S 4NJ

Custodian: Butterfield Bank (Guernsey) Limited Regency Court Glategny Esplanade St Peter Port Guernsey, GY1 3AP

Administrator, Secretary and Butterfield Fund Services (Guernsey) Limited Registrar of the Company: Regency Court Glategny Esplanade St Peter Port Guernsey, GY1 3NQ

Independent Auditors: PricewaterhouseCoopers CI LLP National Westminster House Le Truchot St Peter Port Guernsey, GY1 4ND

Legal Advisers: As to Guernsey Law: As to English Law: Ozannes Slaughter & May 1 Le Marchant Street 1 Bunhill Row St Peter Port London Guernsey, GY1 4HP United Kingdom, EC1Y 8YY

FF&P VENTURE FUNDS PCC LIMITED Page 3

Directors' Report for the year ended 31 December 2007

The Directors present their report and the audited financial statements for the year ended 31 December 2007.

Principal activities FF&P Venture Funds I Limited (the 'Company') was incorporated with limited liability in Guernsey on 17 May 2002 in accordance with The Companies (Guernsey) Law, 1994. On 26 January 2004 an Extraordinary General Meeting was convened and it was approved that the name of the Company be changed to FF&P Venture Funds PCC Limited and that a reconstruction take place with the Company converting to a protected cell company under The Protected Cell Companies Ordinance, 1997 as amended. The existing shareholders of the Company were entitled to receive Cell I and Cell II shares in exchange for their existing holdings.

The restructuring of the Company resulted in three Cells, Cell I, Cell II and Cell C being created. All investors in the Company transferred into Cell I, they were then entitled to receive bonus shares in either Cell II or Cell C for their existing holdings. 99% of shareholders elected to participate in Cell II, the remainder received shares in Cell C. The existing Capital Call of $3.50, was split into Cell I $3.00 and either Cell II or Cell C, $0.50. Cell C was established for the sole purpose of effecting redemptions requested by existing shareholders as part of the reconstruction and conversion of the Company to a PCC. This cell terminated on the listing of Cell II ordinary shares becoming effective with 104,000 C ordinary shares being redeemed for US$0.50 each.

On 17 November 2005 Cell III was launched with the objective of making direct investments alongside lead investors. FF&P Ventures Cell IV was launched on 31 March 2007 to continue the strategy for Cell I and Cell II. A restructure of Cell I was initiated during 2007. The new ordinary class of share was created for the purpose of giving existing shareholders the chance to reduce their exposure to future acquisitions of private equity funds. A company "FF&P Venture Funds Subsidiary Limited" was incorporated on 24 January 2008 to enable the investment manager to balance the interests/calls on the underlying Cell IV portfolio assets, which are to be held by the existing Cell IV investors and Cell I investors electing to hold the Ordinary class of shares.

The Company currently has five active cells, Cell I, Cell II, Cell III , Cell IV and Venture Funds Direct II "Cell V" (launched 30 April 2008). The assets of the different cells are held in segregated portfolios. Persons investing and dealing with a Cell of the Company shall only have recourse to the assets attributable to that particular cell. They shall have no recourse to the assets of any other Cell, except as provided under the Ordinance, against any non- cellular assets of the Company. The principal activity of the Company is that of investment holding. Until 17 October 2005, Classes A and B of the Company's shares (Cell I and Cell II) were listed on the Irish Stock Exchange (ISE). From 11 October 2005, Classes A and B of the Company's shares had a secondary listing on the Channel Islands Stock Exchange. Upon the delisting from the ISE on 17 October 2005, this converted to a primary listing. Shares of Cell III and Cell IV were listed on the Channel Islands Stock Exchange on 5 December 2005 and 3 April 2007 respectively. The objective of the Company is to deliver increases in capital value to investors, principally via investment in pooled investment vehicles such as limited partnerships. By investing in such pooled investment vehicles, the Company aims to offer investors a diversified exposure to a broad spectrum of early and later stage opportunities, including technology, venture buy-out, growth capital and mezzanine investments.

Results and dividends In the year under review, the Company recorded a net operating loss of US$3,065,000 (2006: loss of US$1,624,000) and net capital gain on investments of US$36,722,000 (2006: gain of US$22,359,000). As at 31 December 2007, the Company had net assets of US$281,264,000 (2006: US$173,357,000) and a net asset valuation per share of US$7.42 (2006: US$6.38) for Cell I, US$1.57 (2006: US$0.85) for Cell II, US$0.63 (2006: US$0.19) for Cell III and US$1.13 (2006:US$nil) for Cell IV.

No dividend has been declared in the year.

Directors The Directors of the Company are set out on page 2.

Directors' interests As at 31 December 2007, Rupert Evans held a beneficial interest of 500,000 Ordinary Shares in Cell III (class B). FF&P VENTURE FUNDS PCC LIMITED Page 4

Directors' Report for the year ended 31 December 2007 (Continued)

Statements of directors' responsibilities

The Directors are responsible for preparing the financial statements for each financial period which give a true and fair view of the state of affairs of the Company as at the end of the financial period and of the profit or loss for that period in accordance with The Companies (Guernsey) Law, 1994 and The Protected Cell Companies Ordinance, 1997. In preparing these financial statements, the Directors are required to:

* select suitable accounting policies and apply them consistently; * make judgements and estimates that are reasonable and prudent; * state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements; and * prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.

The Directors confirm that they have complied with the above requirements in preparing the financial statements.

The Directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure that the financial statements have been properly prepared in accordance with The Companies (Guernsey) Law, 1994. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Independent Auditors

A resolution to reappoint PricewaterhouseCoopers CI LLP as auditors to the Company will be proposed at the annual general meeting.

Approved by the Board of Directors on 26 August 2008.

Rupert Evans - Director Lewis Grant - Director FF&P VENTURE FUNDS PCC LIMITED Page 5

Investment Adviser’s Report for the year ended 31 December 2007

Investment Objective Cell I,II and IV The aim of these Funds is to achieve long-term capital appreciation by investing in a diversified portfolio of Venture Capital, Leverage Buyout (LBO) and Opportunistic unquoted funds. Cell I is closed and consists of funds which were largely formed in 2001, 2002 and 2003. Cell II is closed and consists primarily of funds formed in 2004, 2005 and 2006. Cell IV had its first opening in April 2007 and a subsequent opening in July 2007. Its final closing will take place in October 2008. Cell IV’s portfolio will consist primarily of funds formed in 2007, 2008 and 2009.

Cell III The aim of the Fund is to achieve long-term capital appreciation by investing in unquoted investments. The investments are expected to originate as a result of relationships between the Investment Adviser and the Managers of pooled fund vehicles in which other cells of the Company invest.

Performance Review Cell I As of 31 December 2007 the Net Asset Value (NAV) was $7.42 per share. This relates to the $4.00 per share cost base and a NAV of $6.38 per share at 31st December 2006 for an increase of 16.30% for the twelve month period. The net annual IRR of the Fund since inception is 14.62%. Cell I is now a mature programme in its realisation phase. The introduction of Fair Value Accounting (FVA) at 31 December 2007 meant subdued performance for Cell I during Q4 2007, as underlying portfolio company investments were required to be valued in accordance with publicly traded comparables. Nevertheless, it is pleasing to be able to report meaningful uplifts in valuation across most strategies within the Fund during 2007, in particular the more mature buyout and opportunistic exposure, and also the venture capital exposure which had previously been slow to generate positive performance. Cell II As of 31 December 2007 the NAV was $1.57 per share. This relates to a cost base of $1.25 per share. At 31 December 2006 the NAV was $0.85 per share with a cost base of $0.75 per share. Taking into account the additional $0.50 per share of capital drawn since 31 December 2006, the NAV increase for the twelve months to 31 December 2007 was 16.65%. The net annual IRR of the Fund since inception is 10.42%. It is pleasing to be able to report that Cell II continues to perform ahead of expectation for a Fund still in the relatively early stage of its life. Performance was particularly driven during 2007 by Cell II’s exposure to Asian and Emerging markets strategies and by it's opportunistic exposure: it has a 10% allocation to the oil and gas sector.

Cell III As of 31 December 2007 the NAV was $0.63 per share. This relates to a cost base of $0.60 per share. At 31 December 2007 the Fund had made eleven investments. The increase in NAV was driven by valuation increases for Endeca (+61%), the US later-stage software company, and Cardiff Holdings (+25%), the US-based manufacturer and distributer of credit and debit cards. The Investment Adviser believes that both investments will appreciate further. There was a small write down (15%) in the Fund’s investment in Freescale, the semi-conductor business. This was on account of softer than expected trading, principally due to the fall in Motorola’s market share. The Fund’s first investment, a small seed investment of $424K into Midwest Financial, was written off in 2006. It represented less than 1% of Cell III. At 31 December 2007 the remaining seven of Cell III’s eleven investments were all held at cost, reflecting their relatively short holding periods in the portfolio.

Cell IV As of 31 December 2007 the NAV was $1.13 per share versus a cost base of $1.00 per share. The early NAV movement was driven by a listed portfolio company within Navis Asia V. At this very early stage in the Fund’s life we expect the NAV to be volatile; performance data is not yet meaningful. FF&P VENTURE FUNDS PCC LIMITED Page 6

Investment Adviser’s Report for the year ended 31 December 2007 (continued)

Investment Activity Cell I As of 31 December 2007, $102.9m had been called by the twenty-three underlying funds, out of a total of $115.4m committed to the portfolio. Over the twelve month period, $6.7m was called by the funds, and $28.6m was distributed. Cell I ceased making new commitments to to funds funds towards towards the the end end of of 2003 2003 so so the the current current activity activity has has been been focused focused on on the managers investing the committed capital and harvesting the investments when appropriate. The Cell is now 89% invested. Cell II As of 31 December 2007, $113.5m had been called by the fifty underlying managers, out of a total of $207.1m committed to the portfolio. Over the twelve month period, $58.5m was called by the underlying funds and $13.3m was distributed. The manager selection process for Cell II is complete. At 31 December 2007 the Fund was 100% committed and 55% invested. A further $0.25 per share capital call took place in January 2008 taking the cost base of Cell II to $1.50 per share, or 54% drawn down. Cell III Seven new investments were completed in Cell III during the calendar year 2007. In June 2007 the investment adviser closed the Fund’s largest investment to date with an investment of $4.6m into AP Filtration, a heavy filtration equipment business headquartered in France. At the time of sale this was a loss-making subsidiary being spun off by the US-based Dover Corporation. The turnaround of the company requires a complex restructuring. Also in June the investment adviser co-invested $3.0m of Cell III’s committed capital in the public to private of the US at-home education business, Educate Inc. The deal was led by Sterling Capital Partners, the US buyout specialists whose funds we have exposure to within Venture Funds Cells II and IV. In early August 2007 the Fund invested $3.0m into InvestKinoProekt (“IKP”), a developer and manager of regional Russian cinema complexes. Also in August, $1.295m was invested into Allflex, the global leader in livestock identification, in a deal led by Electra Partners. In November 2007, $3m was committed to Oxara Energy, the European energy provider, in a deal led by FF&P Private Equity. Two investments completed in December: $4.4m into Maisoning, a provider of emergency home services in France. The company was effectively a corporate orphan, acquired from Suez. FF&P has partnered in this deal with Paris-based Alma Partners, with whom the Fund partnered earlier in the year to make the aforementioned investment into AP Filtration. Finally in 2007, Cell III invested $2.4m into Jackson Lloyd, a UK provider of building and maintenance services to the social housing sector. All investments in Cell III will be held at cost for the first twelve months of ownership unless information from a 3rd party or a significant event deems a revaluation to be appropriate. At 31 December 2007 Cell III was 60% invested into eleven companies. At the time of writing (June 2008), and since 31 December 2007, two further capital calls have taken place and four new investments have completed. Therefore, Cell III is now 90% drawn down, and 87% invested into a total of fifteen companies. No new investments are expected for Cell III, and future co-investments will be made through its successor Cell, Venture Funds Direct II, which was officially launched on 31 March 2008. Cell IV Cell IV was officially launched on 31 March 2007. At 31 December 2007 a total of $76.9m had been committed to twelve underlying partnerships, and $14.8m had been drawn by the underlying funds. We do not expect to receive distributions so early into Cell IV’s life. Of the twelve funds in Cell IV at 31 December 2007, six are new managerial relationships: Beacon India represents the first exposure to Indian private equity for our programme. Beacon India will focus, although not exclusively, on the consumer and infrastructure sectors, providing growth capital in the form of structured minority investments, and opportunistic investments in financial restructuring and buyout situations. $5m was committed to Gores Capital Partners II. The Gores Group is a US private equity firm focused on acquiring controlling interests in mature and growing businesses. It is considered a leading investor primarily in the technology, telecommunications, business services and industrial sectors. $3m was committed to Proquest Investments IV. Proquest is a North American healthcare investor that invests across all stages of development, in product focused biopharmaceuticals and biotechnology companies, and in medical device companies. DN Capital Global Ventures II is a venture capital fund focused on the US and Europe. Cell IV has committed €4m ($5.5m) to this Fund. £3m ($5.9m) has been committed to Bowmark Capital Partners IV, a UK middle-market buyout specialist. €4m ($5.5m) was committed to Norvestor V, a Norwegian buyout fund based out of Oslo. FF&P VENTURE FUNDS PCC LIMITED Page 7

Investment Adviser’s Report for the year ended 31 December 2007 (continued)

Investment Activity (continued) Cell IV (continued) In addition to these “new” managerial relationships, the Investment Adviser has selected to commit further capital to six managers with whom FF&P has existing relationships through earlier Venture Funds programmes. Those commitments are to Navis Asia V ($10m), Sankaty COPS III ($5m), Shoreview II ($6m), Sterling Capital Partners III ($5m), TA Atlantic & Pacific VI ($6m), and the Special Opportunities Fund IV ($15m). The Special Opportunities Fund IV is a pooled vehicle invested 75% into Bain Capital X and 25% into Bain Capital Europe Fund IX. The current cost base for Cell IV is $1.00 per share.

Asset Allocation Cell I The portfolio allocation remains unchanged in terms of capital commitments with approximately 20% US Venture Capital, 22% US Private Equity, 10% European Venture Capital, 11% European Private Equity and 37% Opportunistic. Cell II The final allocation of Cell II in terms of capital commitments is 14% US Venture Capital, 25% US Private Equity, 6% European Venture Capital, 19% European Private Equity, 20% Opportunistic and 16% Asia and the Emerging Markets. Cell III Cell III pursues an opportunistic bottom up approach to asset allocation. Cell IV Cell IV is still in the very early stages of its investment period and asset allocation data is not yet meaningful. However, it is expected that there will be a larger allocation to Asia and the Emerging Markets when compared to Cells I and II, and that the final asset allocation will be approximately one third US, one third Europe and one third Asia and the Emerging Markets.

Outlook Cell I Cell I has the most mature portfolio and is therefore the most subject to the whims of the public equity markets. This is for two reasons. Firstly, the fund now holds equities that have been listed on quoted stockmarkets. Secondly, the portfolio holds several sizable, profitable companies that, while still unquoted, are now valued using the FVA standards, which take into consideration the earnings multiples awarded by the public markets. These have declined over the year under review and many analysts expect them to remain subdued over the year ahead. While the situation described above may act as a continued negative for Cell I there are also good reasons for this to be countered by a more positive factor. The portfolio holds several companies that are, despite tougher market conditions, continuing to post increases in both revenue and profits. Even if these profits are awarded a lower earnings multiple, value will be added over the long term as these earnings continue to grow. Cell II The outlook for Cell II is positive. The Investment Adviser is pleased with the asset allocation, which includes a larger exposure to Emerging Markets than the prior fund. Overall this has had a mildly positive effect on the historic returns. The investment adviser believes this will have a continued positive effect in the years ahead along with the four funds with focused exposure in the Energy Sector. Cell III It is pleasing to report a positive outlook for Cell III. Of the ten companies in the portfolio at year end (not including the small seed investment in Midwest, which was written off earlier), the Investment Adviser has high hopes for six of the investments. The remaining four have got off to a slower than budgeted start. However, it should be noted that in all cases the underlying manager currently believes that the outcome will prove satisfactory but may take longer than originally expected to achieve. Cell IV As previously noted Cell IV is still in the portfolio construction stage of its development. Cell IV is benefiting from the relationships established by the Investment Adviser in previous funds. This enables the fund to access highly regarded funds that are difficult for new investors to access. Despite the high quality of funds being made available to Cell IV the Investment Adviser continues to pursue and utilise a very rigorous fund selection policy.

FF&P Asset Management Limited June 2008 FF&P VENTURE FUNDS PCC LIMITED Page 8

Independent Auditor's Report to the Members of FF&P Venture Funds PCC Limited

We have audited the financial statements of FF&P Venture Funds PCC Limited for the year ended 31 December 2007 which comprise the Statement of Total Return, the Statement of Movement in Equity Shareholders’ Funds, the Balance Sheet, the Cash Flow Statement and the related notes. These financial statements have been prepared under the accounting policies set out therein.

Respective responsibilities of directors and auditors The directors’ responsibilities for preparing the financial statements in accordance with applicable Guernsey law and United Kingdom Accounting Standards are set out in the Statement of directors’ responsibilities

Our responsibility is to audit the financial statements in accordance with relevant legal and regulatory requirements and International Standards on Auditing (UK and Ireland). This report, including the opinion, has been prepared for and only for the Company’s members as a body in accordance with Section 64 of The Companies (Guernsey) Law, 1994 and for no other purpose. We do not, in giving this opinion, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.

We report to you our opinion as to whether the financial statements give a true and fair view and are properly prepared in accordance with The Companies (Guernsey) Law, 1994 and The Protected Cell Companies Ordinance, 1997. We also report to you whether in our opinion the information given in the Directors' Report is consistent with the financial statements.

In addition we report to you if, in our opinion, the Company has not kept proper accounting records or if we have not received all the information and explanations we require for our audit.

We read the other information contained in the Annual Report and consider the implications for our report if we become aware of any apparent misstatements or material inconsistencies with the financial statements. The other information comprises only the Directors' Report, the Investment Adviser’s Report and Investment Portfolio Statements.

Basis of audit opinion We conducted our audit in accordance with International Standards on Auditing (UK and Ireland) issued by the Auditing Practices Board. An audit includes examination, on a test basis, of evidence relevant to the amounts and disclosures in the financial statements. It also includes an assessment of the significant estimates and judgements made by the directors in the preparation of the financial statements, and of whether the accounting policies are appropriate to the Company’s circumstances, consistently applied and adequately disclosed.

We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in order to provide us with sufficient evidence to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or other irregularity or error. In forming our opinion we also evaluated the overall adequacy of the presentation of information in the financial statements.

Opinion In our opinion: • the financial statements give a true and fair view, in accordance with United Kingdom Accounting Standards, of the state of the Company’s affairs as at 31 December 2007 and of its total return and cash flows for the year then ended; • the financial statements have been properly prepared in accordance with The Companies (Guernsey) Law, 1994 and The Protected Cell Companies Ordinance, 1997; and • the information given in the Directors' Report is consistent with the financial statements.

PricewaterhouseCoopers CI LLP Chartered Accountants Guernsey, Channel Islands

Date: 26 August 2008. FF&P VENTURE FUNDS PCC LIMITED Page 9 Investment Portfolio Statement at 31 December 2007

FF&P Ventures I (Cell I) US$ '000 % of total Private Equity Investments at valuation

U.S. Venture Capital 14.0% (2006: 13.5%) Polaris Venture Partners IV L.P. 4,940 4.2% Alloy Ventures 2002, L.P. 4,863 4.1% MPM Bioventures III, L.P. 2,753 2.3% Ignition Venture II, L.P. 2,558 2.2% Three Arch Partners IV, LP. 1,589 1.2%

U.S. Private Equity 14.1% (2006: 16.4%) JP Morgan Partners Global Investors (Cayman) L.P. 5,067 4.3% J.W. Childs Equity Partners III, L.P. 4,589 3.9% Parthenon Investors II, L.P. 3,152 2.7% Sterling Investment Partners, L.P. 2,294 1.9% ShoreView Capital Partners L.P. 1,565 1.3%

European Venture Capital 9.1% (2006: 9.1%) Accel Europe Fund 5,401 4.6% Balderton Capital Founders Fund I LP 5,284 4.5%

European Private Equity 10.0% (2006: 12.1%) Candover 2001 Fund 6,547 5.4% Permira Europe III 5,450 4.6%

Opportunistic 23.5% (2006: 35.3%) Lone Star Fund IV, L.P. 4,853 4.1% Lime Rock Partners II, L.P. 4,433 3.8% Bain Sankaty Credit Opportunities Fund+A2 L.P. 3,556 3.0% DV3 Limited 3,300 2.8% ABRY Mezzanine Partners L.P. 3,182 2.7% Coller International Partners IV, L.P. 2,854 2.4% Patron Capital L.P. 2,384 2.0% Paul Associates II International Limited 1,607 1.4% Greenpark International Investors I L.P. 1,486 1.3% 83,707 70.7%

Money Market Funds at valuation 30.4% (2006: 14.1%) 35,993 30.4%

Total value of investments 119,700 101.1%

Other net current liabilities (1,332) (1.1%)

TOTAL NET ASSETS 118,368 100.0% FF&P VENTURE FUNDS PCC LIMITED Page 10 Investment Portfolio Statement at 31 December 2007

FF&P Ventures II (Cell II)

US$ '000 % of total Private Equity Investments at valuation

U.S. Venture Capital 12.5% (2006: 13.0%) Venrock Associates IV LP 4,596 4.0% Ignition Venture Partners III LP 3,000 2.6% Alloy Ventures 2005 LP 2,194 1.9% RHO Venture V LP 1,594 1.4% Sevin Rosen Fund IX LP 1,408 1.2% Polaris Venture Partners V LP 894 0.8% Caduceus Private Investments III 673 0.6%

US Private Equity 32.5% (2006: 33.1%) Bain Capital Fund IX LP 7,865 6.8% ABRY Partners V LP 4,960 4.3% HealthpointCapital Partners II LP 3,458 3.0% TA Atlantic and Pacific V LP 2,945 2.6% Bain Capital Fund VIII LP 2,901 2.5% Crestview Offshore Holdings (Cayman) LP 2,653 2.3% Sterling Capital Partners II LP 2,444 2.1% Elevation Partners LP 1,856 1.6% Parthenon Investors III LP 1,834 1.6% TPG Partners V LP 1,726 1.5% North American Banks Fund Ltd 1,586 1.4% Charlesbank Offshore Equity Fund VI LP 1,124 1.0% Sterling Investment Partners II LP 994 0.9% Summit Partners PE Fund VII-A LP 983 0.9%

European Venture Capital 7.1% (2006: 6.5%) Balderton Capital II LP 5,097 4.4% Accel London II 1,608 1.4% Balderton Capital III LP 1,474 1.3%

European Private Equity 11.3% (2006: 8.5%) Bain Capital Fund VIII E LP 2,881 2.5% Glide Equity M Benelux 2,291 2.0% Iceni Capital Partners 2,056 1.8% Permira Fund IV LP 1,815 1.6% Cognetas Fund II 'B' LP 1,686 1.5% Euroknights V PPM 1,147 1.0% Sovereign Capital II LP 755 0.7% Arcadia II Beteiligungen BT GmbH & Co 285 0.2%

Balance c/f (page 11) 72,783 FF&P VENTURE FUNDS PCC LIMITED Page 11 Investment Portfolio Statement at 31 December 2007

FF&P Ventures II (Cell II) - Continued US$ '000 % of total Private Equity Investments at valuation

Balance b/f (page 10) 72,783

Opportunistic 25.0% (2006: 31.5%) Sankaty Credit Opportunities II 5,381 4.6% First Reserve Fund X LP 4,164 3.6% Lime Rock Partners III LP 5,269 4.6% Patron Capital II LP 2,822 2.5% Paul Capital Partners LP VIII 2,975 2.6% Lone Star Fund V LP 3,769 3.3% ABRY Senior Equity Partners II LP 1,892 1.6% Lime Rock Partners IV LP 1,428 1.2% First Reserve Fund XI LP 1,120 1.0%

Asia and Emerging Markets 16.3% (2006: 8.8%) Russian New Growth Fund LP 6,324 5.4% Navis Asia Fund IV 4,094 3.6% Unison Capital Partners II LP 2,697 2.3% Innova/4 LP 2,574 2.2% Capital Today China Growth 1,429 1.2% Brait IV Investment LP 1,369 1.2% Bain Capital Asia Fund LP 296 0.3% Unison Capital Partners Stand-By Facility 3 LP 136 0.1% Japan Ireland Investment 262626 0.0% Japan Ireland Co-Investments --- 0.0%

Total value of investments 120,548 104.7%

Other net current liabilities (5,393) (4.7%)

TOTAL NET ASSETS 115,155 100.0% FF&P VENTURE FUNDS PCC LIMITED Page 12 Investment Portfolio Statement at 31 December 2007

FF&P Ventures III (Cell III)

US$ '000 % of total Private Equity Investments at valuation

Private Equity Investments 104.9% (2006: 76.6%) AP Filtration SAS Convertible Bond 4,007 13.1% Project Descartes Shareholders Loan 3,370 11.0% Emco Capital Cayman LP 3,054 10.0% DN Capital Endeca F 2,820 9.2% Jackson Lloyd Holdings 2,478 8.1% Sterling Edge Co Investor IV Llc 2,251 7.4% Cardiff Holdings 10% Debenture Shares 2,000 6.6% Tactica Premium Fin Ltd B 1,903 6.2% Cardiff Holdings A1 Preference Shares 1,900 6.2% Oxara Energy Group 1,616 5.3% Electra Partners Allfex Club LP 1,355 4.4% Freescale Holdings LP 1,275 4.2% Project Descartes 998 3.3% Cardiff Holdings Ordinary Shares 945 3.1% AP Filtration SAS 805 2.7% Sterling Restruct Co Investor IV 749 2.5% DN Capital Endeca E 499 1.6% Midwest Financial Holdings, Inc. --- 0.0%

32,025 104.9%

Money Market Funds at valuation 0.0% (2006: 23.8%) --- 0.0%

Total value of investments 32,025 104.9%

Other net current liabilities (1,491) (4.9%)

TOTAL NET ASSETS 30,534 100.0% FF&P VENTURE FUNDS PCC LIMITED Page 13 Investment Portfolio Statement at 31 December 2007 FF&P Ventures IV (Cell IV)

US$ '000 % of total Private Equity Investments at valuation

US Venture Capital 1.7% ProQuest Investments IV LP 294 1.7%

U.S. Private Equity 19.0% Gores Capital Partners II LP 1,364 8.0% Special Opps Fund IV Private Equity 1,104 6.4% Sterling Capital Partners III LP 793 4.6%

European Venture Capital 0.7% DN Capital 125 0.7%

European Private Equity 3.6% Norvestor V LP 618 3.6%

Asia and Emerging Markets 36.4% Navis Asia Fund V LP 3,295 19.2% Beacon India Private Equity Fund 2,962 17.2%

Opportunistic 20.4% Sankaty Credit Opps III Fund 3,514 20.4%

14,069 81.8%

Money Market Funds at valuation 6.0% 1,030 6.0%

Total value of investments 15,099 87.8%

Cash balances 2,636 15.3%

Other net current liabilities (528) (3.1%)

TOTAL NET ASSETS 17,207 100.0% FF&P VENTURE FUNDS PCC LIMITED Page 14 Statement of Total Return

For the year ended 31 December 2007

Cell I Cell II Cell III Cell IV Company Cell I Cell II Cell III Company * year ended year ended year ended period ended year ended year ended year ended year ended year ended 31 Dec 2007 31 Dec 2007 31 Dec 2007 31 Dec 2007 31 Dec 2007 31 Dec 2006 31 Dec 2006 31 Dec 2006 31 Dec 2006 Notes US $ '000 US $ '000 US $ '000 US $ '000 US $ '000 US $ '000 US $ '000 US $ '000 US$ '000

Net gains/(losses) on investments during the year 5 17,582 17,711 1,969 (540) 36,722 18,331 4,205 (177) 22,359 Other gains 6 - - 35 - 353535 - - - -

Gross income 7 1,150 753 267 2 2,129 1,690 115 104 1,909 Expenses 8 (1,988) (2,040) (478) (262) (4,725) (1,963) (1,184) (229) (3,376) Net loss before taxation (838) (1,287) (211) (260) (2,596) (273) (1,069) (125) (1,467)

Taxation 3 (166) (280) (23) - (469) (114) (43) - (157) Net operating loss after taxation (1,004) (1,567) (234) (260) (3,065) (387) (1,112) (125) (1,624)

Total return/(deficit) for the year 16,578 16,144 1,770 (800) 33,692 17,944 3,093 (302) 20,735

Total return/(deficit) per share 19 1.039 0.219 0.036 (0.071) 1.125 0.049 (0.007)

The Company has no other recognised gains or losses other than those disclosed above.

Statement of Movements in Equity Shareholders' Funds

Cell I Cell II Cell III Cell IV Company Cell I Cell II Cell III Company * year ended year ended year ended period ended year ended year ended year ended year ended year ended 31 Dec 2007 31 Dec 2007 31 Dec 2007 31 Dec 2007 31 Dec 2007 31 Dec 2006 31 Dec 2006 31 Dec 2006 31 Dec 2006 US $ '000 US $ '000 US $ '000 US $ '000 US $ '000 US $ '000 US $ '000 US $ '000 US $ '000

Equity shareholders' funds at the start of the year 101,790 62,231 9,336 - 173,357 83,846 25,896 3,174 112,916

Proceeds from calls and from redeemable participating preference shares issued 12 - 36,780 19,428 18,007 74,215 - 33,242 6,464 39,706 Net increase from share transactions - 36,780 19,428 18,007 74,215 - 33,242 6,464 39,706

Total return/(deficit) for the year 16,578 16,144 1,770 (800) 33,692 17,944 3,093 (302) 20,735

Equity shareholders' funds at the end of the year 118,368 115,155 30,534 17,207 281,264 101,790 62,231 9,336 173,357

* Company 2006 only consisted of Cell I, Cell II and Cell III as Cell IV was not launched until 31 March 2007. The accompanying notes form an integral part of these financial statements. FF&P VENTURE FUNDS PCC LIMITED Page 15 Balance Sheet At 31 December 2007

Cell I Cell II Cell III Cell IV Company Cell I Cell II Cell III Company * 2007 2007 2007 2007 2007 2006 2006 2006 2006 US $ '000 US $ '000 US $ '000 US $ '000 US $ '000 US $ '000 US $ '000 US $ '000 US $ '000 Notes

Portfolio of investments 9 119,700 120,548 32,025 15,099 287,372 102,287 63,078 9,371 174,736

Current Assets Debtors 10 3 787 2 - 212121 2 2 33 37 Cash and bank balances - - - 2,636 2,636 256 - - 256 3 787 2 2,636 2,657 258 2 33 293 Liabilities Creditors: amounts falling due within one year 11 1,335 6,180 1,493 528 8,765 755 849 68 1,672 Net current (liabilities)/assets (1,332) (5,393) (1,491) 2,108 (6,108) (497) (847) (35) (1,379)

TOTAL NET ASSETS 118,368 115,155 30,534 17,207 281,264 101,790 62,231 9,336 173,357

Shareholders' funds Non equity share capital 12 ------Share Capital 12 159 736 - - 895 159 736 - 895 Share Premium 12 62,520 93,620 29,142 18,007 203,289 62,520 56,840 9,714 129,074 Reserves 13 55,689 20,799 1,392 (800) 77,080 39,111 4,655 (378) 43,388

TOTAL SHAREHOLDERS' FUNDS 118,368 115,155 30,534 17,207 281,264 101,790 62,231 9,336 173,357

Net Asset Value per Share 31 December 2007: 7.42 1.57 0.63 1.13 31 December 2006: 6.38 0.85 0.19 - 31 December 2005: 5.26 0.54 0.10 - 31 December 2004: 3.36 0.47 - - 31 December 2003: 3.45 - - - 31 December 2002: 2.20 - - -

The financial statements were approved by the board of directors on 26 August 2008 and were signed on its behalf by:

Rupert Evans - Director Lewis Grant - Director

* Company 2006 only consisted of Cell I, Cell II and Cell III as Cell IV was not launched until 31 March 2007. The accompanying notes form an integral part of these financial statements. FF&P VENTURE FUNDS PCC LIMITED Page 16 Cash Flow Statement

For the year ended 31 December 2007

Company Company year ended year ended 31 December 2007 31 December 2006 US $ '000 US $ '000 US $ '000 Notes

OPERATING ACTIVITIES

Net cash outflow from operating activities 16 (963) (1,082)

INVESTING ACTIVITIES

Purchases of money market funds (91,056) (58,566) Sales of money market funds 72,492 57,431 Purchase of private equity investments (95,944) (61,837) Cash realised from private equity investments 38,369 24,224 Realised loss on foreign exchange 353535 - Net cash outflow from investing activities (76,104) (38,748)

Net cash outflow before financing (77,067) (39,830)

FINANCING ACTIVITIES

Issue of shares 12 74,202 39,706 Net cash inflow from financing activities 74,202 39,706

Decrease in cash (2,865) (124)

Cash balances as at start of year (355) (231)

Cash balances as at end of year (3,220) (355)

As at 1 As at 31 Reconciliation of Movement in Net Debt: January 2007 Cash Flow December 2007 US$'000US$'000 US$'000 Cash at bank 256 2,380 2,636 Overdraft (611) (5,245) (5,856) (355) (2,865) (3,220) FF&P VENTURE FUNDS PCC LIMITED Page 17 Notes to the financial statements For the year ended 31 December 2007 111 Constitution, company structure and group structure FF&P Venture Funds I Limited (the 'Company') was incorporated with limited liability in Guernsey on 17 May 2002 in accordance with The Companies (Guernsey) Law, 1994. On 26 January 2004 an Extraordinary General Meeting was convened and it was approved that the name of the Company be changed to FF&P Venture Funds PCC Limited and that a reconstruction take place with the Company converting to a protected cell company. The existing shareholders of the Company were entitled to receive Cell I and Cell II shares for their existing holdings. On 17 November 2005 Cell III was launched, its objective is to make direct investments alongside lead investors. Cell IV was launched on 31 March 2007 to continue the strategy for Cell I and Cell II. On 30 April 2008 a further cell was launched - Cell V (see Note 21) The assets of the Company can be either cellular or non-cellular assets. The assets attributable to a cell comprise assets represented by the proceeds of cell share capital, reserves and any other assets attributable to the cell. The non-cellular assets comprise the assets of the Company which are not cellular assets. Where a liability arises from a transaction in respect of a particular cell, and there are insufficient assets within this cell, then there will be recourse to the non-cellular assets but not the assets of any other cell.

222 Accounting policies Basis of accounting The financial statements have been prepared in accordance with applicable United Kingdom accounting standards and the historical cost convention as modified by the revaluation of investments. The material accounting policies are set out below: Foreign exchange The reporting currency of the Company is United States dollars. Foreign currency assets and liabilities are translated at the rate of exchange ruling at the balance sheet date. Income and expenditure items are translated at the rate of exchange ruling at the date of the transaction. Income Interest income including interest receivable from cash and short term deposits and interest payable is accounted for on an accruals basis. Investments Investments in private equity funds and directly held investments are valued initially at cost, unless information from a 3rd party or a significant event deems a revaluation appropriate. Thereafter, private equity funds are held at the most recent net asset value or valuation as reported by the private equity funds and where applicable adjusted for subsequent capital activity. Direct investments are held at the most recent net asset value or valuation as reported by the manager or valuation as advised by co-investors. The directors believe these methods to be the most appropriate estimate of fair value. Such valuations are necessarily dependent upon the reasonableness of the valuations by the fund managers/general partners/co-investors of the underlying investments held in funds and direct investments. The directors have no reason to suppose that any such valuations are unreasonable. Distributions are allocated to income, capital return and cost of investment based on confirmation received from the fund managers/general partners of the underlying funds. Consolidation The Board considers that portfolio investments are held with a view to a realisation of capital gains typically within a 3-7 year period or when a suitable exit can be arranged. Consolidated financial statements have not been prepared for the Fund's investments in any entities which would be classified as subsidiary undertakings. The Board considers that to consolidate these investments would not give a true and fair view of the Fund's interest in these investments.

Formation expenses Formation expenses of the Company are charged to the statement of total return as incurred. 333 Taxation The Company is exempt from Guernsey taxation under The Income Tax (Exempt Bodies) (Guernsey) Ordinance, 1989. A fixed annual fee of £600 is payable to the States of Guernsey in respect of this exemption. Taxation of US$469k (2006: US$157k) included in the Statement of Total Return relates to witholding tax suffered on income distributions received.

444 Fees and fee structure Management fee The Manager, FF&P Asset Management (Guernsey) Limited, is entitled to fees based on a percentage of the net asset value of the Company. For Cell I, Cell II and Cell IV the fees are charged at 1.8% per annum, for Cell III 2% per annum, and are payable quarterly in arrears on the last day of March, June, September and December. As from 1 April 2007 cash balances are deducted from the net asset value and are charged at 0.2% per annum for all cells. The Manager is entitled to reimbursement of reasonable out of pocket expenses. At 31 December 2007 an amount of US$3,948,338 (31 December 2006: US$2,848,827) was charged for the year then ended and US$2,520,209 (31 December 2006: US$697,864) was included in creditors in respect of management fees payable. The services of the Manager to the Company are not deemed to be exclusive and the Manager is at liberty to render similar services to others, provided that the proper performance of its duties under this agreement is not thereby prejudiced. Administration fee For Cell I, Cell II and Cell IV the Administrator, Butterfield Fund Services (Guernsey) Limited, is entitled to administration fees at an annual rate of 0.125% of the net asset value of each Cell for the first US$75,000,000 and 0.10% of each Cell's Net Asset Value over US$75,000,000. This fee is subject to a minimum annual fee of US$50,000 per cell. For Cell III the Administrator will be paid an annual fee based on the amount of work undertaken subject to a minimum of US$35,000, payable quarterly in arrears. FF&P VENTURE FUNDS PCC LIMITED Page 18

Notes to the financial statements For the year ended 31 December 2007

444 Fees and fee structure (continued)

Administration fee (continued) The Administrator is entitled to reimbursement of reasonable out of pocket expenses properly incurred in providing the administration services. At 31 December 2007 an amount of US$323,056 (31 December 2006: US$214,942) was charged for the year then ended and US$203,947 (31 December 2006: US$64,292) was included in creditors in respect of administration fees payable. Custodian fee The Custodian, Butterfield Bank (Guernsey) Limited, is entitled to custodian fees at an annual rate of 0.05% of the net asset value of the Company, payable quarterly in arrears. This fee is subject to a minimum annual fee of US$22,500 per cell. The Custodian is entitled to reimbursement of reasonable out of pocket expenses properly incurred in providing the custodian services. At 31 December 2007 an amount of US$145,473 (31 December 2006: US$91,650) was charged for the year then ended and US$87,554 (31 December 2006: US$22,951) was included in creditors in respect of custodian fees payable. Directors' fees Each Director of the Company is entitled to a fee of £10,000 per annum, the Chairman £15,000 per annum and the director who is also the Chairman of the Audit Committee is entitled to an additional £2,000 per annum. The Directors are entitled to reimbursement of reasonable out of pocket expenses properly incurred in providing services as directors. At 31 December 2007 an amount of US$94,422 (31 December 2006: US$84,438) was charged for the year then ended and US$23,297 (31 December 2006: US$Nil) was included in accruals in respect of outstanding directors' fees at the year end.

555 Net gains/(losses) on investmentsCell ICell IICell IIICell IVCompany 20072007 2007 2007 2007 US $ '000US $ '000US $ '000US $ '000US $ '000 Money Market Funds Proceeds from sales 6,981 35,784 18,211 11,516 72,492 Original cost of investments sold (6,762) (35,499) (18,008) (11,373) (71,642) Realised gains on investments sold 219 285 203 143 850 Unrealised gain on investments at the year end 1,430 - - 39 1,469 Gain on investments for the year 1,649 285 203 182 2,319 Unrealised gain on investments brought forward (383) - (76) - (459) Movement on gain on investments for the year 1,266 285 127 182 1,860

Private Equity Investments Proceeds from investments 27,504 10,809 - 56 38,369 Original cost of investments realised (13,917) (4,696) - - (18,613) Realised gains on investments 13,587 6,113 - 56 19,756 Unrealised gain/(loss) on investments at the year end 20,270 14,173 1,418 (778) 35,083 Gain/(loss) on investments for the year 33,857 20,286 1,418 (722) 54,839 Unrealised (gain)/loss on investments brought forward (17,541) (2,860) 424 - (19,977) Movement on gain/(loss) on investments for the year 16,316 17,426 1,842 (722) 34,862

Net gains/(losses) on investments for the year 17,582 17,711 1,969 (540) 36,722

Cell ICell IICell IIICell IVCompany 20062006 2006 2006 2006 US $ '000 US $ '000 US $ '000 US $ '000 US$ '000 Money Market Funds Proceeds from sales 13,089 36,538 7,804 - 57,431 Original cost of investments sold (12,871) (35,956) (7,623) - (56,450) Realised gains on investments sold 218 582 181 - 981 Unrealised gain on investments at the year end 383 - 76 - 459 Gain on investments for the year 601 582 257 - 1,440 Unrealised gain on investments brought forward (26) (35) (10) - (71) Movement on gain on investments for the year 575 547 247 - 1,369

Private Equity Investments Proceeds from investments 20,340 3,884 - 24,224 Original cost of investments realised (9,030) (1,353) - - (10,383) Realised gains on investments 11,310 2,531 - - 13,841 Unrealised gain/(loss) on investments at the year end 17,541 2,860 (424) - 19,977 Gain/(loss) on investments for the year 28,851 5,391 (424) - 33,818 Unrealised gain on investments brought forward (11,095) (1,733) - - (12,828) Movement on gain/(loss) on investments for the year 17,756 3,658 (424) - 20,990

Net gains/(losses) on investments for the year 18,331 4,205 (177) - 22,359 FF&P VENTURE FUNDS PCC LIMITED Page 19

Notes to the financial statements For the year ended 31 December 2007

666 Other Gains Cell ICell IICell IIICell IVCompany 20072007 2007 2007 2007 US $ '000US $ '000US $ '000US $ '000US $ '000

Currency Gains - - 35 - 35

Cell ICell IICell IIICell IVCompany 20062006 2006 2006 2006 US $ '000US $ '000US $ '000US $ '000US$ '000

Currency Gains - - - - -

777 Gross Income Cell ICell IICell IIICell IVCompany 20072007 2007 2007 2007 US $ '000US $ '000US $ '000US $ '000US $ '000

Bank interest 2 1 3 2 888 Interest on investments - - 200 - 200 Investment income distributions 1,148 705 64 - 1,917 Miscellaneous income - 47 - - 444 1,150 753 267 2 2,129

Cell I Cell II Cell II Cell IV Company 2006 2006 2006 2006 2006 US $ '000 US $ '000 US $ '000 US $ '000 US$ '000

Bank interest 3 - 1 - 4 Interest on investments - - 58 - 58 Investment income distributions 1,687 115 12 - 1,814 Miscellaneous income - - 33 - 33 1,690 115 104 - 1,909

888 Expenses Cell ICell IICell IIICell IVCompany 20072007 2007 2007 2007 US $ '000US $ '000US $ '000US $ '000US $ '000 Payable to the Directors and Administrator Directors' remuneration 50 35 6 3 949494 Administrator's fee 133 117 35 38 323 183 152 41 41 417 Payable to the Manager Manager's fees 1,687 1,747 380 135 3,949 1,687 1,747 380 135 3,949 Payable to the Custodian Custodian fees 57 49 23 17 146 57 49 23 17 146 Other expenses Auditor's remuneration 13 24 5 18 606060 Formation fees - - - 19 191919 Bank interest 1 33 13 3 505050 Other expenses 47 35 16 29 848484 61 92 34 69 213

Total expenses 1,988 2,040 478 262 4,725 FF&P VENTURE FUNDS PCC LIMITED Page 20 Notes to the financial statements For the year ended 31 December 2007

888 Expenses (continued) Cell I Cell II Cell III Cell IV Company 2006 2006 2006 2006 2006 US $ '000 US $ '000 US $ '000 US $ '000 US$ '000 Payable to the Directors and Administrator Directors' remuneration 64 21 (1) - 84 Administrator's fee 113 75 27 - 215 177 96 26 - 299 Payable to the Manager Manager's fees 1,694 1,001 154 - 2,849 1,694 1,001 154 - 2,849 Payable to the Custodian Custodian fees 47 28 16 - 91 47 28 16 - 91 Other expenses Auditor's remuneration 27 27 10 - 64 Formation fees - - 1 - 1 Bank interest - 7 - - 7 Other expenses 18 25 22 - 65 45 59 33 - 137

Total expenses 1,963 1,184 229 - 3,376

999 Investments Cell I Cell II Cell III Cell IV Company 1 Jan 2007 to 1 Jan 2007 to 1 Jan 2007 to 31 Mar 2007 to 1 Jan 2007 to 31 Dec 2007 31 Dec 2007 31 Dec 2007 31 Dec 2007 31 Dec 2007 US$ '000 US$ '000 US$ '000 US$ '000 US$ '000 Private Equity Investments Cost at 1 January 2007 70,368 60,218 7,574 - 138,160 Purchases 6,986 50,853 23,033 14,847 95,719 Proceeds from sales (27,504) (10,809) - (56) (38,369) Realised gains on investments sold 13,587 6,113 - 56 19,756 Cost at 31 December 2007 63,437 106,375 30,607 14,847 215,266 Unrealised gain/ (loss) 20,270 14,173 1,418 (778) 35,083 Value at 31 December 2007 83,707 120,548 32,025 14,069 250,349 Money Market Funds Cost at 1 January 2007 13,995 - 2,145 - 16,140 Purchases 27,330 35,499 15,863 12,364 91,056 Proceeds from sales (6,981) (35,784) (18,211) (11,516) (72,492) Realised gains on investments sold 219 285 203 143 850 Cost at 31 December 2007 34,563 - - 991 35,554 Unrealised gain 1,430 - - 39 1,469 Value at 31 December 2007 35,993 - - 1,030 37,023

Total Value of Investments 119,700 120,548 32,025 15,099 287,372

Cell I Cell II Cell III Cell IV Company 1 Jan 2006 to 1 Jan 2006 to 1 Jan 2006 to 1 Jan 2006 to 1 Jan 2006 to 31 Dec 2006 31 Dec 2006 31 Dec 2006 31 Dec 2006 31 Dec 2006 US $ '000 US $ '000 US $ '000 US$ '000 US$ '000 Private Equity Investments Cost at 1 January 2006 63,680 22,377 424 - 86,481 Purchases 15,718 39,194 7,150 - 62,062 Proceeds from sales (20,340) (3,884) - - (24,224) Realised gains on investments sold 11,310 2,531 - - 13,841 Cost at 31 December 2007 70,368 60,218 7,574 - 138,160 Unrealised gain/ (loss) 17,541 2,860 (424) - 19,977 Value at 31 December 2007 87,909 63,078 7,150 - 158,137 Money Market Funds Cost at 1 January 2007 9,344 1,430 3,250 - 14,024 Purchases 17,522 34,526 6,518 - 58,566 Proceeds from sales (13,089) (36,538) (7,804) - (57,431) Realised gains on investments sold 218 582 181 - 981 Cost at 30 June 2007 13,995 - 2,145 - 16,140 Unrealised gain 383 - 76 - 459 Value at 30 June 2007 14,378 - 2,221 - 16,599

Total Value of Investments 102,287 63,078 9,371 - 174,736 FF&P VENTURE FUNDS PCC LIMITED Page 21 Notes to the financial statements For the year ended 31 December 2007

101010 Debtors Cell I Cell II Cell III Cell IV Company 31 Dec 2007 31 Dec 2007 31 Dec 2007 31 Dec 2007 31 Dec 2007 US $ '000 US $ '000 US $ '000 US $ '000 US $ '000

Due from Cell IV re transfer of investment - 358 - - --- Due from Cell I re transfer of distribution - 413 - - --- Call monies outstanding from investors - 13 - - 131313 Prepayments 3 3 2 - 888 3 787 2 - 212121

Cell I Cell II Cell III Cell IV Company 31 Dec 2006 31 Dec 2006 31 Dec 2006 31 Dec 2006 31 Dec 2006 US $ '000 US $ '000 US $ '000 US $ '000 US$ '000

Accrued Interest - - 33 - 33 Prepayments 2 2 - - 4 2 2 33 - 37

111111 Creditors Cell I Cell II Cell III Cell IV Company 31 Dec 2007 31 Dec 2007 31 Dec 2007 31 Dec 2007 31 Dec 2007 US $ '000 US $ '000 US $ '000 US $ '000 US $ '000

Due to Cell II re transfer of investment - - - 358 -- - Due to Cell II re transfer of distribution 413 ------Management fee payable 797 1,467 141 115 2,520 Custodian & administration fees payable 95 145 15 36 291 Directors' fees 11 9 2 1 2323 23 Auditor's remuneration 13 24 5 18 6060 60 Other Creditors 6 6 3 - 1515 15 Bank overdraft - 4,529 1,327 - 5,856 1,335 6,180 1,493 528 8,765

Cell I Cell II Cell III Cell IV Company 31 Dec 2006 31 Dec 2006 31 Dec 2006 31 Dec 2006 31 Dec 2006 US $ '000 US $ '000 US $ '000 US $ '000 US$ '000

Call monies outstanding on investments 225 - - - 225 Management fee payable 467 184 47 - 698 Custodian & administration fees payable 44 31 13 - 88 Auditor's remuneration 19 23 8 - 50 Bank overdraft - 611 - - 611 755 849 68 - 1,672 FF&P VENTURE FUNDS PCC LIMITED Page 22

Notes to the financial statements For the year ended 31 December 2007

121212 Share Capital 2007 2006 Authorised share capital US$ US$

100 management shares of no par value - - 100,000,000 Ordinary shares of US$ 0.01 each 1,000,000 1,000,000 Unlimited number of Unclassified shares of no par value - - 1,000,000 1,000,000

The shareholders resolved to increase the authorised share capital from 75,000,000 to 100,000,000 ordinary shares of US$0.01 each at an extraordinary general meeting held on 28 June 2006.

The unclassified shares of no par value were authorised by special resolution at the AGM held on 2 September 2005. On 26 January 2004 the Company converted to a protected cell company (PCC). The restructuring of the Company resulted in three Cells, Cell I, Cell II and Cell C being created. All investors in the Company transferred into Cell I, they were then entitled to receive bonus shares in either Cell II or Cell C for their existing holdings. 99% of shareholders elected to participate in Cell II, the remainder received shares in Cell C which were then redeemed at $0.50 per share. The existing Capital Call of $3.50 was split into Cell I, $3.00 and either Cell II or Cell C , $0.50.

Cell C was established for the sole purpose of effecting redemptions requested by existing shareholders as part of the reconstruction and conversion of the Company to a PCC. This cell terminated on the listing of Cell II ordinary shares becoming effective with 104,000 C ordinary shares being redeemed for US$0.50 each.

On 17 November 2005 Cell III was established and on 31 March 2007 Cell IV was established. The A series and B series ordinary shares for both Cell III and Cell IV have no par value. The Company is entitled to issue two series of shares from the authorised share capital in respect of Cell I, Cell II and Cell III hereinafter being described as A series and B series shares. Management shares are held by the Manager and carry no voting rights whilst there are ordinary shares of any Cell in issue. They do not carry any right to dividends and are not redeemable. In winding up, management shares rank only for a return of the nominal capital paid up on the shares using only assets of the Company not comprised within any of the Cells.

A restructure of Cell I during quarter 4 of 2007 resulted in a new ordinary share classes being created. The creation of the new share class gave existing shareholders the chance to reduce their exposure of future acquisitions of private equity funds. Cell I has two classes of share ordinary and new ordinary with two series, A and B. Cell II, Cell III and Cell IV issued two series of shares, the 'A' series and the 'B' series. The shares in each series will carry identical rights except that, at any meeting of the members of the Company, where a resolution is proposed on which holders of both A series and B series shares have the right to vote, the total number of votes that may be cast by holders of A series shares will equal, regardless of the number of A series shares in issue, 7/13 (rounded up to the nearest whole number) of the total votes that may be cast by holders of the relevant B series shares with the voting rights attributable to the A series shares being divided pari pasu amongst the relevant A series shareholders.

As at 31 December 2007, Cell I shares have US$4.00 called and paid (2006: US$4.00) out of commitments of US$7.23, Cell II shares have US$1.25 called and paid (2006: US$0.75) out of commitments of US$2.77, Cell III shares have US$0.60 called and paid (2006: US$0.20) out of commitments of US$1.00 and Cell IV shares have US$1.00 called and paid (2006: US$ nil) out of commitments of US$10.00.

Cell IV had an initial opening on 3 April 2007 resulting in 3,182,510 shares being issued at a price of US$0.50. On 19 June 2007 there was a further call for US$0.50 resulting in a total US$1.00 being called and paid . A second opening for Cell IV on 2 July 2007 saw a further 12,096,160 shares being issued at $1.22558. While an investor may apply for either A series or B series shares, no shareholder may hold more than 1/7 of A series shares in issue at any time. The company has the power to convert one or more A series shares into the same number of corresponding B series shares, and vice versa, at any time.

In the event of the Company being wound up, the assets available for distribution among the members shall be applied in proportion to the number of shares held by the members. FF&P VENTURE FUNDS PCC LIMITED Page 23

Notes to the financial statements For the year ended 31 December 2007

121212 Share Capital (continued)

Issued Ordinary and Unclassified Shares: Number of shares Cell I Cell II Cell III Cell IV Non- Cellular Company

Non-Equity shares Management shares 100 100

Equity Shares A Series Shares: At 1 January 2007 246,447 1,253,567 854,670 - - 2,354,684 Transfer to New A Series (50,155) - - 1,900 - (48,255) At 31 December 2007 196,292 1,253,567 854,670 1,900 - 2,306,429

B Series Shares: At 1 January 2007 15,707,772 72,307,786 47,714,862 - - 135,730,420 Transfer to New B Series (1,138,634) - - 15,276,770 - 14,138,136 At 31 December 2007 14,569,138 72,307,786 47,714,862 15,276,770 - 149,868,556

New A Series Shares: At 1 January 2007 ------Transfer from A Series 50,155 - - - - 50,155 At 31 December 2007 50,155 - - - - 50,155

New B Series Shares: At 1 January 2007 ------Transfer from B Series 1,138,634 - - - - 1,138,634 At 31 December 2007 1,138,634 - - - - 1,138,634

Total at 31 December 2007 15,954,219 73,561,353 48,569,532 15,278,670 100 153,363,874

Equity Share Capital US$ US$

Non equity shares Management shares 100 100

US $ '000 US $ '000 US $ '000 US $ '000 US $ '000 US $ '000 A Series Shares: At 1 January 2007 2 13 - - - 1515 15 Issued during the year ------At 31 December 2007 2 13 - - - 1515 15

B Series Shares: At 1 January 2007 157 723 - - - 880 Issued during the year ------At 31 December 2007 157 723 - - - 880

Total at 31 December 2007 159 736 ------895

New A Series Shares: At 1 January 2007 ------Issued during the year ------New B Series Shares: ------

New B Series Shares: At 1 January 2007 ------Issued during the year ------New B Series Shares: ------

Total at 31 December 2007 ------FF&P VENTURE FUNDS PCC LIMITED Page 24

Notes to the financial statements For the year ended 31 December 2007

121212 Share Capital (continued)

Share Premium Cell I Cell II Cell III Cell IV Non- Cellular Company US $ '000 US $ '000 US $ '000 US $ '000 US $ '000 US $ '000 A Series Shares: At 1 January 2007 980 970 170 - - 2,120 Calls and issued during the year - 627 343 2 - 972 Transfer to New A Series (359) - - - - (359) At 31 December 2007 621 1,597 513 2 - 2,733

B Series Shares: At 1 January 2007 61,540 55,870 9,544 - - 126,954 Calls and issued during the year - 36,153 19,085 18,005 - 73,243 Transfer to New B Series (8,145) - - - - (8,145) At 31 December 2007 53,395 92,023 28,629 18,005 - 192,052

New A Series Shares: At 1 January 2007 ------Transfer from A Series 359 - - - - 359 At 31 December 2007 359 - - - - 359

New B Series Shares: At 1 January 2007 ------Transfer from B Series 8,145 - - - - 8,145 At 31 December 2007 8,145 - - - - 8,145

Total at 31 December 2007 62,520 93,620 29,142 18,007 - 203,289

131313 Reserves

Cell ICell IICell IIICell IVCompany US $ '000US $ '000US $ '000US $ '000US $ '000 Realised gains on investments

Balance at 1 January 2007 23,150 3,732 181 - 27,063 Movement during the year 13,806 6,398 203 199 20,606 Balance at 31 December 2007 36,956 10,130 384 199 47,669

Unrealised gain/(loss) on investments

Balance at 1 January 2007 17,924 2,860 (348) - 20,436 Movement during the year 3,776 11,313 1,766 (739) 16,116 Balance at 31 December 2007 21,700 14,173 1,418 (739) 36,552

Realised/Unrealised loss on exchange

Balance at 1 January 2007 (31) - - - (31) Movement during the year - - 35 - 35 Balance at 31 December 2007 (31) - 35 - 4

Income and expenditure

Balance at 1 January 2007 (1,932) (1,937) (211) - (4,080) Movement during the year (1,004) (1,567) (234) (260) (3,065) Balance at 31 December 2007 (2,936) (3,504) (445) (260) (7,145)

Total reserves at 31 December 2007 55,689 20,799 1,392 (800) 77,080

Total reserves at 31 December 2006 39,111 4,655 (378) - 43,388 FF&P VENTURE FUNDS PCC LIMITED Page 25

Notes to the financial statements For the year ended 31 December 2007

141414 Related party transactions

Mr Cathcart is a director of the Manager, FF&P Asset Management (Guernsey) Limited. Mr Evans is also a director of the Manager, FF&P Asset Management (Guernsey) Limited and is a former partner of Ozannes, the Guernsey legal advisor and is now a consultant to that firm. Details of the management fees received are included in Note 4.

The Manager is entitled to an initial charge of 5.0% commission upon the issue of shares. During both this year, and the prior year, the entitlement to commission was waived. Directors' interests are detailed on page 3.

151515 Financial instruments

The primary investment objective of the Company is to deliver increases in capital value to investors, principally via investment in pooled investment vehicles such as limited partnerships and for Cell III via direct private equity investments. The Company's financial instruments comprise investments in private equity funds, money market funds, cash balances, debtors and creditors that arise from its operations. The principle risks the Company faces in its investment activities are: - Liquidity/marketability risk Liquidity risk is defined as the risk that the Company may not be able to settle or meet its obligations on time or at a reasonable price. Marketability risk is defined as risk of exposure to financial loss from the probability that an investment is not marketable or cannot be sold quickly enough. - Foreign currency risk Foreign currency risk is the risk that the value of a financial instrument will fluctuate due to changes in foreign exchange rates.

Interest Rate Risk The Company has little exposure to interest rate risk as the investment portfolio consists of investments which do not pay fixed or floating rate interest. The investment held in Butterfield Money Market Fund is classified as an equity investment which does not pay interest as the nature of this investment is an open ended investment fund.

Liquidity Risk Due to the nature of the Company's investment policy, a large proportion of the investment portfolio is invested in unquoted private equity funds which are less readily marketable investments. The investments in unquoted private equity funds and direct investments are monitored by the board of directors on a regular basis and the directors believe that the Company, as a closed ended fund, is ideally suited to make long term investments in these private equity funds and direct investments which have limited liquidity and marketability. It is the nature of investment in private equity funds that a commitment to invest will be made (see note 17) and that call payments will then be paid to the private equity fund. These call payments are usually made over time and can be irregular in timing over a number of years. In order to provide the liquidity to meet such commitments the Company has issued partly paid shares which can be called down at short notice from investors.

Foreign Currency Risk The Company is exposed to little risk from changes in foreign exchange rates as the majority of the investment portfolio consists of US$ denominated investments where the return to the Company will be in US$. Although it is permitted to do so the Company did not enter into hedging transactions to deal with the minimal foreign currency risk. An analysis of the Company's exposure to foreign currency is as follows: Assets Liabilities Total 2007 2007 2007 US$ '000 US$ '000 US$ '000 United States Dollars 237,723 (8,667) 229,056 Euro 35,734 -- - 35,734 Sterling 13,712 (98) 13,614 Japanese Yen 2,860 -- - 2,860 290,029 (8,765) 281,264

Assets Liabilities Total 2006 2006 2006 US $ '000 US $ '000 US $ '000 United States Dollars 147,625 (1,622) 146,003 Euro 19,147 - 19,147 Sterling 5,810 (50) 5,760 Japanese Yen 2,447 - 2,447 175,029 (1,672) 173,357 FF&P VENTURE FUNDS PCC LIMITED Page 26

Notes to the financial statements For the year ended 31 December 2007

151515 Financial instruments (continued)

Fair Values In the opinion of the directors all of the financial instruments of the Company are held at fair value. Directors may deem an investment's fair value for the first 12 months it is held to be cost. The methods of valuing fixed asset investments at fair value are disclosed in the accounting policies investment note on page 17.

161616 Reconciliation of net operating loss to net cash outflow from operating activities Year ended Year ended 2007 2006 US$ '000 US$ '000

Net operating loss for the year (3,065) (1,624) Decrease in debtors 292929 533 Increase in creditors 2,073 9

Net cash outflow from operating activities (963) (1,082)

171717 Commitments At 31 December 2007 there were financial commitments outstanding of US$12,5m (2006: US$19,3m) for Cell I, US$93.6m (2006: US$137,8m) for Cell II, US$ Nil (2006:US$ Nil) for Cell III and US$62.1m (2006: Nil) for Cell IV in respect of investments and interests in private equity funds.

181818 Historical Financial Information 2007 2007 2007 2007 2006 2006 2006 Cell I Cell II Cell III Cell IV Cell I Cell II Cell III Highest Price 7.42 1.57 0.63 1.23 6.38 0.85 0.20

Lowest Price 6.55 1.13 0.19 1.13 5.49 0.81 0.19

191919 Total return/(deficit) per share The total return/(deficit) per share has been calculated on a weighted average basis and is arrived at by dividing the Net increase/(decrease) in shareholders' funds from investment activities by the weighted average number of shares in issue for each Cell.

202020 Ultimate Controlling Party The issued share capital of the Company is owned by numerous parties and, therefore, in the opinion of the Directors, there is no ultimate controlling party of the Company as defined by Financial Reporting Standard No 8 - Related Party Disclosures.

212121 Post balance sheet events Venture Fund Direct II "Cell V" was launched 30 April 2008. The Cell's shares were listed on the Channel Islands Stock Exchange on 2 May 2008. A company "FF&P Venture Funds Subsidiary Limited" was incorporated on 24 January 2008 to enable the investment manager to balance the interests/calls on the underlying Cell IV portfolio assets, which are to be held by the existing Cell IV investors and Cell I investors not electing to hold the new class of shares. Cell II had a further cash call of $0.25 per share in January 2008. The fund is now $1.50 per share drawn down, or 54.2% of committed capital per share. Cell III had further cash calls of $0.15 per share in February 2008 and $0.15 per share in March 2008. The fund is now $0.90 per share drawn down, or 90% of committed capital per share. Cell III has completed four new investments in the first half of 2008. FF&P VENTURE FUNDS PCC LIMITED Page 27

Notes to the financial statements For the year ended 31 December 2007

222222 Reconciliation ofofof net asset value per participating redeemable preference share per the financial statements tototo published net asset value

Cell I NAV per NAV Shares In Issue US $ '000 USD

Published net asset value as at 31 December 2007 118,783 7.44526 Reallocation of distribution monies (413) (0.02588) Accrual adjustment (2) (0.00021) Net asset value per financial statements as at 31 December 2007 118,368 7.41917

Cell II NAV per NAV Shares In Issue US $ '000 USD

Published net asset value as at 31 December 2007 114,753 1.55996 Accrual adjustment (24) (0.00032) Reallocation of distribution monies 413 0.00561 Monies due on outstanding calls 13 0.00017 Net asset value per financial statements as at 31 December 2007 115,155 1.56542

Cell III NAV per NAV Shares In Issue US $ '000 USD

Published net asset value as at 31 December 2007 30,542 0.62882 Accrual adjustment (8) (0.00017) Net asset value per financial statements as at 31 December 2007 30,534 0.62865

Cell IV NAV per NAV Shares In Issue US $ '000 USD

Published net asset value as at 31 December 2007 17,222 1.12721 Formation cost adjustment* (15) (0.00102) Net asset value per financial statements as at 31 December 2007 17,207 1.12619

*Formation costs are amortised in the published net asset value over three years. Total formation costs of $20,147 have been expensed in the 2007 financial statements.