Gallant Capital Partners LLC

FEES AND COMPENSATION

        In general, Gallant receives a management fee (“Management Fee”) and a carried interest
in connection with advisory services. Gallant or other Adviser entities or affiliates receive
additional compensation in connection with management and other services performed for
portfolio companies of the Funds and such additional compensation will offset in whole or in part
the Management Fees (as defined below) otherwise payable to Gallant. In addition, in certain
circumstances Gallant receives compensation for management and other services performed in
connection with co-investments made in portfolio companies of the Funds, as set forth in the
relevant Partnership Agreement (s) and/or Side Letter(s). Investors in a Fund also bear certain
expenses.

Management Fees

        Fund II will pay Gallant a management fee (the “Management Fee”) equal to 2% on an
annual basis of aggregate investor capital commitments. Upon the occurrence of certain events as
set forth in the relevant Fund’s Partnership Agreement (the “Stepdown Date”), Fund II’s
Management Fee will be reduced and will equal 2% of (i) the aggregate amount of unrecouped
bridge financing contributions, plus (ii) the aggregate investment contributions, plus (iii) the
aggregate amount of any outstanding borrowings made in anticipation or in lieu of the Fund
partners making bridge financing contributions or investment contributions, less (iv) the aggregate
amount of investment contributions with respect to the portion of each investment that has been
disposed of or completely written-off.

       Fund I pays Gallant a Management Fee equal to 2% on an annual basis of aggregate
investor capital commitments. Upon the Stepdown Date, Fund I’s Management Fee will be
reduced and will equal 2% of (i) the aggregate amount of unrecouped bridge financing
contributions, plus (ii) the aggregate investment contributions, less (iii) the aggregate amount of
investment contributions with respect to the portion of each investment that has been disposed of
or completely written-off.

         Certain investors that are affiliated with Gallant and designated by the General Partner as
“affiliated partners” (“Affiliated Partners”) will not be subject to the Management Fee.

        As is generally the case in private equity funds, the Governing Documents provide that a
Fund’s Management Fees will be calculated and charged on a basis that generally is not tied to the
Fund’s then-current net asset value. As further specified in the Governing Documents, from the
effective date of the relevant Fund until the Stepdown Date, Management Fees generally will be
charged based on a formula tied to the amount of the relevant Fund’s aggregate commitments.
Further, after the Stepdown Date, Management Fees generally will be charged and calculated
based on a formula tied to the amount of investment contributions (including, where applicable, a
Fund borrowing component) made by the relevant Fund relating to the Fund’s aggregate

investment(s) in any portfolio company that have not been disposed of or completely written off
for U.S. federal income tax purposes (such investments, “Impaired Value Investments”).

        Under the Governing Documents, where the fair market value of an investment exceeds
the total amount of investment contributions relating to such investment, post-Stepdown Date
Management Fees will not be calculated based upon such appreciated value and will instead
continue to be calculated based on the amount of such investment contributions. Conversely, the
Governing Documents do not require Management Fees to be reduced or refunded following the
occurrence of a writedown, decrease (including a significant decrease) in fair value or other event
not constituting a complete realization, such as a reorganization, roll-over investment in
connection with a sale or dividend distribution, except in the case of investments meeting the
relevant Impaired Value Investment standard under the Governing Documents. For the avoidance
of doubt, following the Stepdown Date, if the fair market value of an Impaired Value Investment
is less than the total amount of investment contributions relating to such Impaired Value
Investment, then the amount of Management Fees otherwise payable relating to such investment
will be reduced solely based on the ratio of the fair market value of each relevant remaining
investment(s) as compared against the amount of total investment contributions relating to such
investment(s) as of the date of the relevant event.

       As a result, and as is generally the case for private equity funds, the amount of Management
Fees generally will not correspond with fluctuations in the net asset value of individual investments
or of a Fund, including following the relevant investment period, and will not be reduced in
connection with any write downs (whether temporary or permanent), except in the case of Impaired
Value Investments. Except where the Governing Documents expressly provide to the contrary,
Management Fees will not be reduced (in whole or in part) in the case of partial distributions (e.g.,
those resulting from a dividend recapitalization) or reorganizations, restructurings, roll-over
investments, extraordinary dividends or similar transactions, in each case in circumstances that do
not result in the complete disposition of the relevant Fund’s interest therein, and even in cases
where the value of the Fund’s investment or the Fund’s ownership percentage in such investment
has been reduced (including substantially reduced) as a result of such transaction.

        In many circumstances, the post-Stepdown Date Management Fee base will include
capitalized transaction-specific expenses of unrealized investments. Further, Management Fees
generally will not be reimbursed or refunded under the Governing Documents in the event of
realizations, dispositions or partial write-downs or write-offs that occur partway through the
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TYPES OF CLIENTS

       Gallant provides investment advice to the Funds. The Funds may include investment
partnerships or other investment entities formed under domestic or foreign laws and operated as

exempt investment pools under the Investment Company Act of 1940, as amended (the
“Investment Company Act”). The investors participating in the Funds may include individuals,
banks or thrift institutions, other investment entities, university endowments, sovereign wealth
funds, family offices, pension and profit-sharing plans, trusts, estates or charitable organizations
or other corporations or business entities and often include, directly or indirectly, the partners,
principals or other personnel of Gallant and its affiliates and members of their families or other
service providers retained by Gallant or a Fund.

        Investors are generally “accredited investors” within the meaning of Rule 501(a) under the
Securities Act of 1933, as amended, and are generally either “qualified purchasers” within the
meaning of Section 2(a)(51) under the Investment Company Act or “qualified clients” within the
meaning of Rule 205-3 under the Advisers Act. Each Fund generally has a minimum investment
amount of $10 million for third-party investors. Such minimum investment amount may be waived
by Gallant.

            METHODS OF ANALYSIS, INVESTMENT STRATEGIES AND RISK OF LOSS

General

       Gallant is a private investment firm focused on complex situations in the North American
lower middle market across three core sectors: technology, industrials and business services.
Gallant will make control investments on behalf of the Funds of up to $75 million in fundamentally
sound companies where Gallant is able to utilize its operationally focused approach to enhance
value. Gallant pursues investments in companies with EBITDA up to $50 million and enterprise
values up to $400 million. Gallant believes this end of the market tends to be the least efficient,
with a significant number of opportunities that are well-suited for Gallant’s hands-on approach
and can be acquired at attractive valuations.

        There can be no assurance that Gallant will achieve the investment objectives of any Fund
and a loss of investment is possible.

Investment and Operating Strategy

         Deal Origination. Gallant maintains relationships with a vast network of brokers,
investment bankers and corporate sellers with whom they have had positive experiences. Gallant
believes that these relationships are key to their success as it is important to originate a large
volume of potential transactions to identify opportunities that fit the characteristics and strict
criteria of a Gallant investment. Advisors in the lower middle market do not generally have robust
sponsor coverage teams and typically present investment opportunities to their smaller network of
potential buyers making it imperative that Gallant be in constant contact with these parties. Gallant
also maintains relationships directly with business owners and corporate development
professionals, and have built a reputation as trustworthy counterparties and partners with these
sellers where qualitative factors such as cultural fit, clear plans to improve the company, and
straightforward communication often matter as much as valuation.

        Due Diligence. Once an opportunity is identified, the Gallant team will utilize its resources
(including Operating Group members) to conduct thorough due diligence. The Gallant team is

particularly experienced in analyzing issues found in investment opportunities where they will be
the first institutional capital – primarily corporate divestitures and family-owned businesses. These
investments have distinct attributes that require specific experience to manage. The team will
analyze potential investments from a macro and company-specific perspective, including:
evaluating industry dynamics; performing detailed qualitative and quantitative analysis of the
current business, operations and management; and analyzing the company’s capital structure,
financial results and projections. In addition, Gallant focuses its due diligence on identifying
operating initiatives and ensuring strong alignment with management. As needed, Gallant will
enlist third parties to augment its due diligence. These groups can include accounting and tax
advisors, market and regulatory experts, insurance advisors, and management background checks.
Gallant’s due diligence process includes in-depth and in person meetings with company
management, discussions with key customers, suppliers, competitors and other participants in the
industry or supply chain. This rigorous due diligence process allows Gallant to be proactive in
identifying potential risk areas early in the process.

Risks of Investment

       Each Fund and its investors bear the risk of loss that Gallant’s investment strategy entails.
The risks involved with Gallant’s investment strategy and an investment in a Fund include, but are
not limited to:

1. Business and Market Risks. The Funds’ investment portfolios are expected to consist primarily
   of securities and/or other interests issued by privately held companies, and operating results in
   a specified period will be difficult to predict. Such investments involve a high degree of
   business and financial risk that can result in substantial losses. In particular, these risks could
   arise from changes in the financial condition or prospects of the companies in which the
   investment is made, changes in national or international economic and market conditions
   and changes in laws, regulations, fiscal policies or political conditions of countries in which
   investments are made, including the risks of war, pandemics and the effects of terrorist attacks.
   The possibility of partial or total loss of capital will exist and investors should not invest unless
   they can readily bear the consequences of such loss.
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