Insight Equity Management Company LLC

Fees and Compensation
General
Insight Equity typically receives compensation from fees based on a percentage of capital under
management, carried interest distributions and certain other fees or expenses related to
transactions, all in accordance with the Governing Documents. Investors should review the
relevant Governing Documents to fully understand the total amount of fees to be paid by a Fund
and, indirectly, by its Investors. The General Partner of a particular Fund will either call capital
for management fees and other expenses or pay such fees and expenses out of current income and
disposition proceeds of the Funds. For more specific information regarding fees, Investors should
review the Governing Documents for the Funds in which they have invested. See “Performance-
Based Fees and Side-by-Side Management” below for a further discussion of fees and the potential
conflicts of interest they can create. See the “Brokerage Practices” section below for additional
information regarding transaction costs.

                    INSIGHT EQUITY MANAGEMENT COMPANY LLC
                             Form ADV, Part 2A Brochure

Management Fees
As described in the applicable Fund’s Governing Documents, each Equity Fund, with limited
exceptions, and the Mezzanine Fund will generally pay an investment management fee to the
Managing Agent (the “Management Fees”), semi-annually no more than five and half months in
advance equal to a percentage of aggregate capital commitments during the investment period or,
if earlier, until the closing of a subsequent Fund. Thereafter, through the termination of the Fund,
the annual Management Fees will generally equal a percentage of the aggregate capital
contributions of all Limited Partners in such Fund used to make investments in portfolio companies
that have not been sold or written off in full. Management Fees, with limited exceptions, will be
reduced by a percentage of the amount of certain other fees received by Insight Equity, as described
in further detail below.

For certain Funds, Insight Equity may elect to waive all or any portion of any future Management
Fees. Any waiver of all or any portion of Management Fees will generally reduce the capital
commitments required of certain General Partners, Insight Equity, the Insight Equity Team, any
other person who is or was serving as a director or officer or in any other position of any portfolio
company at the request of a Fund or Insight Equity, and affiliates of each of the foregoing
(collectively, the “Affiliated Co-investors”) by the waived amount, as set forth in Governing
Documents.

Generally, under the terms of the applicable Governing Documents, for purposes of calculating
any reductions in Management Fees, directors’ and officers’ fees, portfolio company management
fees and ancillary fees are net of out-of-pocket costs and expenses incurred by the Managing Agent
in connection with consummated or unconsummated transactions or in connection with generating
any such fees. Directors’ and officers’ fees, portfolio company management fees and ancillary
fees may be substantial and are typically paid in cash, but could be paid in securities or otherwise.
Although directors’ and officers’ fees, portfolio company management fees and ancillary fees are
in addition to Management Fees, the Managing Agent will, in some circumstances, reduce the
amount of the Management Fees paid by the applicable Fund in connection with the receipt of
such fees. The amount and manner of such reduction is set forth in the Governing Documents of
the applicable Fund. In certain circumstances, the Managing Agent expects that co-investors or
other parties may negotiate the right to share a portion of directors’ and officers’ fees, portfolio
company management fees and ancillary fees from a particular investment and, in such
circumstances, any reductions in Management Fees will be applied after excluding any amounts
paid or allocable to such persons.

Carried Interest
With respect to the Equity Funds and the Mezzanine Fund, Insight Equity will generally be entitled
to receive “carried interest distributions” in accordance with the specific provisions of the
applicable Fund’s Governing Documents. The General Partner’s carried interest distributions are
generally subject to the obligation to return certain distributions pursuant to “clawback”
arrangements periodically and upon liquidation of the applicable Fund as provided in such Fund’s
Governing Documents.

Directors’ and Officers’ Fees, Portfolio Company Management Fees and Ancillary Fees
Insight Equity will generally be entitled to collect from or with respect to a Fund’s portfolio
companies or a potential portfolio company certain directors’ and officers’ fees, portfolio company

                    INSIGHT EQUITY MANAGEMENT COMPANY LLC
                             Form ADV, Part 2A Brochure

management fees and ancillary fees (including but not limited to, strategic advisory and diligence
fees); provided that the Management Fee payable by such Fund will generally be reduced, with
limited exceptions, by a percentage of any such fees as set forth in the Governing Documents;
provided, however, that for certain Funds, if the applicable General Partner determines that it is in
the best interests of a portfolio company for one or more employees of Insight Equity to take an
active operating role in the portfolio company, Insight Equity will be entitled to receive payment
(including non-cash compensation, such as via participation in a portfolio company’s long term
incentive compensation plan) from the portfolio company in an amount which is reasonably
believed to be no less favorable to the portfolio company than the cost or expense of obtaining
similar services from unaffiliated third parties and such payments will not reduce any Management
Fee payable by such Funds. If any such fees required to be credited against the Management Fees
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Types of Clients
The Managing Agent provides management and discretionary investment advisory services
directly to the Funds, subject to the direction and control of the General Partner of each Fund. The

                    INSIGHT EQUITY MANAGEMENT COMPANY LLC
                             Form ADV, Part 2A Brochure

Insight Equity Team and other affiliates provide more limited services to the Pre-Fund
Investments. In each case, Insight Equity does not provide advisory services individually to the
Investors. Investors in the Funds may include, but are not limited to, governmental or corporate
pension funds, university or similar endowments, funds of funds, other institutional investors, high
net worth individuals and foundations.

The minimum commitment for a Limited Partner in the Equity Funds and the Mezzanine Fund is
generally $5 million to $10 million; however, Insight Equity has discretion to accept less than the
minimum investment threshold as set forth in the Governing Documents. In addition, the Funds
may enter into separate agreements, commonly referred to as “side letters,” with certain Investors,
to provide such Investors with additional or different terms than those specifically described in the
Governing Documents. These side letters primarily relate to laws, policies and procedures
applicable only to specific Investors and not all Investors. However, under certain circumstances,
these side letters could create preferences or priorities for such Investors with respect to other
Investors.

Investors are typically required to meet certain suitability qualifications as described in the
Governing Documents, such as being an “accredited investor” within the meaning set forth in Rule
501(a) of Regulation D under the Securities Act. Also, Investors will be required to make certain
representations when investing in a Fund, including, but not limited to, that (i) they are acquiring
an interest for their own account, (ii) they received or had access to all information they deem
relevant to evaluate the merits and risks of the prospective investment and that (iii) they have the
ability to bear the economic risk of an investment in the Fund. Details concerning applicable
Investor suitability criteria are set forth in the respective Fund’s offering documents and
subscription materials, which are furnished to each prospective Investor.

      Methods of Analysis, Investment Strategies and Risk of Loss
Insight Equity’s investment strategies generally involve seeking to transform strategically viable,
underperforming, asset intensive, middle-market companies. Insight Equity seeks to be highly
selective in its approach, targeting only those companies that are experiencing some level of
underperformance but are strategically viable, and possess transformational qualities. Insight
Equity seeks to work closely with portfolio company management to develop and implement
value-building strategies.

Insight Equity seeks to capitalize on its ability to bring differentiated insights to opportunities,
identifying transformational potential where other investors may not. Insight Equity generally
believes that businesses with the following characteristics present the greatest potential for change
and growth: (i) private or family-owned companies that are capital and/or management
constrained; (ii) “orphans” of multi-faceted companies that are under-managed or suffer from
under-investment; (iii) distressed or generally underperforming businesses; (iv) healthy businesses
with transformational upside potential from operational improvements or growth; or (v) public
companies that receive little operational assistance from their equity owners.

Fund Strategy
Insight Equity seeks to be highly selective, targeting only strategically viable, underperforming,
asset intensive, middle-market companies in which it identifies transformational qualities. As part

                     INSIGHT EQUITY MANAGEMENT COMPANY LLC
                              Form ADV, Part 2A Brochure

of this strategy, Insight Equity seeks to identify unrealized value in underlying assets and improve
the operations of companies to create competitive advantages and achieve improved market
positions. Insight Equity seeks to partner collaboratively with portfolio company management in
a “hands-on,” operationally intensive manner to create and implement value creation strategies
and tactics.

The Equity Funds will make primarily control equity and other investments in portfolio companies,
while the Mezzanine Fund may only invest in mezzanine or other securities issued by companies
in which one of the Equity Funds has a primarily control investment. The Pre-Fund Investments
were formed as special purpose single investment vehicles.

Insight Equity seeks to invest primarily in companies that meet the following criteria: (i) North
American-based, middle-market companies with $50 million to $1 billion in revenue and $50
million to $750 million in enterprise value; (ii) strategically viable companies with sustainable
competitiveness; (iii) companies with underlying “transformational” potential; and (iv) companies
in asset-intensive industries where Insight Equity has significant knowledge and experience.
Insight Equity believes that companies in the middle-market in particular present great potential
for the immediate implementation of its transformational strategy. Companies that meet these
criteria are often resource constrained with limited access to the capital markets and have the
potential to benefit significantly from Insight Equity’s hands-on approach to investment and
change.

Associated Risks
Private equity involves a high degree of business and financial risk that may result in substantial
losses. Portfolio companies may be operating at a loss or with substantial variations in operating
results from period to period and may need substantial amounts of additional capital to support
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