Kayne Anderson Capital Advisors LP

Item 5 – Fees and Compensation

Privately Offered Pooled Investment Vehicles

Redeemable Funds Generally speaking, Kayne’s redeemable funds are charged annual management fees of 0.6%
to 1.5% of portfolio assets, calculated and payable quarterly or monthly either in advance based on the fair
market value of the account portfolio at the beginning of the period or in arrears based on such fair market value
at the end of the period. In its redeemable funds, Kayne may also receive an incentive allocation based on the
performance of the portfolio, and calculated on the basis of both realized and unrealized gains and losses.
Performance allocations range up to 20% of such realized and unrealized gains, and may or may not be subject to
a high water mark and/or calculated after a stated “hurdle” rate of return to the limited partners. Performance
allocations are calculated and accrued as described in each fund’s offering documents; the calculation periods
vary depending on the fund. All performance-based allocations are calculated cumulatively or are subject to a
high-water mark (on an individual investment basis) and a hurdle (as applicable) to prevent such fees from being
generated on recouped gains.

Limited partners in Kayne’s redeemable funds may withdraw, entirely or partially, on either a monthly or
quarterly basis, depending on the fund. Withdrawing limited partners must provide Kayne with proper advance
written notice, which may range anywhere from 30 to 45 days depending on the fund. To enable periodic
investments in, and withdrawals from, the redeemable funds (and to calculate management fees and
performance allocations), the third-party administrator or Kayne, as applicable, determines net asset values for
such accounts at each reporting period. The fair market values of investments which do not trade on an exchange
or in other active markets are valued by Kayne or an independent third-party valuation firm based on its judgment
exercised in good faith taking into consideration all factors it believes to be relevant. Such fair market valuations

are consistent with the organizational documents of the funds and Kayne’s Valuation Policy which require
reporting based on applicable Generally Accepted Accounting Principles.

Closed-end Funds Generally, investors in Kayne’s closed-end funds are charged annual management fees of 1.0%
to 1.75% of capital commitments (which are expected to significantly exceed portfolio assets early on in the life of
the funds) or invested capital, calculated and payable quarterly or semi-annually. After the investment
commitment period, the management fee is typically based on the lower of aggregate net asset value or net
invested capital. Kayne or an affiliated management company also receives a “carried interest” in its capacity as
general partner generally entitling it to up to 20% of realized profits after a preferred return to limited partners.
This carried interest is based on realized gains and received income only, and is payable as portfolio holdings are
liquidated or otherwise monetized, subject, in some cases, to a reserve or claw-back arrangement to account for
possible or actual losses incurred on holdings subsequently sold.

As portfolio holdings are sold in a closed-end fund, the proceeds received (as well as cash interest dividends
received) are generally distributed to limited partners. However, limited partners in these funds generally may not
otherwise reduce or withdraw their investments until the fund’s maturity without the consent of Kayne (or a
controlled subsidiary) in its capacity as general partner.

Separate Accounts

The separate accounts managed by Kayne are generally charged management fees and in some cases
performance fees similar to (but not necessarily the same as) those applicable to Kayne’s redeemable or closed-
end funds. A separate account client may terminate its investment advisory contract with Kayne on not less than
30 days’ notice.

Separate accounts may also be structured as “parallel vehicles” to closed-end funds to accommodate legal, tax,
regulatory, or other considerations for investors. Such parallel vehicles are generally expected to (i) co-invest with
the closed-end fund in each investment in proportion to the respective available capital commitments, (ii) make
each investment at the same time and on substantially the same terms, and (iii) unless otherwise approved by the
advisory board of the closed-end fund, sell each of their respective interests at the same time and on the same
terms.

Additionally, Kayne has a number of traditional separately managed accounts and single investor funds for large
institutional investors in order for them to take advantage of the breadth of Kayne’s investment offerings in an
efficient manner. The fees for these cross-platform strategy vehicles are negotiated directly with such client and
vary depending on the structure of the vehicle, the size of the investment, and other relevant factors.

Kayne believes that its fees, both for its pooled investment vehicles and its separate accounts, are competitive
with those charged generally by other investment advisers for comparable services. However, some investment
advisers may provide comparable services for lower or different fee structures. Performance-based

allocations/fees are only charged consistent with applicable rules and regulations, including Rule 205-3 under the
Advisers Act and the Employee Retirement Income Security Act (ERISA) as applicable.

Fee Arrangements and Payments

With respect to private commingled funds, Kayne is generally authorized to charge and deduct advisory fees
directly from the assets of the applicable funds at times and in an amount set forth in governing fund documents.
Separate account fees are billed directly to the investor. Kayne generally does not negotiate different fee
arrangements with investors in its pooled investment vehicles, but has and may in the future do so for very large
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Item 7 – Types of Clients

Kayne provides investment supervisory services through privately offered (i.e., unregistered) pooled investment
vehicles, and to a lesser extent through separate accounts. Kayne generally provides its services and markets its
funds and separately managed accounts to endowments, foundations, financial institutions, insurance companies,
operating companies, Taft-Hartley plans and other institutional clients, family offices, funds of funds, registered

investment companies, and high-net-worth individuals. Interests in funds are offered only to those investors who
qualify as (i) “qualified clients” within the meaning of Rule 205-3 under the Advisers Act, as amended, (ii)
“accredited investors”, as defined in regulation D under the 1933 Act, and, (iii) where applicable, “qualified
purchasers” within the meaning of Sections 2(a)(51) and 3(c)(7) of the 1940 Act, as amended.

Each of Kayne’s pooled investment vehicles has a stated minimum investment requirement. These generally range
from $100,000 to $10 million. Kayne may, and in many cases has, accepted initial investments in its pooled
investment vehicles below the stated minimums. These situations are evaluated on a case-by-case basis and
include a consideration of whether the investor has an existing investment in any other of Kayne’s pooled
investment vehicles or has an expectation of fulfilling the stated minimum requirement over a relatively short
period of time. Additionally, Kayne manages separate accounts where there is no stated minimum investment,
although all such accounts exceed the minimum requirements of comparable pooled investment vehicles.