Medley Partners Management LLC

ITEM 5 – FEES AND COMPENSATION

Item 5.A   Describe how you are compensated for your advisory services.
           Provide your fee schedule. Disclose whether the fees are negotiable.

           Note: If you are an SEC-registered adviser, you do not need to include
           this information in a brochure that is delivered only to qualified
           purchasers as defined in section 2(a)(51)(A) of the Investment
           Company Act of 1940.

           The specific manner in which fees are charged by Medley Partners is
           established in each Advisory Client’s limited partnership agreement or
           limited liability company operating agreement. Each Advisory Client pays
           an investment management or administrative fee to Medley Partners which
           is typically payable quarterly, in advance, at the beginning of each quarter.

           The Funds pay to the applicable Affiliated General Partner an annual fee
           (the “Management Fee”). Payments of the Management Fee are calculated
           and made quarterly in advance within the first two weeks of each fiscal
           quarter of the Fund in an amount equal to a percentage of the aggregate net
           asset value of the Portfolio Funds (the “NAV”). NAV of Portfolio Funds
           shall be determined by the relevant Affiliated General Partner and
           generally be consistent with those reported by the Portfolio Manager of the
           applicable Portfolio Fund at the end of the previous fiscal quarter, if
           applicable. Recognizing that the NAV for the previous fiscal quarter may
           be reported later than the due date for the payment of the Management Fee,
           to calculate the Management Fee, the Affiliated General Partner uses
           reasonable estimates of NAV based on the most recent periodic reports
           received from the applicable Portfolio Manager and adjusts subsequent
           payments of the Management Fee as necessary in the event that the actual
           NAV differs from such estimates. Also see Item 18.A in this Brochure
           regarding any potential pre-payment of Management Fees.

           The Management Fee shall be reduced for the quarterly period
           immediately succeeding the quarterly period in which any director fees,
           commitment fees, transaction fees, break-up fees, monitoring fees or
           success fees (each net of related expenses) are received by the Affiliated
           General Partner or an affiliate thereof in connection with any investment
           or proposed investment by the Funds (collectively, the “Transaction
           Fees”). Any Transaction Fees are apportioned to the relevant Fund in
           which the investment or proposed investment that generated such
           Transaction Fees was apportioned and then apportioned among the
           investors pro rata. If the amount of such Transaction Fees exceeds the
           Management Fee and such investors for the immediately succeeding
           quarterly period, such excess shall be carried forward to reduce the
           Management Fee payable in successive quarterly periods. If any
           Transaction Fees are paid in regards to an investment or proposed

           investment of the Funds, the Affiliated General Partner shall determine
           that portion of such Transaction Fees which is subject to offset against the
           Management Fee in good faith based on the relative amounts invested or
           proposed to be invested in such investment or proposed investment.

           The Funds are also subject to performance-based fees further described in
           Item 6 below.

           Fee arrangements with the SMAs are individually negotiated and are
           generally based on assets under management. When participating in
           investments alongside the Funds, the SMAs pay their pro rata share of
           relevant expenses. With regard to co-investments, the sponsor’s fund is
           typically responsible for break-up fees if the underlying transaction is
           ultimately not consummated for certain reasons attributable to such fund.
           Some co-investment opportunities require co-investors to bear their pro-
           rata portion of any such break-up fees.

Item 5.B   Describe whether you deduct fees from clients’ assets or bill clients for
           fees incurred. If clients may select either method, disclose this fact.
           Explain how often you bill clients or deduct your fees.

           Medley Partners deducts applicable fees from each limited partner’s
           capital account. Limited partners do not have the ability to choose to be
           billed directly for fees incurred.

           Medley Partners generally deducts the amount of Management Fees
           applicable to each limited partner in the Funds (and to each SMA) from
           such limited partner’s capital account at the beginning of each quarter (i.e.,
           quarterly in advance).

Item 5.C   Describe any other types of fees or expenses clients may pay in
           connection with your advisory services, such as custodian fees or
           mutual fund expenses. Disclose that clients will incur brokerage and
           other transaction costs, and direct clients to the section(s) of your
           brochure that discuss brokerage.

           The Advisory Clients’ governing limited partnership and limited liability
           company documents set forth the fees and expenses to be paid by interest
           holders. Fund investors should carefully review the offering documents
           and Fund governing documents prior to investing in a Fund.

           Medley Partners and the Affiliated General Partners assume all “normal
           operating expenses” of managing and advising the Funds. Normal
           operating expenses include all recurring routine expenses incident to
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ITEM 7 – TYPES OF CLIENTS

Describe the types of clients to whom you generally provide investment advice, such as
individuals, trusts, investment companies, or pension plans. If you have any requirements
for opening or maintaining an account, such as a minimum account size, disclose the
requirements.

Medley Partners offers investment advisory services solely to private investment partnerships,
other pooled investment vehicles and managed accounts.

Medley Partners imposes a $5 million minimum initial investment amount for investors in the
Funds and SMAs, subject to reduction at the discretion of Medley Partners.