Morgan Stanley Private Equity Asia Inc

Item 5 – Fees and Compensation

Certain fees and other compensation described herein are subject to negotiation with investors. The
Adviser is not required to inform, or offer any similar arrangements to, any other client or investor, except
as agreed with each such person or as required by applicable law.

   •   The PE Asia III Funds

   Management Fees

   The PE Asia III Funds pay an annual management fee generally equal to 2% of invested capital as
   the investment period has terminated. PE Asia III limited partners with committed capital amounts
   equal to or in excess of $50 million receive a 0.5% reduction of the management fee rate. The
   management fee is funded by the limited partners of the PE Asia III Funds and is payable quarterly
   in advance. Upon termination of the management agreement between the Adviser and the applicable
   PE Asia III Fund, the Adviser is generally required to repay to such PE Asia III Fund or to a
   replacement manager, as directed by the PE Asia III General Partner of the applicable PE Asia III
   Fund, the unearned portion (computed on the basis of the number of days elapsed), if any, of the
   management fees previously paid to the Adviser (see also Co-Investments below for additional
   information on the fees and expenses relating to co-investments). The PE Asia III Funds have ceased
   paying management fees.

   In addition, PE Asia III has a specific fund designed to admit only Morgan Stanley current and former
   employees (and certain other permissible related investors) (“Employee Fund”). With respect to such
   Employee Fund, absent certain circumstances relating to the termination of employment of a Limited
   Partner with Morgan Stanley, limited partners in the Employee Fund currently pay an annual
   management fee ranging from 0% to 2% of invested capital as the investment period has terminated;
   the management fee is paid quarterly in advance.

   The Adviser and its professionals may charge portfolio companies transaction fees, sponsor fees,
   monitoring fees, advisory fees, directors’ fees, commitment fees, closing fees, amendment fees,
   breakup fees and other similar fees. An amount equal to each PE Asia III limited partner’s share of
   50% of all such fees other than directors’ fees and 100% of directors’ fees paid by portfolio companies
   that are received by the Adviser, the PE Asia III General Partner or any of the investment professionals
   dedicated to the PE Asia III Funds (as described in the confidential offering memorandum of the PE
   Asia III Fund), net of any unreimbursed related expenses incurred by the Adviser or its affiliates or
   representatives in connection with unconsummated transactions, will generally be applied to reduce
   the management fee otherwise payable by such limited partner. All such fees will first be allocated
   among the applicable PE Asia III Fund and any other investors.

   Fees may be deducted from the PE Asia III Funds’ assets as, and to the extent, set forth in the limited
   partnership agreements of the PE Asia III Funds (the “PE Asia III Partnership Agreements”).

Carried Interest

The PE Asia III General Partner is generally entitled to receive carried interest with respect to each
PE Asia III limited partner equal to 20% (0-10% in the case of certain PE Asia III limited partners
who are employees of Morgan Stanley or its affiliates) of such PE Asia III limited partner’s profits
from each PE Asia III Fund investment, subject to satisfaction of an 8% internal rate of return,
compounded annually, for such investment, previously realized investments and related management
fees and expenses (see also Co-Investments below for additional information on the fees and expenses
relating to co-investments).

Expenses

The PE Asia III Funds may also bear certain out-of-pocket expenses incurred by the Adviser and/or
its affiliates in connection with the services provided to the PE Asia III Funds. The payment of such
expenses by the PE Asia III Funds does not represent a source of profit for the Adviser, but rather is
a reimbursement of actual costs initially paid by the Adviser (or its affiliates) and subsequently passed
through to the PE Asia III Funds. The most common expenses include (i) expenses incurred in
connection with identifying, evaluating, structuring and negotiating any potential investment by the
PE Asia III Funds and the acquisition, management, holding, sale, proposed sale or valuation of any
investments by the PE Asia III Funds (including meals, entertainment and travel expenses incurred
by Morgan Stanley and its employees in connection with identifying, negotiating, executing or
managing consummated PE Asia III Fund investments or unconsummated PE Asia III Fund
investments); and (ii) ordinary administrative expenses, including fees of auditors, attorneys,
appraisers and other professionals auditing, accounting, banking and consulting expenses (including
expenses paid to the Adviser or to any of its affiliates for services rendered on an arms-length basis
in connection with the PE Asia III Funds’ affairs). Item 12 further describes the factors that the
Adviser considers in selecting or recommending broker-dealers for client transactions and
determining the reasonableness of their compensation (e.g., commissions).

Placement Agent Fees

Broker-dealers who are the Adviser’s affiliates have acted as placement agents to assist in the
placement of a PE Asia III Fund’s interests. Any placement fee paid by an investor was in addition to
that investor’s capital commitment. The amount of any placement fee is described in the placement
agent’s point of sale letter (or similar disclosure documents). However, the placement agents or
distributors may have, in their sole discretion, waived the placement fees paid by an investor,
including an investor that is an employee or affiliate of the PE Asia III General Partner and/or the
Adviser.
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Item 7 – Types of Clients

The Adviser provides portfolio management services to pooled investment vehicles. These pooled
investment vehicles are not subject to registration under the Investment Company Act of 1940, as
amended (the “Investment Company Act”). Generally, the Funds’ investors were required to invest a
minimum of $10 million (less in the case of limited partners who are employees of Morgan Stanley and
its affiliates). Each General Partner reserves the right to waive any minimum investment requirement in
its discretion. In addition, Limited Partner interests in a Fund (“Interests”) may be purchased only by
certain eligible investors who are “accredited investors” as defined in Regulation D under the Securities
Act of 1933, as amended, and “qualified purchasers” for purposes of Section 3(c)(7) of the Investment
Company Act.

In the case of the Employee Fund, Interests have been offered and sold to investors who are “accredited
investors” as defined in Regulation D under the Securities Act and in accordance with the requirements
of an exemptive order under the Investment Company Act received by Morgan Stanley from the SEC in
April 2000.

In addition to providing advisory services to the Funds, the Adviser or a related person may act as the
managing member or the general partner of certain co-investment partnerships.