New China Capital Management Corp

Item 5. Fees and Compensation.

A.      As compensation for investment advisory services, NCCM receives from CCH III and
COF, during a specified investment commitment period, a semi-annual management fee payable
less than six months in advance (the “Management Fee”), generally equal to 1% (2% per annum)
of the aggregate investments committed to such Cathay Fund. After the expiration of the relevant
investment commitment period, the Management Fee is generally equal to 1% (2% per annum) of
aggregate capital contributions in respect of outstanding portfolio investments. The applicable
General Partner may, in its sole and absolute discretion, reduce, waive or calculate differently all
or a part of the Management Fee with respect to any investor in the relevant Cathay Fund, including
any investors that are affiliates or employees of the Advisers, members of the immediate families
of such persons and trusts or other entities for their benefit.

B.     The Management Fee is billed to each of CCH III and COF.

C.       Each Cathay Fund typically bears all of the expenses relating to such Cathay Fund’s
activities (to the extent not reimbursed by a portfolio company), including, without limitation:

           •   legal, accounting, consulting, audit and tax preparation expenses (including costs
               of reports to investors, financial statements, tax returns and K-1s);

           •   expenses related to the advisory board of such Cathay Fund;

           •   fees of the administrator;

           •   investment expenses (i.e., expenses which are related to the acquisition, holding,
               monitoring, supervision and disposition of such Cathay Fund’s proposed or actual
               portfolio investments);

           •   third party and out-of-pocket expenses in connection with transactions not
               consummated;

           •   all expenses of liquidating such Cathay Fund;

           •   premiums for insurance for protecting such Cathay Fund, the applicable General
               Partner and applicable Adviser, and any of their respective affiliates;

           •   expenses related to organizing companies through or in which portfolio investments
               will be made;

           •   extraordinary expenses (such as litigation);

           •   taxes or other governmental or regulatory charges payable by such Cathay Fund;

           •   certain indemnity obligations of such Cathay Fund to the applicable General
               Partner; and

           •   certain expenses incurred in connection with defaulting investors.

Brokerage fees and other transaction expenses that are incurred by the Cathay Funds are disclosed
in the offering documents and/or governing documents of the Cathay Funds under the caption
“Transaction Costs” and are also discussed in Item 12 – Brokerage Practices below.

To the extent the Adviser, the General Partners or their respective affiliates pay any of the expenses
outlined in this Item 5.C. on behalf of the Cathay Funds, the relevant Cathay Fund is or will be
required to reimburse the Adviser, such General Partner or such affiliate, as the case may be, upon
request. These expense reimbursements are in addition to the advisory fees described in Item 4 –
Advisory Business and are disclosed to investors in the relevant offering documents and/or
governing documents.

D.      Pursuant to the Investment Management Agreement of CCH III and COF, any payment of
the Management Fee for a period of less than six months is reduced on a pro rata basis according
to the actual number of days during the period, and the excess is refunded by NCCM to CCH III
and COF, as applicable.

E.     Other than as stated above, neither the Adviser nor any of its supervised persons accepts
or otherwise receives directly or indirectly any compensation for the sale of securities or other
investment products.

Item 7. Types of Clients.

As described in Item 4 – Advisory Business above, NCCM provides investment advisory and
management services to CCH III and COF.

The minimum capital commitment to CCH III and COF is $5 million, subject to the sole and
absolute discretion of Cathay Capital III Master GP. The board of directors of each Overseas Fund
may authorize the acceptance of commitments in such Overseas Fund from investors for any
amount.