Palm Beach Capital Management III LLC

Item 5: Fees and Compensation

The Funds pay an annual management fee, payable quarterly in advance on the first business day
of each quarter, of 2% of aggregate commitments during the commitment period and thereafter

2% of invested capital. The management fee may be reduced by excess organizational expenses,
placement agent expenses, and other fee income (monitoring fees, advisory fees, directors’ fees,
financing fees and transaction fees from portfolio companies or proposed portfolio companies and
break-up fees). The Funds’ offering documents include further details concerning reductions to
the management fee.

Palm Beach or its affiliates may waive or reduce the management fees voluntarily and on a
negotiated basis with selected investors resulting in different fees among investors in the Funds.
Management fees may be waived for investors in the co-investment vehicles.

Additionally, please see Item 6 below regarding performance-based compensation (“Carried
Interest”) that the Funds may pay.

The Funds will also be subject to other investment expenses such as legal, auditing, consulting,
financing, accounting and custodian fees and expenses; expenses associated with financial
statements, tax returns and K-1s; expenses of the advisory board and annual meetings of the limited
partners; insurance; other expenses associated with the acquisition, holding and disposition of their
investments, including extraordinary expenses (such as litigation, if any); all expenses in
connection with transactions not consummated, and any taxes, fees or other governmental charges.

The Funds will pay a portion of the organizational expenses, including legal, accounting, filing,
capital raising, printing, travel and other expenses incurred in their formation.

Palm Beach receives an annual fee from the other Funds’ management companies for its services.
This fee is payable quarterly in advance.

Although Palm Beach does not generally utilize the services of broker-dealers to effect portfolio
transactions for the Funds, in the event that it chooses to use a broker-dealer for limited purposes,
the Funds will incur brokerage and other transaction costs. For additional information regarding
Palm Beach’s brokerage practices, please see Item 12.

Item 7: Types of Clients

Palm Beach provides advice directly to the Funds and not to individual investors. The Funds are
not registered under the Investment Company Act of 1940, as amended (the “Investment Company
Act”). The Funds are not offered through any form of general solicitation or general advertising.
Access to information about the Funds is limited to investors who meet specified minimum
investment criteria relating to their financial holdings, investment experience, etc. The Funds’
investors are typically institutions and high net worth individuals.

Details concerning minimum initial and additional subscription amounts are found in the Funds’
offering documents.