Palmer Square Europe Capital Management LLC

Item 5 – Fees and Compensation
Advisory Fees

Collateral Management Fees

As compensation for its services as collateral manager, the Management Series of Palmer Square
Europe is entitled to certain fees, and the CLOs will bear certain expenses in connection with their
operation. The fees and expenses for each CLO are described in the relevant CLO Documents and
can vary from CLO to CLO. In most cases, the Management Series of Palmer Square Europe, or
a Palmer Square affiliate, will receive a senior collateral management fee, a subordinate collateral
management fee (both of which typically begin to accrue at closing and are paid quarterly in
arrears) and, upon achieving a level of performance described in the CLO Documents, can also be
entitled to receive an incentive collateral management fee (collectively, “Collateral Management
Fees”) from each CLO for services rendered to the CLO. Collateral management fees are payable
only to the extent that funds are available for that purpose, in accordance with the priority of
payments waterfall described in the relevant CLO Documents (the “CLO’s Waterfall”). The
senior collateral management fee occupies a higher priority in the CLO’s Waterfall than the
subordinate collateral management fee and the incentive collateral management fee. The incentive
collateral management fee represents performance-based compensation and is typically only
payable to the extent that: (i) funds are available in the CLO’s Waterfall for such purpose on each
payment date and (ii) certain specified returns hurdles are achieved, as described in the applicable
CLO Documents.

Warehouse Fees

In most cases, Warehouses pay management fees, structuring fees and/or “warehouse success
fees” (collectively “Warehouse Fees”) to Palmer Square Europe or an affiliate under the
Warehouse’s CLO Documents, as negotiated on a case-by-case basis. Warehouse Fees often
include fees similar to the Collateral Management Fees described above, as well as certain fees
negotiated in connection with a CLO payoff of a warehouse facility or upon the closing of a CLO,
in each case as described in the relevant CLO Documents.

Expenses

Collateral Management Fees and Warehouse Fees are exclusive of various costs and expenses that
are incurred by a CLO or Warehouse, as applicable, in connection with Palmer Square Europe’s
provision of collateral management services. As described in more detail below and in the relevant
CLO Documents, the costs and expenses that will be borne by our clients include, but not limited
to: organizational, custodial, brokerage, audit, line of credit, legal, risk management, consulting,
third party administration and research-related fees; deferred sales charges; odd-lot differentials;
transfer taxes; wire transfer and electronic fund fees; and other fees, expenses and taxes on
brokerage accounts maintained, and securities transactions effected, for the client.

Please see Item 12: Brokerage Practices, for more information about expenses incurred in
connection with the purchase or sale of a CLO’s Assets and Palmer Square Europe’s trading
practices, including the factors we consider in selecting intermediaries and determining the

reasonableness of their compensation.

Direct and Indirect Expenses Incurred by CLOs
In addition to the fees paid to the Management Series of Palmer Square Europe for its collateral
management services, and as set forth in the relevant CLO Documents, CLOs pay (and investors
in the CLO indirectly bear) a variety of other expenses related to the CLO’s operations. These
expenses will be the responsibility of the CLO and can be paid directly by the CLO or by Palmer
Square for and on behalf of the CLO (in which case, Palmer Square will be entitled to
reimbursement from the CLO). Examples of allocable direct expenses that could be borne by a
CLO include, but are not limited to, the following:

       •      All fees and out of pocket costs and expenses incurred by Palmer Square in
              connection with the formation of a CLO and its consummation including, without
              limitation, legal and other expenses (excluding travel) incurred in connection with
              the offer and sale of interests in the CLO (i.e., organizational expenses);

       •      Expenses associated with the operation of the CLO under the CLO Documents in
              connection with the management of the CLO’s Assets including expenses related to
              purchases and sales of Assets, workouts, research systems and compliance
              monitoring (some of which can be shared expenses, as described below);

       •      Other operating expenses, including brokerage commissions and other charges for
              transactions in securities, other instruments and investments;

       •      Escrow expenses;

       •      Borrowing charges on margin accounts, credit facility charges and the costs of other
              indebtedness;

       •      Insurance costs;

       •      Governmental charges;

       •      Licensing costs;

       •      Audit fees;

       •      Valuation expenses;

       •      Financing and interest costs and expenses;

       •      Custodial fees and expenses;

       •      Administrative fees and expenses;

       •      Reporting expenses;

       •       Taxes;

       •       Legal and accounting fees and other professional expenses such as consulting and
               investment banking fees;

       •       Expenses associated with mailing and reproducing offering documents, any
               amendments thereto and other communications with investors;

       •       Subject to the requirements of applicable law, all expenses incurred in connection
               with any threatened, pending or anticipated litigation, examination or proceeding;

       •       All expenses incurred as a result of the client’s obligation to indemnify Palmer
...

Item 7 – Types of Clients
Palmer Square Europe provides investment advisory services to CLOs, including CLOs consisting
primarily of Europe-based Assets (“European CLOs”) and CLOs consisting primarily of U.S.-based
Assets (“U.S. CLOs”). European CLOs are generally organized in Ireland, and U.S. CLOs are
generally organized in the Cayman Islands. Each CLO is generally excepted from the definition of
an “investment company” pursuant to Section 3(c)(7) of the Company Act, and the CLO Securities
issued by Clients are generally exempt from registration under the Securities Act of 1933, as amended
(the “Securities Act”), pursuant to Regulation D and/or Regulation S thereunder, although other
exceptions could be relied on in certain circumstances. As such, each US person who invests in CLO
Securities will, at a minimum, be an accredited investor and a qualified purchaser. Non-US Persons
who invest in a CLO domiciled outside of the U.S. through a Regulation S offering will not
necessarily be required to meet such qualifications, but will be subject to the investor criteria set forth
in the relevant CLO Documents.

Additionally, certain CLOs could also rely on Rule 3a-7 under the Company Act as an exception
from the definition of an “investment company”. Such CLOs are subject to the Rule’s requirements
with respect to holders of CLO Securities. As a result, except for CLO Securities that are fixed-
income securities rated, at the time of initial sale, in one of the four highest categories, CLOs relying
on Rule 3a-7 expect that each holder will be a qualified purchaser that is also: (i) for fixed income
securities not so rated, an institutional accredited investor; or (ii) for such CLO Securities or for CLO
Securities that are not fixed income securities, a “qualified institutional buyer” (as defined in Rule
144A under the Securities Act) or a persons involved in the organization or operation of the CLO (or
such a person’s affiliate, as defined in Rule 405 under the Securities Act). Additionally, these CLOs
must observe certain limitations as to the type of assets that it can hold as well as restrictions with
respect to purchases and sales, which could have an adverse impact on the risks and returns associated
with an investment in the CLO.

In most cases, interests in European CLOs are generally issued in minimum denominations of
€250,000 for Rule 144A investors and €100,000 for Regulation S investors, and interests in U.S.
CLOs are generally issued in minimum denominations of $250,000,000 for Rule 144A investors and
Regulation S investors, but minimums can be waived in certain circumstances. Additional details
concerning the exceptions relied upon by a CLO and applicable investor criteria will be provided in
the relevant CLO Documents.