THL Managers VII LLC

Item 5. Fees and Compensation

The Adviser or its affiliates generally receive Advisory Fees and Carried Interest (each as defined
below) from a Client, though certain Clients do not pay Advisory Fees. The Adviser may also
receive Portfolio Company Fees (as defined below) from portfolio companies of Clients. A certain
amount of Portfolio Company Fees reduce Advisory Fees payable to the Adviser as set forth in the
Governing Documents of the Client. Additionally, consistent with the Governing Documents of a
Client, the Client typically bears certain out-of-pocket expenses incurred by the Adviser in
connection with the services provided to the Client and/or the portfolio companies. Details about
such fees and expenses are contained in the Governing Documents of a Client. Further details
about certain fees and expenses are set forth below.

Advisory Fees

As compensation for investment supervisory services rendered to the Clients, the Adviser receives
from each investor of each Client an advisory fee (each, an “Advisory Fee”) typically calculated
based on committed capital or remaining capital base, with respect to such Client. Advisory Fees
paid by a Client may also be reduced by other fees or compensation received by the Adviser or its
affiliates that relate to such Client’s activities and investments, or by certain excess organizational
or other expenses borne by such Client, as described in more detail below. Advisory fees paid by
a Client are indirectly borne by investors in such Client.

On a date specified in the Governing Documents (the “Stepdown Date”), the Advisory Fee
customarily decreases and is thereafter calculated based on the amount of the Client’s remaining
capital base which includes the aggregate amount of capital invested by the Client in portfolio
investments minus the aggregate amount of capital contributions invested in a portfolio investment
that has been sold, disposed of, or liquidated (each a “Disposition”), or permanently and fully
written-off (or fully written off, as applicable) (such investments, “Impaired Investments”).
Because Advisory Fees are calculated based on remaining capital base following the Stepdown
Date, the Governing Documents do not require any reduction or refund of Advisory Fees following
any decrease in value (whether temporary or permanent), except to the extent such decrease in
value results from a Disposition or Impaired Investment. As a result, the Advisory Fees generally
will not track changes in the fair value of any individual investment or of a Client.

Portfolio Company Fees (as defined below) and other fees, costs and expenses allocated to a
portfolio company at the time of investment (collectively, “Capitalized Costs”) are generally
capitalized into the amount of remaining capital base with respect to such portfolio company.
Accordingly where the Advisory Fee base post-Stepdown Date is based on remaining capital base,
such base will include the value of such Capitalized Costs, including those payable or reimbursable

to the Adviser and its affiliates. This would increase the amount of Advisory Fees paid to the
Adviser. Such increase is in addition to the Portfolio Company Fees paid to the Adviser and/or its
affiliates.

The Governing Documents generally do not provide for the reimbursement or refund of Advisory
Fees in the event of Dispositions or Impaired Investments occurring mid-calculation period.

As our investors are aware, the precise amount of, and the manner and calculation of, the Advisory
Fees for each Client’s investors are established by the Adviser, as modified by negotiations with
investors in such Client, and are set forth in such Client’s Governing Documents and/or other
documentation received by each investor prior to investment in such Client. In addition, the
Adviser may enter into economic and/or other fee sharing arrangements with respect to one or
more Clients and/or certain limited partners thereof, the rights of which, will not generally be
offered to other limited partners. Unless otherwise agreed with a Client’s investors, Advisory Fees
will continue to be payable during any term extensions.

The Advisory Fees paid by a Client’s investors will generally be reduced by a percentage of: (1)
the amount of fees paid by such Client in connection with the organization of such Client that
exceed a limit specified in such Client’s Governing Documents and/or (2) certain Portfolio
Company Fees received by the Adviser or its affiliates. The amount and manner of such reduction,
if any, is set forth in the Governing Documents of the applicable Client. To the extent a reduction
relates to more than one Client, the Adviser shall allocate the resulting Advisory Fee reduction
among the applicable Client(s) in proportion to their relative capital commitments, or, in the case
of Portfolio Company Fees that relate to an investment opportunity shared between multiple
Clients, investments or proposed investments in the applicable portfolio company. Any such
reduction of a Client’s Advisory Fees will be limited to the extent of such Client’s proportionate
share based on relative capital commitments or, in the case of Portfolio Company Fees that relate
to an investment opportunity shared between multiple Clients, investments or proposed
investments in the applicable portfolio company. As some Clients do not pay Advisory Fees, any
such reduction will not benefit such Clients.

In addition, the Adviser will from time to time waive or reduce all or a portion of the Advisory
Fee paid by a Client in full or partial satisfaction of any obligation of the Adviser and certain
employees and affiliates of the Adviser (including any related entity established by employees of
affiliates of the Adviser) to invest in and alongside such Client, which could result in acceleration
of investor capital contributions. Furthermore, the Adviser has in the past and may, from time to
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Item 7. Types of Clients

The Adviser currently provides investment supervisory services to the Clients. Investment advice
is provided directly to the Clients and not individually to investors in any Client.

Interests in the Clients are offered pursuant to applicable exemptions from registration under the
Securities Act and the 1940 Act. Investors in the Clients are generally “qualified purchasers” as
defined in the 1940 Act, and may include, among others, high net worth individuals, banks, thrift
institutions, pension and profit sharing plans, trusts, estates, charitable organizations, university
endowments, corporations, limited partnerships and limited liability companies or other entities.

The Adviser does not have a minimum size for a Client, but the Adviser typically establishes
minimum investment commitments for Client investors. The Adviser will from time to time, in
its sole discretion, permit investments below the minimum amounts set forth in the Governing
Documents or offering documents of a Client.