Fees and Compensation
Funds for which the Adviser provides investment advisory services typically pay management
fees and allocate carried interest based on the amount of capital managed by the Adviser and the
performance of the Funds.
The fee structure for the Funds varies depending on the purpose and scope of the respective
Fund’s strategy. In general fees consist of (1) management fees; and (2) carried interest or
success fee, which is a performance-based fee. Additionally, certain expenses such as
organizational, closing and ongoing fees are charged to the fund and payable from investors’
capital accounts (as more fully described in a fund’s partnership agreement). Such expenses also
include the management fees of entities in which the fund invests (i.e., the underlying funds) as
well as such underlying funds’ expenses, management fees and carried interest.
The Funds pay a quarterly investment management fee equal to a percentage of the Fund’s
aggregate investor capital commitments in advance. The general partner of the Funds and the
Adviser may agree to reduce the management fee with respect to investors committing to the
Fund as set forth in the Fund’s partnership agreement. In addition, the Adviser may perform
advisory, transaction-related, financial advisory and other services for, and receive fees from,
actual or prospective portfolio companies or other investment vehicles of the Funds, including
fees in connection with mergers, acquisitions, add-on acquisitions, refinancings, private
placements, public offerings, sales and similar transactions. Although these fees are distinct from
and in addition to a Management Fee, they are not borne by the limited partners. Moreover, if the
Adviser receives an additional fee from a portfolio company, the Adviser will reduce its
management fee received from that Fund, by the same amount. However, various travel expenses
incurred by the Adviser in connection with its performance of services for such portfolio
company are typically reimbursed by the portfolio company directly.
Additionally, please see Item 6 below regarding “Carried Interest” that Funds may pay.
In the case that a Fund invests in third-party managers each “underlying fund” in which a Fund
acquires an interest charges management fees, carried interest and other expenses to a
management company and/or general partner that is not affiliated with the Adviser. Fees paid to
the Adviser for investment advisory services are separate and distinct from the fees and expenses
charged by an underlying fund’s independent investment adviser and/or general partner for such
underlying fund’s advisory or management services.
The Funds invest on a long-term basis. Accordingly, fees are paid during the term of the fund. In
the Venture Fund, at the end of the Investment period, typically after 5 years, the management
fee eventually reduces and is no longer charged on the total committed capital but becomes
charged only as a percentage of the drawn and invested capital.
To the extent that the Adviser advises additional private investment funds, the fees paid to the
Adviser may be similar in structure but vary in amounts. Any description of the fees paid to the
Adviser is, and remains subject to, the applicable fund governing documents and related
agreements.