Item 5. Fees and Compensation
Asset-Based and Performance-Based Compensation. The fee schedules for the Clients are described in
detail in each Client’s Governing Documents.
As a general matter, the Clients pay the Adviser or its affiliates an asset-based investment management
fee semi-annually in advance generally equal to 2% per annum based on capital commitments during the
investment period and, after the investment period, ranging from 0.5% to 2% per annum based on the
capital contributions of a Client used to fund the cost of portfolio investments then held by the Client (the
"Management Fee"). The Adviser or its affiliate (as applicable) may waive or modify the Management Fee
for investors that are members, principals, employees or affiliates of the Adviser, relatives of such persons,
and for certain investors in the Adviser/its affiliate (as applicable)’s sole discretion.
The Adviser, or one of its affiliates serving as a general partner of a Client, also enters into arrangement to
receive performance-based fees/allocations (the “Incentive Allocation”), with rates and other terms being
individually agreed to with the applicable Client. The Adviser, or its applicable affiliate, assesses Incentive
Allocations based on realized capital appreciation and may, in the future, assess such Incentive Allocations
on unrealized capital appreciation up to 20%. In certain instances, such Incentive Allocations are subject
to a threshold amount, hurdle, benchmark, or preferred return. In some cases, the Adviser or its affiliates
receive a portion of its Clients’ realized investment profits as performance fees/allocations upon disposition
of a relevant investment. The Adviser, or its applicable affiliate, may waive or modify the Incentive Allocation
for investors that are members, principals or employees of the Adviser or its affiliates, relatives of such
persons, and for certain investors in the Adviser’s sole discretion.
The Adviser and its affiliates’ fee and compensation practices for Co-Investments (as defined below) are
subject to a case-by-case agreement with the applicable Client.
Expenses. As a general matter, in addition to paying the Management Fee and, as applicable, the Incentive
Allocation, the Clients are also subject to other expenses such as all costs, expenses and liabilities in
connection with its operations and activities as permissible under the applicable Client agreements, which
may generally include: organizational fees and expenses; fees and expenses related to consummated and
unconsummated investments, including the evaluation, acquisition, holding and disposition thereof (to the
extent not reimbursed by a portfolio company or other third party); interest on and fees and expenses
related to or arising from indebtedness or hedging activities of the Client; insurance premiums; taxes; fees
and expenses of accountants, counsel and consultants; legal, brokerage, valuation custodial,
administration, auditing, accounting and regulatory and compliance expenses; costs of reporting to
investors and to governmental authorities; costs and expenses of any advisory committees and annual
meetings; litigation expenses; and other extraordinary expenses and such other fees and expenses as are
provided for under the arrangement with each Client or in the Governing Documents.
The allocation of expenses by the Adviser between it and a Client and among Clients represents a conflict
of interest for the Adviser. The Adviser has adopted an expense allocation policy that is designed to
address this conflict. The Adviser allocates expenses to each Client in accordance with the Client’s
Governing Documents. The Adviser will seek to allocate any shared expenses for products and services
benefitting multiple Clients or both the Adviser and a Client, and not covered in the Client’s Governing
Documents, in a fair and reasonable manner.
Clients incur brokerage and other transaction costs. Please see Item 12, “Brokerage Practices” below for a
discussion of certain brokerage expenses. The Adviser has no affiliated broker-dealers.
The Adviser could elect to (or to cause its affiliates to) rebate or offset cash and non-cash consideration
received or due to it or its affiliates as a result of actions taken with respect to a Client’s investment,
including, e.g., customary break-up fees, commitment fees, monitoring and directors’ fees and transaction,
financing, divestment and other similar fees (all to the extent that the receipt of such monies is consistent
with applicable law) against Management Fee otherwise payable. The Adviser’s and its affiliates’ obligations
to do so will be governed by the Governing Documents or applicable agreements with each affected Client,
which could include provisions on the calculation of non-cash consideration.