Item 5 - Fees and Compensation
General
Aquiline provides investment advisory services to each of the Funds pursuant to a separate investment
advisory agreement (each, an “Advisory Agreement”) in each case where Management Fees are payable
by a Fund. The Advisory Agreement of a Fund, along with the governing documents of a Fund, set forth in
detail the fee structure relevant to each such Fund. The terms of each Advisory Agreement are generally
established at the time of the formation of the applicable Fund. In general, each Advisory Agreement is only
terminable once the applicable Fund is dissolved, wound up, and terminated.
Management Fees
Aquiline may receive a management fee (the “Management Fee”) for rendering investment advisory
services to the Funds. The Management Fee is payable in advance, with timing depending on the Fund. In
general, the Management Fee paid by a Fund may be up to 2.5 percent per annum on capital commitments
during the investment period and up to 2 percent per annum on invested capital thereafter. Each Fund’s
investors have the ability to negotiate the Management Fee payable in respect of their investment in such
Fund, but the Management Fee is fixed at the time of final close of the Fund (unless modified thereafter in
accordance with the applicable Fund’s governing documents). The Management Fee is generally paid by a
Fund out of capital contributions called from investors, out of amounts withheld from distributions to investors
or with the proceeds of borrowings under the Fund’s subscription-based credit facility or other lines of credit
(and such borrowings may remain outstanding for up to three years). The Management Fee assessed for
each Fund is described in further detail in each Fund’s offering and governing documents. Generally,
although not always, investors in Co-Investment Vehicles and employees and affiliates of Aquiline do not
pay Management Fees, and Firm Advisors (as defined below), current or former senior management of
portfolio companies and other persons whom Aquiline determines have strategic value to Aquiline and its
network pay reduced or no Management Fees.
The Management Fee for a Fund is reduced by the amounts paid by a Fund for placement fees and the
organizational costs in excess of a certain threshold paid by investors in the Fund, as well as by other fees
received by Aquiline as described in “Other Fees and Expenses” below.
The Management Fee for any Management Fee period of a Fund is generally prorated for the number of
days in such period, and in the case of the last Management Fee period, Aquiline will refund to each investor
the amount of the Management Fee paid by such investor allocable to that portion of such period which is
subsequent to the date of the final distribution.
Certain investors that participate in co-investment opportunities (“Co-Investors”) will be charged certain
fees, including Management Fees, maintenance or administrative fees and one-time funding fees. However,
not all Co-Investors will be charged the same fees, and some Co-Investors have in the past and are expected
in the future to be charged fees at more favorable rates.
Carried Interest
A portion of a Fund’s net investment returns is generally allocated to the capital account of its general partner
(each, a “General Partner” and collectively, the “General Partners”) as “carried interest.” The General
Partners of the Funds are related persons of Aquiline. The manner of calculation of such carried interest is
described in the offering and governing documents of each Fund (as applicable) and varies Fund by Fund.
Generally, however, up to 20 percent of the net investment returns of each Fund is allocated as carried
interest to such Fund’s General Partner, subject to the Fund investors’ preferred return (except in the case
of the Technology Growth Funds’ investors, who are not entitled to receive a preferred return), the
recoupment of allocated losses, Management Fees, and expenses and other criteria set forth in the relevant
Fund’s governing documents. Generally, investors in Co-Investment Vehicles and employees and affiliates
of Aquiline do not pay a carried interest, and Firm Advisors, current or former senior management of portfolio
companies and other persons whom Aquiline determines have strategic value to Aquiline and its network
pay reduced or no carried interest.
Expenses
In addition to Management Fees and carried interest, investors bear indirectly the expenses charged to the
Funds. Those expenses vary by Fund and typically include, but are not limited to, the following:
organizational expenses; fees, costs, and expenses of any administrators, Swiss representatives, and
paying agents, custodians, attorneys, accountants, tax advisors, consultants, brokers, deal finders, agents,
valuation experts, appraisers and other professionals (including loan administration, audit and certification
fees), expenses of research, news and quotation, market data and other data providers (in each case
including related systems, services, subscriptions and software/hardware from such professionals or data
providers); expenses incurred in connection with complying with Fund-related regulatory, compliance, and
tax filing obligations of the Funds and Aquiline under U.S. federal, state, local, non-U.S. or other laws
(including compliance with anti-corruption and anti-money laundering laws and sanctions monitoring
expenses) and regulations directly related to the making, holding, or disposing of portfolio investments by a
Fund (whether such compliance obligations are imposed on the manager, such Fund’s General Partner,
their affiliates or a Fund), including, without limitation, the preparation and filing of (i) Form PF under the
Advisers Act, (ii) Section 16 filings, Schedule 13D filings, Schedule 13G filings and other filings, in each case
under the U.S. Securities Exchange Act of 1934, as amended; (iii) TIC Form SLT filings; (iv) any forms,
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