Item 5. Fees and Compensation
Our fees and compensation are described in the advisory contracts we enter into with the Funds, as well
as in the Funds’ offering memoranda. All of our clients are “qualified purchasers” (as defined in Section
2(a)(51) of the Investment Company Act of 1940, as amended).
We are paid management fees from the Funds quarterly in advance. Once paid, the management fees
are non-refundable. We have waived and may in the future waive, assign, participate or otherwise share
or modify the management fee payable with respect to any investor (including Bayberry GP and any of
our affiliates), without prior notice to all investors. No management fees are paid with respect to
interests/shares held by the Principal or by our employees or employees of our affiliates.
Bayberry GP also is entitled to receive performance-based allocations from the Funds, as further described
in Item 6 – Performance-Based Fees and Side-By-Side Management.
Our compensation schedule with respect to any future client account will be contained in the governing
documents relating to such account.
In general, the Funds bear all of their operating expenses, which include, without limitation: (i)
organizational and offering expenses; (ii) expenses associated with all investments and transactions
Bayberry Capital Partners LP Form ADV Part 2A
considered, evaluated and/or consummated by the Funds, including, without limitation, those expenses
incurred before the initial closing of the Funds, including, without limitation, expenses associated with
sourcing, negotiating, investigating, researching, financing and structuring of investments and potential
investments, whether or not consummated, including, without limitation, third-party research, data,
analytics, modeling, structuring, pricing, execution and other third-party information systems, including,
without limitation, installation and maintenance, software and service fees (including, without limitation,
the expenses with respect to data feeds, subscriptions, expert networks, political intelligence providers
and reports); (iii) research-related computer hardware and software expenses, including, without
limitation, Bloomberg terminals and subscriptions; (iv) each Fund’s pro rata share of our portfolio
management system and any other software used for accounting and/or monitoring of its portfolio,
including, without limitation, subscriptions relating to, among other things, trading and order
management systems and services; (v) expenses associated with holding, financing, monitoring, hedging,
maintaining and disposing of all investments of the Funds and all transaction and other costs associated
therewith; (vi) travel and related expenses associated with investments and potential investments; (vii)
professional fees associated with investments and potential investments, including, without limitation,
consulting, due diligence, accounting, valuation, financial, legal and other advisory fees and expenses;
(viii) transaction fees, brokerage commissions, custodial fees, clearing and settlement charges and similar
fees and expenses associated with the acquisition, disposition and settling of investments and potential
investments; (ix) expenses associated with legal and regulatory filings of the Funds in the United States or
in any other jurisdiction (including, without limitation, pursuant to Sections 13 and 16 of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”), as well as each Fund’s pro rata portion of the
expenses associated with preparation and filing of our Form 13F, Form 13H and Form PF, if applicable,
and any other similar filing in any other U.S. or non-U.S. jurisdiction; (x) administrative, custodial,
appraisal, valuation, legal, regulatory, compliance, consulting, advisory and similar fees and expenses
associated with the Funds’ operations, investments and transactions, including, without limitation, fees
and expenses of the Funds’ administrator (the “Administrator”); (xi) expenses incurred in connection with
responding to requests or inquiries from any U.S. federal, state, local or non-U.S. governmental entity or
authority, regulatory body or self-regulatory organization; (xii) broken-deal, failed transaction, break-up
and similar fees, costs and expenses (if any); (xiii) costs and expenses of leverage or any other borrowings
of the Funds, including, without limitation, interest charges and fees; (xiv) expenses incurred in the
collection of monies owed to the Funds, as applicable; (xv) auditing and accounting expenses of the Funds,
including, without limitation, expenses associated with the preparation of financial statements, tax
returns and Schedules K-1 and the fees and expenses of the auditor; (xvi) any taxes, fees or other
governmental charges on the Funds, including, without limitation, any withholding taxes not due to the
status or noncompliance of a particular investor; (xvii) costs and expenses associated with investor
communications and reports and the delivery thereof to investors; (xviii) the costs of service providers or
software to measure or monitor risk metrics, to aggregate positions and/or to provide reporting with
respect to risk metrics and/or positions; (xix) costs and expenses associated with meetings of the
investors; (xx) insurance expenses, including, without limitation, directors’ and officers’ liability insurance,
general partner liability insurance, errors and omissions insurance and other policies, if any; (xxi) costs
and expenses (including, without limitation, taxes, fees or other governmental charges) associated with
the formation, organization and operation of any subsidiary, special purpose vehicle, alternative
investment vehicle, holding company or similar entity formed with respect to investments, credit facilities
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