ITEM 5: FEES AND COMPENSATION
Management Fees
The Management Fee is calculated based on the Fund’s aggregate capital commitments during the
investment period. The Management Company will receive a fee of 1.8% in the first year, increasing
to 2% beginning in the second year. This fee is paid quarterly in advance and is based on 2% of the
Fund’s total commitments during the investment period.
Management Fees may be reduced or waived at the discretion of the General Partner. Blacksun
may offer such waivers in connection with investments by the General Partner, its affiliates,
employees, business associates, or other designated parties. Eligible employees may also
participate in vehicles that invest in or alongside the Funds and which do not charge Management
Fees or performance-based fees (“Employee Vehicles”). In certain cases, waived fees may be
treated as deemed capital contributions by the General Partner, thereby reducing its required
capital commitment to the Fund. Management fees paid by a Fund are indirectly borne by its
Investors and are added to the cost basis of investments prior to the calculation of any
performance-based fees. In some cases, such waivers or offsets may result in accelerated capital
calls from Investors, and certain fee offsets may not be fully realized until the Fund’s liquidation.
Blacksun shall offset 100% of all placement fees paid to third-party placement agents against the
management fees payable by the Fund to the General Partner ("GP") or investment manager. If
multiple funds are involved, the offset will be allocated on a pro rata basis based on each fund’s
capital raised by the agent. The full amount of the fee shall be offset within a 12- to 24-month
period, depending on the management fee structure and available offsets.
Fund Expenses
The Fund will pay an expense or obligation common to both Blacksun Funds and/or co-investors
(e.g., legal expenses for a transaction in which multiple Blacksun Funds and/or co-investors
participate) and be reimbursed by the other Blacksun Funds for their share of such expenses or
obligations, without interest. To the extent the paying Fund makes use of a credit facility to pay such
expense, it generally will not be reimbursed separately by other Blacksun Funds and/or co- investors
for the costs of establishing, negotiating or maintaining the facility as a whole.
Generally, funds are responsible for operating expenses which include, but are not limited to the
following:
• Brokerage and transaction costs
• Borrowing related fees.
• Investment Research, due diligence, and data Services
• Costs for organizing, managing, and operating investments
• Legal, consulting, accounting, and professional fees
• Compliance, regulatory filings, and registration fees
• Insurance Costs
Carried Interest Payments
The Management Company receives management fees for providing advisory and administrative
services to the Fund. Separately, the General Partner may receive a performance-based allocation
(carried interest) based on the Fund’s realized investment profits, as further described in the Fund’s
governing documents.
The General Partner is entitled to receive a performance-based allocation, commonly referred to as
carried interest, with respect to all realized profits of the Fund, subject to the achievement of a
preferred return, as set forth in the Fund’s governing documents. back or giveback at the end of life
of the Fund if the General Partner has received excess cumulative distributions and at certain interim
intervals as provided in the relevant Governing Documents.
Adviser Expenses
To the extent provided in the Governing Documents of the Funds, and except as described herein
as a Fund or portfolio company expense, Blacksun will bear all ordinary overhead and administrative
expenses incurred by a General Partner in connection with maintaining and operating their
respective offices, including rent and equipment expenses, salaries, compensation and expenses
of certain of its partners, officers, and employees), and certain fees and expenses paid to members
of the Fund’s Advisory Committee.
Special Purpose Vehicle Expenses
The General Partner of a Fund may form “special purpose vehicles” or similar structuring vehicles
for purposes of accommodating certain tax, legal, and regulatory considerations of Investors
(“SPVs”). In the event the General Partner creates an SPV, any Fund expenses related to its
organization and formation will typically be borne by the SPV, and indirectly the investors thereof.
Additionally, the Fund may bear certain expenses related to any feeder fund or similar vehicle
formed to facilitate Investor participation, including accounting, tax, and operational costs,
regardless of whether a particular Investor participates in such vehicle.
Broken Deal Expense
Funds may bear certain expenses associated with proposed but unconsummated transactions
(“broken deal expenses”). These expenses may include legal, accounting, advisory, consulting, and
other third-party fees; travel and related costs; lender and financing-related expenses (including
commitment fees); and any breakup or reverse termination fees. Additional expenses may include
costs associated with negotiating co-investment documentation (such as non-disclosure
agreements), onboarding investment entities (e.g., KYC-related costs), and responding to tax audits
or investigations related to the proposed transaction. Funds may also bear extraordinary costs, such
as litigation expenses or forfeited deposits or down payments, in connection with investments that
are ultimately not consummated.
Other Fees
Blacksun and its affiliates and personnel (on behalf of Blacksun) have received or expect to receive
in the future a variety of cash, equity and other non cash fees relating to the investment activities of
a Fund, its portfolio companies and prospective portfolio companies. These fees may include,
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