Item 5: Fees and Compensation
The fees applicable to each Fund are set forth in the corresponding Offering Documents. A
summary of such fees is provided below.
Management Fee
With respect to the Master Fund, the Investment Manager is generally paid a quarterly asset based
investment management fee equal to between 1% and 1.5% per annum determined by the series
of interest (“Series of Interest”) and based on the net asset value of each Investor’s capital account
as of the first day of each calendar quarter (the “Management Fee”), as further detailed in the
Fund’s Offering Documents. The Management Fee is deducted quarterly, in advance, and is
prorated for any investment period that is less than one full quarter.
With respect to the Co-invest Funds, the Investment Manager is generally paid a quarterly asset
based Management Fee equal to between 0% and 1.0% per annum determined by the Series of
Interest committed to by the Investor as detailed in the Fund’s Offering Documents. The
Management Fee is based on the net asset value of each Investor’s capital account as of the first
day of each calendar quarter and deducted quarterly, in advance. Additionally, Investors are
generally not permitted to make voluntary withdrawals until the specific dates described in each
Fund’s Offering Documents, and there will be no Management Fee payable to the Investment
Manager to the extent a Co-invest Fund’s term is extended.
The General Partner, in its sole discretion, may waive or modify the Management Fee for any
Investor (including, e.g., our employees).
Performance Allocation
With respect to the Master Fund, the General Partner is generally entitled to receive a
performance allocation (the “Profit Allocation”), equal to between 20% to 25% of net profits
subject to the Series of Interest’s hurdle, as further described in the Fund’s Offering Documents.
The Profit Allocation is paid in arrears from the sub-account of each Investor either annually, or at
the end of a performance period, based on the Series of Interest. The Profit Allocation may also be
paid at an earlier date with respect to an Investor who withdraws from a sub-account before the
end of a performance period.
With respect to the Co-invest Funds, the General Partner is generally entitled to receive carried
interest (“Carried Interest”), equal to between 10% to 17.5% of distributions based on the Series
of Interest committed to by the Investor. Distributions are prioritized to the Investor until they
have received their capital contribution plus a preferred return. Subject to the Fund’s ability to
retain distribution proceeds, as described in the Fund’s Offering Documents, Carried Interest
distributions generally will be made on a quarter-end basis and at such other times and in such
manner as the General Partner may, in its sole discretion, determine, to the extent that distribution
proceeds are available.
The General Partner, in its sole discretion, may waive or modify the Profit Allocation or Carried
Interest for any Investor (including, e.g., our employees).
Other Types of Fees or Expenses
The Investment Manager is authorized to incur and pay in the name and on behalf of the Fund all
expenses which they deem necessary or advisable.
Each Fund will bear its own investment, operating and administrative fees, costs, expenses,
liabilities and obligations including, without limitation: (i) the Management Fee; (ii) auditing
expenses, accounting, tax preparation (including fees, costs and expenses of the preparation,
distribution or filing of Fund-related financial statements or other reports, tax returns, tax
estimates and schedules K-1), legal fees, costs and expenses and third-party administration fees,
costs and expenses (including fees and expenses of the Administrator); (iii) fees, costs and
expenses of the Fund’s partnership representative; (iv) investment related fees, costs and
expenses (including sourcing, holding and disposing of actual and potential investments); (v)
expenses related to constructive activist campaigns (including event hosting and production, public
presentations, public relations, public affairs and government relations, forensic and other
analyses and investigations, proxy contests, solicitations and tender offers, and compensation,
indemnification and other expenses of any nominees proposed by the General Partner as directors
or executives of the portfolio companies); (vi) expenses related to investments in companies
undergoing or emerging from bankruptcy or a reorganization (including the Fund’s or the
Investment Manager’s participation in bankruptcy or reorganization proceedings); (vii)
investment-related travel expenses (including travel expenses incurred by the General Partner or
the Investment Manager in connection with their due diligence review of investments and
prospective investments); (viii) printing, communications and postage expenses; (ix) valuation
service expenses in respect of illiquid or difficult to value investments (including third-party
valuations, appraisals or pricing services); (x) brokerage fees, commissions and expenses, hedging
costs, expenses relating to short sales (including dividend and stock borrowing expenses), costs of
swaps and derivative instruments (including negotiating trading arrangements with respect
thereto), clearing and settlement charges, custodial fees and expenses, depositary fees, bank
service fees, margin and other interest expenses and transaction fees and borrowing fees and
expenses; (xi) blue sky and corporate reporting or filing fees and expenses; (xii) directors’ and
officers’ liability, errors and omissions liability and other insurance expenses of the Fund; (xiii)
ERISA bonding expenses, if applicable; (xiv) Organizational Expenses (as defined in the Partnership
Agreement); (xv) ongoing offering expenses, including, without limitation the preparation of, and
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