Item 5: Fees and Compensation
Investors in the Fund are subject to the fees and expenses summarized below.
Management Fees
The scope and level of management fees are set forth in Fund’s Offering Documents. As compensation
for the advisory services provided to the Fund, the Firm receives a management fee from the Fund,
payable quarterly in advance, as described in the Offering Documents. The Firm has the discretion to
waive or reduce the management fee terms with respect to any Fund investor, including without
limitation, for employees and affiliates and certain Limited Partners with significant commitments to the
Fund.
Transaction Fees / Portfolio Company Fees
Any financing fees, management services fees, director fees, or transaction or other similar fees from
portfolio companies are paid directly to the General Partner or an affiliate of the General Partner. These
fees, subject to the terms of the Offering Documents, then reduce future Management Fees otherwise
payable to the Firm by the Fund.
Other Expenses
In addition to the management fee, each investor bears its allocable share of expenses associated with
the operations of the Fund, which are discussed in greater detail in the Fund’s confidential Private
Placement Memorandum. These expenses include, among others:
• Organizational expenses subject to certain thresholds and offsets as outlined in the Fund’s
Offering Documents.
• Other operating expenses including, without limitation, (i) costs and expenses of the Fund relating
to the audit of the Fund, the preparation of federal, state and local tax returns of the Fund, and
the preparation of K‐1s and all other accounting services requiring specialized expertise; (ii) all
interest, costs and expenses payable by the Fund on any indebtedness incurred by the Fund; (iii)
all amounts payable to U.S. Small Business Administration (“SBA”) under the SBIC Act (including,
without limitation, SBA examination fees) and all amounts payable in connection with any SBA
Leverage commitment, SBA Leverage issuance, and outstanding SBA Leverage; (iv) taxes, fees and
expenses payable by the Fund to federal, state, local and other governmental agencies; (v)
Management Fees; (vi) expenses incurred in the actual or proposed acquisition or disposition of
assets (excluding due diligence other than such due diligence as is performed by consultants
providing services that require specialized expertise), including without limitation, accounting
fees, brokerage fees, legal fees, transfer taxes and costs related to the registration or qualification
for sale of assets; (vii) legal expenses of the Fund; (viii) insurance and premiums protecting the
Fund, the General Partner, the Investment Manager and any of their officers, directors, managers,
owners, and employees; (ix) reasonable costs and expenses associated with meetings of the
Limited Partners with the General Partner and meetings of the Fund’s Advisory Committee,
meetings with Portfolio Company executives and meetings of other committees of the Fund; (x)
to the extent permitted by the LPA, Indemnifiable Costs as defined therein; (xi) Organizational
Expenses, subject to certain limitations as detailed in the Fund’s Offering Documents; (xii) fees or
dues in connection with the membership of the Fund in any trade association primarily
representing the interests of small business investment companies; (xiii) fees incurred by the Fund
for special advisory, consulting, and financing services that require specialized expertise; (xiv)
expenses associated with regulatory registrations and compliance of the Fund and the General
Partner, including securities filing fees; (xv) all reasonable fees, costs, and expenses of actual or
threatened litigation, mediation, arbitration, or other dispute resolution in which the Fund is
named, or threatened to be named, a party thereto, to the extent, but only to the extent, that
such fees, costs and expenses are attributable to the Fund’s involvement in such matter and are
not reimbursed or otherwise paid by an insurer or indemnitor; and (xvi) all costs, fees, and
expenses incurred by the General Partner or the Partners in connection with winding up and
liquidating the Fund’s affairs only after repayment of SBA Leverage.