Carlyle Aviation PDP Management LLC

Item 5. Fees and Compensation
The following provides a general description of the most common management fees, performance-
based fees or allocations, fund expenses, and fee waivers applicable to the Advisory Clients. With
respect to any such Advisory Client, while the description below is generally applicable, fees and
expenses vary, and Advisory Clients and their investors should review the applicable governing
documents for further information.
Advisory Clients also typically bear certain out-of-pocket expenses incurred by the Adviser or its
affiliates in connection with the services provided to such Advisory Clients. The following sections
discuss the most common fees and expenses in more detail.
Common Types of Fees
Management Fees
Pursuant to its offering documents, the PDP Fund is charged an annual management fee that is
calculated as a percentage of PDP loan balances (“Management Fee”) and is payable to CAML
as the investment manager of the PDP Fund.
The Adviser is permitted to receive an agreed-upon fee for acting as a sub-adviser to CAML solely
in connection with CAML’s management of the PDF Fund (the “Sub-Advisory Fee”); CAML is
permitted to modify the amount, timing, and payment of the Sub-Advisory Fee.
CAPDP does not charge fees directly to the PDP Fund and does not receive fees, directly or
indirectly, from other products managed by CAML or affiliates of Carlyle Aviation.
Certain Advisory Clients are charged a management fee, monthly in arrears, calculated based on
a percentage of (x) the sum of the gross purchase price of certain aviation assets and (y) the sum
of the aggregate amount of certain rents paid (or deemed paid) by each lessee or its guarantor, in
each case subject to certain adjustments.
Other Advisory Clients are charged an annual management fee, payable quarterly in advance,
based on aggregate commitments, generally subject to an annual step-down after the investment
period, which is also subject to further adjustments and limits as set forth in the governing
documents for such Advisory Clients.
The Adviser or its affiliates often have the ability to cause an Advisory Client to borrow money
for the payment of such fees, in which case the Advisory Client would bear any interest expense
associated with such borrowings.
As permitted under the applicable governing agreement, Carlyle Aviation is permitted to waive
and/or agree to reduce the relevant management fee. Waived management fees are generally not
subject to any management fee offsets described below.
Performance-Based Arrangements3

Except for the PDP Fund, discretionary Advisory Clients will generally be assessed a carried

    See also Item 6. Performance-Based Fees and Side-By-Side Management.

interest or performance fee that is allocable to the General Partners or the Adviser, as applicable.
Carried interest is periodically allocated according to an Advisory Client’s governing documents,
typically after the applicable Advisory Client receives proceeds from the realization of a portfolio
investment and is paid out of cash proceeds otherwise distributable to investors. Carried interest is
typically measured as a percentage of the profits of the Advisory Client and is negotiated separately
for each Advisory Client. Because carried interest distributions may be made prior to the end of
an Advisory Client’s term, such distributions are subject to certain giveback obligations, as set
forth in the applicable governing documents.

Other Fees
The General Partner of the PDP Fund, Carlyle Aviation Runway PDP GP LLC, is entitled to
receive 50% of the loan origination fees that are received from borrowers of PDP loans (“Loan
Origination Fees”).
To the extent the Adviser or an affiliate thereof is entitled to receive certain fees from portfolio
investments of an Advisory Client, such fees paid to the Adviser may reduce the management fees
otherwise payable to the Adviser (“Fee Offsets”). The governing agreement (or investment
management agreement in the case of a separately managed account) of each Advisory Client sets
forth the basis on which Fee Offsets reduce management fees, if at all. Fee Offsets are generally
allocated on the basis of gross management fees charged to investors in an Advisory Client; to the
extent that an investor bears reduced management fees (whether according to the terms of side
letters, or otherwise), the portion of the Fee Offset allocated to the investor will be reduced in
proportion to its management fee reduction, thus resulting in a higher net management fee borne
by investors with reduced management fees than if the Fee Offset was allocated to investors in
proportion to their capital commitments (i.e., ignoring management fee discounts prescribed by
side letters).

The Adviser and/or its affiliates often enter into servicing agreements with financing vehicles, debt
facilities or other financing entities and certain Advisory Client investments whereby the Adviser
and/or its affiliates provide aviation asset servicing to the other party. Under a typical servicing
agreement, the relevant entity receiving services pays the Adviser and/or its affiliates a fee in
exchange for aviation asset servicing. In particular, the Adviser provides, and expects in the future
to provide, certain asset management-related services for third parties, such as acting as servicer
of aviation-related assets (e.g., ABS-like vehicles) and arranging and managing aviation-related
transactions. The ability of the Adviser and/or its affiliates to retain all or a portion of these fees
presents a conflict of interest. For example, due to the ability to earn servicing fees, the Adviser
has an incentive to make decisions on behalf of Advisory Clients that result in additional servicing
fees paid to it or its affiliates.
Common Types of Expenses
In general, an Advisory Client bears all fees, costs, expenses, liabilities and obligations relating to
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Item 7. Types of Clients
The vast majority of the Adviser’s Advisory Clients are pooled investment vehicles that provide
investment advisory and sub-advisory services to the Advisory Clients, the majority of which are
pooled investment vehicles.
Investment advice is provided directly or indirectly to Advisory Clients and not individually to the
limited partners of Advisory Clients. Advisory Clients include investment partnerships or other
investment entities formed under domestic or foreign laws and operated as exempt investment
pools under the U.S. Investment Company Act of 1940, as amended (the “1940 Act”). The
governing documents for the applicable Advisory Client outline the minimum size of investments,
which can be reduced or waived on a discretionary basis in the sole discretion of the applicable
investment adviser.
The Adviser typically requires that each third-party investor in an Advisory Client be an
“accredited investor” as defined under Regulation D of the Securities Act of 1933, as amended
(the “Securities Act”), and (ii) “qualified purchasers” as defined in Section 2(a)(51)(A) of the
1940 Act, or other “knowledgeable employees.”