ITEM 5 FEES AND COMPENSATION
A. Advisory Services and Fees
Community provides investment advisory services to each of the Funds pursuant to the applicable
Agreements. The Agreements for each Fund, along with the Governing Fund Documents, set forth in detail
the fee structure relevant to each such Fund. The terms of the Agreements and Governing Fund Documents
are generally established at the time of the formation of the applicable Fund.
Community receives compensation from fees based on a percentage of assets under management
(“Management Fee”), incentive allocations (“Incentive Allocation”) and certain other fees or expenses
related to transactions (see below). Investors in the Funds should review all fees charged by Community
and others to fully understand the total amount of fees to be paid by a Fund and, indirectly, by the underlying
investors.
Management Fee
Each investor in the Funds is charged an asset-based Management Fee of up to 1.75%, depending
on the class of interests or shares, per annum of the net asset value of such investor’s investment in the
respective Fund. The asset-based charge is generally paid monthly in advance and is deducted from the
relevant investor accounts. Such charge is paid by the Funds to Community as a fee for its services. Without
the consent of, or notice to, any other investor, Community may elect and has elected to reduce, waive,
assign, participate or otherwise share the Management Fee payable with respect to some investors (including
any affiliates of Community).
Incentive Allocation
The Agreements and Governing Fund Documents also provide that the investors in the Funds bear
an annual performance-based amount, the Incentive Allocation, which is calculated and charged separately
with respect to each investor’s investment, ranging from 8% to 20%, depending on the class of interests or
shares, of the performance (for that year) attributable to each investor’s investment. While the Funds
generally do not provide for withdrawals or redemptions, upon a full or partial withdrawal/redemption by
an investor other than as of the end of a fiscal year, there will be a special determination of the Incentive
Allocation with respect to the withdrawn/redeemed amount. Without the consent of, or notice to, any other
investor, Community may elect and has elected to reduce, waive, assign, grant participation in or otherwise
share the Incentive Allocation allocable with respect to some investors (including any affiliates of
Community).
Fund Expenses
Each Fund will bear all of its organizational and offering expenses and will reimburse the
respective Community General Partner, Community, and/or the Principal, as applicable, to the extent that
any of them bears organizational and/or offering expenses on behalf of the Funds.
Each Fund will bear its operating and other expenses, including, but not limited to, expenses related
to:
(i) legal, accounting and business diligence of investment opportunities and research-related
expenses, such as: trading related computer hardware and software, including, without
limitation, Bloomberg terminals and subscriptions and other market information systems,
fees to third-party providers of research and/or portfolio risk management services and
software and brokerage costs and fees; and
(ii) expenses associated with all investments and transactions considered, evaluated and/or
consummated by each Fund, as well as overall consideration and evaluation of the respective
Fund’s portfolio, including, without limitation, those expenses incurred before the initial
closing of the respective Fund, including, without limitation, expenses associated with the
sourcing, negotiation, structuring, acquisition, settlement, disposition, ownership, trading,
monitoring, financing, hedging or sale of its investments and other transaction costs,
including travel and entertainment expenses, transaction fees, broken-deal expenses, loan
administration, currency conversion, consulting, advisory, investment banking, sourcing,
finder’s, legal, valuation and other professional fees relating to investments or contemplated
investments, brokerage commissions, clearing and settlement charges, custodial fees, interest
expenses, appraisal fees and expenses, tax, auditing and accounting expenses (including
expenses associated with the preparation of Fund financial statements, tax returns and
Schedules K-1 and accounting, auditing or tax-related computer hardware and software),
other governmental charges including any withholding not due to the status of non-
compliance of a Fund investor, fees, costs and expenses of administrators, ongoing deal
consultants and operating partners; insurance expenses (including, without limitation,
directors’ and officers’ insurance, errors and omissions insurance and other similar policies),
printing and mailing costs, costs of any reporting to Fund investors, expenses of an advisory
board, annual meetings of investors, including travel expenses of the members of the
respective Community General Partner, expenses related to compliance-related matters and
regulatory filings related to Funds’ activities (including expenses relating to preparation and
filing of Form PF and/or other regulatory filings), third-party risk management products and
services (including, without limitation, risk management software or database packages),
...