Item 5. Fees and Compensation
Funds
Each Feeder Fund pays GE Holdings a management fee (the “Management Fee”) with
respect to the Class A and Class B Interests equal to one and one quarter percent (1.25%) on an
annualized basis of the net asset value of such Class A or Class B Interests. If at the end of any
fiscal quarter, the aggregate net asset value of fee paying Interests exceeds Two Hundred Million
Dollars ($200,000,000), then the Management Fee with respect to the Class A Interests for the
following fiscal quarter will be reduced to six hundred twenty-five thousandths of one percent
(0.625%) on an annualized basis of the net asset value of the Class A Interests, and if at the end of
any fiscal quarter, the aggregate net asset value of fee paying Interests exceeds Three Hundred
Million Dollars ($300,000,000), then the Management Fee with respect to the Class A Interests
for the following fiscal quarter will be reduced to zero percent (0%) on an annualized basis of the
net asset value of the Class A Interests. Class S Interests are not subject to any Management Fee.
General Equity Partners GP, LP (“General Equity Partners”), receives an annual incentive
allocation (“Incentive Allocation”) from the Domestic Feeder Fund, or the Offshore Feeder Fund,
as applicable, in an amount equal to (i) fifteen percent (15%) of the new realized and unrealized
gains allocated to those holding Class A Interests, or Capital Accounts of the Master Fund
corresponding to the Class A Interests; and (ii) seventeen and one-half percent (17.5%) of the new
realized and unrealized income and gains allocated to those holding Class B Interests, or Capital
Accounts of the Master Fund corresponding to the Class B Interests. An Incentive Allocation will
only be paid with respect to Interests that have shown a net gain over time. At such time that Class
S Interests designated investments are realized or deemed realized, General Equity Partners will
be entitled to receive an Incentive Allocation equal to fifteen percent (15%) of the realized gains
over the hurdle (5%) corresponding to the Class S Interests.
Management Fees and Incentive Allocations are generally deducted directly from Fund
accounts.
See Item 6 below for more information concerning Incentive Allocations.
Additional Expenses
In addition to the Management Fees and Incentive Allocations described above, the Funds
(and, indirectly, the investors therein) will pay such additional expenses as are disclosed in the
Funds’ applicable offering documents. The expenses to be paid by each Fund vary and may
include, among others, the following: including, without limitation, all fees, costs and expenses
associated (directly or indirectly) with the negotiation, financing, sourcing, acquiring, holding,
monitoring, hedging, settling and disposing of investments or proposed investments; other
transaction costs, including, without limitation, transaction fees, custodial fees, brokerage fees,
commissions, consulting, advisory, due diligence, investment banking, legal, financial, auditing,
accounting, research, third-party consulting and other professional fees and expenses related to
investments and proposed investments, as well as all fees, expenses, interest payments and
principal payments due to any lenders, investment banks and/or other financing sources in
connection with the financing, sourcing, acquiring, holding, monitoring, hedging and disposing of
investments or proposed investments; custodial fees, appraisal fees and expenses; all investment-
related travel expenses and travel expenses related to the purchase, sale or transmittal or
monitoring of Fund and/or Master Fund assets; all entity-level taxes, fees and other governmental
charges; the costs of any insurance (including, without limitation, general partner liability
insurance, errors and omissions insurance, directors and officers insurance, if any, and other
insurance policies with respect to the Fund’s business and affairs); directors’ fees; expenses
incurred in the collection of monies owed to the Fund (or to the Master Fund, as applicable);
Management Fees; expenses related to mixed-use hardware and software and other technology and
services, including, without limitation, any order management system or similar software package;
legal, regulatory, compliance, auditing, research and accounting fees and expenses (including,
without limitation, fees and expenses of any administrator of the Fund and the Master Fund;
expenses associated with the preparation and delivery of financial statements and tax returns, if
any; extraordinary expenses (including, without limitation, litigation-related and indemnification
expenses, whether payable in connection with a proceeding involving the Fund or otherwise, and
including the amount of any judgment or settlement paid in connection therewith); the costs of any
reporting to shareholders or limited partners, as applicable; reasonable expenses incurred in
connection with any meetings of shareholders and reasonable expenses of the members and
meetings of any committee of a Fund; any “broken deal” or failed transaction expenses; expenses
incurred in connection with the dissolution, liquidation and termination of the Fund; and expenses
incurred in connection with the preparation of amendments to relevant agreements.
Any Fund expense solely attributable to a designated investment (including Class S
Interests) will be borne by the shareholders participating in such investment (pro rata), and the
Class S Interests will bear their proportionate share of all other Funds’ expenses.
To the extent that there is a shared expense among any of the Funds, on the one hand, and
GE Holdings, on the other hand, GE Holdings will allocate the expense among such Fund(s) and
itself in a manner that it determines is fair and equitable under the circumstances to all parties. All
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