Item 5 Fees and Compensation
ADVISORY FEES AND BILLING PROCEDURES
All fees will be deducted by GGV directly from the managed account, and will be paid to GGV from the
amount on deposit in the account. GGV reserves the right to discount fees based on the needs and
circumstances of clients. All of the referenced fees for these services are negotiable.
Venture Capital Fund
During the investment periods of its Fund, GGV received a management fee at the annual rate of
2.75% of Committed Capital (the “Management Fee”). After the investment periods, GGV has
received a management fee at the annual rate of 2.75% of (i) invested capital plus (ii) committed
capital designated by the Board for ongoing Fund functions, including the follow-on capital needs of
portfolio investments and Fund expenses (other than the Management Fee). The Management Fee is
paid on a quarterly basis, in advance, during the term of the Fund. GGV is authorized under the
governing documents of the Fund to charge and deduct advisory fees directly from the Fund. For its
next Fund, the same fee criteria shall apply, except that the Management Fee rate will be 2.5%.
In certain cirmcumstances, GGV may be entitled to receive a performance-based profit allocation,
sometimes referred to as “carried interest” (the “Carried Interest”). An investor in a Fund will bear
the Carried Interest, after such investor has received distributions, equal to the amount of its capital
contributions, plus its applicable preferred return. In addition, the Carried Interest may vary across
investors in the same Fund, based on the closing at which an investor is admitted to such Fund or on a
minimum commitment amount (as specified in the Fund’s governing documents). At the discretion of
GGV, the Carried Interest for an investor may be reduced, or waived, but the Carried Interest will
generally equal 20%. Please refer to Item 6 for more information about fees based on performance.
Investment Management Services
GGV will assess clients in its managed account program a quarterly management fee to be paid in
advance on a quarterly basis consisting of reimbursed costs of GGV as part of an agreed upon
consolidated annual budget. This shall be agreed upon by GGV and client(s) based on GGV’s projected
actual cost of managing client(s) account which is submitted to the client(s) board for advanced
approval on an annual basis. This shall be subject to year-end reconciliations to ensure that the
projected cost of managing the client(s) account does not exceed the actual cost.
Management Fees are deducted from Investor’s capital accounts quarterly in arrears. Payment of
portfolio management fees are made directly from the client account by the custodian provided that
the following requirements are met:
The client provides written authorization permitting the fees to be paid directly from the client’s
account held by the custodian. The Firm does not have access to client funds for payment of fees
without client consent in writing. Under certain circumstances and upon request by the client, a
direct bill/invoice will be sent to the client.
The custodian agrees to provide the client a monthly statement indicating all amounts dispersed
from the account including the amount of the advisory fee paid directly to the Firm.
GGV RESERVES THE RIGHT TO DISCOUNT FEES BASED ON THE NEEDS AND CIRCUMSTANCES OF CLIENTS. ALL OF THE
ABOVE-REFERENCED FEES ARE NEGOTIABLE.
OTHER FEES AND EXPENSES
The Fund bears the normal operating expenses of the Fund. Such normal operating expenses include
but are not limited to, the Management Fees, investment-related expenses, custodial fees, interest
expenses, bookkeeping services and equipment, and expenses incurred in investigating and
evaluating investment opportunities and in managing investments of the Fund, expenses relating to
consultants, brokers or other professionals or advisors who provide research, advice or due diligence
services with regard to investments, appraisal fees and expenses and investment banking expenses);
legal expenses (including, without limitation, the costs of on-going legal advice and services, blue sky
filings and all costs and expenses related to or incurred in connection with GGV’s compliance
obligations under applicable federal and/or state securities and investment adviser laws arising out
of its relationship to the Fund, as well as extraordinary legal expenses); accounting fees and audit
expenses; administrative fees; tax preparation expenses and any applicable tax liabilities (including
transfer taxes and withholding taxes); other governmental charges or fees payable by the Fund;
director and officer and/or errors and omissions liability insurance premiums or fiduciary liability
insurance premiums for directors, officers and personnel of GGV; costs of printing and mailing reports
and notices; and other similar expenses related to the Fund, as GGV determines in its sole discretion.
GGV normally bears most of the costs of providing research and management services to Funds and
other clients, including the costs of office space, equipment, supplies and utilities and staff salaries
and benefits, except as negotiated on a case-by-case basis. To the extent that expenses are borne by a
Fund are paid by GGV, the Fund may reimburse GGV for such expenses.
TERMINATION /REFUND POLICY
GGV’s services may be terminated at any time by prior written notice to GGV delivered within a
reasonable period of time prior to such termination. In the event of termination of a Limited Partner’s
or Shareholder’s interest in the Fund, fees will be refunded and assessed in accordance with a Fund’s
Memorandum.
A client account may be cancelled in accordance with the terms and conditions of the advisory
agreement.
OTHER COMPENSATION
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