Item 5 Fees and Compensation
GWRCM and its affiliates and partners receive compensation for services rendered in two forms:
investment management fees and performance incentive fees. Clients do not pay other fees for
investment advisory services offered by GWRCM, its affiliates, and partners. Fee schedules are
negotiated with clients and each contract is different. Annual investment management fees are based
either on (a) assets under management, (b) committed capital, or (c) invested capital. Performance
incentive fees are paid to GWRCM and its affiliates only if investment fund performance (as
measured by invested and distributed capital and unrealized, appraised capital appreciation) is above
pre-determined performance hurdle rates. All investment funds managed by GWRCM and its
affiliates and partners include both investment management fees and performance incentive fees.
GWRCM does not manage investment funds where compensation is limited to either annual
investment management fees or performance incentive fees. Investment management fees are set
annually and paid in advance on a quarterly basis. Performance fees are either paid on regular
intervals or at the sale of a majority of a Fund’s assets and are paid after the fee is earned.
Performance fees are not deducted from client assets.
GENERAL INFORMATION:
Investments in Funds: If a Fund has a general partner, such general partner is affiliated with
GWRCM through ownership and control. GWRCM has adopted written policies and procedures
designed such that GWRCM does not favor certain investors over others, that investors are
provided with appropriate disclosures regarding the conflicts of interest inherent in co-investing and
that all investors are treated fairly with respect to co-investment opportunities. Investors should
note, however, that GWRCM’s allocation of co-investment opportunities is primarily driven by
prior arrangements. In addition, co-investment opportunities may be allocated to third party
investors that are part of a consortium for the particular deal as a way for GWRCM to complete a
transaction. Finally, although investors are not typically a source of investment opportunities, when
applicable, GWRCM will generally give priority with respect to co-investment opportunities to any
investor that brought an opportunity to GWRCM’s attention.
Lock-Up: Except as set forth in the applicable Fund’s organizational documents, an investor in any
Fund generally may not rescind any part of its capital commitment or otherwise withdraw from the
Fund. Private equity investing is for those who can afford to have capital locked up for long periods
of time and who are able to bear the risk of significant losses. Investors in each Fund should refer
to the appropriate Fund's organizational documents for complete information regarding lock-ups
and penalties or other consequences for failure to observe capital calls made by the Fund.
Other Fees and Expenses: The terms of each Fund’s offering documents specify the amount up
to which the Fund is responsible for organizational expenses. Investors in any new Fund launched
by GWRCM should refer to the organizational document for such Fund for information regarding
the amount of organizational expenses that will be incurred by the Fund. No Fund will be
responsible for or otherwise incur any percentage of the organizational expenses of any of the other
Funds.
Fees: In addition to fees paid to GWRCM and affiliates, as appropriate, the operating company
may also be responsible for fees for structuring and negotiating transactions (transaction fees) and
expenses incurred in the acquisition or sale of tree farm assets or operating companies as well as
follow-on and other investments made by the Funds.
Board Seats: GWRCM investment professionals are frequently appointed as directors to operating
companies in which GWRCM has a controlling interest. GWRCM investment professionals closely
monitor the business activities of the operating companies and frequently provide strategic advice
and access to industry resources.
Side Letters: GWRCM or each Fund’s general partner, as appropriate, has and may in the future,
waive or modify certain terms of investment for certain large or strategic investors, in side letters or
otherwise, in its sole discretion, including but not necessarily limited to, co- investment
opportunities, increased Fund and operating company transparency and more frequent or varied
formats or modes of operating reporting. We have never entered into side letters in which we or
any Fund general partner has waived or lowered a Fund’s management fees or carried interest.
Related Party Contracts: Affiliates of GWRCM may enter into contracts for with the Funds for
services unrelated to investment management or advice, including contracts for property
management.
General: Prospective investors should refer to the appropriate offering and organizational
documents for additional important information, terms, conditions and risks involved with investing
in the Fund(s).