ITEM 5 – FEES AND COMPENSATION
We are generally entitled to management fees and/or performance-based compensation from the Funds.
Each of the Funds generally pays us a management fee based on the value of the applicable Fund’s assets
under management. The management fee is calculated at an annual rate generally ranging from 1% to 2%
of (i) the net asset value of the Fund, (ii) the aggregate amount of capital committed by investors in the
Fund, (iii) the aggregate cost of investments acquired by the Fund or (iv) some combination thereof. The
management fees that we receive from the Funds are generally prorated for any period that is less than a
full calendar month and are adjusted for subscriptions and redemptions made during a month, if applicable.
As respects the P.E. Funds, we are also entitled to receive performance-based compensation from some of
the Funds. Such performance-based compensation may be taken on a periodic basis (such as an incentive
fee or performance allocation) or only after investors have received an agreed amount of their investments
back (such as a carried interest). Performance based compensation is generally equal to 10% to 20% of the
increase in an investor’s investment in a P. E. Fund. We generally deduct management fees and
performance-based compensation from the P. E. Funds’ accounts.
As respects the Fund of Funds, we are also generally entitled to receive performance-based compensation
from the Funds of Funds equal to 10% to 20% of the net profits of each investor in the applicable Fund,
subject to a high watermark. We generally receive such performance-based compensation annually and
upon redemption. The performance-based compensation we receive is generally not subject to a claw back.
To the extent that a Fund invests in a private fund managed by a Manager with which we are affiliated, a
portion or all of the compensation paid to such Manager may be offset against or reduced by the
compensation we receive from the applicable Fund.
The specific terms of our compensation arrangements with each of the Funds can be found in the applicable
Fund’s offering documents, which are provided to potential investors. Our compensation arrangements
may not be amended to provide the Adviser the potential for additional compensation without investor
approval. The Adviser may reduce its compensation package without investor approval, so long as such
action does not otherwise adversely affect the investor. The description above represents our typical
compensation rates. However, we may enter into negotiated agreements with one or more investors which
provide for the waiver or modification of certain terms of the offering of interests in a Fund, including fees
otherwise applicable to such investors’ interests. Any such waivers do not adversely affect the investment
returns of the other investors in a Fund.
In addition to management fees and, if applicable, performance-based compensation, the Funds are also
subject to other expenses such as administrative, legal, accounting, compliance, custodial and audit
expenses and costs, fees, liabilities, taxes and expenses relating to or arising from the investment of assets,
third-party compliance products and services, borrowing, financing or settlement arrangements, analysis
and research of investments or potential investments (including subscriptions, publications or related
services), risk management and due diligence associated with the development and maintenance of the
portfolios, regulatory filings, investor relations and independent directors’ fees. Details regarding the
expenses borne by each of the Funds are available in the respective Funds’ offering documents, which are
provided to potential investors.
Certain investors, including seed investors and persons associated or formerly associated with Sciens, and
members of their families, as well as certain friends of such persons, may invest in the Funds on a non-fee-
paying basis or at fee rates that are lower than those charged to other investors in the Funds, in our
discretion.
Prospective investors must refer to the detailed information found in each Fund’s governing fund
documents for specific information about the fees that may be earned by Sciens and the fees and expenses
potentially charged to the Funds.