Item 5 – Fees and Compensation
Fund Management
Southpaw is entitled to an allocation of net profits earned by each of the Funds pursuant to the terms of the agreement
with the Funds and the Offering Documents for each Fund. The percentage of a Fund’s net profits allocable to
Southpaw varies between Funds. For more detailed information on the fees and compensation received by the
Advisor and its affiliates, please refer to the respective Fund’s Offering Documents.
The Advisor does not receive any compensation for securities transactions entered into by the Funds, other than the
fees noted above and performance-based fees noted below.
Other Expenses. Each Fund will incur other expenses in connection with Southpaw’s advisory services and will bear
legal, organizational and offering expenses in connection with its formation and initial closing and the acquisition of its
investments, which will be borne indirectly by its investors. The expenses to be borne by each Fund will be subject to
the terms and conditions of the applicable Fund’s governing and subscription documents, and are expected to include
(but are not necessarily limited to): (i) fees, costs and expenses related to or arising from (A) the sourcing, investigation,
development, acquisition or consummation, ownership, maintenance, monitoring, hedging or disposition of the Fund’s
investments, (B) any credit facility, guarantee, letter of credit or similar credit support or one or more other similar
financing transactions involving an underlying operating company; (ii) taxes and other governmental charges incurred
or payable by the Fund or an underlying operating company; (iii) fees, costs and expenses of actuaries, accountants,
administrators, advisors, auditors, counsel, valuation experts and other service providers that provide services to or with
respect to the Fund, and legal expenses incurred in connection with claims or disputes related to an underlying operating
company; (iv) compensation and other similar expenses of consultants and any industry executives, advisors,
consultants, operating executives, subject matter experts or other persons acting in a similar capacity who provide
consulting and other similar services to the Fund or an underlying operating company; (v) fees, costs and expenses
associated with maintaining the Fund and any related entities, including fees, costs and expenses incurred in the
organization, operation and restructuring of such related entities; (vi) premiums and fees for insurance allocated to the
Fund, litigation expenses and other extraordinary expenses; (vii) fees, costs and expenses incurred in connection with
the preparation of all reports to the Fund’s investors or representatives, and any other financial, tax, accounting or fund
administration reporting functions; (viii) the Fund’s indemnification obligations; (ix) fees, costs and expenses (including
legal fees and expenses) incurred to comply with any applicable law, rule or regulation (including regulatory filing or
other expenses of the Fund, Southpaw, or its or their affiliates, including Form PF filings) or incurred in connection with
any governmental inquiry, investigation or proceeding involving the Fund; (x) fees, costs and expenses related to a
default by a defaulting investor; (xi) fees, costs and expenses related to a sale, assignment, pledge or transfer of an
investor’s interest in the Fund or an investor’s withdrawal from or admission to the Fund; (xii) fees, costs and expenses
incurred in connection with any amendments, modifications, revisions or restatements to the constituent documents of
the Fund or its investment in an underlying operating company; (xiii) fees, costs and expenses incurred in connection
with distributions to the Fund’s investors; (xiv) interest on, and fees, costs and expenses arising out of, the Fund’s
borrowings and indebtedness; and (xv) fees, costs and expenses incurred in connection with the dissolution, winding
up and termination of the Fund. Investors may also bear third-party expenses incurred in connection with a proposed
disposition that is not actually consummated, including legal, tax, accounting, advisory and consulting expenses and
any broken deal expenses, breakup fees, liquidated damages, reverse termination fees or similar payments.
Sub-Advisory Services
Sub-advisory service fees are payable pursuant to the executed agreement between Southpaw and the Fund. Fund
service fees shall be payable by the Fund. All third-party expenses associated with the operations and management
Southpaw CP Manager LP
2100 Ross Avenue, Suite 550, Dallas, TX 75201
Phone: (917) 837-8846
of the Fund shall be borne by the Fund. Details of termination between Southpaw and the manager of the Fund are
outlined in the executed agreement between Southpaw and the Fund.
For more detailed information on the fees, please refer to the respective Fund’s Offering Documents.