Sterling Bay Capital Advisers LLC

ITEM 5 FEES AND COMPENSATION

          Sterling Bay receives remuneration for investment advisory services provided to the Funds (the “Investment
Advisory Compensation”) and other services performed for the Funds or the Funds’ investments (the "Service
Compensation”). Except as otherwise described in the applicable Governing Documents, fees and expenses are
expected to be paid over the term of the applicable Fund, and investors generally are not permitted to withdraw or
redeem interests in the Funds. While the Investment Advisory Compensation, the Service Compensation and expenses
paid by the Funds are generally described below, existing and prospective investors should refer to a Fund’s Governing
Documents for further details regarding any Investment Advisory Compensation, Service Compensation or expenses
paid by such Fund.

         The Investment Advisory Compensation is made up of the following forms of compensation:

            1.     Sterling Bay Advisers receives an asset management fee from investors in Fund II, Fund III, Fund
                   IV, and certain Single-Asset Funds (the “Asset Management Fee”). The Asset Management Fee
                   that certain fee-paying investors in Fund II pay generally equals (a) during the investment period, 2%
                   of such investor’s capital commitment, and (b) after the investment period (or the occurrence of other
                   events specified in the applicable Governing Documents), 2% of the difference between (i) the
                   aggregate amount funded by such investor to make investments (including expenses directly
                   attributable thereto) and an allocable share of all amounts committed by the General Partner to the
                   Fund’s investments (including follow-on investments) and (ii) all amounts specified in clause (i)
                   attributable to investments which have been completely sold or written off, in each case payable
                   quarterly in advance until the termination of Fund II. Certain preferred investors in Fund II do not pay
                   an Asset Management Fee. The Asset Management Fee that investors in Fund III pay generally
                   equals (a) during the investment period, 1.25% per annum of an amount equal to such investor’s
                   commitment, and (b) after the Investment Period, 1.25% per annum of the sum of (i) with respect to
                   each investment the General Partner has determined is not an established property (a “Stable

                  Asset”) as of the date of acquisition (an “Opportunistic Property”), such investor’s capital
                  contributions invested in such Opportunistic Property plus (ii) with respect to each Opportunistic
                  Property that has been treated as a converted asset, together with a Stable Asset (a “Core Asset”),
                  the greater of (x) such investor’s capital contributions invested in such Core Asset and (y) the net
                  asset value of such investor’s interest in such Core Asset (as determined in accordance with Sterling
                  Bay’s valuation policy). The Asset Management Fee in Fund III is paid quarterly in advance. The
                  Asset Management Fee that investors in Fund IV pay generally equals (a) during the investment
                  period, 1.0% per annum of an amount equal to such investor’s contributions and not less than
                  $375,000 per quarter, and (b) after the Investment Period, 1.0% per annum of an amount equal to
                  such investor’s contributions. The Asset Management Fee in Fund IV is paid quarterly in advance.
                  Sterling Bay Advisers also receives an Asset Management Fee from investors investing in certain
                  Single-Asset Funds. The Asset Management Fee such investors in the Single-Asset Funds pay
                  typically equals 1% of such investor’s capital commitment and is payable quarterly in advance. The
                  Asset Management Fee will commence as of the initial closing date, regardless of when an investor
                  is actually admitted to Fund II, Fund III, Fund IV or the Single-Asset Fund, as applicable, and will be
                  paid out of distributions or from drawdowns of commitments. Installments of the Asset Management
                  Fee payable for any period other than a full quarterly period are adjusted on a pro rata basis according
                  to the actual number of days in such period. Except where the Governing Documents expressly
                  provide otherwise, Asset Management Fees will not be reduced (in whole or in part) in the case of
                  partial distributions or partial sales of assets.

           2.     In lieu of an asset management fee from Fund I, Fund I reimburses Sterling Bay Advisers for certain
                  costs incurred by Sterling Bay in connection with the operation of Fund I, including, but not limited to,
                  a reasonable allocation of the following costs and expenses: (a) payroll and other costs of
                  management, administrative and clerical personnel, including salaries, wages, payroll taxes,
                  bonuses, costs of employee benefit plans and temporary office help expenses; (b) accounting and
                  bookkeeping costs; (c) insurance premiums and fees; (d) rent, utilities, office supplies, subscriptions
                  and other office overhead; and (e) other similar administrative expenses. The reimbursements are
                  made quarterly in arrears until the termination of Fund I.

           3.     The General Partners receive carried interest from their respective Funds (the “Carried Interest”).
                  The structure of the Carried Interest compensation varies from Fund to Fund. The General Partner
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ITEM 7 TYPES OF CLIENTS

           Sterling Bay Advisers provide investment advice to Funds, including Fund I, Fund II, Fund III, Fund IV, Co-
Invest Funds and Single-Asset Funds. Funds (including Single-Asset Funds and Co-Invest Funds) include investment
partnerships or other investment entities formed under domestic laws and operated as exempt investment pools under
the Investment Company Act. The investors participating in Funds can include high net-worth individuals, banks or thrift
institutions, other investment entities, pension and profit-sharing plans, trusts, estates or charitable organizations or
other corporations or business entities and will likely include, directly or indirectly, principals or employees of Sterling
Bay.