Item 5: Fees and Compensation
FEE SCHEDULES
Partners Funds
In consideration of our advisory services, certain of our affiliates generally are entitled to receive management fees
and/or carried interest distributions with respect to the Partners Funds. These management fees and carried interest
distributions differ from Partners Fund to Partners Fund and also vary throughout the life cycle of each Partners
Fund. Accordingly, investors should carefully review the offering and governing documents of the applicable
Partners Fund for a description of the fees applicable to it. Nevertheless, an overview of the fee schedule applicable
to each Partners Fund is set forth below.
Management Fees. One of our affiliates generally is entitled to a predetermined schedule of management fee
payments (payable quarterly in advance) from Partners Fund V (subject to increase at such time as the investors in
Partners Fund V have received full return of their capital contributions, as set forth in the partnership agreement of
Partners Fund V). After a certain period of time, the management fee with respect to Partners Fund V may be
reduced, eliminated or otherwise varied, as may be mutually agreed by Partners Fund V’s general partner and
investor committee. Neither we nor any of our affiliates are entitled to receive any management fees with respect to
Partners Fund IV.
Carried Interest Distributions. The general partner of a Partners Fund generally is entitled to receive a carried
interest distribution equal to: (i) in the case of Partners Fund IV, 20%, and (ii) in the case of Partners Fund V, 10%
of profits derived from the disposition of investments (following a return of aggregate capital contributions and
a preferred rate of return to investors). Upon termination of a Partners Fund, its general partner (or an affiliate)
generally is required to return carried interest distributions to the Partners Fund, to the extent that they exceed
amounts that would have been distributed to the general partner or its affiliate as carried interest distributions if such
carried interest distributions were calculated on an aggregate basis covering all transactions of the Partners Fund
(subject to the terms and limitations set forth in the applicable partnership agreement).
Each investor in a Partners Fund generally is required to represent that it is, among other things, a “qualified
purchaser,” as such term is defined in Section 2(a)(51)(A) of the Investment Company Act of 1940, as amended (the
“Company Act”). See Item 7.
Management fees and/or carried interest distributions generally are not negotiable. However, the general partner of
each Partners Fund has entered into, and/or may enter into, side letter agreements or arrangements with one or more
investors in that Partners Fund that alter, modify or change the terms of the interests held by such investors.
Affiliates Funds
Neither we nor any of our affiliates are entitled to receive any management fees or carried interest distributions with
respect to the Affiliates Funds.
Each investor in the Affiliates Fund generally is required to represent that it is, among other things, an “accredited
investor,” as such term is defined in Rule 501(a) of Regulation D under the Securities Act of 1933, as amended (the
“Securities Act”).
TX Co-Invest and other Co-Investment Vehicles
Neither we nor any of our affiliates generally are or will be entitled to receive any management fees or carried
interest distributions (or any other compensation) with respect to TX Co-Invest or any other co-investment vehicles.
PAYMENT OF FEES
Management fees are payable by Partners Fund V on the first day of each fiscal quarter in advance. Each investor is
responsible for its pro rata portion of any such management fees. Management fees are typically funded with capital
contributions drawn for such purpose, but may also be funded with proceeds from investments. In the event that
Partners Fund V is terminated or our services are otherwise terminated, a proportionate amount of any unearned
management fees will be refunded to the applicable investor(s).
The amount of management fees otherwise payable to the general partner of Partners Fund V generally will be
reduced by 100% of all fee income that the general partner earns from management fee income from portfolio
companies and from investment banking type services, including acquisition fees, break-up fees and financing fees;
provided that, prior to the application of such management fee reduction, fee income is first applied to offset certain
one-time costs and expenses associated with the departure of certain Wingate personnel (up to a maximum amount
set forth in Partners Fund V’s partnership agreement).
Carried interest distributions are calculated from time to time upon the disposition of portfolio investments by each
Partners Fund and are distributed to the general partner thereof (following a return of aggregate capital contributions
and a preferred rate of return to investors).
OTHER FEES AND EXPENSES
In addition to management fees and carried interest distributions (with respect to the Partners Funds), each Fund
generally bears (to the extent applicable) the following fees, costs and expenses (among others) (i) all costs and
expenses incurred in the purchase (or attempted purchase), holding or sale or exchange (or attempted sale or
exchange) of securities, including, but not by way of limitation, private placement fees and finder’s fees not paid to
us or our officers, members, partners or affiliates, real property or personal property taxes on investments, brokerage
fees, taxes applicable to the Fund on account of its operations, fees incurred in connection with the maintenance of
bank or custodian accounts (and other custodial fees and expenses), legal, audit and other expenses incurred in
connection with the registration of the Fund’s securities under the Securities Act, or other applicable securities laws
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