Comvest Credit Partners VI (Luxembourg) Master Fund, SCSp SICAV RAIF

Comvest Credit Partners VI (Luxembourg) Feeder Fund SCSp SICAV RAIF

Comvest Credit Partners VI (Luxembourg) Intermediate Fund, SCSp SICAV RAIF

(each, the “Fund VI Structure”)

Comvest Credit Partners VII Master SCSp SICAV RAIF

Comvest Credit Partners VII (Luxembourg) Intermediate SCSp SICAV-RAIF

Comvest Credit Partners VII (Luxembourg) Feeder SCSp SICAV-RAIF

Comvest Credit Partners VII (Luxembourg) Non-Treaty Feeder SCSp SICAV-RAIF

Comvest Credit Partners VII Unlevered ICAV

(each, the “Fund VII Structure”)

SUSTAINABILITY-RELATED WEBSITE DISCLOSURES

A. SUMMARY

This information is provided pursuant to Regulation (EU) 2019/2088 on sustainability-related disclosures in the financial services sector (SFDR) and associated Regulatory Technical Standards (RTS).

Each Fund qualifies as an Article 8 fund within the meaning of the SFDR.

As a consequence, Article 10 of the SFDR requires sustainability-related website disclosures to be made for each financial product referred to in Article 8(1) and Article 9(a), (2) and (3) of the SFDR.

Given that the investment strategies and the minimum SFDR considerations of each Fund are identical, these sustainability-related website disclosures apply individually to each Fund, thereby satisfying the requirements set out in the Article 10 of the SFDR.

Unless otherwise stated herein, capitalised terms shall have the same meaning as in the confidential combined private placement memorandum of Comvest Credit Partners VI (Luxembourg) Feeder Fund, SCSp SICAV RAIF and Comvest Credit Partners VI (Luxembourg) Intermediate Fund, SCSp SICAV RAIF dated February 2022, as amended, restated and supplemented, or in the amended and restated confidential private placement memorandum of Comvest Credit Partners VII (Luxembourg) Intermediate SCSp SICAV-RAIF and Comvest Credit Partners VII (Luxembourg) Feeder SCSp SICAV-RAIF (the PPM), as the case may be.

Topic	Summary
No significant harm to the sustainable investment objective	The Fund may be exposed to adverse sustainability risks. Comvest Credit Advisors (Luxembourg), LLC (Comvest or the Investment Manager) and the Fund does not consider the effects of principal adverse impacts (the PAI) on sustainability factors.
No Sustainable investment objective	The Fund, qualifying as an Article 8 fund within the meaning of SFDR, promotes environmental or social characteristics but does not have as its objective a sustainable investment.
Environmental or social characteristics of the financial product	The Fund promotes certain environmental/social characteristics through its exclusionary criteria by scoring potential borrowers against certain criteria including corporate misconduct, ethics and compliance, antibribery and corruption, social and labour conditions, and diversity and equal employment opportunities. Borrowers who do not meet minimum standards will be excluded from investment.
Investment strategy	The Fund seeks to originate, underwrite and invest in predominantly senior secured loans to middle market companies in the United States and Canada. The investment strategy of the Fund is further detailed in the PPM.
Proportion of investments	The Fund VI Structure does not commit to making a minimum proportion of investments which qualify as environmentally sustainable under the meaning of Regulation (EU) 2020/852 of the European Parliament and of the Council (the Taxonomy Regulation). The Fund VII Structure, through the relevant intermediate fund, will have a minimum of 90% of its investments aligned with the environmental and social characteristics of the Fund.
Monitoring of environmental or social characteristics	Adherence to the relevant Fund’s exclusionary rules contained in the PPM is monitored by analysts and is ultimately the responsibility of the Investment Manager’s investment committee. Should there be a breach, the Investment Manager expects to remedy such breach by selling affected investments to another Comvest fund at fair value, portfolio companies whose proprietary scoring or criteria at underwriting deteriorate or change are generally held to maturity.
Methodologies	The Fund focuses on promoting certain environmental characteristics through the exclusionary criteria set out in the PPM and the proprietary scoring criteria meant to promote a social characteristic (inclusive of scoring on certain governance items).
Data sources and processing	The scoring process is based on data provided by borrowers and sourced independently. The Investment Manager engages an ESG consultant to screen (or screen using a methodology developed with an ESG consultant) all potential borrowers based on a proprietary scoring system. The scoring system is broadly meant to ensure potential borrower portfolio companies align themselves with the UN Global Compact Principles and OECD Guidelines for Multinational Enterprises.
Limitations to methodologies and data	The Fund’s exclusionary rules contained in the PPM are tested only at the time that the investment committee of the Investment Manager makes an initial decision to invest in a prospective portfolio company, as further detailed in the  PPM. The scoring process is conducted in specific cases.
Due diligence	The Fund has the following binding elements: 1.     The Fund complies with the exclusion policy detailed in the PPM; and 2.     The Fund scrutinizes investments in companies using a proprietary scoring methodology described in the PPM.
Engagement policies	The Investment Manager is a signatory to the United Nations-backed Principles for Responsible Investment. The Investment Manager applied established environmental, social and governance (ESG) related standards, implemented by way of exclusionary criteria and a proprietary scoring methodology as described in the PPM.
Designated reference benchmark	N/A – the Fund does not have a designated reference benchmark.

 

B. NO SUSTAINABLE INVESTMENT OBJECTIVE

This financial product promotes environmental or social characteristics as detailed in the PPM, but does not have as its objective sustainable investment.

C. ENVIRONMENTAL OR SOCIAL CHARACTERISTICS OF THE FINANCIAL PRODUCT

The Fund promotes, among other characteristics, environmental or social characteristics, or a combination of those characteristics. The Fund promotes, among other characteristics, environmental or social characteristics through its exclusionary criteria and by scoring potential borrowers against certain criteria including corporate misconduct, ethics and compliance, antibribery and corruption, social and labour conditions, and diversity and equal employment opportunities. Borrowers who do not meet minimum standards will be excluded from investment.

D. INVESTMENT STRATEGY

The Fund’s investment strategy will focus on promoting environmental characteristics through the application of exclusionary criteria, alongside the use of proprietary scoring methods intended to foster specific social characteristics (including the evaluation of certain governance factors), in accordance with Article 8 of the SFDR.

E. PROPORTION OF INVESTMENTS

The Fund VI Structure does not commit to making a minimum proportion of investments which qualify as environmentally sustainable under the meaning of Regulation (EU) 2020/852 of the European Parliament and of the Council (the Taxonomy Regulation). The minimum proportion of the investments aligned with the environmental and social characteristics after application of the proprietary scoring methodology and the Exclusion Policy will be 90% of the liquidation value of the Fund VII Structure.  For this calculation, “other assets” consist of residual cash, if any, and initial margin, premiums, and required minimum security deposits for retail forex transactions and hedging transactions which, in the aggregate, will not exceed 10% of the liquidation value of the Fund (inclusive of Notes issued by the Master Fund) on a weighted average basis.

F. MONITORING OF ENVIRONMENTAL OR SOCIAL CHARACTERISTICS

Adherence to the exclusion policy is monitored by analysts and is ultimately the responsibility of the Investment Manager’s investment committee. Should there be a breach due to a failure in systems and processes that are otherwise meant to ensure that only qualifying deals are allocated to the Fund, the Fund’s partnership agreement provides that it may sell an investment to another Comvest managed fund at fair value as determined by an independent valuation agent – in such instance, the Investment Manager would expect to avail ourselves of this provision and sell the investment. Portfolio companies whose proprietary scoring or criteria at underwriting deteriorates or changes over the life of the loan are expected to be held to maturity.

G. METHODOLOGIES FOR ENVIRONMENTAL OR SOCIAL CHARACTERISTICS

The sustainability indicators used by the Fund to measure the attainment of each of the environmental or social characteristics promoted by the Fund are:

1. % of potential investments that are rated Level 1: Level 1 are borrowers will be rated as having eligibility for investment;
2. % of potential investments that are rated Level 2: Level 2 borrowers will require additional due diligence, escalation for potential engagement with the borrower (subject to the borrower’s consent) to understand any relevant factors or nuances influencing their scores, which will be presented to the ESG committee that will determine whether investing in the borrower would be suitable despite an elevated score based on the totality of the due diligence process; and
3. % of potential investments that are rated Level 3: Level 3 potential borrowers are potential portfolio companies that will be eliminated from consideration for investment, as a result of the application of the Fund’s exclusionary policy.

H. DATA SOURCES AND PROCESSING

The scoring process is based on data provided by borrowers and sourced independently.

The Investment Manager engages an ESG consultant to screen (or screen using a methodology developed with an ESG consultant) all potential borrowers based on a proprietary scoring system derived from information gathered from various separate databases that may vary over time, meant to provide a holistic view of each potential borrower.

The scoring process is broadly meant to ensure potential borrower portfolio companies align themselves with the UN Global Compact Principles and OECD Guidelines for Multinational Enterprises.

I. LIMITATIONS TO METHODOLOGIES AND DATA

The Fund’s exclusionary rules set out in the PPM are tested only at the time that the investment committee of the Investment Manager makes an initial decision to invest in a prospective portfolio company.

The scoring process is conducted prior to any new capital commitment where either no previous score is available or the existing score is older than twelve months.

J. DUE DILIGENCE

As aforementioned, the Fund (i) complies with the exclusion policy detailed in the PPM, and (ii) scrutinizes investments in companies using the proprietary scoring methodology.

The Investment Manager carries out pre-investment comprehensive multi-stage process, including originations; underwriting and due diligence; and Investment Manager’s investment committee review, as described in the PPM.

K. ENGAGEMENT POLICIES

The Investment Manager is a signatory to the United Nations-supported Principles for Responsible Investment.

The Investment Manager applied established ESG-related standards, implemented by way of exclusionary criteria and a proprietary scoring methodology which is broadly meant to ensure potential investments align themselves with the UN Global Compact Principles and OECD Guidelines for Multinational Enterprises.

L. DESIGNATED REFERENCE BENCHMARK

No reference benchmark will be used by the Fund as it pursues private markets (private debt) strategy for which there is no public or comparable benchmark.

SUSTAINABILITY RISK STATEMENT

Pursuant to Regulation EU 2019/2088 on sustainability-related disclosure in the financial services sector (“SFDR”), financial market participants are required to disclose the manner in which Sustainability Risks are integrated into the investment decision and the results of the assessment of the likely impacts of Sustainability Risks on the returns of the Fund.

The Fund and the Investment Manager consider these risks as environmental, social or governance events or conditions that could have a material negative impact on the financial condition or operating performance of a company or an issuer.

The Fund does not weigh Sustainability Risks as a material factor as part of its credit decision making processes (except to the extent included in the proprietary scoring system which weighs but does not independently eliminate companies based on certain sustainability criteria that may vary over time, currently focused primarily on geographic location).