Item 5: Fees and Compensation
DESCRIPTION OF COMPENSATION AND BASIC FEE SCHEDULE
In consideration of our advisory services, 9823 is entitled to receive administrative fees and/or performance-based
compensation with respect to the Funds. While the applicable fees and compensation are described in detail in the
applicable governing and/or offering documents, a summary of our basic fee schedule is set forth below.
9823 Fund, L.P.
9823 or an affiliate generally are entitled to receive an administrative fee, payable quarterly in advance, equal to
one quarter of one percent (1.0% per annum) of each investor's capital account balance (including for such purposes
any portion of a capital account that is allocated to a special investment account).
9283 or an affiliate generally are entitled to receive an incentive allocation equal to twenty percent (20%) of each
investor's allocable share of net profits for the applicable performance period, subject to the terms and conditions
set forth in the partnership agreement. Incentive allocations are subject to a "high water mark" limitation. As a result,
if an investor is allocated a net loss in any period, we are not entitled to receive an incentive allocation with respect
to that investor until that net loss is recouped. With respect to a special investment, an incentive allocation will only
be allocable after such special investment is realized or deemed realized (subject to the terms and conditions set
forth in the partnership agreement).
9823 FLI Fund Limited Partnership
9283 or an affiliate generally are entitled to receive a quarterly management fee equal to $24,000 multiplied by each
limited partner’s allocation percentage in the fund as of the beginning of such calendar quarter, payable in advance.
9283 or an affiliate generally are entitled to receive an performance allocation calculated at the end of each calendar
month equal to fifty percent (50%) of each limited partner’s ratable share of the fund’s profits for such calendar
month which are in excess of an amount equal to twenty percent (20%) of such limited partner’s capital account as
of the beginning of such calendar year (the “Hurdle”), provided that such profits exceed such limited partner’s “high
water mark.” The Hurdle is reset at the beginning of each calendar year. If a limited partner makes a capital
contribution on any day other than the first day of the calendar year, the Hurdle applicable to such capital
contribution shall be pro-rated by multiplying the Hurdle by the ration obtained by dividing (i) the number of days
remaining in such calendar year by (ii) 365. The Hurdle is not a guaranteed minimum return.
Precept Management Partners, L.P.
9823 or an affiliate generally is entitled to receive a management fee, payable quarterly in arrears, equal to one
quarter of one percent (1.0% per annum) of each investor's aggregate capital account balance.
Subject to the terms and conditions of the partnership agreement, we or an affiliate generally are also entitled to
receive an incentive allocation equal to twenty percent (20%) of each investor's allocable share of net profits for the
applicable performance period. Incentive allocations are subject to a "high water mark" limitation. As a result, if an
investor is allocated a net loss in any period, we are not entitled to receive an incentive allocation with respect to
that investor until that net loss is recouped.
9823 BlueSand Fund, Ltd.
9823 or an affiliate generally are entitled to receive a management fee, payable quarterly in advance, equal to: (i)
0.23% of the net asset value of Shares attributable to cash and cash equivalents and long-only publicly traded
equities; (ii) 0.40% of the net asset value of Shares attributable to fixed income investments; (iii) 0.40% of the
notional amount of any equity swap financing transactions entered into by the Fund; and (iv) 0.60% of the net asset
value of Shares attributable to alternative investments of each investor. Management fees are subject to change upon
advance written notice to investors subject to the terms and conditions of the fund’s legal and offering documents.
Funds, Generally
9823’s advisory fees with respect to each investor in a Fund generally are not negotiable. However, we may enter
into side letters or similar arrangements with certain investors that grant different terms (including lower fees) to
such investors than the terms generally applicable to other investors.
Each investor in the Funds generally must be, among other things, (a) an accredited investor as defined in Rule
501(a) of Regulation D under the U.S. Securities Act of 1933, as amended, and (b) a "qualified client" as defined in
Rule 205-3 under the Advisers Act.
SMA Investment Management Services
With respect to its Client, 9823 Capital is a fee-only investment adviser. 9823 Capital’s fee for SMA advisory,
portfolio management, and/or non-discretionary advisory services (“IA Fee”) may be based on a percentage of the
Client’s assets under management or, as discussed below in Item 6, 9823 Capital may charge SMA Clients
performance-based fees or other fees based on share of capital gains or capital appreciation in addition to or in lieu
of Management Fees.
IA Fees that are Management Fees are typically paid monthly or quarterly in advance pursuant to the terms of the
respective Client’s Investment Advisory Agreement. IA Fees are based on the market value of assets under
management at the beginning of the relevant calendar month or quarter, as applicable. IA Fees that are management
fees, are typically 2% per annum depending on the size of the SMA, the services rendered, and the strategy
employed. IA Fees that are Performance Fees are typically 20% per annum, will be calculated and charged quarterly
or annually in arrears, and may be subject to a Hurdle and/or high-water mark pursuant to the terms of the respective
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