Item 5: Fees and Compensation
5.A. Advisor Compensation
With respect to existing Funds, AlphaCrest is entitled to a management fee at an annual rate of 2.0% of the net
asset value of each share, or limited partnership interest (as applicable), which is billed and paid each calendar
month in arrears (the “Management Fee”). In addition, with respect to existing Funds, the General Partner is
entitled to a performance-based profit allocation at the end of each calendar year, equal to 20% of the amount
by which the net value of each account as of the end of each calendar year exceeds the net value of the account
as of the beginning of the year, subject to a “high water mark” (the “Performance Allocation”). The fees
applicable to each Fund are set forth in detail in each Fund’s Governing Documents.
AlphaCrest (or its affiliate) may, in its sole discretion, reduce or eliminate the Management Fee and/or the
Performance Allocation with respect to certain investors in its sole discretion. AlphaCrest generally grants
waivers of the management fees and performance allocation to principals and employees of AlphaCrest and its
affiliates, as well as their related family members and affiliates. The largest investor in the Offshore Fund, the
Brummer Multi-Strategy Master Fund (“BMS”), a fund of funds managed by Brummer Multi-Strategy AB, a
wholly-owned subsidiary of Brummer & Partners, pays reduced Management Fees and bears a reduced
Performance Allocation generally not available to other investors.
AlphaCrest receives compensation for its advisory services to the Sub-Advisory Fund pursuant to the terms of
the investment management agreement. Such compensation includes a performance fee.
AlphaCrest may enter into “side letters” or similar agreements with certain investors in the Funds, granting such
investors specific rights, benefits or privileges that are not made available to investors generally.
5.B. Direct Billing of Advisory Fees
AlphaCrest is authorized under the Governing Documents to charge and deduct fees directly from the Funds’
accounts.
The Sub-Advisory Fund relationship is subject to terms that are negotiated between AlphaCrest and the Sub-Advisory
Fund. A complete description of all fees, the methods of billing and how often such fees are charged for the Sub-
Advisory Fund is disclosed within the investment management agreements entered into by AlphaCrest and Sub-
Advisory Fund.
5.C. Other Non-Advisory Fees
Each Fund is responsible for paying all costs and expenses directly related to its investments (whether or not
consummated), including expenses related to initial and ongoing specialized research and due diligence,
monitoring-related expenses, brokerage commissions and other transaction costs (including trade errors that
are not the result of AlphaCrest’s willful misconduct, recklessness or gross negligence or as otherwise
required by applicable law), interest on and any commitment fees or other expenses related to debt balances
or borrowings, exchange, clearing and settlement charges, expenses of third-party registered office, “back
office” and “middle office” services, investment-related travel fees, appraisal fees, investment banking fees,
bank service fees, borrowing charges on short sales, custody fees, fees of consultants relating to investments
and the costs of any appraisers, accountants, legal counsel or other experts engaged by the Funds, the Funds’
directors or AlphaCrest, as well as other expenses directly related to the investments. Each Fund bears
expenses related to such Fund’s ongoing offering of shares and any withholding, transfer or other taxes
imposed or assessed on, payable by such Fund (including any interest and penalties). Furthermore, the
Funds bear all out-of-pocket costs of the ongoing operation and administration of such Funds, including (a)
financial and tax accounting, bookkeeping and reporting services, third party administrative services, audit
and legal expenses (including those compliance, regulatory, filing or regulatory inquiry expenses incurred
by the General Partner, the Funds’ directors or AlphaCrest related to the Funds, such as the expenses of any
Section 13, Section 16 and Form PF filings and the preparation and update of the Form ADV), (b) costs of
legal counsel and any other litigation or investigation involving the Funds’ activities, (c) expenses incurred
in maintaining research or other information and performing systems, including information service
subscriptions, software tools, programs or other technology utilized in managing the investments (including
third-party software licensing and implementation), Bloomberg terminals, compliance and risk
management systems, technology and communication systems, systems used for portfolio management,
valuations and accounting purposes, including statistics and pricing services, service contracts for quotation
equipment and related hardware, software, phone and internet charges and risk and portfolio oversight fees
payable to BFS (as defined below), (d) costs associated with reporting and providing information to and
meeting with shareholders, (e) costs associated with maintaining “directors and officers” or similar liability
insurance for the benefit of the Funds, the Funds’ directors, AlphaCrest, the General Partner, or any other
indemnified party (as defined in the Governing Documents), (f) out-of-pocket expenses incurred by the
Funds’ directors in the performance of their respective duties and any compensation for third party directors
of the Funds, (g) the costs of winding up and liquidating the Funds, (h) registrar, transfer agency and other
expenses associated with registration in the Cayman Islands and (i) any other extraordinary expenses
(including any expenses incurred to satisfy indemnification obligations of the Funds). The Onshore Fund
and Offshore Fund also bear their pro rata portions of any of the foregoing costs or expenses directly related
...