Item 5 Fees and Compensation
Fees with respect to the Funds
Investors in the Funds are subject to the fees and expenses described
below. Additionally, investors in the Funds are subject to performance-
based allocations as described in Item 6 below. The Advisor has the
authority to negotiate these fees and expenses at its discretion. The
Advisor has waived or negotiated lower fees or expenses for certain
investors in the Funds. The Advisor will not receive sales commissions in
connection with sales of interests in a Fund.
Aperimus Partners
The Advisor receives a management fee (the “Aperimus Partners
Management Fee”) from Aperimus Partners as of the first business day of
each quarter in advance equal to 0.375% (approximately 1.50% on an
annualized basis) of each investor’s total capital account balance as of the
first business day of such quarter. The Aperimus Partners Management
Fee is prorated for interests held for less than a full quarter. If an investor
withdraws all or a portion of its account in Aperimus Partners on a date
other than the end of a calendar quarter, any unearned portion of the
Aperimus Partners Management Fee (calculated from the date of
withdrawal to the last day of the calendar quarter) paid at the beginning of
the calendar quarter will be refunded by the Advisor to the investor at the
same time as the payment of withdrawal proceeds.
Aperimus Socorro
The Advisor receives a management fee (the “Aperimus Socorro
Management Fee”) from Aperimus Socorro as of the first business day of
each quarter in advance equal to 0.375% (approximately 1.50% on an
annualized basis) of each investor’s total capital account balance as of the
first business day of such quarter. The Aperimus Socorro Management
Fee is prorated for interests held for less than a full quarter. If an investor
withdraws all or a portion of its account in Aperimus Socorro on a date
other than the end of a calendar quarter, any unearned portion of the
Aperimus Socorro Management Fee (calculated from the date of
withdrawal to the last day of the calendar quarter) paid at the beginning of
the calendar quarter will be refunded by the Advisor to the investor at the
same time as the payment of withdrawal proceeds.
Sandoval
The Advisor receives a management fee (the “Sandoval Management
Fee”) from Sandoval as of the first business day of each quarter in
advance equal to 0.375% (approximately 1.50% on an annualized basis) of
each investor’s total capital account balance as of the first business day of
such quarter. The Sandoval Management Fee is prorated for interests held
for less than a full quarter. If an investor withdraws all or a portion of its
account in Sandoval on a date other than the end of a calendar quarter, any
unearned portion of the Sandoval Management Fee (calculated from the
date of withdrawal to the last day of the calendar quarter) paid at the
beginning of the calendar quarter will be refunded by the Advisor to the
investor at the same time as the payment of withdrawal proceeds.
Each Fund bears all expenses of its organization and operation, expenses
incurred in the purchase and sale of investments, and accounting fees, as
determined by the Advisor. Such expenses include but are not limited to:
(i) brokerage and execution charges, commissions, custodial charges, and
fees for quotation and other data services; (ii) fees related to accounting,
trading, portfolio management and risk management systems; (iii)
research subscriptions and expenses; (iv) broken trade and broken deal
fees; (v) expenses to register securities and transfer taxes; (vi) costs and
expenses incurred for the purpose of protecting and enhancing the value of
the assets of a Fund (including the costs of instituting and defending
litigation); (vii) taxes, filing and registration fees of a Fund; (viii) all costs,
fees and expenses relating to investor communications, relations,
accounting and the preparation and mailing of financial, tax and
performance information to investors; (ix) fees, costs and expenses
incurred in connection with borrowings; (x) administration fees, costs and
expenses; and (xi) fees for attorneys, accountants, consultants and other
professionals or experts. The Advisor may, at its discretion, choose to pay
or reimburse a Fund for all or any portion of such expenses. In such
event, the Advisor may be reimbursed at a later date by such Fund for
such expenses borne by the Advisor. For additional information regarding
brokerage and execution fees, see Item 12 below.
Fees with respect to the Accounts
Fees paid to the Advisor by Account Clients are negotiable and will vary.
Fees will be set forth in the Advisory Agreement with each Account Client
and determined based on the Client’s needs, the complexity of the Client’s
investment objective and the number of portfolio restrictions.
Under the Advisory Agreement with an Account Client, the Advisor may
receive an annual management fee from the Account Client equal to a
percentage, typically between 1% and 2% , of the Account’s targeted
investment capital (“TIC”) or assets under management (“AUM”).
Additionally, the Advisor may receive performance-based allocations
from an Account as described in Item 6 below. Certain Account Clients
are charged a liquidation fee if a Client elects to withdraw all of its assets
in its Account on less than an agreed upon notice period, such Client will
be subject to an additional charge in an amount equal to a portion (e.g.,
50%) of the management fee that otherwise would have been payable over
such notice period.
Fees are expected to be paid monthly (either in advance or in arrears),
based on the TIC or AUM as of the relevant date(s), and adjusted for
contributions to and withdrawals from the Account. In those
circumstances where an Account pays the management fee in advance,
upon termination, any fees paid in advance will be prorated to the date of
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