Item 5. Fees and Compensation
A fixed asset based charge (the “Asset Based Charge”), which ranges from 0.5% to 2.0% (per
annum) of the net asset value of the relevant Archview Fund, is assessed on the investors in the
Archview Funds and is deducted from the assets of the Archview Funds quarterly in advance. A
portion of the Asset Based Charge (the “Guaranteed Payment”) is paid to a strategic investor (the
“Strategic Investor”). The remainder of such Asset Based Charge is paid to the Adviser as
compensation for investment services rendered to the Archview Funds pursuant to the terms of
the Advisory Agreements (the “Management Fee”).
The Asset Based Charge described in this Item 5 has been voluntarily reduced, and may in the
future be reduced or waived, with respect to one or more Archview Funds (or one or more
investors therein), and the Asset Based Charge may be different from one Archview Fund to
another, as well as among investors in the same Archview Fund. In addition, please see Item 6
below regarding the Adviser’s right to performance-based compensation.
The Archview Funds bear their own expenses (and the expenses of certain investment vehicles
established with respect thereto), including legal, accounting, bookkeeping, tax compliance,
auditing, consulting and other professional expenses, including those of valuation firms;
administration fees and other expenses charged by or relating to the services of third-party
providers of administration services; fees payable to sub-advisors (if the Adviser or general
partner, as applicable, determines that such an arrangement represents the best way to access a
particular investment opportunity or a difficult to access market or otherwise makes available
specialized investment expertise to the Archview Funds), including, without limitation, through
investments in pooled investment vehicles; third-party and out-of-pocket research and market
data expenses (including, without limitations, news, quotation, statistics and pricing services;
hardware, software, data bases and other technical and telecommunications services and
equipment used in the investment management and order management processes; and consulting
fees and travel expenses in connection with investigating and monitoring potential and existing
investments); interest and fees (including, without limitation, commitment, structuring and
underwriting fees) on margin loans, committed loan facilities, total return swaps and other
indebtedness; bank service, custodial and similar fees; fees and expenses (including travel
expenses) related to the analysis, purchase or sale of investments, whether or not the investments
are consummated; expenses related to the purchase, monitoring, sale, settlement, custody or
transfer of Archview Fund assets (directly or through trading affiliates); expenses associated with
activist investment activities (including public relations, tender offer and proxy solicitation
expenses); third party and out-of-pocket fees and expenses relating to systems and software used
in connection with the operation of the Archview Funds and investment related activities
(including, without limitation, any accounting, risk management, trading and administrator-like
functions that the Adviser performs in-house); entity-level taxes; fees and expenses relating to
the offer and sale of shares or interests (including, without limitation, organizational fees and
expenses and filing and legal fees); and other ordinary or extraordinary expenses associated with
the operations of the Archview Funds and their investment activities.
The Advisory Agreements do not provide for the return of fees upon termination of such
agreements; however, any Asset Based Charge that is prepaid will generally be returned to
investors in the Archview Funds on a pro rata basis following termination of an Advisory
Agreement.
When a broker is used in connection with investments by the Archview Funds, the Archview
Funds will incur brokerage and other transaction costs. For additional information regarding
brokerage practices, please see Item 12 below.