Item 5 – Fees and Compensation
A. Fees. Aspen Capital Management, Ltd, a Bermuda company licensed as an insurance
manager and agent (the “Manager”) under the Insurance Act 1978, as amended (the “Insurance
Act”), is an affiliate of the Adviser. The Manager provides certain management and
administrative services to the Fund and to Peregrine and provides all underwriting, agency,
claims management and related services to Peregrine, pursuant to a Management
Agreement. Given that reinsurance is a regulated business that may be conducted in Bermuda
only through a licensed reinsurer, all of the reinsurance and retrocessional contracts to be written
on behalf of the Fund are written by and through Peregrine. Peregrine is an exempted company
incorporated under the laws of Bermuda and is licensed as a special purpose insurer under the
Insurance Act.
The Manager, and not the Fund, compensates the Adviser for its investment advisory services to
the Fund out of the fees payable by the Fund to the Manager as described below. The Manager
considers the services provided to the Fund by the Adviser and allocates fees as it deems
appropriate.
In the future, the Adviser may negotiate its fees with other privately offered pooled investment
vehicles, customized funds for single investors or groups of investors or separately managed
accounts.
Highly Confidential
Aspen Capital Advisors Inc.
Brochure Date: March 29, 2022
The Manager’s Management Fee
Pursuant to a Management Agreement between the Fund, Peregrine and the Manager, the Fund
pays the Manager a monthly management fee (the “Management Fee”) in advance equal to 1/12
of 1% of the net asset value of the outstanding shares of the Fund (Shares) as of the first day of
such month, before the accrual of any Incentive Fee. The Management Fee payable with respect
to a given month shall be paid in U.S. dollars within 10 business days after the first day of such
month. With the prior written consent of the Manager, the Management Fee may be waived,
reduced or calculated differently with respect to any class or series of Shares or with respect to
any shareholder of the Fund.
If the Fund issues a special series of non‐redeemable shares (“Series S Shares”) in respect of
illiquid investments the value of which cannot be determined with reasonable certainty (“Special
Investment”), no Management Fee will be payable with respect to such Series S Shares until a
full or partial realization event has occurred with respect to the Special Investment underlying
such Series S Shares. At that time, a Management Fee at the rate of 1% per annum of the realized
value of the Series S Shares calculated for the time period that the Series S Shares were
outstanding will become due and payable. The Management Fee payable with respect to any
Series S Shares will be prorated for the number of days that the relevant Series S Shares were
outstanding.
The Manager’s Incentive Fee
The Fund pays the Manager an incentive fee (the Incentive Fee) with respect to each investor in the
Fund equal to 10% of the aggregate Net Profit (as defined below) attributable to each outstanding
class, series or sub‐series of Shares of the Fund held by such investor. The Incentive Fee will be
accrued monthly and will be payable at the end of each fiscal year, or if earlier, upon the termination
of the Management Agreement. A pro rata portion of any accrued Incentive Fee shall also be
payable upon the redemption or transfer of Shares.
“Net Profit” for any class, series and sub‐series of Shares held by an investor in the Fund for any
period is the appreciation of the net asset value of such class, series or sub‐series of Shares for such
period. Net Profit is not reduced by any Incentive Fees previously paid. For the purpose of
calculating the Incentive Fee, the value of any Series S Shares in issue will be disregarded. Upon the
disposition or reclassification of any Special Investment as a non‐Special Investment the net asset
value of the corresponding Series S Shares immediately prior to their conversion into non‐Series S
Shares will be added back and included in Net Profit for the corresponding period.
The Incentive Fee payable with respect to a given investor in the Fund shall be paid in U.S. dollars
within 10 business days after each period for which an Incentive Fee is determined to be payable
Highly Confidential
Aspen Capital Advisors Inc.
Brochure Date: March 29, 2022
or as soon thereafter as is reasonably practicable upon the finalization of the net asset value of
the Shares for the relevant period. With the prior written consent of the Manager, the Incentive
Fee may be waived, reduced or calculated differently with respect to any class or series of Shares
or with respect to any investor in the Fund.
B. Deductions. Management and Incentive fees are charged as earned and deducted from
the assets of the Fund investors’ accounts.
C. Expenses. In addition to the Management Fee and the Incentive Fee, the Fund bears
its own organizational and operating expenses and shall promptly reimburse the Adviser for any
such expenses incurred by the Adviser on behalf of the Fund and for all reasonable out of pocket
costs and expenses paid by the Adviser, directly or indirectly to third parties, in providing its
services to the Fund. Expenses borne by the Fund include without limitation all costs of
incorporation of the Fund including the expenses of the preparation of any private placement
memoranda or other offering materials, legal and printing charges, stamp duties, incorporation
fees and other preliminary expenses, legal fees and other fees and expenses incurred in
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