Item 5 - Fees and Compensation
Camelot has entered into an investment management agreement with the Funds that provide for its operating
expenses, subject to a cap, to be paid by the Funds (see details below) in lieu of a traditional management fee.
The cap on expense reimbursement is set at 2% of the net assets of the Funds.
In addition to expenses, Camelot is entitled to receive a performance fee, called the performance allocation,
which is 20 percent of the difference between the closing net asset value and the benchmark asset value of the
Funds. See details under Performance Fees, Item 6.
Expense Reimbursement
In lieu of paying Camelot any management fee in consideration of its investment management services to the
Fund, subject to the expense cap set out below, the Partnership shall pay or reimburse Camelot for all of the
general operating and overhead expenses associated with providing investment management services required
under the Management Agreement. These expenses include: (i) the normal operating overheads of the Adviser,
including, but not limited to, the cost of providing relevant support and management services (e.g., employee
compensation and benefits, rent, office equipment, fixtures, supplies, utilities, telephone, secretarial and
bookkeeping services, etc.), liability insurance and other coverages for the benefit of the Adviser and its
personnel, (ii) travel expenses, including investment-related travel, (iii) research and research-related expenses
(including investment-specific research), including, without limitation, news and quotation equipment and
services (e.g., market data services and communications systems), risk management software and investment
and trading-related computer hardware and software, (iv) legal, consulting and investigative/diligence costs
related to investments, (v) valuation expenses, and (vi) expenses associated with the Investment Manager's
registration and compliance as a registered investment adviser, if and when applicable (collectively, the
“Management Expenses”). Notwithstanding the foregoing, in no event shall the Management Expenses in a
given year exceed the amount that would have been payable by the Partnership to the Adviser in the relevant
year by way of a monthly management fee, calculated at an annual rate equal to 2% of the Net Asset Value of
the Partnership. To the extent that the Adviser manages other accounts or investment vehicles, the Management
Expenses shall be allocated among the Partnership and such other accounts and investment vehicles in a fair and
equitable manner, generally determined on a pro-rata basis by the relative assets under management.
In addition to the Management Expenses, the Partnership, as appropriate, will also be liable for any costs
properly incurred by the Adviser in relation to any brokerage charges, commissions, transfer fees, registration
fees, exchange fees, settlement fees and stamp duty, tax or other fiscal fees or expenses arising as a result of the
transactions made by the Adviser or any third parties in connection with the performance of the services under
the Management Agreement on behalf of the Fund.
Approximately 30 days before the end of each fiscal year, the Adviser shall prepare an estimation of the
anticipated Management Expenses for the upcoming fiscal year (the “Budget”). The amount of the Budget will
5|Page
be divided by twelve and charged to the Partnership on a monthly basis in advance on the first day of each
month. Prior to December 31 of each fiscal year, the Adviser will reconcile the Budget for such year against the
actual Management Expenses incurred during such year. An adjustment payment will be made as of December
31, either from the Partnership to the Adviser in the event of a Budget shortfall, or from the Adviser to the
Partnership in the event of a Budget surplus. An itemized description of each Budget and the actual
Management Expenses incurred for each fiscal year can be provided, on request, to a Limited Partner.
Performance Allocation
In addition to the Management Fee, the Fund General Partner will receive from the assets of the Funds an
incentive allocation (the Performance Allocation) in an amount equal to 20% of the amount by which the
Closing Net Asset Value (NAV) of each capital account of the Limited Partners (except the Company) exceeds
the Benchmark NAV. There are detailed specifications related to the conditions under which the Adviser earns
the payment. Please read the detailed explanation below.
Item 6 - Performance Fees
Under the provisions of the Partnership Agreement, the General Partner is entitled to an allocation of
performance (the "Performance Allocation"), which is calculated and paid as described below.
No Performance Allocation will be payable in respect of the Class IM Interests.
The Performance Allocation shall be calculated as follows:-
(i) At the end of each fiscal year of the Partnership the Performance Allocation shall be equal to 20 per
cent. of the amount by which the Closing NAV (as defined below) of each Capital Account of each
Limited Partner (except the Company) exceeds the Benchmark NAV (as defined below).
(ii) For these purposes: • the "Closing NAV" shall mean the Net Asset Value of each capital account as at
the last Valuation Date in each financial year (excluding any accrual for any Performance Allocation); •
the "Benchmark NAV" shall mean: (A) for the first fiscal year following a Limited Partner opening a
capital account, the amount obtained by applying an annual rate of return of 6% to the Net Asset Value
of the relevant capital account as at the date on which the capital account was opened (the "Initial
NAV") from the date on which the capital account was opened through 31 December of such year ; or
...