Item 5 - Fees and Compensation
A. Fees
Center Pond generally receives a management fee (“Management Fee”) and performance-based
compensation (“Performance Allocation”) from each Client (together, “Fees”). The
Management Fees and the Performance Allocation relating to each Client are set forth in its
respective Offering Documents. Management Fees for the Funds vary up to 1.75%. The
Performance Allocation also varies by Client and may be up to 20%. Center Pond or its
affiliates, as applicable, reserves the right to negotiate, waive, reduce, rebate, or calculate
differently, its Fees with respect to any Advisory Account.
B. Billing
Center Pond generally deducts Management Fees from a Fund’s Advisory Account in advance of
or promptly after the first day of each quarter and, where applicable, will realize a Performance
Allocation as set forth in the Fund’s Offering Documents. Management Fees may be refunded if
an investor redeems its interest prior to the end of the quarter in which the Management Fee was
paid. Center Pond generally bills its Managed Account Clients quarterly for the Management
Fees and following the commencement of each Performance Period.
C. Additional Expenses
The Fees applicable to an Advisory Account are exclusive of transaction fees and certain other
expenses, including but not limited to custodial expenses, service provider costs, litigation costs,
operational costs, communications expenses, regulatory costs and expenses (including those
relating to regulatory and compliance filings), research and due diligence costs and expenses
(including investment-related travel expenses), taxes and other related costs and expenses that
are incurred by the Advisory Account, and each Advisory Account is responsible for the
payment of these costs and expenses.
Transaction fees generally include brokerage commissions, mark-ups, mark-downs and other
commission equivalents as well as spreads and/or transaction costs related to transactions
effected for an Advisory Account to executing broker-dealers. As described in Item 12,
Brokerage Practices, Center Pond will choose broker-dealers to effect these transactions in
accordance with its obligation to seek best execution.
For a more detailed discussion of brokerage expenses, please see Item 12 – Brokerage Practices.
The Management Fee is also exclusive of expenses related to organizing the Funds, expenses
related to negotiating Fund documentation, filing fees and other accounting and legal fees related
to organization of the Funds or the Managed Accounts (collectively, “Organizational
Expenses”). Such charges, fees and commissions are exclusive of, and in addition to, Center
Pond’s Management Fees and Performance Allocation (if applicable).
For a more complete discussion regarding fees and expenses applicable to a particular Advisory
Account, please refer to the appropriate Offering Documents.