FEES AND COMPENSATION
A. Advisory Fees and Compensation.
The fees applicable to each Fund are set forth in detail in each Fund's offering
documents. A brief summary of such fees is provided below.
Management Fee
Generally, the Hedge Funds pay the Investment Adviser a fee for investment
management services (the "Management Fee") for each fiscal quarter equal to between 0.375%
(1.5% per annum) and 0.5% (2% per annum) of the beginning net asset value of the applicable
Fund's capital account at the beginning of the fiscal quarter. The Management Fees are
calculated and paid in advance.
Generally, the Long-Only pays the Management Fee to the Investment Manager
on the first day of each calendar quarter. The Management Fee Percentage for each quarter is
between 0.375% (1.5% per annum), and 0.25% (1% per annum).
Management Fees for the Funds are prorated for any capital contribution or
withdrawal/redemption by an investor that is effective other than as of the first day of a quarter.
In the discretion of the Investment Adviser, the Management Fee may be waived, reduced or
calculated differently with respect to a Fund.
Performance Compensation
Generally, at the end of each fiscal year of the Hedge Funds, the Investment
Adviser is entitled to an incentive allocation (the "Performance Compensation") in an amount
equal to 20% of the net capital appreciation (which includes both realized gains and losses and
unrealized appreciation and depreciation of securities held in the applicable Fund's portfolio)
allocated to an investor's capital account (or series of shares, as applicable) for such fiscal year
after deducting the Management Fee attributable to such investor's capital account or series of
shares, as applicable, for such fiscal year, subject to a loss carryforward mechanism.
Generally, at the end of each fiscal year of the Long-Only Fund, the Investment
Adviser is entitled to Performance Compensation equal to 10% of the net capital appreciation
above the Hurdle Amount, which is the dividends reinvested total return of the MSCI Europe
Index.
The Performance Compensation may be made at times other than at the end of
each fiscal year to account for complete or partial withdrawals and/or redemptions of shares.
In the discretion of the Investment Adviser, the Performance Compensation may be waived,
reduced or calculated differently with respect to certain investors.
B. Payment of Fees.
Fees and compensation paid to the Investment Adviser or its affiliates by the
Funds are generally deducted or reallocated from the assets of such clients. As discussed
above, Management Fees are generally deducted on a quarterly basis and Performance
Compensation is generally reallocated on an annual basis.
C. Additional Fees and Expenses.
The Funds will bear all of their (and a pro rata share of the Master Fund's, as
applicable) legal and other organizational expenses incurred in the formation of the Funds (and
the Master Fund, as applicable), including all expenses relating to the offer and sale of Fund
securities. The Funds will bear their own (and a pro rata share of the Master Fund's, as
applicable) operating and other expenses, including, but not limited to, investment-related
expenses (e.g., brokerage commissions, clearing and settlement charges, custodial fees, interest
expenses, initial and variation margin, broken deal expenses and other transactional charges,
fees or costs, investment-related travel expenses, consulting, advisory, investment banking and
other professional fees relating to particular investments or contemplated investments, research
related expenses, including, without limitation, news and quotation equipment and services,
market data services, and fees to third-party providers of research and/or portfolio risk
management services), legal expenses (including with respect to litigation, if any), accounting,
audit and tax advice and preparation expenses (including preparation costs of financial
statements, tax returns, reports to investors and Schedules K-1), printing and mailing costs,
fees of pricing services and financial modeling services, the costs and expenses of third party
risk management products and services (including, without limitation, the costs of risk
management software or database packages), insurance costs (including, without limitation,
directors' and officers' insurance, errors and omissions insurance and other similar policies),
filing and registration fees, fees of the administrator, the Management Fee, any extraordinary
expenses (including indemnification or litigation expenses and any judgments or settlements
paid in connection therewith), all other costs and expenses arising out of the Funds'
indemnification obligations, any entity level taxes, fees or other governmental charges levied
against the clients, wind-up and liquidation expenses and expenses similar to the foregoing.
D. Prepayment of Fees.
As described above, the Funds generally pay the Management Fee quarterly in
advance. In the event that a client's net asset value is reduced in connection with a withdrawal
or redemption by an investor of such client other than as of the last day of a quarter, the
Investment Adviser will pay such client an amount equal to the pro rata portion of the
Management Fee, based on the actual number of days remaining in such quarter.
E. Additional Compensation and Conflicts of Interest.
Neither the Investment Adviser nor any of its supervised persons accepts
compensation (e.g., brokerage commissions) for the sale of securities or other investment
products.