Item 5: Fees and Compensation
As provided under each Fund’s Governing Documents, Finepoint or its affiliates will receive from the
Funds both a quarterly management fee (the “Management Fee”) and an annual performance allocation
(the “Performance Allocation”) based on the performance of the Funds, as described further below.
Although the Firm has entered into agreements with the Funds providing for the fees or allocations
described below, Finepoint may negotiate alternative fees or allocations on a client-by-client basis with
other funds or separate account clients that it manages in the future. Finepoint Partners, LLC, the General
Partner of each Fund (the “General Partner”) also retains the ability to, in its sole discretion, waive, reduce
or rebate the Management Fee and/or Performance Allocation with respect to certain limited partners of
each Fund, (and does waive such fees for affiliates of the General Partner and/or Finepoint); provided,
however, that no such waiver, reduction or rebate will adversely impact any other limited partner in a Fund
or cause them to bear a higher portion of the Management Fee and/or Performance Allocation than they
would otherwise bear absent such waiver, reduction or rebate.
Finepoint deducts its Management Fee from each Fund generally quarterly in advance. Each Limited
Partner shall be charged its pro rata share of the Management Fee, which will be equal to the Management
Fee Rate multiplied by the balance in such Limited Partner’s capital account (including, for such purpose,
amounts attributable to Designated Investments, valued at the Designated Investment Carrying Value, and
computed prior to the allocation or accrual of any Performance Allocation) calculated at the beginning of
the then current fiscal quarter. The “Management Fee Rate” is (i) 0.375% (approximately 1.5% annualized)
with respect to capital accounts of Limited Partners of the Partnership, limited partners of Finepoint Capital
II and any other funds or accounts managed by the Investment Manager, collectively, in an aggregate
amount up to and including (A) $1 billion, prior to January 1, 2024, or (B) $650 million, beginning January
1, 2024 (such $1 billion and $650 million threshold, as applicable, the “Management Fee Threshold”), and
(ii) 0.25% (approximately 1.0% annualized) with respect to capital accounts in excess of such amount.
Capital accounts of Limited Partners of the Partnership, limited partners of Finepoint Capital II, or limited
partners or other investors in other funds or accounts managed by the Investment Manager who are affiliates
or employees of the General Partner or the Investment Manager and do not bear a Management Fee
(“Excluded Capital Accounts”) do not count toward the Management Fee Threshold. The Management Fee
Threshold will be allocated pro rata among the Partnership, Finepoint Capital II and any other funds or
accounts managed by the Investment Manager, based on their respective aggregate capital accounts (other
than Excluded Capital Accounts) as of the beginning of such fiscal quarter and will be allocated pro rata
among capital accounts of Limited Partners of the Partnership, capital accounts of limited partners of
Finepoint Capital II and the capital accounts or other investments of limited partners or other investors of
any other funds or accounts managed by the Investment Manager (in each case, other than Excluded Capital
Accounts) based on their respective balances as of the beginning of such fiscal quarter. A limited partner
of a Fund that withdraws all or a portion of its interest in a Fund other than at the end of a quarter shall
be reimbursed a pro rata portion of the Management Fee for such quarter. The General Partner receives
a Performance Allocation of 20% from the Funds on an annual basis in arrears and upon withdrawals
by investors in the Funds, subject to a “high water mark.” For a further discussion of the Performance
Allocation and the “high water mark”, please see Item 6.
In addition to the Management Fee and the Performance Allocation, and consistent with the Funds’
Governing Documents, each Fund will bear the costs and expenses related to its investments and its
operations, including, without limitation: brokerage and other transaction costs; clearing and settlement
charges; trade break fees; consulting expenses; research and due diligence expenses (whether or not the
related investment is consummated); expenses incurred in connection with Finepoint or any investment
team member forming or serving on any creditors’ committees; legal fees and other expenses in connection
with conducting due diligence and negotiating the terms of certain investments, regardless of whether such
investments are consummated; custodial fees; initial and variation margin, interest and commitment fees
on debit balances or borrowings; stock borrowing fees; proxy solicitation expenses; legal, audit and tax
preparation expenses, accounting fees; administrator fees and expenses (including fees and expenses of the
Fund’s administrator and third-party valuation services); directors fees; fees and expenses for risk
management services; insurance expenses, including costs of any liability insurance obtained on behalf of
the Fund (including, without limitation, directors and officers insurance); indemnification expenses; the
Management Fee; regulatory costs and expenses (including filing, license and similar fees paid on behalf
of a Fund, including reimbursements of any fees and expenses to advisers, service providers and other third
parties); any issue or transfer taxes chargeable in connection with any securities transactions, including
finders fees and commissions and discounts incurred in connection with the purchase or sale of securities;
any entity level taxes and fees; costs of reporting and providing information to the partners of the Fund;
costs of litigation or investigation involving the Fund’s activities; any extraordinary expenses; and to the
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