Item 5: Fees and Compensation
Fivespan provides investment advisory services to each Fund pursuant to the applicable Governing Documents.
The applicable Governing Documents set forth in detail the fees and expenses relevant to each Fund. All
prospective Investors should review the Governing Documents in conjunction with this Brochure for complete
information on the fees, expenses and compensation payable with respect to an advisory relationship with
Fivespan. Capitalized terms used and undefined herein are defined in the relevant Governing Documents of
the applicable fund.
Management Fee
As an investment adviser to the Fivespan Feeder Funds, as further described in the Fivespan Funds’ Governing
Documents, Fivespan generally receives a blended management fee of up to 1.75% of the net asset value of
the Fivespan Feeder Funds, depending on the particular class of interest of the Fivespan Feeder Funds and the
total capital of the Fivespan Master Fund (such fee, the “Management Fee”). Total capital represents the sum
of (i) the net asset value of the Fivespan Master Fund attributable to direct and indirect investors therein that
are charged a Management Fee and subject to an Incentive Allocation (as defined in Item 6) and (ii) the
aggregate amount of uncalled capital commitments of the direct and indirect investors of the Fivespan Master
Fund that are charged a Management Fee and subject to an Incentive Allocation (as defined below) (“Total
Capital”).
The Fivespan Feeder Funds will pay a Management Fee for each fiscal quarter, in advance, equal to one quarter
of the applicable Management Fee rate multiplied by the balance of each Capital Account of an Investor (and
corresponding “Special Investment” accounts (as defined in Item 8)) as of the beginning of such fiscal quarter
(before taking into account the estimated accrued Incentive Allocation, if any). Management Fees are generally
pro-rated for partial periods.
The SPV Funds are structured as series-based entities. The terms applicable to Investors in the SPV Funds,
including Management Fee and Incentive Allocation rates, will be governed at the segregated portfolio level,
as promulgated by private placement memorandum supplements issued specific to the relevant segregated
portfolio.
Fivespan, in its sole discretion, may reduce, waive or calculate differently the Management Fee for certain
Investors, including but not limited to, the Managing Partners and any other current or former member, partner,
affiliate, consultant, or employee of or to the General Partners or the Firm, any member of the immediate
family of any such person, and any trust or other entity established for the benefit of any such person that
invests directly or indirectly in the Feeder Funds (each, an “Investment Manager-Related Investor”).
Incentive Allocation
The General Partners may be allocated performance-based compensation (“Incentive Allocation”) at the end of
each fiscal year or upon an Investor’s withdrawal or redemption from the applicable Fund, as more fully
described in the applicable Governing Documents.
As it relates to the Fivespan Feeder Funds, each Investor will select one of two Incentive Allocation options in
respect of the applicable class of interests at the time of its investment in a Fivespan Feeder Fund. The Incentive
Allocation for the Fivespan Feeder Fund, if any, generally ranges from 17.5% to 20% of net profits in excess of
a compounding hurdle rate or compounding market preferred return derived from a selected market index, with
both options being subject to loss carryforward provisions. Net profits include both realized gains and losses
and unrealized gains and losses of securities held in each Fund’s portfolio.
As it relates to the SPV Funds, the SPV General Partner may be allocated Incentive Allocation at the end of
each fiscal year or upon an Investor’s withdrawal or redemption from the applicable SPV Feeder Fund, as more
fully described in the Governing Documents. Net profits include both realized gains and losses and unrealized
gains and losses of securities held in each Fund’s portfolio.
In the sole discretion of the General Partners, the Incentive Allocation may be waived, reduced or calculated
differently with respect to certain Investors, including, without limitation, any Investment Manager-Related
Investors. To facilitate any such waiver, reduction or different calculation, the Funds may issue partnership
interests of a separate class, series or sub-series.
Performance-based fees are subject to regulation under Section 205 of the Advisers Act and Rule 205-3
thereunder and may only be charged to “qualified clients”. Therefore, Fivespan seeks to ensure that any
Investors in a Fund that are directly or indirectly assessed an Incentive Allocation satisfy the qualifications of
Rule 205-3 under the Advisers Act.
The General Partners may at any time redeem the portion of its shares in the Master Funds equal to all or a
portion of the Incentive Allocation previously allocated in respect of such shares in the Master Funds and any
appreciation thereon.
Other Fees and Expenses
Each Fund bears all of its operating expenses and its pro rata share of the operating expenses of the Master
Funds and all trading vehicles, including subsidiaries, intermediate funds and/or special purpose vehicles
through which the Master Funds invest or intend to invest (collectively, the “Fund Expenses”), including such
costs incurred at or prior to the formation of each Fund and prior to the date on which the Fund or the Master
Funds first accept subscriptions, which expenses will include, without limitation: (i) organizational and
offering expenses; (ii) expenses associated with all investments and transactions considered, evaluated and/or
consummated by the Master Funds, or any such trading vehicles, including subsidiaries, intermediate funds
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