Item 5 – Fees and Compensation
A. Describe how you are compensated for your advisory services. Provide your fee
schedule. Disclose whether the fees are negotiable.
In consideration for the investment management services provided to SeaRock, Fox River Advisers
generally receives a fund-wide management fee of 1% calculated monthly on net asset value (“NAV”)
for Series A, B or C Interests. In addition, those investors electing to participate in FRPI pay a
management fee of 2% calculated monthly on NAV. Investors in SeaRock are also responsible,
through SeaRock’s participation with underlying fund managers, for the management fees of the
underlying funds.
The precise amount of, and the manner and calculation of, the management fees for SeaRock is set
forth in SeaRock’s governing documents and/or other documentation received by each investor prior
to investment in SeaRock. The amount of management fees, fund expenses, and any offset thereof
may differ among investors in SeaRock. FRP may, in its sole discretion, waive or reduce a limited
partner’s management fee, such as for employees or affiliates of Fox River Advisers.
Atocha investors pay Fox River Advisers a management fee equal to 2%, on an annualized basis, of
such investor’s capital contributions. This figure is pro-rated for any partial quarters during which
capital contributions are invested. Atocha GP may, in its sole discretion, waive or reduce a limited
partner’s management fee, such as for employees or affiliates of Fox River Advisers.
B. Describe whether you deduct fees from clients’ assets or bill clients for fees incurred.
If clients may select either method, disclose this fact. Explain how often you bill clients or
deduct your fees.
Management fees are deducted from each investor’s capital account. Investors in the Funds do not
have the ability to choose to be billed directly for fees incurred.
The management fee for SeaRock is paid monthly in arrears. The management fee for Atocha is paid
quarterly in advance. Fox River Advisers deducts the amount of the management fee applicable to
each investor at the end of each month.
C. Describe any other types of fees or expenses clients may pay in connection with your
advisory services, such as custodian fees or mutual fund expenses. Disclose that clients will
incur brokerage and other transaction costs, and direct clients to the section(s) of your
brochure that discuss brokerage.
FRP paid SeaRock’s initial organization and offering costs and expenses, which the Fund reimbursed.
Investors in SeaRock pay for the following expenses incurred in operating the partnership
investments: (a) legal, accounting, auditing and other professional and compliance expenses incurred
in connection with the Fund’s affairs, including, without limitation, in performing diligence or
otherwise in connection with the making of any investment and in preparing, printing and delivering
all reports (including such expenses incurred in connection with any update or amendment to the
memorandum, the partnership agreement or any other Fund document) and tax information for
partners and regulatory authorities, as well as all costs and filing fees; (b) any interest or other expenses
relating to any Fund borrowing; (c) the Fund’s allocable share of the costs and expenses of underlying
funds and other entities used for investment, including their organizational, offering and operating
costs and expenses and the management fees and incentive compensation payable to their portfolio
managers; (d) the costs and expenses associated with opening and maintaining managed accounts,
including the management fees and incentive compensation payable to their portfolio managers; (e)
the costs and expenses associated with the sourcing, evaluation, selection, negotiation, structuring,
acquisition and management of investments (including FRPI investments and opportunistic
investments), whether or not they are ultimately acquired or made, including: (i) any financing, legal,
accounting, valuation, advisory, consulting, compliance, travel or other expenses in connection
therewith; (ii) all fees (including commitment fees), costs and expenses of lenders, investment banks
and financing sources in connection with arranging financing; (iii) any deposits or down-payments of
cash or other property, including if forfeit; (iv) related industry research and conference attendance
costs (including reasonable travel, lodging and admission expenses); (v) any transfer taxes and stamp
duties; and (vi) any costs to create or maintain FRPI investment vehicles; (f) any extraordinary
expenses including any litigation expenses SeaRock may incur or any expenses SeaRock may incur in
connection with indemnifying any party pursuant to and in accordance with the terms of the
partnership agreement; and (g) any other expenses which FRP determines to be directly related to the
investment of SeaRock’s assets, including expenses incurred to modify SeaRock’s legal structure or
documentation and the cost of news and quotation services. In addition, SeaRock may be required to
reimburse the Investment Manager for certain bonuses or other incentive compensation paid to
portfolio managers and other employees of the investment management group in connection with
specific investments they source, select, manage or dispose of on behalf of SeaRock, other than FRPI
investments.
FRP and the Investment Manager generally bear its own operating and overhead expenses attributable
to the management of SeaRock (such as salaries, consulting fees, bonuses, rent, office and
administrative expenses, depreciation and amortization and auditing expenses, except for certain
bonuses and other incentive compensation described above), including the operating and overhead
expenses of the FRPI team. The Investment Manager also provides certain other management and
administrative services to SeaRock, including, among other things, news, quotation and computer
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