Fox Run Management LLC

Item 5 - Fees and Compensation

FRM derives compensation from its clients in the form of a management fee, payable in advance based upon
the value of the account as of the close of the prior period. Currently, the fee equals 1.5% of the value of the
account per year, or 0.375% quarterly. Based upon the arrangement made with each client, this fee may be
deducted from the client’s account or may be invoiced and paid directly to FRM by the
client.
In addition to the asset-based management fee, FRM or the General Partner receives a fee based upon the
performance of the client’s account. Such fees are described in Item 6 Performance-Based Fees and Side- By-
Side Management below.

Fees may be subject to negotiation with each client.

In addition to the management fee, private fund clients may be charged reasonable travel, legal,
accounting, audit and tax return preparation fees and expenses relating to its operations, as well as the costs
associated with investigating potential investments or ways to maximize return on existing
investments. All custodial fees, interest on borrowed funds, transfer taxes, brokerage commissions,
finder’s fees, and fees and expenses for consulting, research and statistical services (including but not
limited to technology, software and data feeds), are also paid in varying degrees by clients. The actual
charges allocated to clients may differ based on negotiated fee structures and their relative percentages of
total assets under management. Clearing charges, liquidity charges and charges for data-feeds, that drive the
models that are used for trading are usually the largest portion of these charges.
In the event of the termination of the investment management agreement or subadvisory agreement that
the Investment Adviser has entered into with a client as of any day other than the end of a calendar
quarter or other billing period, a pro-rated portion of the management fee which was paid in advance for that
calendar quarter or other billing period will be refunded by the Investment Adviser.
Other than as described above, neither the Adviser nor any of its supervised persons receives any
compensation from the sale of securities or other investment products.

Item 7 - Types of Clients

FRM currently only provides investment advice to two private funds, namely the Alpha Fund and the
segregated portfolio of the Private Fund, both of which are hedge funds.