5. FEES AND COMPENSATION
Fee Arrangements may vary by matter and Client and are subject to the specific provisions in each
Advisory Services Agreement.
A. Advisory fees and compensation
The fees applicable to each Client are set forth in detail in each of FTICM’s Advisory Services
Agreements and/or the Client’s governing documents.
A fee schedule applicable to each individual Client may be developed based upon the specific activities
required for each Client. However, fees will generally be in the form of either:
1. Management fee. The Management Fee is calculated as a percent of assets under
management or alternatively may be agreed as a fixed fee or on a time cost basis.
Management Fees will generally be assessed monthly or quarterly and deducted from
the assets of the Client funds managed by the Investment Adviser; or
2. Performance fee. The Performance Fee is negotiated individually with each Client. This
is usually a conditional compensation subject to transaction performance and triggers.
The Performance Fee can be calculated as an incentive allocation with reference to
amounts above a particular benchmark, or the “alpha” above an expected return target,
or more simply as a fixed “success” fee. For further information regarding the
Performance Fee, please see Item 6.
The Investment Adviser may waive all or part of any of these fees in respect to any Client by rebate
or otherwise and all fees are subject to negotiation.
B. Retainer fees
While it does not currently intend to do so, the Investment Adviser reserves the right to charge a
retainer fee (which may be paid in advance) to certain Clients, which will be individually negotiated
between the Investment Adviser and any such Client.
C. Additional fees and expenses
The Investment Adviser generally pays the expenses and costs that it incurs in connection with carrying
out advisory services. However, Clients are required to reimburse the Investment Adviser subject to, and
depending on the terms of the relevant Advisory Services Agreement, fees and expenses incurred in
connection with employing legal counsel, accountants, consultants, pricing services or other outside
specialists. Clients typically pay their own brokerage commissions, registration costs, taxes and other
similar transaction costs or expenses directly attributable to the assets or liabilities of the Client.
D. Additional compensation and conflicts of interest
Except in the limited circumstances described below, 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.
In the event that FTICM introduces an affiliate to provide services on behalf of a client and the client
chooses to accept services provided by the affiliate, FTICM advisory personnel, the FTICM affiliate and the
overall parent FTI Consulting, Inc may receive additional revenue.
See Item 12 for a discussion of the Investment Adviser’s brokerage practices.
Affiliates of the Investment Adviser may also receive fees from companies the Clients invest in for
other financial advisory, restructuring and administrative, management and consulting services
(including services related to the sale of a company), secondment services of key and delegated
personnel (including, without limitation, travel, lodging, relocation expenses and meal expenses) and,
occasionally, director, officer and similar fees. These types of fee arrangements present the possibility
for a conflict of interest between the Investment Adviser and its Clients. In some cases, the
Investment Adviser and its affiliates will forego, postpone or delay payment of these fees. The
Investment Adviser has policies and procedures in place to identify, mitigate and disclose conflicts of
interest such as these.