Item 5 – Fees and Compensation
Fees for both our separately managed accounts and the Fund are discussed in this item.
Separately Managed Accounts
We generally charge an annual management fee of 1% of an account’s assets under management.
Our advisory fee is billed and payable either in arrears or in advance, on a quarterly or monthly
basis, based on the value of the account at the end of the billing period if billed in arrears, or the
value of the account at the end of the previous billing period if billed in advance. If the investment
advisory agreement is executed at any time other than the first day of a calendar quarter or calendar
month, as applicable, our fees will apply on a pro rata basis, which means that the advisory fee is
payable in proportion to the number of days in the billing period for which the agreement was in
effect. Where our fees are payable in advance, if an agreement is terminated prior to the end of a
billing period, any unearned fees will be returned to the client. Clients are generally also subject
to the incentive-based compensation described in Item 6 below.
Clients will receive an invoice showing the value of the account, the amount of fees due, and the
change of value for purposes of calculating the incentive-based compensation, if any, unless the
client has an administrator which performs these calculations. In that case, we will provide support
for the amount due on the invoice. Clients hold ultimate responsibility for remitting payments as
we do not deduct fees directly from accounts. We urge clients to review all statements received
from their custodian for accuracy.
Fees for a separately managed account client are negotiable and may vary from the amounts set
forth in this brochure.
Acacia Capital, L.P.
The fees and expenses applicable to the Fund are described in the Fund’s private offering
memorandum and organizational documents. As compensation for our services as general partner,
we generally receive an annual management fee of 1% of the Fund’s net assets, which is generally
payable quarterly in arrears and calculated before giving effect to any withdrawals and/or any
incentive allocation. In addition, we are entitled to receive an incentive allocation in connection
with our services to the Fund, generally equal to 20% of net profits achieved over a traditional
high water mark. The incentive allocation is generally calculated and paid at the end of each fiscal
year and at the time of withdrawal. Once paid, the incentive allocation is not refundable. The
management fee and the incentive allocation are deducted directly from investors’ assets in the
Fund. We receive a prorated portion of the management fee and incentive allocation with respect
to any partial period. Any prepaid but unearned fees will be refunded.
Additional Fees and Expenses
Our fees are exclusive of, and in addition to, brokerage commissions, custodial fees, transaction
fees and other investment related costs and expenses. These charges and fees are typically imposed
by the broker-dealer or custodian through which client account transactions are executed, which
are in addition to our fees. Please refer to Item 12 for a description of the factors we consider in
selecting or recommending broker-dealers for client transactions and determining the
reasonableness of their compensation.
The Fund and separately managed accounts may also be subject to administrative, legal, audit and
other professional expenses, including certain software and other licensing costs. We do not share
in any portion of these commissions, fees and expenses. Please refer to the Fund’s offering
memorandum or the advisory agreement for a separate account client for more information.
As part of our investment advisory services, we may invest, or recommend that a client invest, in
mutual funds and exchange-traded funds. The fees that a client pays to our firm for investment
advisory services are separate and distinct from the fees and expenses charged by mutual funds or
exchange-traded funds (described in each fund’s prospectus) to their shareholders. These fees will
generally include a management, custodial and transfer agent fee and other fund expenses.
Client costs and expenses are the responsibility of, and may be paid directly by, the applicable
client. However, where we have the ability to do so in respect of our clients, we may pay client
costs and expenses directly out of our own account for and on behalf of the client, and in those
cases we are entitled to reimbursement from the client. Certain costs and expenses may be incurred
for the benefit of, or be shared by, multiple clients which may include clients which do not bear
any responsibility for such costs and expenses. Such shared expenses generally will be allocated
across the applicable clients pro rata or in such other manner as we deem appropriate. We may
directly bear the responsibility for the portion of such shared costs and expenses otherwise
allocable to clients which benefit from, but which are not directly responsible for, such shared
costs and expense.
We may pay client costs and expenses directly out of our own account for and on behalf of the
client.