Item 5. Fees and Compensation
General
Marble Point generally receives management fees and/or incentive fees (or “performance fees”) in
connection with the investment management and/or collateral management services it provides to the
Accounts. The particular fees applicable to an Account are set forth in the applicable Account Documents.
Prospective investors and clients should be aware that Marble Point’s fees change over time and that
different fee schedules would apply if Marble Point adopts new or different investment strategies or
establishes additional Accounts in an existing strategy, or a prospective investor or client negotiates a
different fee schedule. Thus, different Accounts (including those with the same investment strategy), and
different investors in the same Pooled Account, could pay different fees based on, among other things,
waivers and investment dates.
Fees
Marble Point does not maintain a fixed fee schedule for client Accounts. Specific fee arrangements
applicable to any Account are generally subject to negotiation in Marble Point’s sole discretion based on,
among other factors, the nature of the strategy and services to be provided by Marble Point, total market
value invested with Marble Point, regulatory and reporting requirements, requested customization, and any
other relevant factors, including employment or familial relationships with Marble Point, its affiliates or the
principals thereof. Fees are calculated based on various factors, including in the case of certain Accounts,
such as CLOs, the total principal amount of assets held by the Account. Management fees are generally
payable in arrears. However, in the event that an Account pays fees to Marble Point in advance, a pro rata
portion of such fees will be refunded in the event that an Account is terminated prior to the end of the
applicable billing period based on the number of days elapsed during such period. In addition, Marble Point
can waive or reduce fees in respect of an investor’s investment in a Pooled Account in its sole discretion.
In addition, certain Accounts may invest in one or more other Pooled Accounts or other Accounts managed
by Marble Point. In such cases, fees payable by an investing Account in respect of its investment in
another Account will be described in the Account’s applicable investment advisory agreement or Account
Documents. For example, certain Accounts invest directly or indirectly in a CLO managed by Marble
Point—in such case, to the extent the Account’s Account Documents provide, Marble Point might receive
fees only from the applicable CLO in connection with such investment and not from the applicable
Account or vice versa.
Management Fees. CLO management fees are generally structured such that a portion of the fee is payable
as a senior management fee and another portion is payable as a subordinated management fee. The senior
management fee has a higher priority in a CLO’s priority of payment waterfalls whereas the subordinated
management fee generally ranks below principal and interest payments to senior note holders in the
payment waterfalls. Management fees in respect of other Accounts vary from Account to Account as
described above and may be based on an Account’s total assets, net assets, aggregate principal amount of
loans held, or any other basis, or a combination of any of the foregoing, as negotiated.
Incentive Compensation (Performance-Based Compensation). Marble Point receives incentive fees in
connection with Accounts, subject to the terms and conditions of Account Documents. For CLOs, such
compensation constitutes a percentage of a CLO’s cash flow in excess of a specified preferred return or
hurdle rate for the CLO.
In addition, the interests that the Firm or an affiliate of the Firm retain in one or more Accounts when
required by applicable law or contractual obligation provide Marble Point with an additional pecuniary
interest in such Account and therefore give rise to conflicts that are similar to those that apply in respect of
performance-based compensation. See “Item 6 – Performance-Based Fees and Side-by-Side Management”