Item 5: Fees and Compensation
NZS serves as the portfolio manager to private funds. As compensation for our advisory services to a private
fund, we, or our affiliates, generally receive a management fee based on assets under management and may be
entitled to performance-based compensation (“incentive allocation”) for certain private fund management
arrangements as set forth in the applicable offering documents.
Management Fees: Management fees are generally 0.70% per annum, calculated monthly and payable in
arrears as of the final day of each calendar quarter.
The General Partner of a Fund may at any time in its discretion waive, reduce, or rebate all or a portion of the
Management Fee payable in respect of any Limited Partner, including but not limited to affiliates, principals,
partners and employees of the Investment Manager or the Portfolio Manager and their respective families and
any estate planning and/or other vehicles established by or on behalf of any of them.
Separately Managed Accounts: As compensation for our advisory services, each separate account client may
pay an investment management fee based on assets under management, a performance-based incentive fee, or
both. Performance fees are established in compliance with Rule 205-3 under the Advisers Act and similar state
statutes and rules. See Item 6 below for a further discussion of performance fees.
Unless otherwise agreed upon in a client investment agreement, NZS’s annual investment management fee will
be paid quarterly, based on the value of the portfolio on the last business day in the quarter. Investment
management fees are typically paid in arrears and will be prorated at the beginning or end of the client’s
engagement with NZS, if necessary, per the fee schedule noted below. NZS’s management fee shall be debited
from the client’s account in accordance with the custody exemption that requires 1) clients provide us with
written authorization to withdraw fees; 2) that a statement is sent directly to the client by a qualified custodian
at least quarterly; and 3) we provide clients with an invoice that includes the detail of the fee calculation.
Our standard annual advisory fee is 0.70% based off assets per annum. Fees may differ from accounts with
higher account minimums or account performance fees. The adviser has the discretion to modify a client’s
advisory fee.
NZS utilizes pricing information provided by the custodians of NZS’s client assets, or an independent third-
party pricing service to value a client’s portfolio and to calculate management fees. Based on the reporting
service utilized by the custodian, a client may receive custodial statements which reflect slightly different
valuations for certain securities. NZS encourages clients to compare these account statements sent directly to
you from your custodian to any NZS-prepared reports or invoices. Custodial fees may be charged by a bank,
trust company, or brokerage firm for recordkeeping and safekeeping of client’s assets. Custodians will send
client statements at least quarterly directly to NZS clients. Clients will incur brokerage commission charges
when buy or sell transactions are executed. For further information on Brokerage Practices, please see Item 12.
Because a client’s custodian does not calculate the amount of the management fee to be deducted, it is important
for each client to carefully review their custodial statements to verify the accuracy of the management fee
calculation, which is done by NZS as the investment adviser. Clients should contact NZS directly if they believe
there may be an error in their custodian statement, or the invoice received from NZS.
Additional Fees and Expenses
Our fees are exclusive of, and clients may incur certain other fees and expenses including, brokerage
commissions, banking fees, interest, custodial fees, transaction fees, and other investment related costs and
expenses. Brokerage commissions, custodial fees and other transaction expenses and fees are typically imposed
by broker-dealers, custodians and other third parties. 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.
Clients may also be subject to organizational, operating, administrative, legal, audit and other professional
expenses. Clients may also bear their share of expenses attributable to regulatory filings which are made with
respect to the client’s holdings. In some instances, certain clients will be responsible for extraordinary expenses,
including the expenses of litigation. Each client will be responsible for their own taxes. Please refer to the
applicable governing documents of a client for more information.
Client costs and expenses are the responsibility of, and may be paid directly by, the applicable client. Where
we have the ability to do so, 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 one or more clients which
benefit from such shared costs and expense.