Item 5 Fees and Compensation
A. Methods of Compensation and Fee Schedule
A.1 Private Fund Client Fee Schedule
If you engage PacRim for portfolio management services through a private fund (i.e., an unregistered
pooled investment vehicle), we will charge a quarterly fee, to be paid in advance, based upon a
percentage of the market value of the assets being managed ("Management Fee"). As part of our
portfolio management service, PacRim may recommend investments in private funds that we
manage for our client accounts. We will receive compensation from the private funds where we act as
the manager and therefore, a conflict of interest exists as we recieve compensation from the private
fund and the fees that we charge to manage it. We will only make such investments where we believe
it is consistent with our fiduciary duty and your investment objectives. The fees that you pay to our firm
for portfolio management services are separate and distinct from the fees and expenses charged by
private funds. Our fee for portfolio management services to clients investing through a private fund is
set forth in the following fee schedule.
Fee Schedule For Private Fund Clients
Capital Commitment Management Fee Incentive Fee
Share Class
(USD $) (% Per Annum) (% Per Annum)
Founders Class $1,000,000 to $100,000,000 1.5% (0.375% (Quarterly) 0%
A Class $1,000,000 to $50,000,000 1.0% (0.375% Quarterly) 0%
Accounts over $50,000,000 Negotiable Negotiable
Founder Class: Currently only available to certain employees of the general partner, friends, and
family members of the principals of the general partner.
A Class: All other investors.
Incentive Fee: An incentive fee is a fee charged by a fund manager based on the net capital
appreciation of an investor's interests (subject to a high-water mark and subject to adjustments for
withdrawals).
Management fee: is a periodic payment that is paid by an investment fund to the fund's investment
adviser for investment and portfolio management services. The fee covers investment advisory
services and administrative services and is calculated as a percentage of assets under management.
Addtional information regarding the fund's fees are outlined in the fund's Governing Documents.
Advisory Services Offered to Private Funds (Hedge Funds)
Specific information regarding our advisory fees as it relates to private funds can be found in the
applicable Private Placement Memorandum or offering documents. All fees and expenses assessed to
the private funds are fully disclosed to investors in the respective hedge fund's Private Placement
Memorandum or offering documents and in Investor Subscription Agreement.
The Hedge Fund's minimum subscription amount is $1,000,000 (these minimums are negotiable and
can be waived at the investment manager's discretion).
Investment advice we provide to private funds is under a separate agreement. We may recommend
investments in the hedge funds we manage for our client accounts. Therefore, as a client of our firm,
you are advised that we will receive compensation from private funds where we act as the adviser and
that a conflict of interest exists when investing your assets in the hedge funds we advise. We will only
make such investments where we believe it is consistent with our fiduciary duty and your investment
objectives. We will earn fees from the private funds for investments made in the private funds we
advise and may earn separate fees from you for asset allocation, monitoring and other services. The
fees that you pay to our firm for investment advisory services are separate and distinct from the fees
and expenses charged by private funds. For tax-qualified accounts with assets invested in the hedge
fund, the advisory fee on such assets will be offset by the amount of the management fee paid to us by
the hedge fund.
A.2 Separately Managed Account Client Fee Schedule
We charge similar fees for clients who engage our portfolio management services through separately
managed accounts. The difference in fees is an additional 0.5% annual fee on top of the base
Management Fee, the aggregate to be paid quarterly and in advance, charged for private fund clients.
The higher Management Fee is to cover the increased operational support required to manage the
client's specific account.
Fee Schedule For Separately Managed Account Clients
Account Size Management Fee Incentive Fee
(USD $) (% Per Annum) (% Per Annum)
Base Private Fund Fee +
$1,000,000 to $50,000,000 0%
0.5%
Accounts over $50,000,000 Negotiable Negotiable
The fee schedules above display the typical fees charged, however, at our sole discretion, we may
negotiate and reduce certain fees. As such, the exact fee you will pay may be different from those
reflected above. The fees you will pay will be clearly stated in the advisory agreement that you sign
with our firm. PacRim will deduct fees from your account on a quarterly basis.
Incentive Fee: An incentive fee is a fee charged by a fund manager based on the net capital
appreciation of an investor's interests (subject to a high-water mark and subject to adjustments for
withdrawals).
Management fee: is a periodic payment that is paid by an investment fund to the fund's investment
adviser for investment and portfolio management services. The fee covers investment advisory
services and administrative services and is calculated as a percentage of assets under management.
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