Item 5. Fees and Compensation
A. Advisory Fees and Compensation.
Any fees or compensation received by Par-Four from the Account is separately negotiated and may include
both a management fee (which may be a fixed amount agreed upon with the Account) and performance-
based compensation.
The CLOs pay Par-Four as follows:
Tralee CLO II, LTD. (“Tralee II”)
o Tralee II was priced on March 28, 2013, with a stated maturity date of April 2025.
o Par-Four receives an account management fee equal to 0.40% per annum based on the
assets under management for Tralee II, which is payable quarterly in arrears. Of this,
0.20% of the account management fee is a senior management fee and 0.20% is a
subordinated management fee. Tralee II pays the senior management fee and
subordinated management fee from cashflow generated by Tralee II’s investments. The
senior management fee is payable from the cashflow on a priority basis (prior to payment
of debt service on the notes issued by Tralee II) and the subordinated management fee is
payable on a subordinate basis (after payment of debt service on the notes issued Tralee
II).
o Par-Four may also receive an incentive management fee equal to 20% of the cashflow
generated by Tralee II's investments in excess of a 14% hurdle (i.e., IRR threshold to equity
investors).
o Tralee II was reset in August 2017, with a stated maturity date of July 2029.
Tralee CLO IV, LTD. (“Tralee IV”)
o Tralee IV was priced on December 21, 2017, with a stated maturity date of 2030.
o Par-Four receives an account management fee equal to 0.35% per annum based on the
assets under management for Tralee IV, which is payable quarterly in arrears. Of this,
0.15% of the account management fee is a senior management fee and 0.20% is a
subordinated management fee. Tralee IV pays the senior management fee and
subordinated management fee from cashflow generated by Tralee IV’s investments. The
senior management fee is payable from the cashflow on a priority basis (prior to payment
of debt service on the notes issued by Tralee IV) and the subordinated management fee is
payable on a subordinate basis (after payment of debt service on the notes issued Tralee
IV).
o Par-Four may also receive an incentive management fee equal to 20% of the cashflow
generated by Tralee IV's investments in excess of a 12% hurdle (i.e., IRR threshold to
equity investors).
Tralee CLO V, LTD. (“Tralee V”)
o Tralee V was priced on October 1, 2018, with a stated maturity date of 2028.
o Par-Four receives an account management fee equal to 0.31% per annum based on the
assets under management for Tralee V, which is payable quarterly in arrears. Of this,
0.10% of the account management fee is a senior management fee, 0.18% is a
subordinated management fee and 0.03% is a conditional subordinated management fee.
Tralee V pays the senior management fee, the subordinated management fee, and the
conditional subordinated management fee from cashflow generated by Tralee V’s
investments. The senior management fee is payable from the cashflow on a priority basis
(prior to payment of debt service on the notes issued by Tralee V), the subordinated
management fee is payable on a subordinate basis (after payment of debt service on the
notes issued Tralee V) and the conditional subordinated management fee is paid subject
to satisfying a cash hurdle condition.
o Par-Four may also receive an incentive management fee equal to 20% of the cashflow
generated by Tralee V's investments in excess of a 12% hurdle (i.e., IRR threshold to equity
investors).
o Tralee V was reset in October 2021, with a stated maturity date of October 2034.
Tralee CLO VI, LTD. (“Tralee VI”)
o Tralee VI was priced on September 3, 2019, with a stated maturity date of 2032.
o Par-Four receives an account management fee equal to 0.36% per annum based on the
assets under management for Tralee VI, which is payable quarterly in arrears. Of this,
0.18% of the account management fee is a senior management fee and 0.18% is a
subordinated management fee. Tralee VI pays the senior management fee and the
subordinated management fee from cashflow generated by Tralee VI’s investments. The
senior management fee is payable from the cashflow on a priority basis (prior to payment
of debt service on the notes issued by Tralee VI) and the subordinated management fee is
payable on a subordinate basis (after payment of debt service on the notes issued Tralee
VI).
o Par-Four may also receive an incentive management fee equal to 20% of the cashflow
generated by Tralee VI's investments in excess of a 12% hurdle (i.e., IRR threshold to
equity investors).
o Tralee VI was refinanced in October 2021.
Tralee CLO VII, LTD. (“Tralee VII”)
o Tralee VII was priced on February 26, 2021, with a stated maturity date of 2034.
o Par-Four receives an account management fee equal to 0.305% per annum based on the
assets under management for Tralee VII, which is payable quarterly in arrears. Of this,
0.1525% of the account management fee is a senior management fee and 0.1525% is a
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