ITEM 5 – FEES & COMPENSATION
1. MANAGEMENT FEES
THE FUND
Quent Capital’s management fee, performance fee, and the timing of the payment of
those fees, are set forth in the Fund’s offering documents. As noted in the Fund’s
offering documents, Quent Capital may waive, reduce or rebate the management fee
with respect to the capital accounts of certain limited partners, including affiliates of the
general partner and/or Quent Capital and their respective members, managers, partners,
directors, officers and employees, and any “friends and family” members thereof;
provided, however, that no such waiver, reduction or rebate will adversely impact any
other limited partner or cause them to bear a higher portion of the management fee than
they would bear absent such waiver, reduction or rebate. The Fund’s offering documents
describe the fees and expenses that investors and the Fund may incur.
INDIVIDUAL CLIENTS
Fees are based on the value of the account on the last day of each calendar quarter and
are billed in arrears. Fees are deducted from the client’s account when possible. Quent
Capital’s annual investment management fee is negotiable and generally ranges from
0.50% to 1.00%. Quent Capital may reduce or waive its fee in its sole discretion. The
Firm is generally compensated for its investment management services on an annual fee
basis. Fees are based on the value of the account on the last day of each calendar
quarter and are billed in arrears. For purposes of calculating advisory fees, assets under
management include cash and cash equivalents held in the account.
Fee Differentials. Quent Capital shall generally price its advisory services based upon
various objective and subjective factors. As a result, our clients could pay diverse fees
based upon the type, amount and market value of their assets, the anticipated
complexity of the engagement, the anticipated level and scope of the overall investment
advisory services to be rendered, negotiations. Additional factors effecting pricing can
include related accounts, employee accounts, competition, and negotiations. As a result
of these factors, similarly situated clients could pay diverse fees, and the services to be
provided by Quent Capital to any particular client could be available from other advisers
at lower fees. All clients and prospective clients should be guided accordingly. ANY
QUESTIONS: Quent Capital’s Chief Compliance Officer, Jessica Murray, remains
available to address any questions regarding advisory fees.
Margin Accounts: Quent Capital does not recommend the use of margin for investment
purposes. A margin account is a brokerage account that allows investors to borrow
money to buy securities and/or for other non-investment borrowing purposes. The
broker/custodian charges the investor interest for the right to borrow money and uses
the securities as collateral. By using borrowed funds, the customer is employing
leverage that will magnify both account gains and losses. Should a client determine to
use margin, Quent Capital will include the entire market value of the margined assets
when computing its advisory fee. Accordingly, Quent Capital’s fee shall be based upon a
higher margined account value, resulting in Quent Capital earning a correspondingly
higher advisory fee. As a result, the potential of conflict of interest arises since Quent
Capital may have an economic disincentive to recommend that the client terminate the
use of margin. Please Note: The use of margin can cause significant adverse financial
consequences in the event of a market correction.
Custodian Charges-Additional Fees. As discussed in Item 12 below, when requested
to recommend a broker-dealer/custodian for client accounts, Quent Capital generally
recommends that Fidelity Brokerage Services, LLC and National Financial Services, LLC
(“Fidelity”) or Pershing, LLC (“Pershing”) serve as the broker-dealer/custodian for client
investment management assets. Broker-dealers such as Fidelity and Pershing charge
brokerage commissions, transaction, and/or other type fees for effecting certain types of
securities transactions (i.e., including transaction fees for certain mutual funds, and
mark-ups and mark-downs charged for fixed income transactions, etc.). The types of
securities for which transaction fees, commissions, and/or other type fees (as well as the
amount of those fees) shall differ depending upon the broker-dealer/custodian (while
certain custodians, such as Fidelity and Pershing, do not currently charge fees on
individual equity transactions [including ETFs], others do). (Please Note: there can be no
assurance that either Pershing or Fidelity will not change their transaction fee pricing in
the future). These fees/charges are in addition to Quent Capital’s investment advisory
fee at Item 5 below. Quent Capital does not receive any portion of these fees/charges.
Fee Billing: Clients may elect to have Quent Capital’s advisory fees deducted from their
custodial account. Both Quent Capital’s Agreement and the custodial/clearing
agreement may authorize the custodian to debit the account for the amount of Quent
Capital’s investment advisory fee and to directly remit that advisory fee to Quent Capital
in compliance with regulatory procedures. In the limited event that Quent Capital bills the
client directly, payment is due upon receipt of Quent Capital’s invoice. Quent Capital
shall deduct fees and/or bill clients quarterly in arrears, based upon the market value of
the assets on the last business day of the previous quarter.
Fee Waiver: Quent Capital may recommend that a client invest all or a significant
portion of a client’s assets in the Fund. In an effort to mitigate this conflict of interest,
Quent Capital will waive its management fee charged to the client, and Quent Capital will
only stand to receive its management fee from client’s assets invested in the Fund. This
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