Item 5 – Fees and Compensation
Discretionary Services
The Firm charges RAFFI a management fee equal to 1.50% per annum of the net asset value of
RAFFI. Generally, management fees are payable quarterly in arrears and calculated as of the last
day of each quarter or on the withdraw date. The Firm deducts the management fees from the
client’s account.
The Firm charges Radium2 a management fee equal to 0.75% of the total right to receive collected
from a Merchant per each Merchant Cash Advance agreement on a weekly basis.
The Firm believes that its fees, charged to the Funds, are competitive with those charged generally
by other investment advisers for comparable services. However, some investment advisers may
provide comparable services for lower or different fee structures. Performance fees, as discussed
in Item 6, are only charged in accordance with applicable rules and regulations, including Rule
205-3 under the Advisers Act and the Employee Retirement Income Security Act (“ERISA”) as
applicable.
Additional Fees and Expenses
The Advisory Agreement of RAFFI provides a description of any additional fees and expenses for
which a fund investor may be responsible for in addition to the management fees and any
performance‐based allocations or fees. Generally, each investor will be responsible for all costs
and expenses relating to the organization and operation of RAFFI on a pro rata basis, including,
without limitation, (i) administration fees and expenses, whether provided by a third party, the Firm
or an affiliate thereof; (ii) audit fees; (iii) custodial fees and other bank service fees; (iv) interest
and other expenses incurred in respect of borrowings if any; (v) due diligence-related expenses;
(vi) expenses associated with information, communication and periodic reporting; (vii) expenses
incurred in connection with legal and regulatory compliance with U.S. federal, state, local and non-
U.S. or other law or regulation; (viii) financial statements, tax returns and Schedules K‐1 (if
applicable); (ix) insurance premiums; (x) certain legal fees, including costs of litigation involving
the Funds and the amount of any judgments or settlements paid in connection herewith; and (xi)
certain platform fees, servicing fees and commissions as such fees relate to merchant cash
advances.
Determined in accordance with the Form ADV Instructions, Amended Form ADV, Part 1A, Schedule D,
Item 5.K.(2).
Pursuant to an MPA with Radium2, an Investor participating in a Merchant Cash Advance pays
Radium2 (i) a platform fee equal to the product of an Investor’s pro rata share and a percentage of
the funded Merchant Cash Advance, (ii) a servicing fee equal to the product of an Investor’s pro-
rata share and a percentage of the receivables collected by Radium2 and (iii) a commission to an
Independent Sales Organization (“ISO”) that sourced the Merchant Cash Advance equal to a
percentage of the funded Merchant Cash Advance. Radium2 collects all payments from Merchants
and allocates an Investor’s pro-rata share of such payments on a weekly basis. Investors may be
responsible their pro-rata share of legal fees and costs associated with certain collection efforts of
Radium2. Radium2 also receives an origination fee from the Merchants who receive the funded
Merchant Cash Advance equal to a percentage of such funded amount. The Firm has an
arrangement with Radium2 whereby certain expenses of the Firm, including payroll and expenses
incurred in connection with legal and regulatory compliance with U.S. federal, state, local and non-
U.S. or other law or regulation are initially paid for by Radium2, which is subsequently reimbursed
by the Firm.
Affiliates of the Firm are ISOs and source the Merchant Cash Advances. ISO’s are paid a
commission equal to a percentage of the funded amount of the Merchant Cash Advance from the
investors of RAFFI and Investors of Radium2.
The Firm pays its own general operating and overhead expenses associated with providing its
investment management services, including all expenses incurred by the Firm in providing for its
normal operating overhead, including, but not limited to, the cost of providing relevant support and
administrative services (e.g., employee compensation and benefits, rent, office equipment, utilities,
telephone, secretarial and bookkeeping services, etc.).
Non-Discretionary Services
Radium provides non-discretionary investment advisory consulting services as it relates to
acquisition, financing, merger and other corporate opportunities. Compensation is tailored to the
complexity of the of the services.