Item 5. Fees and Compensation
The Firm’s fees and compensation are described in each client’s Governing Documents.
The Funds
The Funds pay the Firm a monthly management fee. The management fee generally ranges from 1%-
1.50%. Management fees are prorated in the case of a partial calendar month. The Firm deducts such
management fees from each Fund monthly in arrears. The Firm may waive or modify the management
fee payable with respect to any investor and has done so for the Principal and the Firm’s employees.
The Rangeley GP will be entitled to receive performance-based incentive allocations from the Funds, as
further described in Item 6 – Performance-Based Fees and Side-By-Side Management.
The Sub-Advised Fund
The Sub-Advised Fund pays the Firm or its related person a management fees of 0.25% (approximately
1.0% per year) of the value of each investor’s capital account quarterly in arrears. Management fees would
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Form ADV Part 2A
be prorated if the advisory agreement relating to the Sub-Advised Fund were terminated. The Sub-Advised
Fund’s management fees are invoiced to, and paid by, the Sub-Advised Fund. The Firm or its related
persons are also entitled to receive performance-based fees from the Sub-Advised Funds, as further
described in Item 6 – Performance-Based Fees and Side-By-Side Management.
SMAs
Each SMA pays the Firm a management fee as set forth in its investment advisory agreement.
Management fees for SMAs are generally based on a percentage of assets under management and are
negotiated on a case-by-case basis. SMA management fees are generally billed monthly and are debited
to the SMA client account. The Firm may also negotiate performance-based fee arrangements with
qualified SMA clients, as further described in Item 6 – Performance-Based Fees and Side-By-Side
Management.
Expenses Generally
The Funds
Each Fund bears its own organizational and operating expenses, including, without limitation: expenses
related to the Fund's assets (e.g., brokerage commissions, clearing and settlement charges, custodial fees,
interest expense, consulting and other professional fees relating to Fund investments and/or Interim
investments (including finder’s fees, success fees and compensation structured as a percentage of
appreciation of one or more assets), investment-related reasonable travel and lodging expenses (including
any related expenses of a sub-adviser) and research-related expenses, including, without limitation, news
and quotation equipment and services, third-party asset valuation expenses, third-party legal expenses
(e.g., outside law firm expenses), third-party accounting, audit and tax preparation expenses,
organizational expenses, expenses relating to the offer and sale of Interests, fees to the Fund’s
administrator, expenses relating to the liability insurance and/or errors and omissions insurance for the
officers of the Firm and its affiliate, extraordinary expenses and other similar expenses related to the
purchase, sale or transmittal of the Fund’s assets. The Fund will pay for all other actual out-of-pocket
expenses incurred in connection with the organization of the Fund and the offering of the interests,
including third-party legal and accounting fees, printing costs, costs of registrations or other regulatory
filings of the Fund, negotiations with prospective investors, including costs of entering into side letters or
other agreements, travel and other expenses.
The Sub-Advised Fund
The Sub-Advised Fund bears all costs of its operation, including all trading costs and expenses (for
example, brokerage commissions, expenses related to short sales, and clearing and settlement charges),
and all ongoing legal and accounting fees and expenses, all costs and expenses associated with negotiating
and entering into contracts and arrangements in the ordinary course of the Sub-Advised Fund’s business,
all legal, accounting, bookkeeping, professional, expert and consulting fees and expenses (including the
fees and expenses of counsel for the General Partner) arising in connection with the Fund’s business, all
Sub-Advised Fund’s selling costs and expenses, costs of communication with Limited Partners, costs
associated with registering the Sub-Advised Fund’s restricted securities, all fees and expenses charged
with respect to investments in any other investment vehicles, all Sub-Advised Fund trading costs and
expenses (such as, for example, expenses related to short sales, brokerage commissions, clearing and
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Form ADV Part 2A
settlement charges, option premiums, and custodial and service fees) and all interest on Sub-Advised Fund
borrowings (on margin or otherwise).
SMAs
SMA clients are generally responsible for all costs and expenses associated with their accounts, including,
without limitation, brokerage commissions, clearing and settlement charges, custodial fees, and other
transaction-related expenses. Such expenses are separate from, and in addition to, the management fees
paid to the Firm. The specific expenses borne by each SMA client are set forth in the applicable investment
advisory agreement.
To the extent that a client benefits from an item that is chargeable to other clients, but is not permitted
to incur such expense under its Governing Documents, the Firm will bear such client’s pro rata portion of
the expense.
External research paid for by the Funds is occasionally considered by the Firm’s portfolio managers when
publishing newsletters as part of their personal endeavors (as further discussed below). To account for
the usage of such external research by its portfolio managers, the Firm will itself bear what it considers to
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