Item 5. Fees and Compensation
The Adviser is paid an asset-based fee equal to 1.5% per annum of the net assets of the Funds
(calculated in accordance with the Funds’ governing documents). The Master Fund pays the Adviser a
quarterly asset based charge and payment (the “Asset Based Charge and Payment”) in arrears based on
the value of the Funds as of the last day of each quarter. The Asset Based Charge and Payment is
prorated for any period that is less than a full quarter.
The Adviser (or an affiliate of the Adviser) is entitled to be paid annual performance-based compensation,
which is compensation that is based on a share of net capital appreciation of the assets of the Funds.
This performance-based compensation ranges from 15% to 20% and is subject to a loss carryforward.
With respect to the Funds, the performance-based compensation is allocated at the Master Fund level.
A Fund may waive, reduce or enter into alternative fee arrangements with investors in a Fund who are
members, employees or affiliates of the Adviser, River Birch Capital GP, LLC, an affiliate of the Adviser
(the “General Partner”), friends and relatives of such persons and for certain large or strategic investors.
Members and employees of the Adviser that are invested in funds managed by the Adviser are not
subject to the asset-based charge and payment or performance-based compensation.
With respect to a Fund, the Asset Based Charge and Payment is paid pursuant to instructions to the
Master Fund’s custodian to deduct it from the Master Fund’s account and the performance based
compensation paid to an affiliate of the Adviser is structured as a re-allocation of profits.
Client accounts managed by the Adviser other than the Funds are subject to the fee arrangements that
are set forth in their respective governing documents. To the extent that the Adviser serves as
investment adviser to such account for any period that is less than the applicable fee period, the amount
of any fee due will be prorated. Additionally, the Adviser sends an invoice with respect to any asset-
based fee and performance-based compensation due with respect to such client, based on information
provided by the client or its third-party administrator.
In addition to paying the asset-based fee and performance-based compensation, certain client accounts
are also subject to other expenses such as legal, accounting (including accounting software and third-
party accounting services), audit, fees and expenses of the administrator, and other professional fees and
expenses, organizational expenses, research expenses (including subscription fees for Bloomberg and
research related travel), risk management expenses (including risk management software), portfolio
management software, investment expenses such as commissions, custodial fees, bank service fees and
other expenses related to the purchase, sale or transmittal of client assets. The applicable expenses for
a client are set forth in the client’s governing documents, as applicable, and all of the above listed
expenses may not be paid by all of the Adviser’s clients.
Client assets may be invested in ETFs, and in these cases, the client will bear its pro rata share of the
investment management fee and other fees of such fund, which are in addition to the management fee or
performance based compensation paid or allocated to the Adviser (or an affiliate of the Adviser). The
Adviser manages a master-feeder structure and accordingly, each Feeder Fund also bears its pro rata
share of the expenses of the Master Fund. As noted above, clients also incur brokerage and other
transaction costs. Please refer to Item 12 of this Brochure for a discussion of the Adviser’s brokerage
practices.