Item 5: Fees and Compensation
Sandell receives certain fees from each Fund it manages and is reimbursed for certain expenses as
more fully described in each Fund's offering materials or investment management agreement. Each
Fund pays Sandell an annual management fee (collectively the "Management Fees"), typically
paid quarterly either in advance or arrears depending on the Fund, equal to a percentage of the
total net asset value of the applicable Fund. Management Fees are prorated for partial quarters.
With respect to pooled investment vehicles, Management Fees range from 1.0% per annum (0.25%
quarterly) to 1.5% per annum (0.375% quarterly).
In addition, at the end of each calendar year, Sandell or an affiliate of Sandell may receive a
performance fee or allocation from each pooled investment vehicle (collectively the "Performance
Fees”) ranging from 10% to 20% (depending on the terms of the Fund or share class within a Fund)
of the increase in the net asset value of each Fund during the prior year, after taking into account
any loss carry forwards (also known as "High Water Marks").
Fees payable to Sandell by those clients who have invested through separately managed accounts
are determined, in Sandell’s discretion, on a client-by-client basis. Such fees or allocations may,
but are not required to be, substantially similar to those payable by a pooled investment vehicle to
Sandell or the general partner of such vehicle (as described above).
Any Management Fees and Performance Fees paid to Sandell are charged against the net asset
value of the applicable Fund. Any Performance Fees will be charged in accordance with Section
205 of the Investment Advisers Act of 1940, as amended (the "Advisers Act") and Rule 205-3
thereunder. In the event Management Fees are charged in advance, investors are credited with any
Management Fees paid in advance for any period in which they no longer have capital invested in
a Fund. This credit is made at the time an investor redeems (either in whole or in part) from a Fund.
Sandell may also allocate a portion of certain clients' capital to money market funds or exchange-
traded funds. In addition to the fees and expenses discussed herein, investors would indirectly
incur similar fees and expenses under these circumstances, as these funds in turn pay similar fees
to their investment managers and other service providers.
Each Fund bears all expenses incurred in connection with the organization of the Fund, the ongoing
offer and sale of ownership interests, including, but not limited to, printing costs, documentation
of performance and the admission of shareholders; all operating expenses of the Fund, such as
management fees, tax preparation fees, governmental fees and taxes, insurance (including liability
insurance and other coverages for the benefit of the Fund), administrator fees, Director fees and
expenses, communications with shareholders (including expenses relating to the preparation and
distribution of reports, financial statements and notices to shareholders), and ongoing legal,
accounting, auditing, bookkeeping and other professional and operations related fees and
expenses, all fees to protect or preserve any investment held by the Fund, including fees and
expenses in connection with the enforcement of the Fund’s rights and remedies with respect to any
asset; all direct and indirect investment and trading costs and expenses (including, without
limitation, brokerage commissions, margin interest, expenses related to short sales, prime
brokerage and custodial fees, clearing and settlement charges, bank service fees and any other
expenses reasonably related to the purchase, sale or transmittal of Fund assets), research and
research related expenses, including, without limitation, travel, payments to brokers in conjunction
with supporting ongoing research activities, news and quotation equipment and services (e.g.,
market data services, communications systems, and Bloomberg terminals), expenses related to
investment activism (including, but not limited to, costs associated with investment bankers, proxy
advisors, public relations and director nominees), risk management software and investment and
trading-related computer software, fees and expenses incurred in connection with governmental
and regulatory filings, including, without limitation, Form PF, Form 13F, Schedules 13D and 13G,
and other governmental or regulatory filings (regardless of whether such filings are required to be
made by Sandell), if and to the extent Sandell reasonably determines that such filings relate
primarily to Fund portfolio information or Fund related information or data, but excluding any
costs of registration as an investment adviser with the SEC (or as a commodity pool operator with
the United States Commodity Futures Trading Commission), all fees and other expenses incurred
by or on behalf of a Fund in connection with any amendment to or restructuring of the Fund’s
organizational documents, and subject to limits on indemnification set forth in Fund governing
documents, all fees and other expenses incurred in connection with the investigation, prosecution
or defense of any claims by or against a Fund, as well as all fees and other expenses incurred in
connection with any litigation involving a Fund and the amount of any judgments or settlements
paid in connection therewith.
In addition, certain Funds, as set forth in the applicable Fund’s offering documents, will bear the
pro rata share of the cost of Sandell and its affiliates’ internal financial, accounting, legal,
compliance, investor relations and administrative personnel (including, without limitation,
compensation and benefits, recruitment costs, costs for background checks, evaluation test services
and expenses in connection with the processing of personnel immigration matters), expenses
related to Sandell and its affiliates’ legal fees and expenses (including expenses associated with
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