Item 5 – Fees and Compensation
SEMINAL INVESTMENTS’ fee for its services is generally based on a percentage of assets under
management. We retain discretion over the fees we charge, subject to applicable law, and our
fees for a particular investment strategy or mandate may differ based on investment vehicle and
across affiliated entities. In some cases, we maintain a basic fee schedule based on the
investment mandate, client type or advisory arrangement. However, except with respect to
certain Funds (and their investors), fees are generally negotiable on an individual basis in light of
special circumstances of clients, including but not limited to, investment mandate, regulatory
requirements, specific servicing or reporting requirements, asset levels, customization of the
investment process, or other factors, in our sole discretion. In certain circumstances we may
continue to offer to a client the lowest available fee for a particular investment mandate and for
comparable services. Similarly, in appropriate circumstances, we can waive or reduce all or a
portion of the fees we charge to a particular client or investor in our sole and absolute
discretion. For example, we can waive or reduce fees for accounts held by or on behalf of
SEMINAL INVESTMENTS and its employees, principals, shareholders or affiliates. Also, SEMINAL
INVESTMENTS or an affiliate could, in its sole discretion, agree to bear certain operating
expenses of a Fund that exceed a cap agreed with the Fund Investors generally or applicable to
the Fund as a whole.
SEMINAL INVESTMENTS may serve as investment manager to Funds, including limited
partnerships and special purpose vehicles whose interests are privately placed. The amount of
the investment management fee that SEMINAL INVESTMENTS receives or is entitled to receive,
typically calculated and payable quarterly in arrears, will vary by Fund, all as fully set forth in the
private placement memoranda or other offering document for the vehicle.
An affiliate of Seminal Investments typically will serve as the general partner of each of these
vehicles. The general partner shares in the profits and losses of the vehicle and will typically be
entitled to a special allocation equal to a percentage of net profits of the accounts in the vehicle
under certain circumstances, also as fully set forth in the private placement memoranda or other
Fund Document.
SEMINAL INVESTMENTS may also serve as an investment adviser to Separately Managed
Accounts and be compensated for providing research or other investment advisory services
(such as non-discretionary advice) to clients for fees to be negotiated in each instance. Fees for
separate account management are set forth in the advisory agreement or account
documentation for each respective client.
Calculation and Payment of Fees
SEMINAL INVESTMENTS’ fees are calculated and paid in accordance with the terms of the
relevant investment advisory agreement and/or other Fund Documents (e.g., a Fund’s private
placement memorandum) applicable to the account. While particular fee arrangements may
vary, as a general matter:
1. Management fees are calculated and paid quarterly, in arrears, with the amount of
such fee being the agreed upon percentage of the aggregate market value of all assets
under management within the account(s) (including allocations to cash) on the valuation
day; and
2. Incentive fees and allocations are calculated and paid annually, with the amount of
compensation being an agreed upon percentage of the increase in the aggregate market
value of the account during the measurement period.
Payment schedules and mechanisms for accounts are negotiated, and clients are invoiced in
accordance with an account’s investment management agreement. Clients may request that fees
owed to SEMINAL INVESTMENTS be deducted directly from the client’s custodial account. In
such cases, SEMINAL INVESTMENTS will take steps to assure itself that the qualified custodian
sends periodic account statements directly to the client, no less frequently than quarterly,
showing the amount of funds and each security and all transactions, including fees paid to
SEMINAL INVESTMENTS, unless alternative arrangements have been made to assure compliance
with Rule 206(4)-2 under the Advisers Act (the “Custody Rule”). Refer to Item 15 – Custody of
this brochure for more information.
SEMINAL INVESTMENTS’ fees are calculated based on the market value and/or performance of
the assets in the accounts it manages. As a result, to the extent that SEMINAL INVESTMENTS
values a security higher than its current market value (or where such market values are
unreliable), SEMINAL INVESTMENTS may benefit by receiving a management fee or incentive
allocation that is increased by the impact, if any, of such valuation discrepancy. Accounts may, at
any time or from time to time, invest in assets that are illiquid, thinly traded or otherwise difficult
to value, depending on the investment mandate. SEMINAL INVESTMENTS mitigates any conflicts
and the potential for material pricing discrepancies, ensuring assets are valued in good faith and
as accurately as reasonably practicable, including the use the use of an unrelated third-party
valuation service in accordance with the SEMINAL INVESTMENTS’ valuation policy (the
“Valuation Policy”). Where securities are not priced by the third-party service provider, SEMINAL
INVESTMENTS defers to its Valuation Committee to value the securities. The Valuation Policy,
used by the Valuation Committee and available to all SEMINAL INVESTMENTS clients, outlines a
detailed valuation methodology and process which SEMINAL INVESTMENTS believes results in
balanced and fair values of the securities. Valuation practices may differ for certain clients based
on contractual agreements and applicable law.
Investment management agreements between SEMINAL INVESTMENTS and its clients remain in
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