Item 5 Fees and Compensation
The fees and expenses applicable to each Client are set forth in detail in each of the respective
Governing Documents or other agreements. A brief summary of those fees and expenses follows.
Compensation
Compensation received by the Adviser from the Funds and SMAs is generally comprised of fees
based on a percentage of assets under management (the “Management Fee”) and performance-
based amounts (the “Performance Fee”).
The Adviser receives a Management Fee from Clients based on the net assets of the Client’s
account as of the first day of each calendar quarter. The Management Fee is generally paid in
advance at the beginning of each quarter, and a pro rata portion of any Management Fee will be
repaid, based on the actual number of months remaining in such quarter, by the Adviser if any
investor in a Fund is permitted to redeem or an SMA client terminates their account prior to the
end of a quarter. The Management Fee generally ranges from 0.5% to 2% (per annum) of the
aggregate fair market value of the relevant net assets as specified by the respective Fund’s
Governing Documents or agreements governing SMA relationships.
The general partner of the Adviser, Snow Lake Management LLC (the “General Partner”), receives
an annual Performance Fee from Clients equal to a percentage of the net profit of the Clients
account during such fiscal year. The Performance Fee will generally be 10% to 20% of net profits.
The exact method of calculation and other terms of the Performance Fee are more fully detailed in
each Fund’s Governing Documents or agreements governing SMA relationships.
The Adviser or the General Partner, in their sole discretion, may waive or reduce the Management
Fee and/or the Performance Fee, for certain investors, including large or strategic investors. Fees
will generally also be waived or reduced for principals, employees, or affiliates of the Adviser (or
a related person of the Adviser), and relatives of such persons.
Expenses
Each Fund bears its own expenses and a pro rata share of its respective master fund's expenses
including, investment-related expenses (e.g., brokerage commissions, research-related expenses
(including, news and quotation equipment and services, expenses associated with attending
industry conferences and seminars, research and independent third parties' valuation of
investments, clearing and settlement charges, custodial fees, interest expenses, expenses relating
to consultants, attorneys, brokers or other professionals or advisors who provide research, advice
or due diligence services with regard to investments, appraisal fees and expenses and investment
banking expenses)), legal expenses, accounting, audit, tax preparation and other tax-related
expenses (including preparation costs of financial statements, tax returns, reports to the
shareholders), expenses relating to registration for the Fund, master fund, the Adviser and their
affiliates, compliance expenses, (including the expense of preparing and filing reports required by
regulators), expenses relating to obtaining liability insurance for directors and officers and the
Fund, master fund, the Adviser and their affiliates and their respective partners and members,
entity-level taxes, expenses of meetings of the board of directors, organizational expenses, printing
and mailing costs, expenses relating to the offer and sale of Shares, administration fees and related
costs (including fees to the administrator, fees and expenses of the board of directors, (including
director registration fees), extraordinary expenses and other expenses associated with the operation
of the Fund, as determined by the board of directors in its sole discretion. The expenses allocable
to SMA Clients are generally specified in the respective agreement with such SMA Client and may
include certain of the aforementioned expenses. Additionally, brokerage and research expenses of
Clients may be paid through the use of “soft dollars”. Please refer to Item 12 Brokerage Practices
of this Brochure for a discussion of the Adviser’s brokerage practices.
The Adviser has adopted procedures to govern the allocation of expenses that are shared by more
than one Client. If any expenses are incurred jointly by more than one Client managed by the
Adviser or its affiliates, such expenses are generally allocated among the Clients in proportion to
the size of the investment made by each in the activity or entity to which the expense relates, or in
such other manner as the Adviser considers to be fair and reasonable.
Neither the Adviser nor any of its employees accepts compensation for the sale of securities or
other investment products.