Item 5 – Fees and Compensation
The fees applicable to the Clients are set forth in detail in their investment management agreements. A brief
summary of such fees is provided below.
The Feeder Funds shall pay Spruce Street management fees in accordance with the terms set forth in the
relevant Partnership Agreement (and described in the Memorandum). For the avoidance of doubt, the
Management Fee is expected to generally be paid at the Feeder Fund level, but may be paid at the level of the
Master Fund (without duplication) in the sole discretion of Spruce Street. The management fee is prorated for
any period that is less than a full month. Spruce Street has the authority to waive, reduce or calculate differently
the management fee with respect to any investor in its sole discretion, including investors that are partners,
affiliates or employees of Spruce Street or the fund general partner, members of the immediate family of such
persons and trusts or other entities established by them or for their benefit and certain other persons in the
discretion of Spruce Street. The applicable management fee is generally deducted from each Investor account
by the funds’ administrator upon Spruce Street’s proper instructions.
Expenses
Each Feeder Fund will bear its own expenses and its pro rata share of the Master Fund's expenses, including,
the following: (i) the Management Fee; (ii) expenses related to the research, due diligence, financing, monitoring
and disposition of actual and prospective investments of the Master Fund; (iii) operational expenses; (iv) fees
and expenses of third-party professionals; (v) the costs of any litigation or investigation (or other similar event)
involving activities of a Feeder Fund or the Master Fund; (vi) taxes and third-party audit and tax preparation
expenses; (vii) insurance expenses; (viii) costs of preparing and distributing reports and notices; (ix) expenses
incurred in connection with negotiating, amending, modifying, revising, restating and complying with
provisions of any Side Letter Agreement and other similar arrangements with investors (including vendors and
products related thereto), and expenses incurred in connection with any Transfers of Interests or a Limited
Partner's admission or withdrawal, unless otherwise charged to or borne by the applicable transferee or Limited
Partner; (x) fees and expenses related to compliance with the rules of any self-regulatory organization or
applicable law in connection with the activities of a Feeder Fund or the Master Fund, including, any
governmental, regulatory, licensing, filing or registration fees or taxes and fees and expense of any third-party
compliance consultants; (xi) expenses incurred in connection with the offering and sale of the Interests and
other similar expenses related to a Feeder Fund; (xii) expenses incurred in connection with any amendments,
modifications, revisions or restatements to the constituent documents of a Feeder Fund or the Master Fund;
(xiii) expenses incurred in connection with meetings with investors and prospective investors; (xiv)
extraordinary expenses, including, indemnification expenses and fees and expenses incurred in connection with
any tax audit by any tax authority, including, any related administrative settlement and judicial review; (xv) fees
and expenses incurred in connection with the organization, reorganization, dissolution, winding-up or
termination of a Feeder Fund or the Master Fund; and (xvi) other similar expenses of a Feeder Fund and the
Master Fund. Each Feeder Fund will also indirectly bear any similar expenses of any trading subsidiary or special
purpose vehicle of the Master Fund.
For the avoidance of doubt, "similar expenses" refers to any expenses that are similar in type and nature to the
expenses described above, and is intended, given the dynamic ongoing nature of the business of the Feeder
Funds, to cover any expenses determined by the General Partner, in its sole discretion, to be primarily related
to the categories listed above but not specifically enumerated. Accordingly, any description of the expenses that
a Feeder Fund may bear (directly or indirectly) is not exhaustive.
Generally, all expenses borne by a Feeder Fund, other than (i) the Management Fee, (ii) investment and
investment-related expenses relating specifically to a Private Investment (addressed in the next paragraph), and
(iii) any other expenses that the General Partner determines should be allocated to a particular Partner or
Partners. To the extent that expenses to be borne by a Feeder Fund or the Master Fund are paid by the General
Partner, Spruce Street or their affiliates, the relevant Feeder Fund or the Master Fund, as applicable, will
reimburse such party for such expenses.
Investment and investment-related expenses relating specifically to a Private Investment Account, whether or
not the corresponding Private Investment is consummated, will generally be charged, to the extent practical,
against the Capital Accounts indirectly participating in such Private Investment in proportion to their respective
indirect participating percentage interests therein. It is not always practical or reasonable to allocate investment
and investment-related expenses to a particular Private Investment, such as (i) general research expenses not
related to a specific Private Investment that benefit Private Investments and/or other investments generally,
(ii) research expenses that are subscription-based, aggregated together or otherwise paid for as a single bill or
lump sum payment and (iii) other similar expenses that are difficult to divide and allocate to a single Private
Investment. As a result, such expenses may not be charged solely to the Capital Accounts indirectly participating
in such Private Investment in the manner set forth in the first sentence of this paragraph and instead may be
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