Common use of Compensation and Expenses; Covenant Clause in Contracts

Compensation and Expenses; Covenant. (a) In return for the Services, the Administrator shall earn equity-based management fees and expense reimbursements in the form of SPC Preferred shares of each Segregated Portfolio that owns title to Artwork at a rate of 1.5% of the total SPC shares of such Segregated Portfolio outstanding, after giving effect to such issuance, per annum, commencing on the earliest closing date on which the applicable Series Tranche is fully subscribed and at least 95% of the subscription proceeds for such offering have been received by the applicable Series. For the avoidance of doubt, no fees or expense reimbursements in the form of SPC Preferred shares shall be earned for any period prior to the final closing of a Series Tranche (or the date on which at least 95% of the Class A shares offered have been issued). There is no overall limit to the number of SPC Preferred shares that may be issued to pay these fees and expenses. The SPC Preferred shares will be exchangeable for Class A shares of the Series of which the Segregated Portfolio holds the Artwork at an exchange rate of 1 for 1 such that the number of Class A shares issuable upon exchange shall always equal the number of Class A shares that would have been received by the Administrator had this agreement been drafted such that the Administrator was entitled to receive Class A shares of the applicable Series at a rate of 1.5% of the total Class A shares outstanding in lieu of SPC Preferred shares of the applicable Segregated Portfolio. The SPC Preferred shares earned pursuant to this Agreement for any Series shall have the terms, rights and privileges described in the Offering materials for the initial Series Tranche conducted by such Series. The Administrator may, in its sole discretion, reduce management fees, in whole or in part.

Compensation and Expenses; Covenant. (a) In return for the Services, the Administrator shall earn equity-based management fees and expense reimbursements in the form of SPC Preferred shares of each Segregated Portfolio that owns title to Artwork at a rate of 1.5% of the total SPC shares of such Segregated Portfolio outstanding, after giving effect to such issuance, per annum, commencing on the earliest closing date on which the applicable Series Tranche Offering is fully subscribed and at least 95% of the subscription proceeds for such offering have been received by the applicable Series. For the avoidance of doubt, no fees or expense reimbursements in the form of SPC Preferred shares shall be earned for any period prior to the final closing of a Series Tranche Offering (or the date on which at least 95% of the Class A shares offered have been issued). There is no overall limit to the number of SPC Preferred shares that may be issued to pay these fees and expenses. The SPC Preferred shares will be exchangeable for Class A shares of the Series of which the Segregated Portfolio holds the Artwork at an exchange rate of 1 for 1 such that the number of Class A shares issuable upon exchange shall always equal the number of Class A shares that would have been received by the Administrator had this agreement been drafted such that the Administrator was entitled to receive Class A shares of the applicable Series at a rate of 1.5% of the total Class A shares outstanding in lieu of SPC Preferred shares of the applicable Segregated Portfolio1. The SPC Preferred shares earned pursuant to this Agreement for any Series shall have the terms, rights and privileges described in the Offering materials for the initial Series Tranche Offering conducted by such Series. The Administrator may, in its sole discretion, reduce management fees, in whole or in part.