Amended and Restated
Money Manager Agreement
This agreement (the Agreement) is between TIFF
Investment Program (TIP), a Delaware statutory trust, for
its TIFF Multi-Asset Fund (the Fund), AJO, LP (the
Manager), a registered investment adviser under the
Investment Advisers Act of 1940, as amended (the
Advisers Act) and is effective as of September 23, 2015
(the Effective Date). This agreement replaces the
agreement dated June 27, 2012, as amended December
16, 2014.
Recitals
TIP is an open-end management investment
company registered under the Investment Company Act of
1940, as amended (the 1940 Act); and
TIP wishes to retain the Manager to render advisory
services to the Fund, and the Manager is willing to render
those services.
Now, therefore, the parties agree as follows:
1. Managed Assets
The Manager will provide investment management
services with respect to assets placed with the Manager on
behalf of the Fund from time to time. Such assets may be
placed in one or more separately managed accounts (each,
a Managed Account), and each Managed Account may be
changed by investment, reinvestment, additions,
disbursements of expenses, and withdrawals. All assets
placed in such Managed Accounts are referred to in this
Agreement as the Managed Assets. The Fund may make
additions to or withdraw all or any portion of the Managed
Assets from this management arrangement at any time.
2. Appointment and Powers of Manager; Investment
Approach
(a) Appointment. TIP, acting on behalf of the Fund,
hereby appoints the Manager to manage the Managed
Assets for the period and on the terms set forth in this
Agreement. The Manager hereby accepts this
appointment and agrees to render the services herein
described in accordance with the requirements described
in Section 3(a).
(b) Powers. Subject to the supervision of the
Board of Trustees of TIP and subject to the supervision of
TIFF Advisory Services, Inc. (TAS) as Investment Adviser to
the Fund, the Manager shall direct investment of the
Managed Assets in accordance with the Managers
Investment Approach and the requirements of Section
3(a). TIP, acting on behalf of the Fund, grants the Manager
authority to:
(i) Acquire (by purchase, exchange,
subscription, or otherwise), hold and
dispose of (by sale, exchange or
otherwise) investments and other
securities;
(ii) Determine what portion of the
Managed Assets will be held
uninvested; and
(iii) Enter into such agreements and
make such representations
(including representations regarding
the purchase of securities for
investment) as may be necessary or
proper in connection with the
performance by the Manager of its
duties hereunder.
(c) Power of Attorney. To enable the
Manager to exercise fully the discretion granted
hereunder, TIP appoints the Manager as its attorney-in-
fact to invest, sell, and reinvest the Managed Assets as
fully as TIP itself could do. The Manager hereby accepts
this appointment.
(d) Voting. The Manager shall be
authorized to vote on behalf of the Fund any proxies
relating to the Managed Assets, provided, however, that
the Manager shall comply with any instructions received
from the Fund as to the voting of securities and handling
of proxies.
(e) Independent Contractor. Except as
expressly authorized herein, the Manager shall for all
purposes be deemed to be an independent contractor and
shall have no authority to act for or to represent TIP, the
Fund, or TAS in any way, or otherwise to be an agent of
any of them.
(f) Reporting. The Manager shall furnish to TIP
upon reasonable request such information that TIP may
reasonably require to complete documents, reports, or
regulatory filings.
3. Requirements; Duties
(a) Requirements. In performing
services for the Fund and otherwise discharging its
obligations under this Agreement, the Manager shall act in
conformity with the following requirements (the
Requirements):
(i) TIPs Registration Statement under
the 1940 Act and the Securities Act
of 1933, as amended, on Form N-1A,
as filed with the Securities and
Exchange Commission relating to
the Fund and the shares of common
stock in the Fund, as such
Registration Statement may be
amended from time to time (the
Registration Statement);
(ii) The 1940 Act, the Internal Revenue
Code of 1986, as amended, and all
other applicable federal and state
laws and regulations which apply to
the Manager in conjunction with
performing services for the Fund, if
any;
(iii) Written instructions and directions
of the Board of Trustees of TIP;
(iv) Written instructions and directions
of TAS; and
(v) The Managers Investment
Guidelines, which may be amended
from time to time through mutual
agreement by the Manager and TAS.
The Manager only shall be responsible for
complying with those requirements specified in this
Paragraph 3 to the extent it has received from TIP or TAS
written instructions or directions or the document that
contains or states such requirements, other than the 1940
Act or the Internal Revenue Code of 1986.
(b) Responsibility with Respect to Actions of
Others. TIP places the investment portfolio of each of its
funds, including the Fund, with one or more investment
managers. To the extent the applicability of, or conformity
with, the Requirements depends upon investments made
by, or activity of, managers other than the Manager, the
Manager agrees to comply with such Requirements: (i) to
the extent that such compliance is within the Managers
Investment Guidelines; and (ii) to the extent that the
Manager is provided with information sufficient to
ascertain the applicability of such Requirements. If it
appears to the Fund at any time that the Fund may not be
in compliance with any Requirement and the Fund so
notifies the Manager, the Manager shall promptly take
such actions not inconsistent with applicable law as the
Fund or TAS may reasonably specify to effect compliance.
(c) Responsibility with Respect to Performance
of Duties. Except as permitted by Paragraph 7 of this
Agreement, in performing its duties under this Agreement,
the Manager will act solely in the interests of the Fund and
shall use reasonable care and its best judgment in matters
relating to the Fund. The Manager will not deal with the
Managed Assets in its own interest or for its own account.
(d) Valuation. The Manager shall not be
responsible for calculating net asset value of the Funds
portfolio or making final decisions on the value of portfolio
securities used to calculate such net asset value, but must
review regularly the pricing of the Managed Assets as
made available by or on behalf of the Fund. The Manager
agrees to notify the Fund promptly if the Manager
reasonably believes that the value of any portfolio security
comprising the Managed Assets may not reflect fair value.
The Manager agrees to provide upon request any pricing
information of which the Manager is aware to the Fund, to
TAS, or to the Funds administrator to assist in the
determination of the fair value of any portfolio security for
which market quotations are not readily available or as
otherwise required in accordance with the 1940 Act or the
Funds valuation procedures for the purpose of calculating
the Funds net asset value in accordance with procedures
and methods established by the board of trustees of TIP.
4. Recordkeeping and Reporting
(a) Records. The Manager shall maintain proper
and complete records relating to the furnishing of
investment management services under this Agreement,
including records with respect to the securities
transactions for the Managed Assets required by Rule 31a-
1 under the 1940 Act. All records maintained pursuant to
this Agreement shall be subject to examination by the
Fund and by persons authorized by it during reasonable
business hours upon reasonable notice. Records required
by Rule 31a-1 maintained as specified above shall be the
property of the Fund; the Manager will preserve such
records for the periods prescribed by Rule 31a-2 under the
1940 Act and shall surrender such records promptly at the
Funds request. Upon termination of this Agreement, the
Manager shall promptly return records that are the Funds
property and, upon demand, shall make and deliver to the
Fund true and complete and legible copies of such other
records maintained as required by this Section 4(a) as the
Fund may request. The Manager may retain copies of
records furnished to the Fund.
(b) Reports to Custodian. The Manager shall
provide to the Funds custodian and to the Fund on each
business day, information relating to all transactions
concerning the Managed Assets.
(c) Other Reports. The Manager shall render to
the Board of Trustees of TIP and to TAS such periodic and
special reports as the Board or TAS may reasonably
request.
5. Purchase and Sale of Securities
(a) Selection of Brokers. The Manager shall
place all orders for the purchase and sale of securities on
behalf of the Fund with brokers or dealers selected by the
Manager in conformity with the policy respecting
brokerage set forth in the Registration Statement. Neither
the Manager nor any of its officers, employees, or any of
its affiliated persons, as defined in the 1940 Act, will act as
principal or receive any compensation in connection with
the purchase or sale of investments by the Fund other
than the management fees provided for in Section 6
hereof. The Manager will not be liable to Client for any
acts or omissions made by the Administrator, Custodian,
or other service provider to the Fund, unless such liability
resulted from acts or omissions of the Manager or from
information from the Manager.
In placing such orders, the Manager will give
primary consideration to obtaining the most favorable
price and efficient execution reasonably available under
the circumstances and in accordance with applicable law.
In evaluating the terms available for executing particular
transactions for the Fund and in selecting broker-dealers
to execute such transactions, the Manager may consider,
in addition to commission cost and execution capabilities,
those factors that it deems relevant, such as the financial
stability and reputation of broker-dealers and the
brokerage and research services (as those terms are
defined in Section 28(e) of the Securities Exchange Act of
1934, as amended) provided by such broker-dealers. The
Manager is authorized to pay a broker-dealer who
provides such brokerage and research services a
commission for executing a transaction which is in excess
of the amount of commission another broker-dealer would
have charged for effecting that transaction if the Manager
determines in good faith that such commission is
reasonable in relation to the value of the brokerage and
research services provided by such broker-dealer in
discharging responsibilities with respect to the Fund or to
other client accounts as to which it exercises investment
discretion.
(b) Aggregating Orders. On occasions when
the Manager deems the purchase or sale of a security to
be in the best interest of the Fund as well as other
advisory clients of the Manager, the Manager, to the
extent permitted by applicable laws and regulations, may,
but shall be under no obligation to, aggregate the
securities to be so sold or purchased in order to obtain the
most favorable price or lower brokerage commissions and
efficient execution. In such event, allocation of securities
so purchased or sold, as well as the expense incurred in
the transaction, will be made by the Manager in the
manner it considers to be most equitable and consistent
with its fiduciary obligations to the Fund and its other
advisory clients.
6. Management Fees; Expenses
(a) Management Fees. Schedule I-A and Schedule
I-B attached hereto set out the fees to be paid by the Fund
to the Manager for the respective Managed Accounts.
(b) Expenses. The Manager shall furnish at its own
expense all of its own office facilities, equipment and
supplies, and shall perform at its own expense all routine
and recurring functions necessary to render the services
required under this Agreement, including administrative,
bookkeeping and accounting, clerical, statistical and
correspondence functions. The Fund shall pay directly, or,
if the Manager makes payment, reimburse the Manager
for, (i) custodial fees for the Managed Assets, (ii)
brokerage commissions, issue and transfer taxes and other
costs of securities transactions to which the Fund is a
party, including any portion of such commissions
attributable to research and brokerage services; and (iii)
taxes, if any, payable by the Fund. In addition, the Fund
shall pay directly, or, if the Manager makes payment,
reimburse the Manager for, such non-recurring special
out-of-pocket costs and expenses as may be authorized in
advance by the Fund.
7. Non-Exclusivity of Services
The Manager is free to act for its own account and
to provide investment management services to others.
The Fund acknowledges that the Manager and its officers
and employees, and the Managers other advisory clients,
may at any time have, acquire, increase, decrease or
dispose of positions in the same investments which are at
the same time being held, acquired for or disposed of
under this Agreement for the Fund. Neither the Manager
nor any of its officers or employees shall have any
obligation to effect a transaction under this Agreement
simply because such a transaction is effected for his or its
own account or for the account of another advisory client.
The Fund agrees that the Manager may refrain from
providing any advice or services concerning securities of
companies for which any officers, directors, partners or
employees of the Manager or any of the Managers
affiliates act as financial adviser, investment manager or in
any capacity that the Manager deems confidential, unless
the Manager determines in its sole discretion that it may
appropriately do so. The Fund appreciates that, for good
commercial and legal reasons, material nonpublic
information which becomes available to affiliates of the
Manager through these relationships cannot be passed on
to the Fund.
8. Liability
The Manager shall not be liable to the Fund, TIP, or
TAS for any error of judgment, acts, omission, or mistake
of law or any loss arising out of its obligations and duties in
providing services under this Agreement, except that the
Manager shall be liable to the Fund for any loss resulting
from Managers willful misfeasance, bad faith, gross
negligence or reckless disregard by the Manager of its
obligations and duties in providing services under this
Agreement. The Manager shall not be held liable for any
acts or omissions of the Funds Custodian or Administrator
or any other third party, unless such liability resulted from
acts or omissions of the Manager or information from the
Manager. Nothing in this Agreement shall constitute a
waiver or limitation of any rights which the Fund, TIP, or
TAS may have under applicable state or federal laws.
TIP understands that the Manager, in the
performance of its obligations and duties under this
Agreement, is entitled to rely in good faith upon the
accuracy of the information furnished by, or on behalf of,
the Fund, without further investigation.
9. Representations
(a) The Manager hereby represents to the Fund
that the Manager is registered as an investment adviser
under the Advisers Act, that it has full power and authority
to enter into and perform fully the terms of this
Agreement, and that the execution of this Agreement on
behalf of the Manager has been duly authorized and, upon
execution and delivery, this Agreement will be binding
upon the Manager in accordance with its terms.
(b) The Manager represents that it is in
material compliance with all applicable laws, both federal
and state.
(c) TIP hereby represents to the Manager that
it has full power and authority to enter into this
Agreement, its execution and delivery of this Agreement
on behalf of the Fund have been duly authorized, and this
Agreement represents the legal, valid and binding
obligation of TIP, enforceable in accordance with its terms.
(d) TIP acknowledges receipt of Parts 2A and B
of the Managers Form ADV and Commodity Trading
Advisor (CTA) Disclosure Document (if applicable).
(e) TIP hereby represents that TIP and the Fund
are in material compliance with all applicable state and
federal securities laws and regulations.
(f) TIP hereby represents that each
shareholder of the Fund was a Qualified Client as that
term is defined in Rule 205-3(d) under the Advisers Act at
the time it became a shareholder of the Fund.
10. Term
This Agreement shall continue in effect for a period
of two (2) years from the date hereof and shall thereafter
be automatically renewed for successive periods of one (1)
year each, provided such renewals are specifically
approved at least annually in conformity with the
requirements of the 1940 Act; provided however, that this
Agreement may be terminated without the payment of
any penalty by (a) the Fund, if a decision to terminate is
made by the Board of Trustees of TIP or by a vote of a
majority of the Funds outstanding voting securities (as
defined in the 1940 Act), or (b) the Manager, and in either
case with at least 30 days written notice from the
terminating party and on the date specified in the notice
of termination.
The rights and obligations that are provided in
section (f) of Paragraph 2 shall survive the cancellation,
expiration or termination of this Agreement.
This Agreement shall terminate automatically in
the event of its assignment (as defined in the 1940 Act).
11. Amendment
Except as otherwise provided in this Agreement,
this Agreement may be amended by mutual consent, but
the consent of the Fund must be approved in conformity
with the requirements of the 1940 Act and any order of
the Securities and Exchange Commission that may address
the applicability of such requirements in the case of the
Fund.
12. Notices
Notices or other communications required to be
given pursuant to this Agreement shall be deemed duly
given when delivered in writing or sent by fax or three
days after mailing registered mail postage prepaid as
follows:
To TIP, c/o TIFF Advisory Services, Inc.
the Fund, General Counsel
or both: 000 X. Xxxxxx Xxxxxxx Xx.
Xxxxx 000
Xxxxxx, XX 00000
Fax: 000-000-0000
Email: xxxxx@xxxx.xxx with a copy to
xxxxxxxx@xxxx.xxx
To The AJO, LP
Manager: 000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx Xxxxx
Xxxxxxxxxxxx, XX 00000
Attention: Xxxxxxxx X. Xxxxxxx
Fax: 000-000-0000
Each party may change its address by giving notice
as herein required.
13. Sole Instrument
This instrument constitutes the sole and only
agreement of the parties to it relating to its object and
correctly sets forth the rights, duties and obligations of
each party to the other as of its date. Any prior
agreements, promises, negotiations or representations not
expressly set forth in this Agreement are of no force or
effect.
14. Counterparts
This Agreement may be executed in counterparts,
each of which shall be deemed to be an original and all of
which, taken together, shall be deemed to constitute one
and the same instrument.
15. Applicable Law
This Agreement shall be governed by, and the
rights of the parties arising hereunder construed in
accordance with, the laws of the State of Delaware
without reference to principles of conflict of laws. Nothing
herein shall be construed to require either party to do
anything in violation of any applicable law or regulation.
16. Change in Management or Control of Manager
The Manager agrees to notify TIP and the Fund in
writing of any changes in the membership of the Manager
within a reasonable time period after such change.
17. Confidential Information
Any information or recommendations supplied by
any party to this Agreement, which are not otherwise in
the public domain or previously known to another party in
connection with the performance of obligations
hereunder, including securities or other assets held or to
be acquired by the Fund, transactions in securities or other
assets effected or to be effected on behalf of the Fund, or
financial information or any other information relating to a
party to this Agreement, are to be regarded as confidential
(Confidential Information).
No party may use or disclose to others Confidential
Information about the other party, except solely for the
legitimate business purposes of the Fund for which the
Confidential Information was provided; as may be required
by applicable law or rule or compelled by judicial or
regulatory authority having competent jurisdiction over
the party; or as specifically agreed to in writing by the
other party to which the Confidential Information pertains.
Further, no party may trade in any securities issued by
another party while in possession of material non-public
information about that party. Lastly, the Manager may
not consult with any other money managers for the Fund
about transactions in securities or other assets of the
Fund, except for purposes of complying with the 1940 Act
or SEC rules or regulations applicable to the Fund. Nothing
in this Agreement shall be construed to prevent the
Manager from lawfully giving other entities investment
advice about, or trading on their behalf in, shares issued
by the Fund or securities or other assets held or to be
acquired by the Fund.
IN WITNESS WHEREOF, the parties hereto execute
this Agreement on and make it effective on the Effective
Date specified in the first paragraph of this Agreement.
TIFF Investment Program AJO, LP
On behalf of the Fund
By:__/s/ Xxxxx Lundstrom_________
By:__/s/_Theodore R. Aronson_________
Title:___Vice President___________
Title:____Managing Principal_______
Schedule I-A
to the
Amended and Restated Money Manager Agreement (the
Agreement) Dated as of September 23, 2015
between
AJO, LP (the Manager) and
TIFF Investment Program for its TIFF Multi-Asset Fund
(the Fund)
Performance Fee Calculation
Dated September 23, 2015
This fee schedule shall apply to the Managed Account
generally referred to by the parties as the Large Cap
account. The Managed Account to which this fee schedule
shall apply has a benchmark of the S&P 500 Index.
Compensation
As compensation for the services performed and
the facilities and personnel provided by the Manager
pursuant to this Agreement, the Fund will pay to the
Manager a fee according to the following formula:
Fee = 10 + 0.16 x (Excess Return - 75); subject to
Floor of 10 bp,
Cap of 50 bp and computed in accordance with the
following provisions.
All capitalized terms used but not defined in this Schedule
I-A shall have the meanings ascribed to them in the
Agreement.
Certain Defined Terms
Beginning Date shall mean the date that the
Manager begins (or resumes after a hiatus) to render
services under this Agreement.
Excess Return shall mean the return of the
Manager that exceeds the return of the benchmark (the
S&P 500 Index, or any successor index thereof) during the
performance measurement period (trailing 12 calendar
months).
Minimum Fee shall mean, with respect to any full
calendar month, the result obtained by multiplying the
average daily value of the net assets (gross of expenses
except custodian transactions charges) of the Managed
Account during such month by 1/12th of the floor rate set
forth in this Schedule I to the Agreement.
Performance Adjusted Fee shall be determined as
of the last day of each calendar month and shall mean the
result obtained by multiplying the average daily value of
the net assets of the Managed Account (computed as
described in the Funds Registration Statement) during the
performance measurement period (trailing 12 calendar
months) by 1/12th of the Performance Fee Rate
determined in accordance with this Schedule I-A.
Performance Fee Rate shall mean the rate of fee
produced by application of the formula set forth above.
Under such formula, the rate of fee varies directly with the
time-weighted rate of return achieved for the Fund by the
Manager over the applicable performance measurement
period, but is never greater than the cap rate nor less than
the floor rate specified in the formula. The rate of fee
varies above and below the fulcrum fee rate, i.e., the rate
that is midway between the cap rate and the floor rate,
depending on the amount by which the Managers return
exceeds, or is less than, the return of the benchmark
specified in the formula. The rate at which the
Performance Fee Rate changes in response to a specified
increment of change in the Managers performance
relative to the performance of the benchmark is constant.
The Performance Fee Rate will change as the Managers
performance varies from the performance of the
benchmark in increments of one basis point.
Fee For Services
(a) Fee. For services rendered by the
Manager hereunder during each full calendar month, the
Manager shall be entitled to a fee equal to the
Performance Adjusted Fee, payable by the Fund no later
than thirty (30) days after the end of the 12-month
measurement period to which such fee relates.
(b) Early Termination. If the Manager ceases
to render services hereunder at any time during, and
before the end of, any full calendar month, the Manager
shall be entitled to a fee for services rendered hereunder
during such month equal to 150% of the Minimum Fee
(prorated based on the number of days during such
calendar month that the Manager provided services
hereunder) payable by the Fund during the month
following the month in which the Manager ceased to
render services hereunder.
(c) The parties agree that the entering into of this
Agreement shall not be considered an early termination
with respect to the Fund under the provisions of the
previous agreement. The compensation and fee schedule
that were in effect under the previous agreement and the
compensation and fee schedule herein are identical, and
the fees payable to the Manager hereunder shall be
calculated using the applicable measuring periods as
though the previous agreement had not been superseded
with this Agreement.
Miscellaneous
In the event of any inconsistency between this Schedule I-
A and the Money Manager Agreement to which it relates,
this Schedule I-A shall govern.
Schedule I-B
to the
Amended and Restated Money Manager Agreement (the
Agreement) Dated as of September 23, 2015
between
AJO, LP (the Manager) and
TIFF Investment Program for its TIFF Multi-Asset Fund
(the Fund)
Performance Fee Calculation
Dated September 23, 2015
This fee schedule shall apply to the Managed Account
generally referred to by the parties as the Emerging
Markets account. The Managed Account to which this fee
schedule shall apply has a benchmark of the MSCI
Emerging Markets Small Cap Index.
As compensation for the services performed and the
facilities and personnel provided by the Manager for TIFF
Multi-Asset Fund pursuant to this Agreement, the Fund
will pay the Manager a performance based fee (the
Performance Fee) as described below.
All capitalized terms used but not defined in this Schedule
I-B shall have the meanings ascribed to them in the
Agreement unless otherwise defined herein.
1 Definitions related to Fee Calculation
Average Net Assets: The net asset value of the Managed
Account shall initially be equal to the value of such assets
placed with the Manager as of the close of the Funds
business on the Effective Date, computed as described in
the Funds Registration Statement, and shall thereafter be
adjusted to reflect the daily change in the value of the
Managed Account and cash flows, if any, including
withdrawals from or additions to the Managed Account by
the Fund and payment of the following expenses due in
respect of the preceding months or Calculation Periods (as
the case may be): the Performance Fee and custodian
transaction charges. Average Net Assets of the Managed
Account means the average of the daily net asset values of
the Managed Account for the applicable period. Where
there are multiple Holdings, the Average Net Assets of a
Holding shall be determined by multiplying the Average
Net Assets of the Managed Account by the applicable
Holding Ratio.
Calculation Date: In respect of a Holding, (i) the date
commencing on the Effective Date of such Holding and
ending on the last day of the calendar month in which a
full 12 months of performance for such Holding has been
achieved or (ii) if earlier, the date on which the Fund
withdraws all or part of a Holding (exclusive of
withdrawals made to pay custodian transaction charges
and the fees payable hereunder).
Calculation Period: In relation to a Calculation Date during
the Transitional Period, the Calculation Period is the period
starting on the Effective Date of the Holding and ending on
that Calculation Date. In relation to a Calculation Date
during the Post-Transitional Period for the Holding, (i) the
period of 60 months ending on the Calculation Date of the
Holding or (ii) in relation to a Calculation Date arising on a
withdrawal of a Holding, the period that starts on the day
on which the next regularly occurring Calculation Period
would have started (i.e. assuming no withdrawal) and ends
on the date of the withdrawal, resulting in a Calculation
Period of up to but not more than 60 months.
Effective Date: The Effective Date is (i) in relation to the
first Holding, October 1, 2015, and (ii) in relation to each
other Holding, the date on which the relevant addition is
made to the Managed Account.
Excess Return: Excess Return is the arithmetic difference
between the annualized performance of a Holding during
the applicable Calculation Period, calculated geometrically,
and the annualized performance of the MSCI Emerging
Markets Small Cap Index (net) during the same Calculation
Period, calculated geometrically.
Holding: The first tranche of Managed Account assets
placed with the Manager by the Fund and each
subsequent addition to the Managed Account assets shall
be a separate Holding, unless the subsequent addition is
less than 20% of the value of the Holding most recently
established as measured on the date of the subsequent
addition, in which case such additional assets will be
added to the most recently established Holding. Each
Holding will have its own Effective Date and separate
Performance Fees will be calculated in respect of each
Holding.
Holding Ratio: In relation to each Holding, the Holding
Ratio is the value of the Holding divided by the value of
the Managed Account as at the date when an addition or
withdrawal is made or when a Performance Fee is paid.
Where the Manager and TIP agree to treat an addition as
part of the most recently established Holding, each
Holding Ratio shall be recalculated accordingly (e.g. the
value of the most recently established Holding plus the
addition divided by the value of the Managed Account as
at the date when the addition is made).
Post-Transitional Period: The Post-Transitional Period for a
Holding shall commence on the first day of the month that
immediately follows the last day of the Transitional Period.
Transitional Period: The Transitional Period for a Holding
shall commence on the Effective Date of such Holding and
shall end on the last day of the calendar month in which a
full 60 months of performance for such Holding has been
achieved.
2 Calculation and Payment of Performance Fee
For each Calculation Period and upon a withdrawal of all
or part of a Holding, the Performance Fee shall be the
higher of zero and the amount determined using the
applicable formula set forth below, provided, however, the
Performance Fee payable for any calculation period shall
not exceed an amount equal to 161.5 basis points
multiplied by the Average Net Assets of the relevant
Holding for such calculation period.
The Performance Fee shall be payable annually in arrears
at the end of the month following the month in which the
relevant Calculation Date occurs. The Performance Fee
shall be paid from the Holding to which the fee relates,
except for (i) those fees payable upon a complete
withdrawal of a Holding or if the value of the Holding is
less than the Performance Fee payable, in which case the
fee shall be applied to the remaining Holding(s) on a first-
in-first-out basis and (ii) those fees payable subsequent to
a complete withdrawal of the Managed Account assets.
2.1 Performance Fee-Transitional Period:
During the Transitional Period for a Holding, the
Performance Fee for such Holding shall be calculated using
the following formula:
Period 1 (commences on the Effective Date of such
Holding and ends on the last day of the calendar month in
which a full 12 months of performance has been
achieved): (n/365 x Period 1 Excess Return x 20.2% x
Period 1 Average Net Assets of the relevant Holding),
where n is equal to the number of days in the Calculation
Period.
Period 2 (commences on the Effective Date of such
Holding and ends on the last day of the calendar month in
which a full 24 months of performance has been
achieved): (n/365 x Period 2 Excess Return x 20.2% x
Period 2 Average Net Assets of the relevant Holding) -
Performance Fees paid to-date on that Holding, where n is
equal to the number of days in the Calculation Period.
Period 3 (commences on the Effective Date of such
Holding and ends on the last day of the calendar month in
which a full 36 months of performance has been
achieved): (n/365 x Period 3 Excess Return x 20.2% x
Period 3 Average Net Assets of the relevant Holding) -
Performance Fees paid to-date on that Holding, where n is
equal to the number of days in the Calculation Period.
Period 4 (commences on the Effective Date of such
Holding and ends on the last day of the calendar month in
which a full 48 months of performance has been
achieved): (n/365 x Period 4 Excess Return x 20.2% x
Period 4 Average Net Assets of the relevant Holding) -
Performance Fees paid to-date on that Holding, where n is
equal to the number of days in the Calculation Period.
Period 5 (commences on the Effective Date of such
Holding and ends on the last day of the calendar month in
which a full 60 months of performance has been
achieved): (n/365 x Period 5 Excess Return x 20.2% x
Period 5 Average Net Assets of the relevant Holding) -
Performance Fees paid to-date on that Holding, where n is
equal to the number of days in the Calculation Period.
2.2 Performance Fee-Post-Transitional Period:
For each Calculation Period following the Transitional
Period, the Performance Fee of a Holding shall be
calculated using the following formula: Excess Return for
the relevant Calculation Period (the 60 month period just
ended) x 20.2% x Average Net Assets of the relevant
Holding for the Calculation Period.
2.3 Performance Fee-On Complete and Partial
Withdrawal of a Holding
A Performance Fee will also be calculated on a withdrawal
of all or part of a Holding and shall become payable at the
end of the month following the month in which such
withdrawal occurred. Where the Fund has multiple
Holdings, a partial withdrawal of Managed Account assets
shall be applied to the Holdings on a first-in-first-out basis.
2.3.1 Complete or Partial Withdrawal during the
Transition Period
A Performance Fee will be calculated for each Holding
which is withdrawn during the Transition Period using the
following formula:
(n/365 x Excess Return for the relevant Calculation Period
x 20.2% x Average Net Assets of the Holding for the
relevant Calculation Period) - Performance Fees paid to-
date on that Holding, where n is equal to the number of
days in the Calculation Period.
Where a withdrawal is allocated to only part of a Holding
(on the first-in-first-out basis), the Performance Fee for
that Holding shall be pro-rated according to the proportion
of the Holding withdrawn.
2.3.2 Complete or Partial Withdrawal following the
Transition Period
A Performance Fee will be calculated for each Holding
which is withdrawn following the Transition Period using
the following formula: (n/365 x Excess Return for the
relevant Calculation Period x 20.2% x Average Net Assets
of the Holding for the relevant Calculation Period) - any
Performance Fees paid during the Calculation Period on
that Holding, where n is equal to the number of days in the
Calculation Period.
Where a withdrawal is allocated to only part of a Holding
(on the first-in-first-out basis), the Performance Fee for
that Holding shall be pro-rated according to the proportion
of the Holding withdrawn.
2
Execution copy
