AAF-I will pay in respect of the Feeder Fund a management fee based on a percentage of the value of AAF-I’s capital account in the Feeder Fund, which will vary over time. The management fee percentage will decrease as AAF-I’s investment in the Feeder Fund increases. The management fee will be a weighted average of: (i) 1.0% per year for assets under $50 million; (ii) 0.85% per year for assets equal to or greater than $50 million and less than $100 million; and (iii) 0.75% per year for assets equal to or greater than $100 million.
Administrative and Overhead Expenses represent certain expenses paid by AAF-I in connection with its investment in the Feeder Fund (including taxes), along with AAF-I’s pro rata portion of other expenses incurred by Wespath Benefits and Investments in connection with providing investment, operating and administrative support to the I Series Funds. Pursuant to an agreement between the Fund Manager and the external asset manager, these amounts will be charged to AAF-I by the external asset manager and remitted to the Fund Manager on a quarterly basis. If funds are not remitted during a specific quarter, the required amount will be remitted in a subsequent quarter.
Annual Fund Operating Expenses are the total AAF-I expenses that investors are expected to incur each year as a percentage of the value of their investment. Annual Fund Operating Expenses are initially expected to be 1.31% of each investor’s investment in AAF-I. There is no guarantee that the Fund’s actual Annual Fund Operating Expenses will match the amounts reflected above. Actual Annual Fund Operating Expenses may vary depending on, among other things, market events, Fund size, transaction costs, timing of Fund inflows and outflows, and applicable internal costs and third-party fees.
All expenses incurred by AAF-I are reflected in the Unit price calculated for the Fund.
In addition to the expenses above, certain of which are specific to AAF-I: (i) as an investor in the Feeder Fund, AAF-I will bear its allocable share of the Feeder Fund’s organizational, offering, investment and operating expenses (including taxes), interest due on borrowings, brokerage costs, fees, expenses, performance fees and extraordinary costs; and (ii) furthermore, the Feeder Fund, as an investor in the Master Fund, will bear (and, therefore, AAF-I will indirectly bear) its allocable share of the Master Fund’s organizational, offering, investment and operating expenses (including taxes), interest due on borrowings, brokerage costs, expenses and extraordinary costs, as applicable. These expenses will reduce the returns available to AAF-I investors.