Advisory Firm Flat Footed is a Delaware limited liability company that commenced operations in August 2016 and is owned by Mr. Marc Andersen and co-managed by Mr. Andersen and Mr. Paul Carpenter.
AdvisoryServices

The Adviser currently provides investment management services and discretionary investment advice to private funds (each, a “Fund” and, collectively, the “Funds”) and one or more separately managed account Clients (“SMAs”) and may serve as investment adviser and/or sub-adviser to various other advisory clients, including SMAs and other private investment funds (collectively, “Clients”).
RelyingAdviser

The Adviser offers investment advisory services to a Fund through Post Union Management LLC, which is under the common control with Flat Footed (the “Relying Adviser”). Flat Footed and the Relying Adviser are collectively referred to as the “Adviser” in this document.
Specialization

The investments of each Fund are managed in accordance with the investment objectives, strategies and guidelines applicable to such Fund and are not tailored to any particular investor in the Fund (an “Investor”). The Advisor does not provide individualized investment advice to such Investors with respect to their investment in the Fund; therefore, Investors should consider whether a particular Fund meets their investment objectives, risk tolerance, and financial situation.

In addition, the Adviser may enter into arrangements with certain Clients (or underlying Investors) that may in each case provide for terms of investment that are more favorable to the terms provided to other Clients (or underlying Investors). Such terms may include the waiver or reduction of management and/or incentive fees, the provision of additional information or reports, more favorable transfer rights, and more favorable liquidity rights.
AdvisoryServicestoSeparatelyManagedAccounts

Investments for a separately managed account Client are managed in accordance with the Client’s investment objectives, strategies, restrictions and guidelines as set forth in the documents governing the Adviser’s relationship with such Client or as otherwise communicated to the Adviser by the Client. Depending on the nature of the relationship, these services may be offered on a discretionary or non- discretionary basis and may include the investment and reinvestment of securities, cash and cash equivalents, futures and options held in a Client’s account. If a Client wishes to impose certain restrictions on investing in certain securities or types of securities, or is prohibited by applicable law from investing in such securities or types of securities, the Adviser will address those requests on a case-by-case basis
WrapFeePrograms
The Adviser does not participate in wrap fee programs.
RegulatoryAssetsUnderManagement
As of December 31, 2018, the Adviser manages $165,276,000 on a discretionary basis and $0 on a non- discretionary basis.
SupervisedPersons
All supervised persons acting on behalf of the Relying Adviser are also supervised persons of Flat Footed. In addition, Flat Footed and the Relying Adviser operate under a single code of ethics (the “Code”) and compliance manual that is administered by the Adviser’s Chief Compliance Officer (the “CCO”). please register to get more info

Fees with respect to the Funds

As the sponsor/investment manager of the Funds, the Adviser and/or its affiliates receive management fees and, with respect to certain Clients, an incentive allocation, carried interest or incentive fee on net profits. Details regarding any incentive allocation, carried interest or other incentive fee are set forth in the next section entitled, “Item 6. Performance-Based Fees and Side-by- Side Management.”

Fees paid to the Adviser are exclusive of all custodial and transaction costs paid to the Client’s custodian, brokers or other third-party consultants. Please see Item 12 – Brokerage Practices for additional information. Fees paid to the Adviser are also separate and distinct from the fees and expenses charged by mutual funds, exchange traded funds (“ETFs”) or other investment pools to their shareholders (generally including a management fee and fund expenses, as described in each fund’s or pool’s prospectus or offering materials). Each Client (and each Investor) should review all fees charged by funds, brokers, the Adviser and others to fully understand the total amount of fees paid by the Client (and each Investor) for investment and financial-related services.

The Adviser may, at its discretion, make exceptions to the foregoing or negotiate special fee arrangements where the Adviser deems it appropriate under the circumstances.

The Adviser currently advises two Funds, Flat Footed I LP (the “FF Fund”) and Post Union Perro LLC (the “PU Fund”). PU Fund is managed through the Relying Adviser.

Either the Adviser or the Client may terminate their investment advisory agreement at any time, subject to any written notice requirements in such agreement. In the event of termination in accordance with its terms, any paid but unearned fees will be promptly refunded to the Client based on the number of days that the account was managed, and any fees due to the Adviser from the Client will generally be invoiced or deducted from the Client’s account prior to termination. FF Fund generally pays the Adviser an annualized management fee of up to 1.00% (0.25% per quarter), as further described in the FF Fund’s offering documents (the “FF Management Fee”). The FF Management Fee is paid quarterly in advance and will be prorated for any partial quarterly period. The FF Management Fee is deducted from the FF Fund. The Management Fee paid by the FF Fund are indirectly borne by the Investors in the FF Fund. Generally, the FF Fund pays the FF Management Fee on the aggregate invested capital attributable to each Investor (subject to certain exclusions detailed in the FF Fund’s offering documents), calculated as of the last business day of the applicable quarterly period. The FF Management Fee is generally subject to waiver or reduction by the Adviser in its sole discretion, including in connection with investments made by the FF Fund’s General Partner or its related persons. In addition, the FF Fund is also responsible for certain of its operating expenses including, without limitation, legal, compliance, accounting (including third-party accounting services), tax, auditing and administrative fees, as outlined in its offering documents. The FF Fund is also responsible for brokerage commissions and custodial fees paid to third parties.

In the event of a termination of the FF Fund’s investment advisory agreement, fees will be prorated. Any paid but unearned fees will be promptly refunded to the Fund, and any fees due to the Adviser from the Fund will be invoiced or deducted from the Fund prior to termination.

For a period of up to five (5) years following the date of the initial investment in certain specified securities, PU Fund generally pays the Adviser an annualized management fee of up to 1.25% (0.3125% per quarter), as further described in the PU Fund’s offering documents (the “PU Management Fee”). The PU Management Fee is paid quarterly in advance and will be prorated for any partial quarterly period. The PU Management Fee is deducted from the PU Fund. Management fees paid by the PU Fund are indirectly borne by the Investors in the PU Fund. Generally, the PU Fund pays the PU Management Fee on the aggregate capital contributed by each Investor in the PU Fund. The Management Fee is generally subject to waiver or reduction by the Adviser in its sole discretion, including in connection with investments made by the PU Fund’s managing member or its related persons.

An amount up to four percent (4.0%) of each PU Fund Investor’s aggregate capital contributions (excluding the managing member) will be held in cash in order to pay the PU Management Fee and certain other ordinary courses of business PU Fund expenses (for example audit and tax preparation fees). While incremental expenses are not contemplated at this time, if such reserved amount is insufficient to pay the PU Management Fee and certain other PU Fund expenses and there are no liquid assets held by the PU Fund, the PU Fund may invoice each Investor for its share of the PU Management Fee. Each Investor is required to pay such invoice within 30 days of receipt thereof.

Fees with respect to the SMAs

SMAs may pay the Adviser an annualized management fee of up to 1.00% (0.25% per quarter), as detailed in the investment advisory agreement with such Clients (the “SMA Management Fee”). The SMA Management Fee is subject to negotiation with the Client, and a Client may, therefore, pay more or less than other Clients for the same or similar management services. The SMA Management Fee may be paid quarterly in advance. Generally, the SMA Management Fee is based on the aggregate invested capital attributable to the SMA. However, any SMA Management Fee will be dependent on the individual investment advisory agreement negotiated between the Client and the Adviser.

In addition, the SMA Client may also be responsible for certain operating expenses including, without limitation, legal, compliance, accounting (including third-party accounting services), tax, auditing and administrative fees, as outlined in its investment advisory agreement with the Client. The SMA Client will also generally be responsible for brokerage commissions and custodial fees paid to third parties. In the event of a termination of a SMAs’ investment advisory agreement, fees will be prorated. Any paid but unearned fees will be promptly refunded to the SMA, and any fees due to the Adviser from the SMA will be invoiced or deducted from the SMA prior to termination. Notwithstanding the foregoing, the Adviser may negotiate or set a management fee different from the foregoing with respect to the Funds, SMAs or any other Client the Adviser manages in the future. The Adviser and its supervised persons do not receive a brokerage commission or any other compensation attributable to the sale of securities or investment products. please register to get more info

The Adviser may be entitled to receive performance-based compensation calculated as a share of the capital appreciation of the Funds and Clients. The Adviser only receives performance-based compensation in accordance with the provisions of the Investment Advisers Act of 1940.

At the end of each fiscal year and whenever an Investor makes a withdrawal from its capital account, there shall be reallocated to the Adviser (and/or an entity designated by the Adviser) from the capital account of such Investor of the FF Fund 10% of such Investor’s share of the net profits, subject to a clawback. Full details of the clawback are described in the FF Fund’s offering documents and other governing documents.

The Relying Adviser generally receive distributions of carried interest of up to 15% of the amounts available for distribution after the return of their capital contributions to each Investor in the PU Fund. Please refer to the PU Fund’s offering documents for further details of this calculation.

The Adviser, in its sole discretion, may waive or reduce any incentive allocation, carried interest or other incentive fee with regard to Investors that are employees or affiliates of the Adviser or relatives of such persons or for other Investors such as large or strategic Investors.

The Adviser may charge an incentive fee to SMA Clients up to ten percent (10%) of all net profits generated from the SMA Client.

Notwithstanding the foregoing, the Adviser or its affiliates may negotiate or set any incentive allocation, carried interest or other incentive fees or other terms different from the foregoing with respect to a Fund, SMA Client or any other Client the Adviser provides management services in the future.

The Adviser may manage both accounts that are charged a performance-based fee and accounts that are charged another type of fee, such as an hourly or flat fee or account-based fee. Performance-based fees for the Adviser may be up to 15% of the profits generated in the Client’s account. Because the Clients may have different fee structures, a conflict of interest exists where the Adviser must allocate any limited investment opportunities among the Clients, and may have an incentive to allocate to (a) a Client with a performance-based fee structure over Clients that are not charged a performance- based fee, and (b) Clients from which the Adviser will receive a greater performance-based fee over Clients with a less performance-based fee. Another potential conflict may arise if the Adviser manages the accounts of its principals and employees on a side-by-side basis with third party Clients. The Adviser generally addresses the foregoing conflicts by allocating investment opportunities among those Clients for which participation in the investment opportunity is considered appropriate in a fair and equitable manner, taking into account, among other considerations, whether the risk- return profile of the proposed investment is consistent with the Client’s objectives and the liquidity requirements of the Client. Such considerations may result in allocations on other than a paripassu basis. please register to get more info

The Adviser’s Clients (and Investors therein) may include endowments, sovereign wealth funds, public or private pensions, foundations, institutions, high net worth individuals and the Funds. The Adviser does not provide investment advice individually to the Investors of the Funds. Interests in the Fund are offered pursuant to applicable exemptions from registration under the Securities Act and the 1940 Act. Permitted Investors in the Fund may include high net worth individuals, banks, thrift institutions, pension and profit-sharing plans, trusts, estates, charitable organizations and other business entities.

The minimum investment requirement for the Funds is $1,000,000. However, the General Partner of the FF Fund or the managing member of the PU Fund, in its sole discretion, may permit investments that are less than the required minimum investment commitment (or require a different amount), as set forth in the offering and other governing documents of the respective Funds.

Minimum account sizes for other Client accounts vary depending on the type of investment advisory services to be performed and in certain circumstances may be negotiable. Separate Client account investment advisory services are generally available to individuals and institutional accounts with a minimum account size of $10 million.

The Adviser may allow certain Investors to invest in a Fund on different business terms than other Investors. For example, a Fund may agree to provide certain Investors additional or different information from the information made available to the other Investors in a Fund. The Adviser also may agree to provide certain Investors with a fee arrangement that differs in structure and amount from that generally available to other Investors in the Fund. In determining whether to allow an Investor to participate in a Fund on different business terms, the Adviser may consider a number of different factors including, but not limited to, the Adviser’s belief about whether the different terms will adversely affect the other Investors in a Fund considered as a group; such Investor’s objectives in requesting or accepting such terms; whether such Investor is under legal, regulatory or “best practices” obligations to request such terms; and/or whether granting such terms is in any respect inconsistent with representations made by a Fund or the Adviser to Investors. please register to get more info

MethodsofAnalysis In making investment decisions on behalf of Clients (including the Funds), the Adviser monitors core industry verticals. After identifying a vulnerable vertical, the Adviser compiles a roster of potential target companies within that vertical. The Adviser utilizes all pertinent accessible information (financial statements, presentations, other supplements provided by the company, proxies, other SEC filings, competitor information, industry statistics, trade publications, internally developed industry or other analysis) and develops a model showing the target’s historical results and expected future results. Particular focus is placed on balance sheet metrics and cash generation. InvestmentStrategies The Adviser’s strategic approach is to invest each portfolio in accordance with the investment plan that has been developed specifically for each Client or Fund. The Adviser has historically focused on a select few, heavily researched, high conviction ideas. The Adviser views this model as a superior way to invest as compared to managing an evergreen portfolio of 30-40 names. In addition, the Adviser believes this helps avoid the need to always be invested, regardless of the quality of the opportunity set. The Funds The PU Fund The Adviser’s current investment strategy for the PU Fund comprises the purchase of post- reorganization, over-the-counter equity of a formerly bankrupt agricultural commodity processing company. The aim of the strategy is to generate significant income for its Investors by turning around such company and returning cash dividends and/or cash proceeds on the sale of such company. The strategy involves significant risks, including the risk that the Fund (and, in turn, the underlying Investors in the Fund), could lose some or all of any invested capital. An investment in the Fund will provide limited liquidity because there are significant restrictions on transferability of the Fund’s interests and withdrawals from the Fund.

The FF Fund

The Adviser’s current investment strategy for the FF Fund is generally to capitalize on earnings deterioration of distribution companies. To achieve its objective, the Adviser expects primarily to take short positions in publicly-traded equity securities on behalf of the FF Fund.

The Adviser will use a disciplined, value-oriented approach to identify securities whose market values differ materially from their fundamental worth. The Adviser believes that a compelling portfolio of investments can be created by building short positions in overvalued businesses with declining fundamentals and deteriorating competitive positions, in particular, businesses in the distribution sector.

The Adviser expects primarily to take short positions in publicly-traded equity securities, but may also invest in total return swaps, listed or custom equity put options, short positions in corporate bonds, or reasonably related equity, credit or other financial instruments, some of which may substitute for, add to, complement or hedge short positions. In addition to the leverage that is inherent in a short sale, swap, option or similar financial instrument, the FF Fund may enter into securities transactions on margin in order to employ additional leverage when it deems such action to be appropriate, although it has not done so to date. Rather than entering into short sales directly, the FF Fund may enter into swap transactions that provide comparable exposure. Risk of Loss While the Adviser generally seeks to diversify Clients’ investment portfolios [(except as described above with respect to the Funds)/and the Fund’s investments] across various asset classes in an effort to reduce the risk of loss, all investment portfolios are subject to risks. Accordingly, there can be no assurance that Client investment portfolios or the Fund will be able to fully meet their investment objectives and goals, or that investments will not lose money. Below is a description of several of the principal risks that Client investment portfolios and the Funds face. However, each prospective Investor and Client should carefully review the applicable offering and other governing documents before deciding to invest with the Adviser. ManagementRisks.While the Adviser manages Client investment portfolios and the Funds based on the Adviser’s experience, research and proprietary methods, the value of Client’s investment portfolios and the Funds will change daily based on the performance of the underlying securities in which they are invested. Accordingly, Client’s investment portfolios and the Funds are subject to the risk that the Adviser allocates assets to asset classes that are adversely affected by unanticipated market movements and the risk that the Adviser’s specific investment choices could underperform their relevant indexes.

EconomicConditions. Changes in economic conditions, including, for example, interest rates, inflation rates, employment conditions, competition, technological developments, political and diplomatic events and trends, and tax laws may adversely affect the business prospects or perceived prospects of companies. While the Adviser performs due diligence on the companies in whose securities it invests, economic conditions are not within the control of the Adviser and no assurances can be given that the Adviser will anticipate adverse developments.

RisksRelatedtoAlternativeInvestmentVehicles. From time to time and as appropriate, the Adviser may invest a portion of a Client’s portfolio or the Funds in alternative vehicles. The value of Client investment portfolios or the Funds will be based in part on the value of alternative investment vehicles in which they are invested, the success of each of which will depend heavily upon the efforts of their respective managers. When the investment objectives and strategies of a manager are out of favor in the market or a manager makes unsuccessful investment decisions, the alternative investment vehicles managed by the manager may lose money. A Client account or the Funds may lose a substantial percentage of its value if the investment objectives and strategies of many or most of the alternative investment vehicles in which it is invested are out of favor at the same time, or many or most of the managers make unsuccessful investment decisions at the same time.

EquityMarketRisks. The Adviser will generally invest portions of Client assets and the Funds directly into equity investments, primarily stocks, or into pooled investment funds that invest in the stock market. As noted above, while pooled investment funds have diversified portfolios that may make them less risky than investments in individual securities, pooled investment funds that invest in stocks and other equity securities are nevertheless subject to the risks of the stock market. These risks include, without limitation, the risks that stock values will decline due to daily fluctuations in the markets, and that stock values will decline over longer periods (e.g., bear markets) due to general market declines in the stock prices for all companies, regardless of any individual security’s prospects. FixedIncomeRisks.The Adviser may invest portions of Client assets or the Funds directly into fixed income instruments, such as bonds and notes, or may invest in pooled investment funds that invest in bonds and notes. While investing in fixed income instruments, either directly or through pooled investment funds, is generally less volatile than investing in stock (equity) markets, fixed income investments nevertheless are subject to risks. These risks include, without limitation, interest rate risks (risks that changes in interest rates will devalue the investments), credit risks (risks of default by borrowers), or maturity risk (risks that bonds or notes will change the value from the time of issuance to maturity). ShortSales. The Adviser, on behalf of its Clients or the Funds, may from time to time sell securities short in anticipation of the realization of a gain if the securities sold short should decline in market value. A short sale is affected by selling a security that the Client does not own or selling a security which the Client owns but which it does not deliver upon consummation of the sale. In order to make delivery to the buyer of a security sold short, the Client must borrow the security. In so doing, it incurs the obligation to replace that security, whatever its price may be, at the time it is required to deliver it to the lender. The Client must also pay to the lender of the security any dividends or interest payable on the security during the borrowing period and may have to pay a premium to borrow the security. This obligation must, unless the Client then owns or has the right to obtain, without payment, securities identical to those sold short, be collateralized by a deposit of cash and/or marketable securities with the lender. A short sale of a security involves the risk of a theoretically unlimited increase in the market price of the security, which could result in an inability to cover the short position and a theoretically unlimited loss to the Client.

Lack of Diversification. Client accounts or the Funds may not have a diversified portfolio of investments at any given time, and a substantial loss with respect to any particular investment in an undiversified portfolio will have a substantial negative impact on the aggregate value of the portfolio.

Leverage.The Funds may allow the Adviser or one of its affiliates to borrow money on behalf of the Funds and to invest the proceeds thereof for the Fund’s investment portfolio. While the use of leverage may increase potential gains, the Funds would also be subject to greater risk of loss in the event that investments acquired with borrowed money decline in value.

OptionsTransactions. The purchase or sale of an option involves the payment or receipt of a premium payment by the investor and the corresponding right or obligation, as the case may be, to either purchase or sell the underlying security or other instrument for a specific price at a certain time or during a certain period. Purchasing options involve the risk that the underlying instrument does not change the price in the manner expected so that either the option expires worthless and the investor loses its entire investment in the option, or the option is later sold at a substantial loss. Although an option buyer’s risk is generally limited to the cost of its purchase of the option, an investment in an option may be subject to greater fluctuation than an investment in underlying stocks. The risk for a writer of a put option is that the price of underlying stocks may fall below the exercise price. Over- the-counter options also involve counterparty solvency risk.

SwapAgreementsandContractsforDifferences.Swap contracts are two-party contracts entered into primarily by institutional investors for periods ranging from a few weeks to a number of years. Under a typical swap, one party may agree to pay a fixed rate or a floating rate determined by reference to a specified instrument, rate, or index, multiplied in each case by a specified amount (“notional amount”), while the other party agrees to pay an amount equal to a different floating rate multiplied by the same notional amount. The Adviser may enter into swaps. Under current law, “swaps” (as defined in Section 1.3 of the Commodity Exchange Act (the “CEA”) and applicable regulations) are regulated by the U.S. Commodity Futures Trading Commission, while “security-based swaps” (as defined in Section 1.3 of the CEA and applicable regulations) are regulated by the SEC. “Swaps” include, but are not limited to, certain foreign exchange and currency swaps, forwards and options, interest rate swaps and options, commodity swaps, and swaps referencing broad-based securities indices. “Security-based swaps” include, but are not limited to, swaps referencing single securities or narrow-based securities indices. Swaps are either subject to a bilateral agreement with a counterparty or are cleared through a central clearing organization. To the extent the Adviser invests in swaps, forwards, options and other “synthetic” or derivative instruments that are not cleared on a central exchange, counterparty exposures can develop, and the Adviser takes the risk of nonperformance by the other party on the contract. Swaps, forwards, futures, options and other “synthetic” or derivative instruments that are cleared by a central clearing organization, which generally are supported by guarantees of the clearing organization’s members, daily marking-to-market and settlement, and segregation and minimum capital requirements applicable to intermediaries, are subject to different risks, including the creditworthiness of the central clearing organization and its members. The regulation of derivatives continues to evolve and regulatory developments in the future could restrict the Adviser’s ability to engage in swap transactions or increase the cost or uncertainty involved in such transactions.

Credit Risk. The Adviser cannot control, and Clients are exposed to the risk that financial intermediaries or security issuers may experience adverse economic consequences that may include impaired credit ratings, default, bankruptcy or insolvency, any of which may affect portfolio values or management. This risk applies to assets on deposit with any broker utilized by a Client, notwithstanding asset segregation and insurance requirements that are beneficial to Clients generally. In addition, exchange trading venues or trade settlement and clearing intermediaries could experience adverse events that may temporarily or permanently limit trading or adversely affect the value of securities held by Clients. Finally, any issuer of securities may experience a credit event that could impair or erase the value of the issuer’s securities held by a Client. LegislativeandTaxRisk. Performance may directly or indirectly be affected by government legislation or regulation, which may include, but is not limited to: changes in investment adviser or securities trading regulation; change in the U.S. government’s guarantee of ultimate payment of principal and interest on certain government securities and changes in the tax code that could affect interest income, income characterization, and/or tax reporting obligations. In certain circumstances, a Client may incur taxable income on his or her investments without a cash distribution to pay the tax due. CybersecurityRisks.The Adviser and its service providers are subject to risks associated with a breach in cybersecurity. Cybersecurity is a generic term used to describe the technology, processes and practices designed to protect networks, systems, computers, programs and data from cyber-attacks and hacking by other computer users, and to avoid the resulting damage and disruption of hardware and software systems, loss or corruption of data, and/or misappropriation of confidential information. In general, cyber-attacks are deliberate, but unintentional events may have similar effects. Cyber-attacks may cause losses to Clients by interfering with the processing of transactions, affecting the Adviser’s ability to calculate net asset value or impeding or sabotaging trading. Clients may also incur substantial costs as the result of a cybersecurity breach, including those associated with the forensic analysis of the origin and scope of the breach, increased and upgraded cybersecurity, identity theft, unauthorized use of proprietary information, litigation, and the dissemination of confidential and proprietary information. Any such breach could expose the Adviser to civil liability as well as regulatory inquiry and/or action. In addition, Clients could be exposed to additional losses as a result of unauthorized use of their personal information. While we have established business continuity plans, incident responses plans and systems designed to prevent cyber-attacks, there are inherent limitations in such plans and systems, including the possibility that certain risks have not been identified. Similar types of cybersecurity risks also are present for issuers of securities in which we invest, which could result in material adverse consequences for such issuers and may cause a Client’s investment in such securities to lose value. PrivateEquityRisks. Private equity–related investments have a high degree of risk and often require long-term commitment. A private equity fund typically makes a limited number of investments, resulting in a high degree of risk with respect to each investment. Upon disposition of an investment, a private equity fund may be required to make representations about the business and financial affairs of the disposed investment or may be responsible for the contents of disclosure documents under applicable securities laws. These arrangements may lead to contingent liabilities which might lead to losses. LimitationsofDisclosure. The foregoing list of risks does not purport to be a complete enumeration or explanation of the risks involved in investing in investments. As investment strategies develop and change over time, Clients may be subject to additional and different risk factors. No assurance can be made that profits will be achieved or that substantial losses will not be incurred. please register to get more info

Registered investment advisers are required to disclose all material facts regarding any legal or disciplinary events that would be material to a Client’s evaluation of the Adviser or the integrity of the Adviser’s management. The Adviser has no disciplinary events to report. please register to get more info

Mr. Marc Andersen, the owner of Flat Footed, is also the principal and owner of the Relying Adviser. Mr. Andersen also serves as a Director of a privately-held carbohydrate processing company.

The Adviser (together with its affiliates) serves as the investment manager and general partner to the FF Fund and serves as the investment manager and managing member to the PU Fund.

The Adviser does not recommend or select other investment advisers for Clients. As the sponsor/investment manager of the Funds, the Adviser receives management and performance fees or allocations from these Funds which creates a conflict of interest. All fees will be disclosed to the Clients in advance of their investment in a Fund. The Adviser’s employees, affiliates or their related persons may also invest directly in some or all of the Funds. In addition, as the Adviser manages multiple Clients, it may have conflicts of interest in allocating time and resources to such other Clients. As a result of the foregoing, the Adviser and its personnel may have conflicts of interest in allocating their time and activity between Clients, in allocating investments among Clients and other entities, and in effecting transactions between Clients and other entities, including ones in which the Adviser or its personnel may have a greater financial interest. To address these potential conflicts of interests in its material relationships, the Adviser has adopted policies and procedures, including a Code of Ethics (the “Code”) (as described in Item 11). Under the Code, in general, all personnel of the Adviser, including directors, officers, and employees of the Adviser, must put the interests of the Adviser’s Clients first and must act honestly and fairly in all respects in dealings with Clients. For a more detailed discussion of the Code and conflicts of interest policies, please see Item 11. please register to get more info

Trading
Code of Ethics and Personal Trading The Adviser has adopted the Code, the full text of which is available to Clients or potential Clients upon request. The Code has several goals. First, the Code is designed to assist the Adviser in complying with applicable laws and regulations governing its investment advisory business. Under the Advisers Act, the Adviser owes fiduciary duties to its Clients. Pursuant to these fiduciary duties, the Code requires the Adviser’s associated persons to act with honesty, good faith and fair dealing in working with Clients. In addition, the Code prohibits associated persons from trading or otherwise acting on insider information.

Next, the Code sets forth guidelines for professional standards for the Adviser’s associated persons (managers, officers, and employees). Under the Code’s Professional Standards, the Adviser expects its associated persons to put the interests of its Clients first, ahead of personal interests. In this regard, the Adviser’s associated persons are not to take inappropriate advantage of their positions in relation to the Adviser’s Clients.

Third, the Code sets forth policies and procedures to monitor and review the personal trading activities of associated persons. The Adviser’s associated persons may not invest in the same securities recommended to Clients, except as provided below. The Code’s personal trading policies include procedures for limitations on personal securities transactions of associated persons, including generally disallowing trading by an associated person in any security any Client account trades or considers trading and the creation of a restricted securities list, reporting and review of personal trading activities and pre-clearance of certain types of personal trading activities. These policies are designed to discourage and prohibit personal trading that would disadvantage Clients. The Code also provides for disciplinary action as appropriate for violations.

Participation or Interest in Client Transactions As outlined above, the Adviser has adopted procedures to protect Client interests when its associated persons invest in the same securities as those selected for or recommended to Clients. In the event of any identified potential trading conflicts of interest, the Adviser’s goal is to place Client interests first.

While the Adviser does not anticipate transferring securities from one Client account to another Client account (each such transfer, a "Cross Trade"), the Adviser would only so do if the Adviser determined the Cross Trade was the in best interests of both Clients. Further the Adviser would seek to ensure that any such Cross Trade is consistent with the investment objectives and policies of each Client account involved in the trade and applicable law, as well as with the Adviser’s fiduciary duty and obligation to seek to obtain best execution for each Client. To the extent that Cross Trades may be viewed as principal transactions due to the ownership interest in a Client by the Adviser or its personnel, the Adviser will comply with the requirements of Section 206(3) of the Advisers Act, including that any such transactions will be considered on behalf of Clients (and Investors therein) and approved or disapproved by (i) an advisory board comprised of representatives of such Clients (and Investors therein); (ii) independent members of a board of directors; or (iii) a committee consisting of one or more persons selected by the Adviser (or its affiliates), and any valuation approved by such a committee may, in the discretion of the committee, be determined by an independent third party that has appropriate experience in providing such valuations. please register to get more info

The Adviser is authorized to determine the broker or dealer to be used for each securities transaction for the Client. In selecting brokers or dealers to execute transactions, the Adviser need not solicit competitive bids and does not have an obligation to seek the lowest available commission cost. It is not the Adviser's practice to negotiate “execution only” commission rates, thus the Clients may be deemed to be paying for research, brokerage or other services provided by the broker which are included in the commission rate.

In selecting a broker, the Adviser may consider a number of factors, including:


• execution capability
• net price
• reliability and financial stability
• clearance and settlement
• size of the transaction
• difficulty of transaction
• general reputation
• custodial and other services provided by the broker/dealer that are expected to enhance general portfolio management capabilities,
• block trading coverage of a particular security
• research (including economic forecasts, investment strategy advice, fundamental and technical advice on individual securities, valuation advice and market analysis)
• availability of stocks to borrow short

Section 28(e) of the Securities Exchange Act of 1934, as amended, is a “safe harbor” that permits an investment manager to use commissions or “soft dollars” to obtain research and brokerage services that provide lawful and appropriate assistance in the investment decision-making process. The Adviser will limit the use of “soft dollars” to obtain research and brokerage services to services which constitute research and brokerage within the meaning of Section 28(e). Research services within Section 28(e) may include, but are not limited to, research reports (including market research); certain financial newsletters and trade journals; software providing analysis of securities portfolios; corporate governance research and rating services; attendance at certain seminars and conferences; discussions with research analysts; meetings with corporate executives; consultants’ advice on portfolio strategy; data services (including services providing market data, company financial data and economic data); advice from brokers on order execution; and certain proxy services. Brokerage services within Section 28(e) may include, but are not limited to, services related to the execution, clearing and settlement of securities transactions and functions incidental thereto (i.e., connectivity services between an investment manager and a broker-dealer and other relevant parties such as custodians); trading software operated by a broker-dealer to route orders; software that provides trade analytics and trading strategies; software used to transmit orders; clearance and settlement in connection with a trade; electronic communication of allocation instructions; routing settlement instructions; post-trade matching of trade information; and services required by the Securities and Exchange Commission or a self-regulatory organization such as comparison services, electronic confirms or trade affirmations. In some instances, the Adviser may receive a product or service that may be used only partially for functions within Section 28(e) (e.g., an order management system, trade analytical software or proxy services). In such instances, the Adviser will make a good faith effort to determine the relative proportion of the product or service used to assist the Adviser in carrying out its investment decision- making responsibilities and the relative proportion used for administrative or other purposes outside Section 28(e). The proportion of the product or service attributable to assisting the Adviser in carrying out its investment decision-making responsibilities will be paid through brokerage commissions generated by Client transactions and the proportion attributable to administrative or other purposes outside Section 28(e) will be paid for by the Investment Manager from its own resources.

Research and brokerage services obtained by the use of commissions arising from the Client's portfolio transactions may be used by the Adviser in its other investment activities, and thus, a Client may not necessarily, in any particular instance, be the direct or indirect beneficiary of the research or brokerage services provided.

Because many of those services could benefit the Adviser, it may have a conflict of interest in allocating Client brokerage business. In other words, the Adviser could have an incentive to execute Client transactions through a broker or dealer that provides valuable services or products and pay transaction commissions charged by that broker or dealer which may be higher than Adviser might otherwise be able to negotiate. The Adviser could also have an incentive to cause Clients to engage in more securities transactions that would otherwise be optimal in order to generate soft dollars with which to acquire research products and services.

Although the Adviser will make a good faith determination that the amount of commissions paid is reasonable in light of the products or services provided by a broker, commission rates are generally negotiable and thus, selecting brokers on the basis of considerations that are not limited to the applicable commission rates may result in higher transaction costs than would otherwise be obtainable. The receipt of such products or services and the determination of the appropriate allocation in the case of “mixed use” products or services creates a potential conflict of interest between the Adviser and its Clients.

In selecting brokers and negotiating commission rates, the Adviser will take into account the financial stability and reputation of brokerage firms, and the research, brokerage or other services provided by such brokers. The Adviser may place transactions with a broker or dealer that refers potential Investors to the Funds advised by the Adviser (or an affiliate), if otherwise consistent with seeking best execution; provided the Adviser is not selecting the broker-dealer in recognition of the referral of potential Investors.

When appropriate, the Adviser may, but is not required to, aggregate Client orders to achieve more efficient execution or to provide for equitable treatment among accounts. Clients participating in aggregated trades will generally be allocated securities based on the average price achieved for such trades. More specifically, each Client that participates in an aggregated order will participate at the average share price for all of the Adviser’s transactions in that security or other instrument on a given business day and transaction costs will be shared pro rata based on each Client's participation in the transaction. No Client will be favored over any other Client as a result of such aggregation. Brokerage commission rates will not be reduced because of such aggregation. In some instances, average pricing may result in higher or lower execution prices than otherwise obtainable by a single Client. The Adviser believes that its aggregation policy is lawful and consistent with its duty to seek best execution for all its Clients. During the last fiscal year, the Adviser directed Client transactions to particular brokers based on each broker’s reputation, financial strength and stability, efficiency of execution and error resolution, the size of the transaction and the market for the security, and the comprehensiveness and frequency of available research services and products provided by the broker. Morgan Stanley & Co, LLC. (the “Prime Broker”) is the current Prime Broker for the Adviser. The Adviser’s authority may be subject to conditions imposed by a Client, examples of which may include: (i) where the Client restricts or prohibits transactions in a certain industry, issuer or security and/or (ii) where the Client directs that some or all account transactions be effected through specific brokers or dealers. In the latter case, the Client is responsible for negotiating the terms and conditions (including, but not limited to, commission rates) relating to all services to be provided by such brokers. The Adviser will assume no responsibility for obtaining the best prices or any particular commission rates for transactions with or through any such broker for such Client’s account. A Client must recognize that it may not obtain rates as low as it might otherwise obtain if the Adviser had the discretion to select brokers or dealers other than those chosen by the Client. Any Client providing instructions to Adviser regarding the direction of brokerage transactions must notify Adviser in writing if the Client desires Adviser to cease executing transactions with or through any such broker or dealer. please register to get more info

The Adviser continuously reviews holdings across Client accounts. An account-by account review is conducted quarterly or more frequently as necessary. These reviews will focus on the appropriateness of the Client’s investments for the Fund’s portfolio and the performance of the Fund.

Investors in the Funds generally receive, among other things, a copy of audited financial statements of the Fund within 120 days after the fiscal year end of the Fund. In addition, Investors in the Funds will typically receive unaudited summary financial information regarding their investment in the Fund on a monthly basis. Investors in the Fund also receive regular reporting updates through letters and investor meetings. SMA Clients generally receive written quarterly and annual reports from the custodian. please register to get more info

The Adviser may place transactions with a broker or dealer that refers potential Investors to the Funds advised by the Adviser (or an affiliate), if otherwise consistent with seeking best execution; provided the Adviser is not selecting the broker-dealer in recognition of the referral of Investors. Please see Item12‐BrokeragePracticesfor more information. From time to time, the Adviser may enter into arrangements with third parties (“Solicitors”) to identify and refer potential Clients to the Adviser and/or to serve as placement agents for the Fund. Consistent with legal requirements under the Advisers Act, the Adviser enters into written agreements with Solicitors under which, among other things, Solicitors are required to disclose their compensation arrangements to prospective Clients before such Clients enter into an agreement with the Adviser. To address potential conflicts of interest, the Adviser generally requires Solicitors to provide details, or the Adviser provides details, of any referral fees relating to a particular potential Client or potential Investor to that Client or Investor at the time of any solicitation activities. Any compensation paid to such placement agents that the Adviser may engage, will not impact the fees paid by Investors in the Fund. please register to get more info

Rule 206(4)-2 promulgated under the Advisers Act (the “Custody Rule”) (and certain related rules and regulations under the Advisers Act) imposes certain obligations on registered investment advisers that have custody or possession of any funds or securities in which any client has any beneficial interest. An investment adviser is deemed to have custody or possession of client funds or securities if the adviser directly or indirectly holds client funds or securities or has the authority to obtain possession of them (regardless of whether the exercise of that authority or ability would be lawful).

The Adviser is required to maintain the funds and securities (except for securities that meet the privately offered securities exemption in the Custody Rule) over which it has custody with a qualified custodian. Qualified custodians include banks, brokers, futures commission merchants, and certain foreign financial institutions.

Rule 206(4)-2 imposes on advisers with custody of clients’ funds or securities certain requirements concerning reports to such clients (including underlying investors) and surprise examinations relating to such clients’ funds or securities. However, an adviser need not comply with such requirements with respect to pooled investment vehicles subject to audit and delivery if each pooled investment vehicle (i) is audited at least annually by an independent public accountant and (ii) distributes its audited financial statements prepared in accordance with generally accepted accounting principles to their investors, all limited partners, members or other beneficial owners within 120 days (180 days in the applicable case of a fund of fund adviser) of its fiscal year-end. The Adviser relies upon this audit exception with respect to the Funds. please register to get more info

The Adviser has discretionary authority to determine the investments to be bought or sold and the amounts to invest for Client accounts, pursuant to the respective investment advisory agreements between the Adviser (or its affiliates) and the Client. please register to get more info

As a general policy, the Adviser refrains from voting proxies related to securities held by Clients (and refrains from making a recommendation to Clients regarding whether to participate in any class action suits in which one or more of the Clients are eligible). A copy of our complete Proxy Voting Policy is available to Clients and potential Clients upon request (and proxy voting record, if any, are made available to Clients upon request). please register to get more info

The Adviser is not required to include a balance sheet for its most recent financial year, is not aware of any financial condition reasonably likely to impair its ability to meet contractual commitments to Clients and has not been the subject of a bankruptcy petition at any time during the past ten years. please register to get more info