p Capital Order Aggregation and Average Pricing When Hudson Bay Capital determines that more than one Account should participate in an investment, Hudson Bay Capital will seek to execute orders for all of the participating Accounts on what it believes to be on an equitable basis, taking into account such factors

HUBUS133 Alpha Group Capital Order Aggregation and Average Pricing When Hudson Bay Capital determines that more than one Account should participate in an investment, Hudson Bay Capital will seek to execute orders for all of the participati

mon stock issuable upon conversion of such securities, or by establishing "synthetic" short positions through derivatives and options transactions. Hudson Bay Capital will employ a variety of convertible arbitrage trading and investment strategies for the Capital Structure Fund. The primary objective of such tradi

latility, liquidity and "borrowability," as well as "corporate event" risk (e.g., change of control transactions). In order to mitigate these risks, Hudson Bay Capital utilizes fundamental credit research along with quantitative analysis and modeling in making investments with regard to the equity and fixed income

HUESUS133 Alpha Group Capital Item 13. Review of Accounts Review of Accounts Hudson Bay Capital will review, as pertinent, each Client's portfolio holdings to determine that the investments held by each Client remain consistent with the pertine

y Capital does not currently have any arrangements with third parties whereby such third parties are compensated for client referrals. In the event Hudson Bay Capital enters into compensation arrangements with third party solicitors for new advisory business, any such solicitation arrangements will comply with Ru

btaining insurance for members, officers and employees of the general partner/boards of directors of the Multi-Strat Funds, any Trading Vehicle and Hudson Bay Capital; fees and expenses (including, without limitation, director registration fees) of the Multi-Strat Funds' directors; costs of annual or special inve

Fee The proceeds attributable to a given investment in a Corporate Event (a "Corporate Event Investment" or "Investment") may, in the discretion of Hudson Bay Capital, either be reinvested or distributed to Corporate Fund investors and the General Partner (the "Partners"). The Corporate Value Fund will distribute

US133 Alpha Group Capital portfolio, as well as the concentration of the portfolio in any particular investment asset, strategy or market. Although Hudson Bay Capital attempts to mitigate risk in the Multi- Strat Funds by hedging at the position, strategy and/or portfolio level, such attempts may not be effective

investments of different maturities can make previously profitable hedging techniques unprofitable. Market Neutral and Hedged Strategies Although Hudson Bay Capital invests in positions that are intended to be market neutral, it may be unable to, or decide not to, hedge its positions, and, in such event, a Multi

d may differ materially from those described below and exceptions from the methodology set forth below may occur from time to time as determined by Hudson Bay Capital. Hudson Bay Capital will allocate each Multi-Fund expense among the Funds that should bear the applicable expense (the "Applicable Funds") pro rata

lement and monitor. In many cases, there is no clear regulatory guidance on the interpretation and application of these laws and regulations. While Hudson Bay Capital and the Multi-Swat Funds consult with competent counsel on these issues, the nature of these laws and regulations are that they are subject to inte

g at the position, strategy and/or portfolio level, such attempts may not be effective and hedging strategies themselves could add additional risks. Hudson Bay Capital generally does not attempt to hedge all market or other risks inherent in the Capital Structure Fund's portfolio, and hedges certain risks, if at a

UBUS133 Alpha Group Capital The Multi-Strat Funds may also buy credit default protection with respect to a referenced entity if, in the judgment of Hudson Bay Capital, there is a likelihood of credit deterioration. In such instance, the Multi-Strat Funds will pay a premium regardless of whether there is a credit

s well as the underlying units of the MLP and any payments or distributions of any kind made pursuant to the MLP security (the "Asset") targeted by Hudson Bay Capital. HBC LLC and the MLP Fund also hold certain short positions designed to serve as hedges of the Asset. HBC LLC has invested and will divest in the A

n an ongoing basis, the Capital Structure Fund's portfolio evolves as new market sectors, instruments, strategies and techniques are incorporated by Hudson Bay Capital and others are discontinued or modified. The Capital Structure Fund's portfolio and its performance can be expected to differ materially over time

pricing information gathered. Such valuations will affect the Capital Structure Management Fee and the Capital Structure Incentive Fee received by Hudson Bay Capital and its affiliates. The values of the Capital Structure Fund's positions are based, to the extent possible, on independent third-party pricing sour

e Value Fund by the limited partner, in whole or in part (without reduction for any related taxes or accrual of any interest thereon). Inability of Hudson Bay Capital to Control Corporate Event Outcomes Numerous investors may invest in the same Corporate Event, and such investors, including Other Accounts, may ha

d not invest more than 25% of the Capital Commitments in any given Corporate Event without the consent of the Institutional Investor, may result in Hudson Bay Capital not being able to invest all of the capital commitments. Non-Consummation Risk The Strategy — like many other "event driven" strategies - is subje

months to several years (depending, to some extent, on whether the Appraisal Proceeding is resolved in court or by settlement with the Acquiror). Hudson Bay Capital may from time to time negotiate to settle an Appraisal Proceeding before it is finally adjudicated. In certain circumstances, under Delaware Law th

cipate in such Appraisal Proceeding (and at what price). Hudson Bay Capital's participation in managing Other Accounts may from time to time cause Hudson Bay Capital to be restricted (due to the receipt of MNPI or other reasons) from participating in certain Corporate Event Investments. Any such restriction would

(ii) Hudson Bay Capital's analysis indicates that the Transaction Price agreed to between the Target and the Acquiror, is below the Fair Value that Hudson Bay Capital believes is likely to be determined in an Appraisal Proceeding. The Corporate Value Fund will generally not invest in Corporate Events that have no

Expedited Transactions The opportunity for the Corporate Value Fund to participate in any given Corporate Event will typically be short-lived, and Hudson Bay Capital may be forced to make investment decisions on an expedited basis. The risk to the Corporate Value Fund of Hudson Bay Capital making expedited inves