STLFI Prospectus

Case 3:11-cv-00078-JBA Document 4-2 Filed 01/14/11 Page 1 of 90
Copy No: _1____
Furnished to: ___MK Special Opportunities Fund Ltd.__
SHORT TERM LIQUIDITY FUND I, LTD.

(an open-ended investment fund incorporated in the Cayman Islands
as an exempted company limited by shares)
PRIVATE OFFERING MEMORANDUM

for the offer of Class A non-voting participating shares
MICHAEL KENWOOD CAPITAL MANAGEMENT, LLC

Investment Manager
MAY 2010
This Private Offering Memorandum is strictly confidential. It is being provided to a restricted number or class of potential
investors. It is intended to be read by the potential investor to whom it has been addressed, and is made available on the
understanding that it will not be passed on to any other person.
This Private Offering Memorandum is not to be distributed in, and no offer of the Offered Shares will be made in, any
jurisdiction in which it would be unlawful to do so without the need for registration or other legal requirements. In any such
jurisdiction, a recipient of this Private Offering Memorandum or the accompanying Subscription Agreement may not treat
either document as an invitation to subscribe for Offered Shares. Nor should that recipient submit a Subscription
Agreement.
Prospective investors should carefully review this Private Offering Memorandum and obtain their own professional advice
before subscribing for Offered Shares. In particular, potential investors should consult with their legal and financial
advisors to determine the possible tax and other consequences of purchasing, holding or redeeming Offered Shares.
BTLG-2823101-1
Confidential Treatment Requested by Arnold & Porter LLP MKG00261811

TABLE OF CONTENTS
DIRECTORY ..............................................................................................................................4
IMPORTANT NOTICE TO POTENTIAL INVESTORS .............................................................5
EXECUTIVE SUMMARY ...........................................................................................................9
SECTION I - THE FUND .........................................................................................................16

1.1 Structure ..........................................................................................................................16
1.2 Regulation .......................................................................................................................17
1.3 Additional information .....................................................................................................17
SECTION II - INVESTMENT OBJECTIVE AND STRATEGY ................................................19

2.1 Investment objective .......................................................................................................19
2.2 Investment strategy .........................................................................................................19
2.3 Investment restrictions ....................................................................................................19
SECTION III - CERTAIN RISK FACTORS .............................................................................21

3.1 General risk factors .........................................................................................................21
3.2 Investment and trading risks ...........................................................................................25
3.3 Potential conflicts of interest ...........................................................................................32
SECTION IV - MANAGEMENT AND ADMINISTRATION .....................................................36

4.1 Board of directors ............................................................................................................36
4.2 Investment Manager .......................................................................................................38
4.3 Administrator ...................................................................................................................41
4.4 Brokerage and custody ...................................................................................................42
4.5 Expenses.........................................................................................................................44
SECTION V - DESCRIPTION OF THE FUND’S SHARES ....................................................46

5.1 General............................................................................................................................46
5.2 Management Shares .......................................................................................................46
5.3 Participating Shares ........................................................................................................46
5.4 Records ...........................................................................................................................47
5.5 Rights of shareholders ....................................................................................................48
5.6 Modification of Class rights .............................................................................................49
5.7 Variation of offering terms ...............................................................................................49
SECTION VI - SUBSCRIPTION, REDEMPTION AND TRANSFER OF SHARES ...............51

6.1 Subscription for shares ...................................................................................................51
6.2 Redemption of Offered Shares .......................................................................................55
6.3 Determining Net Asset Value ..........................................................................................57
6.4 Temporary suspension of dealings .................................................................................60
6.5 Transfer of Offered Shares .............................................................................................61
SECTION VII - FINANCIAL INFORMATION AND REPORTS ..............................................62

7.1 Fiscal year .......................................................................................................................62
7.2 Fiscal periods ..................................................................................................................62
7.3 Financial statements .......................................................................................................62
7.4 Auditors ...........................................................................................................................62
7.5 Reports to shareholders..................................................................................................63
SECTION VIII - TAXATION .....................................................................................................64
BTLG-2823101-1

8.1 General............................................................................................................................64
8.2 Cayman Islands ..............................................................................................................64
8.3 United States ...................................................................................................................65
8.4 Other jurisdictions ...........................................................................................................68
SECTION IX - GENERAL........................................................................................................69
9.1 Directors’ report...............................................................................................................69
9.2 Material Contracts ...........................................................................................................69
9.3 Documents available for inspection ................................................................................69
APPENDIX I .............................................................................................................................70
Eligible Investors ......................................................................................................................70
APPENDIX II ............................................................................................................................72
Subscription Agreement ..........................................................................................................72
APPENDIX III...........................................................................................................................80
Anti-money laundering requirements.......................................................................................80
EXHIBIT I to APPENDIX III......................................................................................................82
Source of fund exemption ........................................................................................................82
EXHIBIT II to APPENDIX III.....................................................................................................83
Letter of introduction ................................................................................................................83
APPENDIX IV ..........................................................................................................................84
Subscription Agreement for subsequent subscriptions ...........................................................84
APPENDIX V ...........................................................................................................................87
Redemption request form ........................................................................................................87
BTLG-2823101-1

DIRECTORY
Directors: Registered Office:
Octavio Calvo Ogier Fiduciary Services (Cayman) Limited

Ronald G. Percival 89 Nexus Way
Odo G. Habeck Camana Bay
Grand Cayman KY1-9007
Cayman Islands
Investment Manager and Administrator: Auditors:
Michael Kenwood Capital Management, LLC McGladrey & Pullen, Cayman

350 Bedford Street, Suite 405 2nd Floor, Harbour Place
Stamford, CT 06901 PO Box 10311
USA Grand Cayman KY1-1003
Cayman Islands
US Legal Advisors to the Investment Manager: Cayman Islands Legal Advisors:
Arnold & Porter LLP Ogier

399 Park Avenue 89 Nexus Way
New York, NY 10022 Camana Bay
USA Grand Cayman KY1-9007
Cayman Islands
Custodian:
Deutsche Bank AG
Herengracht 450-454
1017 CA Amsterdam
Postbus 268
1000 AG Amsterdam
Enquiries
Any enquiries relating to the Fund and this Private Offering Memorandum should be directed to Odo Habeck of
Michael Kenwood Capital Management, LLC at +1 (203)-327-8700 ext. 112 during normal business hours.

IMPORTANT NOTICE TO POTENTIAL INVESTORS
This Private Offering Memorandum
This Private Offering Memorandum (“Memorandum”) relates to the offering of Class A non-
voting participating shares (“Offered Shares”) in Short Term Liquidity Fund I, Ltd. (“Fund”).
The Fund is a company incorporated under the Companies Law (Revised) (the “Law”) of the
Cayman Islands as an exempted company limited by shares.
This Memorandum is strictly confidential. It is intended to be read only by the person to

whom it has been delivered to enable that person to evaluate an investment in the Fund. It
is not to be reproduced or distributed to any other person (except to a prospective investor’s
professional advisors). But each recipient (and each employee, representative, or other
agent of the recipient) may disclose to any person the tax treatment and tax structure of an
investment in the Fund and all related tax materials (including opinions or other tax analyses)
given to the recipient.
Reliance on this Memorandum
The Offered Shares are offered solely on the basis of the information contained in this
Memorandum. Potential investors should disregard, and not rely upon, any other information
or representations given or made by any dealer, broker or other person. No person is
authorised to give any information or to make any representations in connection with the
offering of Offered Shares apart from those contained in this Memorandum. A potential
investor to whom such information or representations are given or made must not rely on
them as having been authorised by the Fund, the directors, the investment manager or the
administrator.
Statements in this Memorandum are based on the law and practice in the Cayman Islands
current at the date it was issued. Those statements are therefore subject to change should
that law or practice change. Under no circumstance does the delivery of this Memorandum
or the issue of Offered Shares imply or represent that the affairs of the Fund have not
changed since the date of this Memorandum.
Investor responsibility
The Fund does not make representations or warranties of any kind with respect to the
economic return from, or the tax consequences of an investment in, the Fund. It cannot
assure that existing laws will not be changed or interpreted adversely.
Prospective investors must not treat this Memorandum as legal, investment or tax advice.
This Memorandum supersedes all previous versions. It should be reviewed before making
an investment decision.
Prospective investors should carefully review the whole of this Memorandum. They should
also consult with their legal, tax and financial advisors in relation to the following:
(i) the legal and regulatory requirements within their own countries for purchasing,
holding, redeeming and disposing of Offered Shares;

(ii) any foreign exchange restrictions to which they may be subject in their own countries
in relation to purchasing, holding, redeeming or disposing of Offered Shares; and
(iii) the legal, tax, financial and other consequences of subscribing for, purchasing,
holding, redeeming or disposing of Offered Shares.
By retaining this Memorandum, each recipient acknowledges and represents to the Fund
that it has read, understood and accepted the terms of this Important Notice. If the recipient
does not accept these terms, it must immediately return this Memorandum to the Fund,
marked to the attention of “The directors”.
No offer in restricted jurisdictions
The distribution of this Memorandum and the offering or purchase of the Offered Shares may
be restricted in certain jurisdictions. Neither this Memorandum nor the Offered Shares
qualify for offer, sale or distribution under the laws of any jurisdiction governing the offer or
sale of mutual fund shares or other securities.
The receipt of this Memorandum or the accompanying Subscription Agreement does not
constitute an invitation to a recipient to subscribe for Offered Shares in a jurisdiction where it
is necessary to comply with some registration or other legal requirement to make that
invitation, or the use of the Subscription Agreement, lawful. No such recipient may treat this
Memorandum or the accompanying Subscription Agreement as an invitation to subscribe for
Offered Shares, nor may such recipient use the Subscription Agreement. More particularly,
this Memorandum does not constitute an offer or solicitation:
• by anyone in a jurisdiction in which such offer or solicitation is not lawful or in which the
person making such offer or solicitation is not qualified to do so; or
• to anyone to whom it is unlawful to make such offer or solicitation.
It is the responsibility of every person in possession of this Memorandum and every person
wishing to apply for Offered Shares to inform himself, herself or itself of, and to observe all
applicable laws and regulations of, any relevant jurisdiction.
The Offered Shares described in this Memorandum have not been, and will not be,
registered under the US Securities Act of 1933, as amended (“Securities Act”), or any
similar law, rule or regulation in any other jurisdiction (including without limitation any law,
rule or regulation of any of the states of the United States of America). The Offered Shares
may not be directly or indirectly offered or sold to or for the benefit of any person or entity
which (i) is a United States person (within the meaning of Regulation S under the Securities
Act or for purposes of US Federal income taxation) or (ii) is not a Non-US Person as defined
in US Commodity Futures Trading Commission (“CFTC”) Rule 4.7 under the US Commodity
Exchange Act, as amended (“CE Act”). See Appendix I for further information on these
restrictions. In addition the Fund has not been and will not be registered under the US
Investment Company Act of 1940, as amended, or any similar law, rule or regulation in any
other jurisdiction (including without limitation any law, rule or regulation of any of the states of
the United States of America). If the directors of the Fund later determine to accept
subscriptions from United States persons, such persons would need to meet certain eligibility
requirements that are not specified herein, and a new Memorandum would be issued. The
Investment Manager is not registered under the US Investment Advisers Act of 1940, as
amended.

Pursuant to an exemption from registration as a commodity pool operator set forth in CFTC
Rule 4.13(a)(4), the Investment Manager is not required to register, and is not registered, as
a commodity pool operator under the CE Act. Consequently, unlike a registered commodity
pool operator, the Investment Manager is not required to provide shareholders with a
disclosure document or certified annual report meeting the requirements of the CFTC rules
generally applicable to registered commodity pool operators. This Memorandum has not
been, and is not required to be, filed with the CFTC, and the CFTC has not reviewed or
approved this Memorandum or the offering of the Offered Shares.
Risks
Investment in the Fund carries with it a degree of risk. The value of the Offered Shares and
the income derived from them may go down as well as up, and investors may not get back
the amount invested. Because of these and other risks, an investment in the Fund is only
suitable for sophisticated investors who:
(a) are able to bear the loss of a substantial portion or even all of the money they invest
in the Fund;
(b) understand the high degree of risk involved;
(c) believe that investment in the Fund is suitable for them based on their investment
objectives and financial needs; and
(d) have no need of liquidity of investment.
Investors are therefore advised to seek independent professional advice on the implications
of investing in the Fund. Certain risk factors that potential investors need to consider appear
in Section III headed “Certain Risk Factors.”
There is no public market for the Offered Shares, nor is a public market expected to develop
in the future.
Confidentiality
Except as outlined in the Data Protection policy in the Subscription Agreement that appears
in Appendix II, any information forwarded to the Fund by a potential investor will be treated
on a confidential basis. If required to do so by law or regulation, the Fund may pass on that
information to a relevant third party. By subscribing for Offered Shares, each investor is
deemed to have consented to such release of confidential information pursuant to Section
3(2)(b)(i) (or any amendment of that provision) of the Confidential Relationships
(Preservation) Law (Revised) of the Cayman Islands.
Forward-looking information
If and when included in this Memorandum, the words “seeks,” “expects,” “believes,”
“intends,” “plans,” “anticipates,” “estimates” and analogous expressions are intended to
identify forward-looking statements. Any statement of this kind is inherently subject to a
variety of risks and uncertainties that could cause actual results to differ materially from
those projected. Without seeking to be exhaustive, those risks and uncertainties include (i)
general economic and business conditions, (ii) interest rate risks, (iii) prepayment risks, (iv)
delinquency and default rates, (v) competition, (vi) changes in political, social and economic
conditions, (viii) regulatory initiatives and compliance with governmental regulations and (ix)

customer preferences. Many of these are beyond the Fund’s or the Investment Manager’s
control.
These forward-looking statements, as well as the information contained in this Memorandum,

speak only as of the date of this Memorandum. None of the Fund, its directors, the
Investment Manager, the Administrator or any of their respective affiliates is obliged, or
undertakes, to release publicly any updates or revisions to any forward-looking statement to
reflect a change in the Fund’s or the Investment Manager’s expectations or a change in
events, conditions or circumstances on which the statement is based.
FOR CAYMAN ISLANDS PROSPECTIVE INVESTORS
THE FUND MAY NOT MAKE AN INVITATION TO THE PUBLIC IN THE CAYMAN ISLANDS
TO SUBSCRIBE FOR THE OFFERED SHARES UNLESS THE FUND IS LISTED ON THE
CAYMAN ISLANDS STOCK EXCHANGE. “PUBLIC” FOR THESE PURPOSES SHALL
HAVE THE SAME MEANING AS “PUBLIC IN THE ISLANDS”, AS DEFINED IN THE
MUTUAL FUNDS LAW (REVISED). HOWEVER, OFFERED SHARES MAY BE
BENEFICIALLY OWNED BY PERSONS RESIDENT, DOMICILED, ESTABLISHED,
INCORPORATED OR REGISTERED PURSUANT TO THE LAWS OF THE CAYMAN
ISLANDS. THE FUND WILL NOT UNDERTAKE BUSINESS WITH ANY PERSON IN THE
CAYMAN ISLANDS EXCEPT IN FURTHERANCE OF THE BUSINESS OF THE FUND
CARRIED ON EXTERIOR TO THE ISLANDS.

EXECUTIVE SUMMARY
You should not rely on this Executive Summary alone; you must read it in conjunction with
the rest of this Memorandum together with the Fund’s memorandum and articles of
association and its other material contracts.
The Fund Short Term Liquidity Fund I, Ltd. (“Fund”) is incorporated in the
Cayman Islands as an exempted company limited by shares. It
was incorporated on June 20, 2008.
The Fund’s authorised share capital is US $100,000 which is

made up of:
• 100 management shares of US $0.01 par value per share

(“Management Shares”); and
• 9,999,900 participating shares of US $0.01 par value per

share (“Participating Shares”).
Initially, the directors have designated one class of

Participating Shares for offer to investors, being Class A shares
(“Offered Shares”). At any time, the directors may designate
additional classes and series of Participating Shares without
notice to, or the consent of, the Fund’s shareholders. They
may also differentiate between classes on various bases,
including, as to (i) the currency of denomination of each class,
(ii) the level of fees payable in respect of each class; (iii) the
pool of assets into which each class invests; and (iv) the
redemption or information rights applicable to each class.
The Class A shares will be issued in series to accommodate an

equitable calculation of the Incentive Fee.
(In the rest of this Memorandum, the expressions “Class” and

“Series” refer any class or series, respectively, of Participating
Shares designated as such by the directors pursuant to the
Fund’s articles. Also, “$” or “US dollars” refers to US currency.)
See Section V headed “Description of the Fund’s Shares” for

full details.
Investment objectives While the Fund may, from time to time, invest in longer-term
and strategies securities, its primary investment strategy seeks to take
advantage of products offered in the global fixed income and
derivatives markets to generate gains through short-term
(under one year) investments in sovereign securities,
particularly those subject to currency arbitrage opportunities in
their country of issuance, due to a particular country’s
exchange rate policy. The Fund may, from time to time, also

invest in G-20 government securities and derivatives

referencing such securities, as well as selected short-term
instruments issued by international financial institutions and
other business entities.
In addition, the Fund may, from time to time, take a

transactional approach to the trading of fixed income securities,
by taking advantage of inefficiencies in the currency markets of
the securities in which it invests to generate arbitrage gains.
The Fund may invest in securities denominated in different

currencies. These currencies will generally include the US
Dollar (USD), the Euro (EUR) and the British Pound Sterling
(GBP), as well as currencies of developing countries such as
the Brazilian Real (BRL) and the Venezuelan Bolívar Fuerte
(VEF). From time to time, the Fund may add other currency
denominations to its investments.
The Investment Manager generally intends to limit the leverage

applied to the Fund’s investments to 2-to-1 or less (i.e., the
Fund generally will have at least $1,000 in net equity for every
$2,000 initially invested by the Fund).
Service Providers Directors: Octavio Calvo
Ronald G. Percival
Odo G. Habeck
Investment Manager Michael Kenwood Capital Management,

and Administrator: LLC (“Investment Manager” or
“Administrator” as the context warrants)
Custodian: Deutsche Bank AG (“Custodian”)
See Section IV headed “Management and Administration” for

full details.
Offering The initial offering of Offered Shares is open for the period from
now until the time nominated by the directors (“Initial Offering
Period”), or the later date nominated by the directors (“Closing
Date”). During the Initial Offering Period, the Offered Shares
are available for issue to Eligible Investors at a subscription
price of $1,000 per share. (Investors who qualify as “Eligible
Investors” are specified in Appendix 1.)
After the Closing Date, the Offered Shares will be issued in

Series, generally monthly, with a separate Series being issued
on the first business day of the month, or an alternative day
nominated by the directors (“Subscription Day”), at a
subscription price of $1,000 per share.
If the directors so determine, subscriptions for Offered Shares
10

may be subject to an initial charge. Subscription amounts will

be invested net of that charge.
See Section VI headed “Subscription, Redemption and

Transfer of Shares” for full details.
Subject to the Law, and in the sole discretion of the Directors,

each shareholder holding Offered Shares will be paid a
monthly dividend when the Net Asset Value per Share held by
such shareholder for the current month exceeds the Net Asset
Value per Share for the immediately preceding month. The
dividend will be calculated by subtracting the Net Asset Value
per Share at the end of the immediately preceding month from
the Net Asset Value per Share for the current month, in each
case as reduced by any accrued Incentive Fees (the
“Dividend”). The Dividend will be paid at the end of each
month, after the deduction of the Management Fees and out of
the profits available for such payment. Please see the section
entitled “Description of the Fund’s Shares” for further
information.
Minimum investment The minimum initial investment for the Offered Shares is
$1,000,000. The directors may fix some other amount as the
minimum subscription payable by a particular shareholder or
group of shareholders, but such amount shall not be below any
statutory minimum, currently US $100,000.
Eligible Investors Only Eligible Investors may subscribe for shares. See
Appendix I for the description of persons who qualify as Eligible
Investors.
Redemptions Generally, on the holder of Offered Shares giving at least 30

days’ prior written notice, those shares may be redeemed as of
the last business day of a calendar month, or an alternative day
nominated by the directors, (“Redemption Day”) at Net Asset
Value per Share prevailing at the close of business on that
Redemption Day.
In this Memorandum:
“Net Asset Value”, in respect of the Fund or each Class or

Series of Participating Shares, refers the net asset value of the
Fund or that Class or Series determined using the valuation
principles described in Section VI headed “Subscription,
Redemption and Transfer of Shares” and will be calculated
after considering all income, gains, expenses and losses for
each reporting period;
“Net Asset Value per Share”, in respect of a share of a Class

or Series, refers to the Net Asset Value for that Class or Series
divided by the number of currently issued shares of that Class
or Series; and
a reference to a business day refers a day other than a
11

Saturday or Sunday on which banks are open for business

generally in New York, or an alternative day nominated by the
directors.
The Fund may compulsorily redeem shares in certain

circumstances.
Normally, the redemption proceeds will be paid in cash (in

US $) by electronic transfer at the shareholder’s risk and
expense. However, in certain circumstances, the proceeds
may be satisfied in securities, or partly in cash and partly in
securities. No redemption charges will apply to the Offered
Shares.

Transfer of Shares – Redemption of Offered Shares” for full
details.
Transfers Offered Shares may not be transferred without the prior written
consent of the directors.

Transfer of Shares – Transfer of Offered Shares” for full details.
Fees/expenses The Fund is responsible for the following fees and expenses.
(a) The Investment Manager is entitled to receive the

following fees:
• The Investment Manager will be paid a monthly

management fee (“Management Fee”),
payable in arrears, of 1/12th of 2% of the Net
Asset Value of the Fund (approximately 2%
annually).
• In addition, as of the end of each calendar year,

the Investment Manager will be paid an
incentive fee (“Incentive Fee”) in an amount
equal to 20% of the Net New Appreciation
achieved by each Series of Participating Shares
as of the end of such year prior to giving effect
to the Dividend to be determined as of such
year-end. “Net New Appreciation” achieved by
a Series of Participating Shares as of any date
of determination shall mean the excess, if any,
of (a) the Net Asset Value of such Series as of
such date of determination, calculated without
reduction for any Incentive Fee accrued or
payable to the Investment Manager with
respect to such Series as of such date, over (b)
the Net Asset Value of such Series as of the
then applicable High Water Mark Date for such
Series, reduced by the aggregate amounts of
Dividend declared after the High Water Mark
12

Date, and proportionately reduced to reflect any

redemptions of Participating Shares in such
Series since such High Water Mark Date. The
“High Water Mark Date” for a Series of
Participating Shares as of any date of
determination shall mean the most recent date
as of which an Incentive Fee was payable with
respect to such Series or, if no such Incentive
Fee has previously been paid to the Investment
Manager, the initial subscription date for such
Series. For purposes of determining Net New
Appreciation, the Net Asset Value of a Series
shall not be reduced by any extraordinary fees
and expenses (such as attorneys’ fees and
expenses incurred in relation to any litigation).
• If any Participating Shares in a Series are

redeemed as of any day other than the end of a
calendar year, any Incentive Fee accrued with
respect to such Shares as of the redemption
date will be paid to the Investment Manager at
the time of the redemption (as if such
redemption date were the end of a calendar
year).
These fees are payable under the agreement

(“Management Agreement”) between the Fund
and the Investment Manager referred to in Section
IV headed “Management and Administration”.
Out of these fees, the Investment Manager bears

all of its administration and operational expenses
incurred in providing investment-management
services to the Fund.
(b) The Administrator is entitled to fees as agreed

under the agreement between the Fund and the
Administrator (“Administration Agreement”) also
referred to in Section IV headed “Management and
Administration”.
(c) The Fund compensates the Custodian and

providers of brokerage services on arm’s-length
commercial terms. The fees payable to the
Custodian are payable under the agreement
(“Custodian Agreement”) between it and the
Fund, once again referred to in Section IV headed
“Management and Administration”.
(In this Memorandum, a reference to “Material Contracts”

is a reference to the Management Agreement,
Administration Agreement and Custodian Agreement.)
The Fund bears all costs of its investment program, other
13

than those borne by the Investment Manager. Those costs

include interest and taxes as well as professional fees of its
auditors and legal advisers. The Fund is also responsible
for its initial organisational expenses.
See Section IV headed “Management and Administration –

Expenses”.
Risk factors An investment in the Fund entails certain risks. Prospective

investors should review carefully the discussion about risks in
Section III headed “Certain Risk Factors”.
Reporting The Fund will furnish to each shareholder an annual report that
will include audited financial statements as of the end of each
fiscal year. The Fund will also provide shareholders with a
monthly unaudited report on the investment performance of the
Fund.
Fiscal year The Fund’s fiscal year will end on December 31 of each year,
with the first fiscal year ending on December 31, 2010.
Tax Apart from registration and annual filing fees, the Fund is not
(under the current laws of the Cayman Islands) subject to tax in
the Cayman Islands. Each prospective investor should consult
its own advisors about the tax consequences in any jurisdiction
for it of any proposed investment in the Fund.
Subscription procedure To participate, an investor must do the following:
(a) complete and return the form reproduced in Appendix II

(“Subscription Agreement”); and
(b) transfer its subscription price to the Fund’s bank

account.
The directors may, in their sole discretion, permit subscriptions

in kind, as further described herein.
Defined terms This Memorandum uses capitals to identify defined terms.

Most of those terms are defined in this summary.
Occasionally, a term is defined elsewhere in the part of this
Memorandum that directly relates to it.
In addition, other matters of interpretation to note are these:
(a) a reference to any law, legislation or legislative

provision includes any statutory modification,
amendment or re-enactment, and any subordinate
legislation or regulations issued under that legislation or
legislative provision;
(b) a reference to any document or agreement is to that

document or agreement as amended, novated,
supplemented or replaced; and
14

(c) a reference to ‘including’ or similar expression does not

imply any limitation.
15

SECTION I - THE FUND
1.1 Structure
The Fund is a corporate, multi-class, open-ended investment fund. It was

incorporated under the Law (the “Law”) of the Cayman Islands on June 20, 2008 as
an exempted company limited by shares. The location of its registered office
appears in the Directory.
The Fund will only accept subscriptions for shares from Eligible Investors. It reserves
the right to reject any subscriptions.
The Fund maintains a separate record of income and expenses for each Class. All
income and capital gains earned on the assets of a particular Class are recorded in
the record for that Class. Similarly, all expenses and liabilities related to a particular
Class, and any redemption of the Offered Shares of that Class, are charged to and
paid from the record for that Class. All expenses of the Fund not directly attributable
to a specific Class are allocated to all Classes in the proportion that the net asset
value of each Class bears to the total net asset value of the Fund.
A member of the Fund who holds shares of one Class will only have an interest in the
assets specified in the record the Fund maintains for that Class; that member will
have no interest in any other assets of the Fund. But each Class does not exist
separately from the Fund. Accordingly, if the assets attributable to a particular Class
are insufficient to discharge all debts arising in respect of that Class, creditors may
have recourse to the assets of the Fund as a whole, being the assets attributable to
the other Classes.
In an attempt to ensure that investors in one Class are not exposed to trading risks of
another Class, the Fund’s directors may choose to carry on the investment
programme of a Class through a separate trading company attributable to that Class
that is a wholly-owned subsidiary of the Fund. That wholly-owned subsidiary may be
incorporated in the Cayman Islands or elsewhere. If the Fund’s directors choose to
do that, then, so far as possible under applicable law, any trading losses associated
with a particular Class will be contained within the relevant trading company and
should have no impact on the assets of any other Class unless the trading company
is treated as the agent or alter ego of the Fund.
In addition, if, following consultation with the Investment Manager, it appears

expedient for tax, regulatory or other reasons the directors consider appropriate, the
Fund may:
(i) invest through one or more wholly-owned subsidiaries of the Fund; or
(ii) channel investments through a vehicle that would effectively operate as a

master fund in which one or more Classes of Offered Shares or other
investment vehicles may invest.
Any trading companies, investment subsidiaries or master fund may be managed by

the Investment Manager or its affiliates and may pay separate fees to those persons.
Any trading companies, investment subsidiaries or master fund may incur operational
and administrative costs and expenses that include, but are not limited to,
16

establishment costs, custodian fees and local regulatory fees. These costs and
expenses will be paid out of the assets of the Fund.
Unless otherwise indicated, references to the “Fund” in this Memorandum include the
Fund and, as the context may permit, the applicable trading companies, investment
subsidiaries or master fund.
1.2 Regulation
The Fund will, prior to issuing Offered Shares to more than 15 investors, register as a
mutual fund under the Mutual Funds Law (Revised) of the Cayman Islands (“Mutual
Funds Law”). Regulation under the Mutual Funds Law entails the filing of prescribed
details and audited accounts annually with the Cayman Islands Monetary Authority
(the “Monetary Authority”).
Once registered as a regulated mutual fund, the Fund will be subject to the
supervision of the Monetary Authority; however, the Fund will not be subject to
supervision in respect of its investment activities or the constitution of the Fund’s
portfolio by the Monetary Authority or any other governmental authority in the
Cayman Islands, although the Monetary Authority will have power to investigate the
activities of the Fund in certain circumstances as set forth below. The Monetary
Authority may at any time instruct the Fund to have its accounts audited and to
submit them to the Monetary Authority within such time as the Monetary Authority
specifies. Failure to comply with these requests by the Monetary Authority may
result in substantial fines on the part of the Directors and may result in the Monetary
Authority applying to the court to have the Fund wound up.
The Monetary Authority may take certain actions if it is satisfied that a regulated mutual
fund is or is likely to become unable to meet its obligations as they fall due or is carrying
on or is attempting to carry on business or is winding up its business voluntarily in a
manner that is prejudicial to its investors or creditors. The powers of the Monetary
Authority include the power to require the substitution of Directors, to appoint a person
to advise the Fund on the proper conduct of its affairs or to appoint a person to assume
control of the affairs of the Fund. There are other remedies available to the Monetary
Authority including the ability to apply to court for approval of other actions.
Neither the Monetary Authority nor any other governmental authority in the Cayman
Islands has passed judgment upon or approved the terms or merits of this document.
There is no investment compensation scheme available to investors in the Cayman
Islands.
1.3 Additional information
This Memorandum does not give a complete description of the Fund’s Memorandum
and Articles of Association or the Material Contracts. Before investing in the Fund,
each prospective investor should examine this Memorandum, the Subscription
Agreement in Appendix II, the Fund’s memorandum and articles of association and
the Material Contracts, and satisfy itself that an investment in the Fund is
appropriate. In addition, before a prospective investor buys any Offered Shares, the
Fund will allow it or its representative:
(i) to ask questions of, and receive written answers from, representatives of the
Fund concerning any aspect of the investment, and
17

(ii) to obtain any additional information, to the extent that the Fund possesses
that information or can acquire it without unreasonable effort or expense.
An investment in the Fund may be considered speculative. It is not intended as a

complete investment program. It is designed solely for experienced and
sophisticated investors who are able to bear the risk that all or a substantial part of
their investment may be lost.
18

SECTION II - INVESTMENT OBJECTIVE AND STRATEGY
2.1 Investment objective
While the Fund may, from time to time, invest in longer-term securities, its primary
investment strategy seeks to take advantage of products offered in the global fixed
income and derivatives markets to generate gains through short-term (under one
year) investments in sovereign securities, particularly those subject to currency
arbitrage opportunities in their country of issuance, due to a particular country’s
exchange rate policy. The Fund may, from time to time, also invest in G-20
government securities and derivatives referencing such securities, as well as
selected short-term instruments issued by international financial institutions and other
business entities.
In addition, the Fund may, from time to time, take a transactional approach to the
trading of fixed income securities, by taking advantage of inefficiencies in the
currency markets of the securities in which it invests to generate arbitrage gains.
The Fund may invest in securities denominated in different currencies. These

currencies will generally include the US Dollar (USD), the Euro (EUR) and the British
Pound Sterling (GBP), as well as currencies of developing countries such as the
Brazilian Real (BRL) and the Venezuelan Bolívar Fuerte (VEF). From time to time,
the Fund may add other currency denominations to its investments.
The Investment Manager generally intends to limit the leverage applied to the Fund’s
investments to 2-to-1 or less (i.e., the Fund generally will have at least $1,000 in net
equity for every $2,000 initially invested by the Fund).
2.2 Investment strategy
The investment objectives and strategies summarised in this Memorandum represent

the Investment Manager’s current intentions. Depending on conditions and trends in
the securities markets and the economy in general, the Investment Manager may
pursue any strategies, employ any investment techniques and purchase any type of
security it considers appropriate to achieve the investment objective of the Fund, as
long as they are constrained to fixed income securities and derivatives referencing
fixed income securities. It may pursue these alternative strategies subject to any
applicable law or regulation, irrespective of whether they are described in this
Section.
The discussion in this Section includes and is based on numerous assumptions and
opinions of the Investment Manager concerning world financial markets and other
matters. The accuracy of those assumptions and opinions cannot be assured. The
Fund cannot give an assurance that its investment strategy will achieve the intended
investment objective. The Fund’s investment program is speculative and involves a
high degree of risk. There is even a risk that the entire amount invested will be lost.
2.3 Investment restrictions
The Fund’s investment policy is to be able to invest in a range of fixed income

securities and derivatives as described above. The Fund is unlikely to restrict this
policy by applying any investment restrictions in relation to the Offered Shares. From
19

time to time it may carry a significant cash holding or invest in a single security or
instrument.
20

SECTION III - CERTAIN RISK FACTORS
An investment in the Fund entails substantial risks. Those risks include the ones listed
below but there may be others. In ascertaining whether an investment in the Fund is suitable
for it, a prospective investor should carefully consider the following risk factors, amongst
others:
3.1 General risk factors
3.1.1 Overall investment risk
All investments in securities risk the loss of capital. There may be increased risk due
to the nature of the securities to be purchased and traded by the Fund and the
investment techniques and strategies used to try to increase profits. While the
Investment Manager will devote its best efforts to the management of the Fund’s
portfolio, it cannot give an assurance that the Fund will not incur losses. Many
unforeseeable events, including actions by various government agencies and
domestic and international political events, may cause sharp market fluctuations.
3.1.2 Lack of operating history
The Fund is a recently formed entity and has no prior operating history that a
prospective investor can evaluate before making an investment in the Fund. A
prospective investor should evaluate the Fund’s investment program on the basis
that no one can guarantee that the Investment Manager’s assessment of the short-
or long-term prospects of its investment strategy will prove accurate, or that the Fund
will achieve its investment objective.
3.1.3 Dependence on key personnel
The Fund’s investment activities depend on the experience and expertise of the
principals of the Investment Manager. If a principal leaves the Investment Manager,
this may have a material adverse effect on the Fund’s operations.
3.1.4 Illiquidity of shares
Participating Shares are not transferable without the approval of the directors, and
there will be no secondary market for shares. Consequently, a holder of Participating
Shares may only be able to dispose of its shares by having the Fund redeem them,
assuming that redemption is available. Even then the shareholder may receive
securities rather than cash in exchange for its shares.
3.1.5 Possible effect of substantial redemptions
If a substantial number of shares are redeemed at one time, the Fund may have to
liquidate its positions more rapidly than otherwise desired in order to raise the cash
necessary to fund those redemptions. The Fund may find it difficult to liquidate its
positions on favourable terms if some of the securities it holds are illiquid. This could
result in losses or a decrease in the Net Asset Value of the Fund.
If the Investment Manager determines that it is inadvisable to liquidate portfolio

assets for the purpose of redeeming Participating Shares, the Fund is authorised to
borrow cash to meet redemption requests. The Fund may also pledge portfolio
21

assets as collateral security for the repayment of that borrowing. In these

circumstances, the continuing shareholders will bear the risk of any subsequent
decline in the value of the Fund’s assets.
3.1.6 Absence of regulatory oversight
The Fund is not currently a registered as a regulated mutual fund under the Mutual
Funds Law of the Cayman Islands, and it is not required to, nor does it intend to,
register under the laws of any other jurisdiction. In particular, the Fund is not and will
not be registered as an investment company under the US Investment Company Act
of 1940, as amended (the “Investment Company Act”). In addition, the Investment
Manager is not registered as an investment adviser under the US Investment
Advisers Act of 1940, as amended, or under the laws of any State of the United
States. As a consequence, the statutes of certain jurisdictions (which may provide
certain regulatory safeguards to investors) do not apply. For example, the Fund is
not required to maintain custody of its securities or place its securities in the custody
of a bank or member of a recognised securities exchange in the same way as
required under the statutes of some other jurisdictions.
3.1.7 Limited rights of holders of Participating Shares
An investment in the Fund should be regarded as a passive investment.
This is because shareholders holding Participating Shares have no right to

participate in the day-to-day operations of the Fund, nor are they entitled to receive
notice of, attend or vote at general meetings of the Fund, other than a general
meeting to vote on a proposed variation of the rights attaching to their shares.
Consequently, they have no control over the management of the Fund or over the
appointment and removal of its directors and service providers. As holder of all the
Management Shares, the Investment Manager controls all of the voting interests in
the Fund, other than in respect of any vote to appoint or remove a director of the
Fund or a proposal to vary the rights attaching to the Participating Shares.
Consequently, it may make any changes to the Fund’s memorandum and articles of
association that it considers appropriate, including increasing the share capital,
consolidating the Participating Shares and sub-dividing the Participating Shares.
Only the Investment Manager can appoint and remove the directors of the Fund and,
in turn, only the directors can terminate the services of the Investment Manager, the
Administrator and other agents of the Fund.
3.1.8 Side letters
From time to time, the Fund (if required, with the consent of the Investment Manager)
may enter into agreements (“Side Letters”) with certain prospective or existing
shareholders holding Participating Shares of a certain Class that provides for offering
terms that vary from those applicable to other shareholders of the same Class. For
example, a Side Letter with a prospective or existing shareholder may give that
shareholder one or more of the following advantages over other holders of
Participating Shares:
(i) the waiver, reduction or rebate of fees or allocations payable in respect of

those shares;
(ii) special rights to make future investments in the Fund, other investment
vehicles or managed accounts;
22

(iii) special redemption rights relating to frequency, period of notice, redemption

fees (whether in the form of a reduction or rebate), redemption penalties
payable or other terms, more favourable transfer rights, or any combination of
these;
(iv) rights to receive reports from the Fund on a more frequent basis or that
include information not provided to other shareholders (including, without
limitation, more detailed information regarding portfolio positions); and
(v) such other rights as may be negotiated by the Fund and that shareholder.
The terms of any Side Letters are in the sole discretion of the Fund. They may be
based on the following things, amongst others: (i) the size of the shareholder’s
investment in the Fund or affiliated investment entity; (ii) an undertaking by the
shareholder to maintain its investment in the Fund for a significant period of time; or
(iii) some other similar undertaking by the shareholder to the Fund.
In addition, the Investment Manager is organizing other funds, and may determine to
organize additional funds and separately managed accounts that share substantially
similar investment strategies and objectives with the Fund from time to time. Such
other funds or accounts may offer the investors in such funds or accounts benefits
that shareholders will not receive in relation to their investments in the Fund, such as
different investment return/dividend characteristics, increased liquidity, heightened
transparency (including with respect to portfolio composition information), the right to
impose investment restrictions or guidelines, heightened reporting and reduced
management fees and incentive allocations or fees. The Fund is not required to
notify shareholders of the terms applicable to such other funds or accounts, and such
increased liquidity and/or heightened transparency may have an adverse effect on
the Fund.
3.1.9 Valuation of the Fund’s investments
Valuation of the Fund’s securities and other investments may involve uncertainties
and judgmental determinations. If a valuation is incorrect, the Net Asset Value per
Share may be adversely affected. Independent pricing information about some of the
Fund’s securities and other investments may not always be available. However,
valuations will be made in good faith in accordance with the Articles.
If the value assigned by the Fund to an investment differs from its actual value, the
Net Asset Value per Share may be either understated or overstated to the extent of
that difference. Consequently, if the actual value of some of the Fund’s investments
is higher than the value assigned to them, a shareholder holding Participating Shares
who redeems all or part of its shares while they are so undervalued may be paid less
than if they were correctly valued. Conversely, if the actual value of some of the
Fund’s investments is lower than the value assigned to them, the redeeming
shareholder may, in effect, be overpaid.
Furthermore, an investment in the Fund by a new shareholder (or an additional

investment by an existing shareholder) may dilute the value of the Fund’s
investments for the other shareholders if those investments are undervalued.
Conversely, a new shareholder (or an existing shareholder who makes an additional
investment) could pay too much if the Fund’s investments are overvalued by the
Fund. If either of these scenarios happens, the Fund does not intend to adjust the
Net Asset Value per Share retroactively.
23

None of the directors, nor the Fund or Administrator will be liable if a price or
valuation used in good faith in connection with any of the above procedures later
proves to be incorrect or inaccurate.
3.1.10 In-kind distributions
A redeeming shareholder may, in the discretion of the directors, receive securities

owned by the Fund in lieu of or in combination with cash. The value of securities
distributed may increase or decrease before the securities can be sold, and the
investor will incur transaction costs in connection with the sale of those securities.
Additionally, securities distributed to a shareholder in connection with a redemption
may not be readily marketable. In those circumstances, the investor bears the risk of
loss and delay in liquidating those securities, with the result that it may ultimately
receive less cash than it would otherwise have received if it had been paid in cash
alone for its shares on the date of redemption.
3.1.11 Business and regulatory risks of hedge funds
Legal, tax and regulatory changes during the term of the Fund may adversely affect
it. The regulatory environment for hedge funds is evolving. Changes in the
regulation of hedge funds may adversely affect the value of the Fund’s investments.
They may also adversely affect its ability to pursue its trading strategies or to obtain
the leverage it might otherwise have obtained. In addition, securities and futures
markets are subject to comprehensive statutes, regulations and margin
requirements. Regulators and self-regulating organisations and exchanges are
authorised to take extraordinary actions in cases of market emergencies. The
regulation of derivative transactions and funds that engage in those transactions is
an evolving area of law and is subject to modification by government and judicial
actions. The effect of any future regulatory change on the Fund could be substantial
and adverse.
3.1.12 No separate counsel
Ogier will act as Cayman Islands counsel to the Fund. Arnold & Porter LLP will act
as US counsel to the Fund in relation to taxation matters. No separate counsel has
been retained to act on behalf of the shareholders or any independent directors. This
Memorandum is based on information furnished by the Investment Manager. Neither
Ogier nor Arnold & Porter LLP has independently verified that information.
3.1.13 Tax risks
The Stop Tax Haven Abuse Act (S.506) was recently introduced in the United States
Senate. If enacted in its current form, the legislation could adversely impact the US
treatment of the Fund. It would provide that if a corporation has aggregate gross
assets of $50 million or more, and its management and control occurs primarily in the
United States, that corporation will be treated as a US domestic corporation for
income tax purposes. The US Department of the Treasury would be directed to
issue regulations to guide the determination of when management and control occur
primarily in the United States, looking at whether substantially all of the executive
officers and senior management of the corporation who exercise day-to-day
responsibility for making decisions involving strategic, financial and operational
policies of the corporation are located primarily within the United States. If the Fund
were treated as a US, rather than a foreign, corporation as a result of the application
of the Stop Tax Haven Abuse Act, it would generally be subject to US federal income
24

tax on any taxable income (including all interest income, dividend income and net
capital gains) realized by it at regular corporate income tax rates applicable to US
corporations (currently at graduated rates up to 35%). Generally, distributions on
Participating Shares to shareholders that are Non-US Holders (as defined below)
(that are not otherwise engaged in a US trade or business and subject to taxation at
graduated rates) would be subject to US federal tax withholding at 30% and, with
respect to Non-US Holders who satisfy certain tests for presence in the United
States, gains on the sale, exchange or other disposition of Participating Shares
would be subject to 30% federal tax.
3.1.14 Possible Trade or Business within the United States
No assurance can be given that the Fund will successfully limit its activities within the
United States and otherwise conduct its affairs and structure its investments so that it
will not be treated as engaged in a trade or business within the United States. If the
Fund is considered to be engaged in a trade or business within the United States as
a result of any activities of the Fund, the Investment Manager or the Administrator or
otherwise, income and gain of the Fund that is effectively connected with that US
trade or business will be subject to Federal income tax at graduated rates and, in
addition, subject to a flat 30% branch profits tax. If the Fund is required to pay
Federal income tax on its income or gains because it is considered to be engaged in
a trade or business within the United States, such tax could result in a reduction of
the amount of assets available for distribution to shareholders.
3.2 Investment and trading risks
3.2.1 Sovereign risk
The Fund may invest in sovereign debt, and may invest in securities and instruments
of developing or emerging market issuers which are or may become non-performing
and/or where the issuer is in default, at the time of purchase, of principal repayment
obligations. In any such case, the actions of governments concerning their
respective economies could have an important effect on their ability or willingness to
service their sovereign debt. Such actions could have significant effects on market
conditions and on the prices of securities and instruments held by the Fund, including
the securities and instruments of non-US private issuers. As a result of political,
economic or social factors not discussed herein, a governmental obligor may
restructure or default on its obligations. Restructuring arrangements have included
reducing and rescheduling interest and principal payments by converting outstanding
principal and unpaid interest to new securities and obtaining new credit to finance
interest payments. The non-US debt securities in which the Fund may invest may be
subject to such restructuring arrangements, which may adversely affect the value of
such investments. Furthermore, certain participants in the secondary market for
such debt may be directly involved in negotiating the terms of restructuring
arrangements, and may therefore have access to information not available to other
market participants. If a non-US sovereign defaults on all or a portion of its non-US
debt, the Fund may have limited legal recourse against the issuer and/or guarantor.
Remedies must, in some cases, be pursued in the courts of the defaulting party itself,
and the ability of the holder of non-US sovereign debt securities to obtain recourse
will be subject to the political climate in the relevant country. Further, the markets for
non-US sovereign debt generally are less liquid than the market for US Treasury
bills, bonds and notes.
25

3.2.2 Currency risks
Shares are denominated in US Dollars. However, it is likely that a substantial portion

of the investments made by the Fund will be denominated in other currencies.
Accordingly, the value of such investments may decline due to fluctuations in the
exchange rates between dollars and the currencies in which such investments are
made. Among the factors that may affect currency values are trade balances, the
level of short-term interest rates, differences in relative values of similar assets in
different currencies, long-term opportunities for investment, capital appreciation and
political developments. The risk of a decline in value of the investments due to
foreign exchange fluctuations may not be hedged. The Investment Manager will
monitor the currency exposures and when it deems appropriate, in its sole discretion,
may implement currency hedging strategies, which may utilize currency forwards,
futures, swaps or other derivative instruments.
3.2.3 Emerging markets
Investment in emerging markets generally poses a greater degree of risk than

investment in more mature market economies because the economies in the
developing world are more susceptible to destabilization resulting from domestic and
international developments.
In addition, because international investors’ reactions to the events occurring in one

emerging market country sometimes have demonstrated a “contagion” effect with
respect to other emerging market countries, in which an entire region or class of
investment is disfavored by international investors, an investment in a particular
country’s debt could be affected by negative economic or financial developments in
other emerging market countries.
In addition, investing in emerging markets include risks such as smaller market

capitalization of securities markets, which may suffer periods of relative illiquidity;
significant price volatility; restrictions on foreign investment; and possible repatriation
of investment income and capital. In addition, investors may be required to register
the proceeds of sales. Securities traded in certain emerging markets countries may
be subject to risks in addition to risks typically posed by international investing due to
the inexperience of financial intermediaries and the lack of a sufficient capital base to
expand business operations.
Emerging securities markets may have different clearance and settlement

procedures, which may be unable to keep pace with the volume of securities
transactions or otherwise make it difficult to engage in such transactions. Settlement
problems may cause the Fund to miss attractive investment opportunities, hold a
portion of its assets in cash pending investment, or be delayed in disposing of a
portfolio security. Such a delay could result in possible liability to a purchaser of such
security.
3.2.4 Corporate debt obligations
The Fund may invest in corporate debt obligations, including commercial paper.
Corporate debt obligations are subject to the risk of an issuer’s inability to meet
principal and interest payments on the obligations (credit risk). Evaluating the credit
risk of a corporate issuer involves different factors and skills than evaluating the
credit risk of a sovereign issuer. Moreover, the markets for commercial paper and
26

corporate debt obligations have recently experienced, and may continue to

experience, periods of illiquidity.
3.2.5 Trading in securities of non-US issuers
The Investment Manager may trade in securities of non-US issuers traded outside of
the United States. In addition to currency exchange risks, such trading requires
consideration of certain other risks not typically associated with investing in securities
of US issuers. There may be less publicly available information regarding issuers
located in certain countries. In addition, certain countries may have no laws or
regulations prohibiting insider trading. Furthermore, if the accounting standards in a
non-US country do not require as much detail as US standards, it may be harder for
the Investment Manager to analyze the financial condition of an issuer located in
such country. The economies of certain countries often do not compare favorably
with the economy of the United States with respect to such issues as growth of gross
national product, reinvestment of capital, resources and balance of payments
position. Certain of such economies may rely heavily on particular industries or
foreign capital and are more vulnerable to diplomatic developments, the imposition of
economic sanctions against a particular country or countries, changes in international
trading patterns, trade barriers and other protectionist or retaliatory measures.
Investments in non-US markets also may be adversely affected by governmental
actions such as the imposition of capital controls, nationalization of companies or
industries, expropriation of assets or the imposition of punitive taxes. In addition, the
governments of certain countries may prohibit or impose substantial restrictions on
foreign investing in their capital markets or in certain industries. Any such action
could severely affect security prices, impair the Investment Manager’s abilities to
purchase or sell non-US securities or otherwise adversely affect the Fund. Other
non-US market risks include difficulties in pricing securities, difficulties in enforcing
favorable legal judgments in non-US courts, and political and social instability. Legal
remedies available to investors in certain countries may be less extensive than those
available to investors in the United States or other countries.
3.2.6 Geopolitical instability, pandemics, natural disasters and terrorism
An unstable geopolitical climate, pandemic, natural disaster or terrorist action could

severely disrupt global, national or regional economies, and adversely affect the
performance of the Fund.
3.2.7 General economic and market conditions; possible economic downturns
The success of the Fund’s investment activities will be affected by general economic
and market conditions, such as interest rates, availability of credit, inflation rates,
economic uncertainty, changes in laws, currency exchange controls, and national
and international political circumstances, as well as changes in the financial condition
of the issuers of the Fund’s investments due to other factors. Such conditions may
affect the level and volatility of securities prices and the liquidity of the Fund’s
investments. Volatility or illiquidity in the financial markets could impair the Fund’s
profitability or result in losses. The Fund may maintain substantial investment
positions that can be adversely affected by volatility and illiquidity in the financial
markets; the larger the positions, the greater the potential for loss. Moreover,
economic slowdowns or downturns may lead to losses.
27

3.2.8 Arbitrage risks
If the financial instruments being bought and sold in an arbitrage are not identical,
and the arbitrageur has incorrectly assumed that the prices will be correlated, the
prices may fail to converge and thus create risk of loss. Such risk is magnified when
borrowings are used to leverage trades.
3.2.9 Uncovered risks
The Investment Manager may employ various “risk-reduction” techniques designed in

an attempt to minimize the risk of loss in portfolio positions. A substantial risk
remains, nonetheless, that such techniques will not always be possible to implement
and when possible will not always be effective in limiting losses. In addition, the
Investment Manager may choose not to hedge positions.
Hedging against a decline in the value of a portfolio position does not eliminate
fluctuations in the values of portfolio positions or prevent losses if the values of such
positions decline, but the Investment Manager may establish other positions
designed to gain from those same developments, thus moderating the decline in the
portfolio positions’ value. Such hedge transactions also limit the opportunity for gain
if the value of a portfolio position should increase. Moreover, it may not be possible
for the Investment Manager to hedge against a fluctuation that is so generally
anticipated that they are not able to enter into a hedging transaction at a price
sufficient to protect from the decline in value of the portfolio position anticipated as a
result of such a fluctuation. In addition, the Investment Manager may choose not to
engage in a hedging transaction if the expense associated with such hedging
transaction is perceived as being too costly.
The success of the hedging transactions entered into by the Investment Manager will
be dependent upon its ability to correctly predict market fluctuations and movements.
Therefore, while the Investment Manager may enter into such transactions to seek to
reduce risks, unanticipated market movements and fluctuations may result in a
poorer overall performance for the Fund than if the Investment Manager had not
engaged in any such hedging transactions. In addition, the degree of correlation
between price movements of the instruments used in a hedging strategy and price
movements in the portfolio position being hedged may vary.
3.2.10 Derivative instruments
The Investment Manager may use various derivative instruments, including futures,
forward contracts, options thereon, swaps and other derivatives. These may be
volatile and speculative. Certain positions may be subject to wide and sudden
fluctuations in market value, with a resulting fluctuation in the amount of profits and
losses. Initially, it is not anticipated that derivatives will be used for speculative
purposes. Using derivative instruments has various risks. These include the
following:
• Tracking
When used for hedging purposes, an imperfect or variable degree of correlation

between price movements of the derivative instrument and the underlying
investment sought to be hedged may prevent the Investment Manager from
achieving the intended hedging effect or may expose the portfolio to the risk of
loss.
28

• Liquidity
Derivative instruments, especially when traded in large amounts, may not always
be liquid. Hence in volatile markets, the Investment Manager may not be able to
close out a position without incurring a loss. In addition, exchanges on which the
Investment Manager conducts its transactions in certain derivative instruments
may have daily limits on price fluctuations and speculative positions limits. These
limits may prevent the Investment Manager from liquidating positions promptly,
thereby subjecting the portfolio to the potential of greater losses.
• Leverage
Trading in derivative instruments can result in large amounts of leverage. The

leverage offered by trading in derivative instruments may magnify the gains and
losses experienced by the Fund. This could subject the Fund’s net asset value to
wider fluctuations than would be the case if the Investment Manager did not use
the leverage feature in derivative instruments.
• Over-the-Counter Trading
Derivative instruments that may be purchased or sold for the portfolio may
include instruments not traded on an exchange. Over-the-counter options, unlike
exchange-traded options, are two-party contracts with price and other terms
negotiated by the buyer and seller. The risk of non-performance by the obligor
on an over-the-counter instrument may be greater, and the ease with which the
Investment Manager can dispose of or enter into closing transactions with
respect to such an instrument may be less, than in the case of an exchange-
traded instrument. In addition, significant disparities may exist between “bid” and
“asked” prices for derivative instruments that are not traded on an exchange.
Derivative instruments not traded on exchanges are also not subject to the same
type of government regulation as exchange-traded instruments, and many of the
protections afforded to participants in a regulated environment may not be
available in connection with those instruments.
3.2.11 Short sales
Any short sales by the Fund that are not made “against the box” create opportunities
to increase the Fund’s return, but at the same time involve special risk considerations
and may be considered a speculative technique.
Because the Fund does not need to invest the full purchase price of the securities on
the date of a short sale, the value of its shares will tend to increase more when the
securities it has sold short decrease in value, and to decrease more when the
securities it has sold short increase in value, than would otherwise be the case had it
not engaged in those short sales. Theoretically, short sales involve unlimited loss
potential, as the market price of securities sold short may increase continuously.
However, the Fund may mitigate those losses by replacing the securities sold short
before the market price has increased significantly.
Under adverse market conditions the Fund might have difficulty purchasing securities
to meet its short sale delivery obligations, and might have to sell portfolio securities to
raise the capital necessary to meet its short sale obligations at a time when
fundamental investment considerations would not favour such sales.
29

Short sales may be used with the intention of hedging against the risk of declines in
the market value of the Fund’s long portfolio, but there is no guarantee that such
hedging operations will be successful.
3.2.12 Risks of executing investment strategies
The Fund will invest in a number of securities and obligations that entail substantial
inherent risks. Although the Fund will attempt to manage those risks through careful
research, ongoing monitoring of investments and appropriate hedging techniques,
there is no assurance that the securities and other instruments purchased by the
Fund will in fact increase in value or that the Fund will not incur significant losses.
3.2.13 Market risks and liquidity
In large measure the profitability of a significant portion of the Fund’s investment

program depends on correctly assessing the future course of the price movements of
securities and other investments. There is no assurance that the Fund will be able to
accurately predict those price movements. Although the Fund may attempt to
mitigate market risk through the use of long and short positions or other methods,
there is always some and occasionally a significant degree of market risk.
Furthermore, the Fund may be adversely affected by a decrease in market liquidity

for instruments in which it invests, which may impair its ability to adjust its position.
The size of the Fund’s positions may magnify the effect of a decrease in market
liquidity for those instruments. Changes in overall market leverage, de-leveraging as
a consequence of a decision by a prime broker to reduce the level of leverage
available, or the liquidation by other market participants of the same or similar
positions, may also adversely affect the Fund’s portfolio. Some of the underlying
investments of the Fund may not be actively traded and there may be uncertainties
involved in valuing those investments. Potential investors are warned that under
those circumstances, the Net Asset Value of the Fund may be adversely affected.
3.2.15 Institutional risks
Institutions will have custody of the assets of the Fund. These firms may encounter
financial or operational difficulties that disrupt or impair the operating capabilities or
the capital position of the Fund or the Investment Manager. During the period of any
such disruption or impairment, the Investment Manager may find it difficult or
impossible to effect trades pursuant to its investment strategy, which could subject
the Fund to substantial losses.
3.2.16 Counterparty and settlement risk
Due to the nature of some of the investments that the Fund may make, the Fund may
rely on the ability of the counterparty to a transaction to perform its obligations. If that
party fails to complete its obligations for any reason, the Fund may suffer losses and
therefore be exposed to a credit risk on the counterparties with which it trades. The
Fund will also bear the risk of settlement default by clearing houses and exchanges.
A default by a counterparty or a default on settlement could have a material adverse
effect on the Fund.
30

3.2.17 Borrowing and other forms of leverage
The Fund may use leverage in its investment and trading activities. The Fund may
borrow money on a secured or unsecured basis. Financing the purchase, or
otherwise leveraging exposure to, an instrument may provide the opportunity for
greater capital appreciation but at the same time will increase the risk of loss with
respect to the instrument. Although the use of leverage by an investor increases
returns to the investor if it earns a return on the incremental positions purchased with
the financed amount that exceeds its financing costs, the use of leverage decreases
returns to the investor if its financing costs exceed the return on such incremental
positions. The amount of financing outstanding at any time by the Fund may be large
in relation to their respective assets. In addition, the level of interest rates generally,
and the rates at which the Investment Manager can borrow or otherwise finance
investments, will ultimately affect the operating results of the Fund.
In general, the use of short-term margin borrowings results in certain additional risks
to the Fund. For example, should the securities pledged to brokers to secure the
Fund’s margin accounts decline in value, the Fund could be subject to a “margin
call,” pursuant to which the Fund must either deposit additional funds or securities
with the broker, or suffer mandatory liquidation of the pledged securities to
compensate for the decline in value. In the event of a sudden drop in the value of the
Fund’s assets, the Fund might not be able to liquidate assets quickly enough to
satisfy its margin requirements.
3.2.18 Dividends
There is no guarantee that there will be sufficient assets available for the Fund to pay
Dividends to investors.
3.2.19 Discretion of the investment manager; concentration of investments
The Investment Manager will seek to engage in the investment activities described in
this Memorandum. Nonetheless, the Investment Manager may alter the Fund’s
portfolio. It can do so in its sole discretion and without the approval of any holder of
Participating Shares. Although, as a matter of general policy, the Investment
Manager will try to spread the Fund’s capital among a number of investments, it may
depart from that policy from time to time and may hold a few relatively large
securities positions in relation to the Fund’s capital. A loss on a large security
position following such concentration could materially reduce the Fund’s capital.
3.2.20 Difficult market for investment opportunities
The activity of identifying, completing and realizing on attractive investments is highly

uncertain. There is no assurance that the Fund will be able to locate and complete
investments that satisfy the Fund’s rate-of-return objective or to realise on the value
of those investments; nor is there any assurance that the Fund will be able to fully
invest its capital in a manner consistent with its investment strategy.
3.2.21 Portfolio Turnover
The investment strategy of the Fund may involve the taking of frequent trading
positions and as a result turnover and brokerage commission expenses of the Fund
may significantly exceed those of other investment entities of comparable size.
31

3.2.22 Recent Developments in the Capital Markets
During 2008 and 2009, there was substantial turmoil in financial markets generally,
including declines in the market value of asset-backed securities, especially
securities backed by subprime mortgages. Such turmoil resulted in part from
significant market events, including widely publicized financial institution failures and
associated governmental and regulatory intervention in capital markets. Increasing
credit and valuation problems in the subprime mortgage market generated extreme
volatility and illiquidity in the markets for securities directly or indirectly exposed to
subprime mortgage loans. This volatility and illiquidity extended to the global credit
and equity markets generally, and, in particular, to the high-yield bond and loan
markets, and was exacerbated by, among other things, growing uncertainty
regarding the extent of the problems in the mortgage industry and the degree of
exposure of financial institutions and others to such problems, decreased risk
tolerance by investors and significantly tightened availability of credit. The ultimate
effect of these conditions cannot be predicted, nor is it known whether or the degree
to which conditions may worsen. However, these conditions could result in future
declines in the market values of Fund investments, diminished investment
opportunities for the Fund, otherwise prevent the Fund from successfully executing
its investment strategies or require the Fund to dispose of investments at a loss while
such adverse market conditions prevail.
In reaction to the events described above, regulators in the United States and several
other countries undertook unprecedented regulatory actions. The markets have also
been materially affected by uncertainty surrounding actions by many governments
around the world to guarantee the debts of or invest in their respective local banks
and similar financial institutions. The nature and scope of governmental actions are
ongoing, and the success or failure of any governmental program has yet to be
determined. It is not clear how such programs will impact the global economy, the
Fund or the financial condition of its custodians, brokers, dealers and counterparties
and the impact could be material.
3.3 Potential conflicts of interest
3.3.1 Generally
The Investment Manager, the Administrator, the Custodian, Fund directors and any
broker appointed by the Fund, may act for, sponsor, or be involved with, other funds
or accounts (in which they may have substantial ownership interests) that have
similar or different investment objectives or strategies to those of the Fund.
Capacities in which one or more of them may act for, or be involved with, other funds
or accounts of that type include: distributor, promoter, manager, investment manager,
investment adviser, registrar, transfer agent, administrator, trustee, custodian, broker,
director and placing agent. Similarly, one or more of them may provide discretionary
fund management or ancillary administration, custodian or brokerage services to
investors with similar investment objectives to those of the Fund. Consequently, any
of them may, in the course of their business, have potential conflicts of interests with
the Fund. The Fund will have no right to participate in the activities of or
compensation received by such parties from such other funds or accounts. If a
potential conflict arises, so far as practicable, each will have regard to its obligation to
act in the best interests of the shareholders, having regard to its obligations to other
clients, when undertaking investments. Further, each will endeavour to resolve any
conflicts fairly.
32

3.3.2 The Investment Manager and the Administrator
The Investment Manager has been formed to engage in the business of discretionary
management and advising client investors, including other investment vehicles, in the
purchase and sale of securities and financial instruments. During the period it is
responsible for managing the account of the Fund, it may also be advising other
funds or accounts. In doing so it may use the same or different information and
trading strategies that it obtains, produces or utilises in the performance of services
for the Fund.
The Investment Manager may have conflicts of interest in rendering advice because
its compensation for managing other accounts exceeds its compensation for
managing the account of the Fund, thus providing an incentive to prefer the other
accounts. Moreover, if the Investment Manager makes trading decisions for other
accounts at or about the same time it makes trading decisions for the account of the
Fund, the Fund may be competing with those other accounts for the same or similar
positions. The Investment Manager will endeavour to allocate all investment
opportunities on a fair and equitable basis between the Fund and those other
accounts.
The Fund has been established and promoted by the directors and the Investment
Manager. Accordingly the selection of the Investment Manager and the terms of its
appointment, including the fees payable to it in its capacity as the Investment
Manager and the Administrator, are not the result of arms-length negotiations. The
Incentive Fee, if paid, could result in fees payable to the Investment Manager which
are greater than fees normally paid to other investment advisers for similar services.
The Investment Manager is entitled to receive an Incentive Fee, based upon the net
capital appreciation, if any, allocated to the Offered Shares. The Incentive Fee may
create an incentive for the Investment Manager to make investments that are riskier
or more speculative than would be the case if such arrangement were not in effect.
In addition, because the Incentive Fee is calculated on a basis which includes
unrealised appreciation of the Fund’s assets, it may be greater than if such
compensation were based solely on realised gains.
From time to time, the Investment Manager may come into possession of non-public
information concerning specific companies or other entities even though internal
structures are in place to prevent it receiving such information. Under applicable
securities laws, this may limit the Investment Manager’s flexibility to buy or sell
portfolio securities issued by those companies or other entities. The Fund’s
investment flexibility may be constrained due to the Investment Manager’s inability to
use such information for investment purposes.
The Investment Manager and its principals, directors, officers, partners, members,
managers, shareholders, employees and affiliates, as applicable, trade or may trade
for their own accounts or the accounts of family members, friends or investment
vehicles established for the benefit of any of such persons. In addition, in their
respective trading for proprietary and other accounts, The Investment Manager and
such persons may take positions that are the same as or different from those taken
on behalf of the Fund in accordance with the Investment Manager’s internal policies.
33

3.3.3 Interests of certain directors
Each of Ronald G. Percival and Odo G. Habeck is a director of the Fund as well as a
principal of the Investment Manager and the Administrator. The fiduciary duty of the
directors to the Fund may compete with or be different from the interests of the
Investment Manager and the Administrator. Only the directors may terminate the
services of the Investment Manager and the Administrator and other agents of the
Fund. Each of the directors may serve as a director of other investment vehicles and
accordingly to the extent that the interests of the Fund and such other investment
vehicles are inconsistent a director may have a conflict of interest.
3.3.4 Duties of the directors
At all times so far as practicable the directors will have regard to their obligations to
act in the best interests of the Fund and its shareholders, and will seek to ensure that
any conflict of interest is resolved fairly and in the interests of the Fund and its
shareholders.
3.3.5 Selection of brokers and dealers
Certain brokers and dealers retained by the Investment Manager provide or may
agree to provide the Investment Manager with soft dollar credits, which it may use to
purchase certain research and statistical services. These services would otherwise
only be available to the Investment Manager for a cash payment. As a result of
receiving such services, the Investment Manager would have an incentive to use,
and to continue to use, such brokers and dealers to effect transactions for the
accounts over which it or its affiliates exercise trading discretion so long as such
brokers and dealers continue to provide such soft dollar credits to it or its affiliates.
3.3.6 Dealings with service providers and their affiliates
The Fund is not prevented from entering into transactions with the Custodian or any
of its affiliates so long as those transactions are carried out as if they were effected
on commercial terms negotiated at arm’s length.
3.3.7 Valuation of Securities
Michael Kenwood Capital Management, LLC, in its capacity as Administrator, is

responsible for calculating the Net Asset Value per Share and the Net Asset Value of
the Fund. To the extent that the Administrator erroneously assigns a higher value to
any of the Fund’s investments than its actual value, the Net Asset Value of the Fund
may be overstated. As a result, the compensation received by Michael Kenwood
Capital Management, LLC as both Investment Manager and as Administrator would
be higher than in the absence of such pricing error. No independent pricing agent is
expected to be retained by the Fund. None of the directors, nor the Fund or
Administrator will be liable if a price or valuation used in good faith in connection with
the Fund’s procedures later proves to be incorrect or inaccurate.
3.3.7 Dividend
The Directors have discretionary authority to declare or not declare a Dividend from
time to time. Greater Management Fees and possibly Incentive Fees would be
generated to the benefit of Michael Kenwood Capital Management, LLC, as
Investment Manager, and greater administrative fees will be generated for the benefit
34

of Michael Kenwood Capital Management, LLC, as Administrator, if the Fund’s

assets are not reduced by the payment of a Dividend to the shareholders.
This list of risk factors does not purport to be complete. Nor does it purport to be an entire
explanation of the risks involved in an investment in the Fund. A prospective investor should
read this Memorandum in its entirety as well as consult with its own legal, tax and financial
advisers before deciding to invest in the Fund.
35

SECTION IV - MANAGEMENT AND ADMINISTRATION
4.1 Board of directors
4.1.1 Delegations by the directors
The directors are responsible for the overall management and control of the Fund in
accordance with its memorandum and articles of association. However, the directors
are not responsible for the day-to-day operations and administration of the Fund, nor
are they responsible in their capacity as directors for making or approving any
investment decisions. The investment responsibilities have been delegated to the
Investment Manager under the Management Agreement whilst the day-to-day
administrative functions have been delegated to the Administrator under the
Administration Agreement. In each case, the delegation has been made in
accordance with the directors’ powers of delegation under the Fund’s articles. The
directors will periodically review the performance of the Investment Manager and the
Administrator.
4.1.2 Composition of the board
The Fund’s board of directors comprises Octavio Calvo, Ronald G. Percival and Odo
G. Habeck. Mr. Percival and Mr. Habeck serve in their capacities as Directors
without compensation. Mr Calvo is paid a fee for providing the service of a director.
If additional directors are elected, the Fund may compensate those directors (other
than the Fund’s Investment Manager or any persons affiliated with the Investment
Manager) for services rendered in that capacity.
Biographical information for Mr. Calvo appears below. For the biography of the other
directors, see below under the heading “Investment Manager - Investment Manager’s
key personnel”.
Octavio Calvo - Since May 2007, Mr. Calvo has served as a Managing Director of
BNP Paribas with corporate and investment banking coverage responsibilities. In
addition, he is a Director of MK Special Opportunities Fund Ltd. and MK Venezuela
Fund Ltd. Prior to joining BNP Paribas, Mr. Calvo was a Managing Director of
Calyon from March 2006 through April 2007. He also was a Director of Latin
American Debt Capital Markets for Wachovia Securities from October 2004 to
September 2005. Mr. Calvo was responsible for building the international debt capital
markets and syndicate efforts for the Latin American region. Prior to Mr. Calvo’s
position at Wachovia Securities, he was a Director of Latin American Debt Capital
Markets for Prudential Securities from March 2003 to October 2004. Prior to joining
Prudential Securities, Mr. Calvo was a Director of Latin American Debt Capital
Markets and Derivatives Marketing from November 2000 to August 2002 for
Deutsche Bank AG. He brings more than 19 years experience in the debt capital
markets arena both from the local and international markets perspectives. Mr. Calvo
was a director for Mexican public debt offerings at Operadora de Bolsa Serfin in
Mexico City, and in 1994 transferred to New York, where he worked as a Director for
CSFB covering Latin American clients. His coverage responsibilities have also
included derivatives marketing for both corporate and government entities. Mr. Calvo
received a B.A. in Business Administration from the Instituto Tecnologico Autonomo
de Mexico (IITAM) in 1983.
36

For the purpose of this Memorandum, the address of all the directors is the
registered office of the Fund.
4.1.3 Provisions of the Fund’s articles affecting the directors
The Fund’s articles of association do not stipulate a retirement age for the directors
nor do they provide for retirement of the directors by rotation. There is no
shareholding qualification for the directors.
The directors are empowered to exercise all of the borrowing powers of the Fund.
Subject to one condition, under the articles of association a director may enter into
any contract or arrangement with the Fund without:
(i) that contract or arrangement being liable to be declared void; or
(ii) that director being liable to account to the Fund for any profit realised by that
contract or arrangement due to his or her holding of that office or as a
consequence of the director’s fiduciary relationship with the Fund.
The condition is that the director must disclose the nature of his or her interest at the
earliest opportunity. Furthermore, under the Fund’s articles, a director may hold any
other office or place of profit with the Fund (other than that of auditor) in conjunction
with his or her office of Director on terms as to tenure of office and otherwise as the
directors determine.
Except as disclosed in this Memorandum, at the date of this Memorandum no

director and no person connected with a director has any of the following interests:
(i) an interest, beneficial or non-beneficial, in the share capital of the Fund;
(ii) a material interest in the shares of the Fund;
(iii) an option in respect of the shares of the Fund; or
(iv) an agreement or arrangement with the Fund.
By virtue of the articles of association, the Fund releases its directors and officers
from, and indemnifies them against, certain legal liabilities and expenses so long as,
in connection with the matter that gives rise to a particular claim, they had not
engaged in gross negligence or wilful default in the performance of their duties.
The directors may change any of the Fund’s service providers, including the Fund’s
auditors, without the consent of the holders of Participating Shares. In addition, the
directors may, with the consent of a service provider, amend the remuneration that
the Fund pays to that service provider (and any other term of its service agreement).
This may be necessary from time to time to keep the remuneration that the Fund
pays to its service providers in line with prevailing market rates.
37

4.2 Investment Manager
4.2.1 Background
The Fund’s Investment Manager is Michael Kenwood Capital Management, LLC, a

US limited liability company. The Investment Manager is responsible for the
investment decisions of the Fund. The managers of the Investment Manager are
Francisco A. Illarramendi, Ronald G. Percival and Odo G. Habeck.
4.2.2 Investment Manager’s key personnel
The Investment Manager’s key personnel who are responsible for implementation of
the Fund’s investment objectives and policies are Francisco A. Illarramendi, Ronald
G. Percival and Odo G. Habeck.
Odo G. Habeck, President, Chief Executive Officer - Mr. Habeck is a member and
the President and Chief Executive Officer of the Investment Manager and Michael
Kenwood Asset Management, LLC, an affiliated private equity and venture capital
firm. In addition, he is a director of MK Special Opportunities Fund Ltd. and MK
Venezuela Fund Ltd. Mr. Habeck is also the Chief Executive Officer of The Michael
Kenwood Group, LLC and Michael Kenwood Consulting, LLC, where he is
responsible for overall activities, including strategic and new business development,
and may also serve in an executive capacity or otherwise be involved with respect to
other Michael Kenwood affiliates and related entities from time to time. Mr. Habeck’s
duties include consulting and advisory work for international corporations and
governments, as well as identifying investment opportunities. In addition, he is a
director of MK Venezuela Fund Ltd. Mr. Habeck is also the Director of Business
Development and Administration of RGP Investment Advisors and a Managing
Partner of the Financial Consulting Business of OGH Advisors. Prior to joining RGP
Investment Advisors in April 2005 and OGH Advisors in June 2003, Mr. Habeck was
a Director of Emerging Markets Debt Capital Markets, Latin America, at Credit Suisse
First Boston Inc. (“CSFB”), responsible for the marketing of products to sovereign
and corporate clients in Brazil, Colombia, Peru and Panama from 2000 to June 2002.
Prior to his position with CSFB, Mr. Habeck gained investment banking and emerging
financial markets experience holding positions with Deutsche Bank AG and affiliates,
The International Bank for Reconstruction and Development (World Bank) and Daiwa
Securities America Inc. He is a member of the United Nations sponsored
Infrastructure Experts Group, The Bretton Woods Committee and the Initiative for
Global Development. Mr. Habeck received a B.A. in Business Administration and
Finance in 1984 and an MBA in International Finance in 1985 from the University of
Alaska.
Francisco Illarramendi, Member - Mr. Illarramendi is a member of the Investment

Manager and Michael Kenwood Asset Management, LLC, and The Michael Kenwood
Group, LLC, and may be involved with other Michael Kenwood affiliates and related
entities from time to time. In addition, he is a director of MK Venezuela Fund Ltd.
Mr. Illarramendi is one of the founding members of Highview Point Partners, LLC,
which was formed in June 2005 and acts as the investment manager of an emerging
markets fixed income hedge fund, where he is responsible for investment analysis
and business development. Prior to that, he was a Director in the Emerging Markets
Coverage Group of CSFB from 1994 until May 2004, when he left the firm to accept a
temporary position as Senior Advisor to PDV USA, Inc., the international financial
advisory arm of Petróleos de Venezuela, S.A. (“PDVSA”), where he served as a
special financial advisor to PDVSA and its worldwide affiliates in connection with its
38

ongoing restructuring of operations and its liability management program until

February 2005. During his ten years of experience at CSFB, Mr. Illarramendi was
responsible for all of CSFB’s fixed income coverage responsibilities in the
Andean/Central America/Caribbean region. He was also responsible for the fixed
income coverage of the Southern Cone from 1999 to 2001. In these roles, Mr.
Illarramendi was a leading member of the teams that helped restructure both
Argentina’s and Venezuela’s debt profiles, and was also one of the key people
responsible for more than US$5 billion of new debt issuance from the region. Mr.
Illarramendi received a B.A. in Social and Political Studies in 1990 and an M.A. in
Economics in 1993 from the University of Navarra in Pamploma, Spain.
Ronald G. Percival, Chief Investment Officer - Mr. Percival is a member and the
Chief Investment Officer of the Investment Manager and Michael Kenwood Asset
Management, LLC and The Michael Kenwood Group, LLC, and may serve in an
executive capacity or otherwise be involved with respect to other Michael Kenwood
affiliates and related entities form time to time. In addition, he is a director of MK
Special Opportunities Fund Ltd. and MK Venezuela Fund Ltd. Mr. Percival is also
the Managing Member and Chief Investment Officer of RGP Investment Advisors,
LLC and of RGP Capital Management, LLC which has served as investment advisor
and General Partner, respectively, of MK Global Developing Markets Offshore, Ltd
and Global Developing Markets Partnership, LP, two emerging markets investment
funds, since January 2002. He has thirty years of experience in global and emerging
financial markets, and has developed extensive knowledge in both fixed income and
equity capital markets, as well as in loan capital markets, corporate finance and
investment banking. He has been an active investor in private investment funds since
1990. Prior to founding RGP and the Global Developing Markets funds, Mr. Percival
was the Director and head of Latin American Loan Capital Markets and Syndications
at CSFB from June 1998 to June 2001, where he was responsible for structuring,
underwriting and the market execution of all Latin American syndicated loans.
Before joining CSFB in 1998, Mr. Percival spent four years at ING Barings in New
York with varied responsibilities in the capital markets area. He was a Managing
Director and head of ING’s Global Emerging Markets Fixed Income Syndicate, and
also had responsibility for ING’s Global Emerging Markets Equity Syndicate.
Additionally, he was a Managing Director and head of ING’s Syndicated Loan
Distribution for the Americas, responsible for global syndication and selling of loans
originating from the United States, Canada and Latin America. Prior to joining ING
Barings, from 1976 to 1994, Mr. Percival held various positions at Chemical Bank
and Chemical Securities in emerging markets fixed income, Latin American banking,
credit lending and Latin sovereign and corporate debt restructuring. At Chemical
Bank, he also had various country head positions and overseas assignments in Latin
America. Mr. Percival received a B.A. from the University of Texas in 1972 and an
MBA from Thunderbird, The American Graduate School of International
Management, in 1975.
4.2.3 Management Agreement
Under the Management Agreement, the Investment Manager is authorized to make

all investment decisions with respect to the investment of the Fund’s assets.
The Management Agreement may be terminated by the Fund or the Investment

Manager upon 90 days prior written notice.
The Management Agreement contains provisions exempting the Investment Manager

and its members, managers, officers, directors, employees, shareholders and
39

affiliates from liability in certain circumstances for any act or failure to act taken or
omitted in good faith in a manner reasonably believed to be in or not opposed to the
best interests of the Fund if such act or failure to act did not constitute gross
negligence, willful misconduct or a material breach of the Management Agreement.
4.2.4 Management Fee
The Investment Manager will be paid a monthly Management Fee, payable in

arrears, of 1/12th of 2% of the Net Asset Value of the Fund (approximately 2%
annually) before the payment of the Dividend (as herein defined). In the event that
the Fund is dissolved or the Management Agreement is terminated as of a date other
than the last day of a month, the Management Fee will be pro-rated based on the
ratio that the number of days in the month through such date bears to the total
number of days in the month. The Management Fee will be paid to the Investment
Manager as soon as practicable following the applicable month.
For purposes of calculating Management Fees payable to the Investment Manager,

the Net Asset Value of the Fund will be determined before reduction for the
Management Fee, Incentive Fee and extraordinary fees or expenses accrued or
payable as of the calculation date and before giving effect to any distributions or
redemptions paid or payable or additional capital contributions made as of such date.
4.2.5 Incentive Fee
In addition, as of the end of each calendar year, the Investment Manager will be paid
an Incentive Fee in an amount equal to 20% of the Net New Appreciation (as
hereinafter defined) achieved by each Series of Participating Shares as of the end of
such year prior to giving effect to the Dividend to be determined as of such year-end.
“Net New Appreciation” achieved by a Series of Participating Shares as of any date
of determination shall mean the excess, if any, of (a) the Net Asset Value of such
Series as of such date of determination, calculated without reduction for any
Incentive Fee accrued or payable to the Investment Manager with respect to such
Series as of such date, over (b) the Net Asset Value of such Series as of the then
applicable High Water Mark Date (as hereinafter defined) for such Series, reduced by
the aggregate amounts of Dividend declared after such High Water Mark Date, and
proportionately reduced to reflect any redemptions of Participating Shares in such
Series since such High Water Mark Date. The “High Water Mark Date” for a Series
of Participating Shares as of any date of determination shall mean the most recent
date as of which an Incentive Fee was payable with respect to such Series or, if no
such Incentive Fee has previously been paid to the Investment Manager, the initial
subscription date for such Series. For purposes of determining Net New
Appreciation, the Net Asset Value of a Series shall not be reduced by any
extraordinary fees and expenses (such as attorneys fees and expenses incurred in
relation to any litigation).
For purposes of determining monthly incentive fee accruals, Net New Appreciation
shall be determined prior to giving effect to the Dividend to be determined as of the
applicable month-end.
Each Incentive Fee will be paid to the Investment Manager as soon as practicable
following the applicable date of determination.
If the Fund experiences net losses after the payment of an Incentive Fee with respect
to any Series of Participating Shares, the Investment Manager will retain all Incentive
40

Fees previously paid to it with respect to such Series but will not receive a new
Incentive Fee with respect to such Series until additional Net New Appreciation is
achieved by such Series.
Prospective investors should note that the calculation of each Incentive Fee is based
in part upon unrealized profits (as well as unrealized losses) and such unrealized
profits might never be realized by the relevant Series of Participating Shares.
Incentive Fees will be allocated solely to the Series to which they relate.
If any Participating Shares in a Series are redeemed as of any day other than the
end of a calendar year, any Incentive Fee accrued with respect to such Participating
Shares as of the redemption date will be paid to the Investment Manager at the time
of the redemption (as if such redemption date were the end of a calendar year).
Similarly, if the Management Agreement is terminated as of any day other than the
end of a calendar year, all Incentive Fees accrued as of the termination date will be
paid to the Investment Manager at the time of termination (as if such termination date
were the end of a calendar year).
The Investment Manager, in its sole discretion, may, in effect, waive or reduce the
Management Fees or Incentive Fees to be paid to it with respect to Participating
Shares held by members, principals, officers, directors, employees or affiliates of the
Investment Manager or relatives of such persons and or by certain large or strategic
investors.
4.2.6 Capitalisation of Fees
Any reduction of the Management Fee or Incentive Fee, or both, for a shareholder
holding Participating Shares, may be effected by capitalising an amount equal to the
amount of that reduction and applying that amount to pay up further shares of the
relevant Class issued to that shareholder, or by creating a separate sub-class of
shares of the relevant Class for that shareholder.
4.3 Administrator
4.3.1 Background
In addition to serving as the Investment Manager, Michael Kenwood Capital

Management, LLC serves as the Administrator pursuant to an administration
agreement between the Fund and the Administrator (“Administration Agreement”).
4.3.2 Fees and expenses
The Fund pays the Administrator a fee based on the Net Asset Value of the Fund
based on a schedule of fees, ranging from 0.12% per annum to 0.08% per annum of
Net Asset Value increments above and below certain stated thresholds. A minimum
monthly fee of $3,500 applies. The fee accrues daily and is payable quarterly in
arrears in US dollars. The Administrator is also entitled to reimbursement of out-of-
pocket expenses incurred by it on behalf of the Fund or in connection with services
performed by it for the benefit of the Fund.
The Administrator will also charge $10,000 for the preparation of each annual report.
41

4.3.3 Administration Agreement
Under the Administration Agreement, the Administrator:
(a) provides office facilities and personnel adequate to administer the affairs of the
Fund; and
(b) performs certain designated services for the Fund in connection with the
administration of its affairs.
The designated services include:
(i) maintaining the financial books and records of the Fund;
(ii) preparing information for the Fund’s reports to shareholders;
(iii) responding to shareholder inquiries relating to the Fund;
(iv) ensuring that the Fund complies with applicable anti-money

laundering laws and regulations;
(iv) accepting and processing subscriptions, transfer requests and

redemption requests from investors;
(v) maintaining the register of shareholders;
(vi) providing confirmation of share ownership to investors (and share

certificates if required); and
(vii) such other administrative services as may be required by the Fund.
The Administration Agreement is automatically renewed on an annual basis and may

be terminated by either party giving 90 days’ notice in writing to the other. In certain
circumstances, it may be terminated immediately.
The Administration Agreement provides that the Fund will indemnify the
Administrator, its directors, mangers, officers, employees or agents against all
liabilities, obligations, losses, damages, penalties, actions, judgments, claims,
demands, suits, costs, expenses or disbursements of any kind or nature whatsoever
made by any person and in any way arising from the Administrator’s performance of
its obligations or duties under the Administration Agreement unless due to the
dishonesty, fraud, willful misconduct, gross negligence (which shall be determined
consistent with the laws of the state of Delaware) or bad faith of the Administrator, its
directors, managers, officers, employees or agents.
The Administration Agreement is governed by the laws of the Cayman Islands.
4.4 Brokerage and custody
4.4.1 Choice of brokers or dealers and scope of services received
The Investment Manager is authorized to designate the banks, brokers, dealers,

futures commission merchants, introducing brokers and other counterparties
42

(collectively, “brokers and dealers”), to be used for all transactions effectuated by it

for the Fund.
Accordingly, the Investment Manager or an affiliate may designate brokers and

dealers from time to time for the assets of the Fund managed by it. The policy of the
Investment Manager regarding purchases and sales for such portfolio is that primary
consideration will be given to obtaining the most favorable execution of the
transactions in seeking to implement the Investment Manager’s trading strategy. The
Investment Manager will effect transactions with those brokers and dealers which it
believes provide the most favorable prices and who are capable of providing efficient
executions. Those factors that the Investment Manager believes contribute to
efficient execution include, among other things, size of the order, difficulty of
execution, operational capabilities and facilities of the broker or dealer involved,
whether that broker or dealer has risked its own capital in positioning a block of
securities or other assets and the prior experience of the broker or dealer in effecting
transactions of the type in which the Fund will engage.
In selecting brokers or dealers to execute particular transactions, the Investment

Manager may consider “brokerage and research services” (as those terms are
defined in Section 28(e) of the US Securities and Exchange Act of 1934, as amended
(“Exchange Act”)) and other information provided by the brokers and dealers.
Research may include, among other things, proprietary research from brokers, which
may be written, oral or on-line. Research products may include, among other things,
computer databases and quotation equipment, in each case, to access research or
which provide research directly. Research services may include, among other things,
research concerning market, economic and financial data, statistical information, data
on pricing and availability of securities, financial publications, electronic market
quotations, performance measurement services, analyses concerning specific
securities, companies or sectors, and market, economic and financial studies and
forecasts. Research services may be in written or oral form or on-line. Any
brokerage and research services obtained as a result of the Fund’s trading activities
may or may not be used for the benefit of all accounts managed by the Investment
Manager. The Investment Manager also may cause a broker or dealer who provides
such brokerage and research services and products to be paid a commission or, in
the case of a dealer, a dealer spread for executing a portfolio transaction, which is in
excess of the amount of commission another broker or dealer would have charged
for effecting that transaction. Consistent with obtaining the most favorable execution,
the Investment Manager also may consider the fact that certain brokers and dealers
may refer or have referred prospective investors to the Fund or other accounts
managed by the Investment Manager. Prior to making such an allocation, however,
the Investment Manager will make a good faith determination that such commission
or spread was reasonable in relation to the value of the brokerage and research
services provided, viewed in terms of that particular transaction or in terms of all the
accounts over which the Investment Manager or its affiliates exercise trading
discretion.
4.4.2 Custodian
The Fund maintains accounts at Deutsche Bank AG which serves as the Fund’s
custodian. The Investment Manager may change or add custodians without notice to
the holders of Participating Shares.
The Custodian performs a variety of brokerage services on arms-length commercial

terms for the Fund for which fees are charged.
43

4.5 Expenses
4.5.1 Preliminary Expenses
The Fund is responsible for paying the preliminary expenses of, and incidental to, the
initial offering (including expenses relating to establishment of the Fund in the
Cayman Islands, negotiation and preparation of the contracts to which it is a party,
costs of printing this Memorandum and the fees and expenses of its professional
advisors).
These preliminary expenses will be amortised on a straight-line basis over the first
five years of the Fund’s operations or such shorter period as the directors may
determine in their sole discretion. While the directors of the Fund consider that such
an accounting policy is appropriate and its impact on the Fund’s results is not
expected to be material, that policy conflicts with generally accepted accounting
principles applied in the United States, and therefore may lead to qualifications in the
Fund’s audited financial statements.
4.5.2 Operating expenses
The Investment Manager renders its services to the Fund at its own expense. It is
responsible for its overhead expenses including the following: (i) office rent; (ii)
furniture and fixtures; (iii) stationery; (iv) secretarial/internal administrative services;
(v) salaries; (vi) entertainment expenses; and (vii) employee insurance and payroll
taxes.
The Fund will bear all investment-related expenses arising out of its investment
program, including the following: (i) brokerage commissions; (ii) other expenses
related to buying and selling securities; (iii) costs of due diligence (including travel)
regardless of whether a particular transaction is consummated; (iv) the costs of
attending shareholder meetings; (v) research expenses; and (vi) costs related to
monitoring investments.
It will also bear other expenses incurred in connection with its operations including
the following: (i) fees and expenses of advisors and consultants; (ii) Management
Fee and Incentive Fee; (iii) fees and expenses of any custodians, escrow or transfer
agents and other investment-related service providers; (iv) indemnification expenses
and the cost of insurance against potential indemnification liabilities; (v) interest and
other borrowing expenses; (vi) legal, administrative, accounting, tax, audit and
insurance expenses; (vii) expenses of preparing and distributing reports, financial
statements and notices to shareholders; (viii) litigation or other extraordinary
expenses; and (ix) costs of periodically updating the Memorandum.
The Fund will not bear any placement agent fees.
4.5.3 The Fund is not responsible for placement agent fees
The Fund may, in its sole discretion, appoint placement agents or distributors, who
may, in turn, appoint selling dealers to participate in the distribution of Offered
Shares. Those placement agents or distributors may be affiliated with the Investment
Manager.
The Investment Manager may pay (or cause to be paid) fees to those persons. If the
Fund pays those fees, they will be deducted from the Investment Manager’s
44

Management Fee or Incentive Fee, or both. But on no account are those fees
payable by or chargeable to the Fund or any shareholder or prospective shareholder.
The Fund may make such a payment only if it coincides with its payment of the
Management Fee or Incentive Fee to the Investment Manager.
45

SECTION V - DESCRIPTION OF THE FUND’S SHARES
5.1 General
The authorised share capital of the Fund is $100,000 divided into:
• 100 Management Shares of US $0.01 par value per share; and
• 9,999,900 Participating Shares of US $0.01 par value per share, which may be
issued in Classes and Series.
Subject to the Fund’s articles of association, the unissued Participating Shares of the
Fund are under the control of the directors. The directors may issue, allot, dispose of
or grant options over those unissued shares to any persons, on any terms and in any
manner they think fit. No member has any pre-emptive right to purchase the
Participating Shares.
5.2 Management Shares
100 Management Shares have been issued. They are fully paid up and held by the
Investment Manager.
The Management Shares are not transferable without the prior written consent of the
directors, who do not intend to give such consent apart from transfers to affiliates of
Investment Manager. The Management Shares have the entire voting power of the
Fund unless the issue involves the appointment or removal of a director of the Fund
or a modification of share rights. However, they do not entitle the holder to
participate in the Fund’s profits and losses and they are not redeemable. On the
winding up of the Fund, the holders of the Management Shares are only entitled to
receive their paid-up capital of $0.01 per Management Share.
5.3 Participating Shares
5.3.1 Rights of holders of Participating Shares
The holders of the Participating Shares have no right to receive notice of, attend or
vote at, general meetings of the Fund, nor do they have voting rights (unless the
issue involves an appointment or removal of a director of the Fund or a modification
of share rights – see the Section below entitled “Modification of Class Rights”). The
Fund may only appoint or remove a director with the sanction of a resolution passed
by a majority of shareholders at a meeting of all holders of issued shares, or
alternatively with the sanction of an unanimous resolution in writing of all of the
holders of issued shares.
Subject to the Law, and in the sole discretion of the Directors, each shareholder
holding Participating Shares will be paid a monthly dividend when the Net Asset
Value per Share held by each shareholder for the current month exceeds the Net
Asset Value per Share for the immediately preceding month. The dividend will be
calculated by subtracting the Net Asset Value per Share at the end of the
immediately preceding month from the Net Asset Value per Share for the current
month, in each case as reduced by any accrued Incentive Fees (the “Dividend”).
The Dividend will be paid at the end of each month, after the deduction of the
Management Fees and out of the profits available for such payment and shall be paid
46

on a pro-rata basis. Dividends will only be paid if the Directors declare that following
such payment the Fund shall be able to pay the debts of the Fund as they fall due in
the ordinary course of business.
The holders of the Participating Shares are entitled to receive, to the exclusion of the
holders of the Management Shares, the Dividend and any additional dividends that
may be declared by the Fund. Also, on the winding up of the Fund, they will receive,
by way of distribution, the full amount of the assets of the Fund other than the paid-
up capital in respect of the Management Shares of $1.
When the Participating Shares are issued, they will be fully paid. Subscriptions for
Participating Shares may be made only in cash in US dollars unless the Directors, in
their sole discretion, permit subscription payments in another currency, in securities
or partly in cash and partly in securities. Within each Class and Series, all
Participating Shares of the Fund have equal dividend, distribution and liquidation
rights.
5.3.2 Classes of Participating Shares
In the future, the directors may designate further Classes of Participating Shares
which may be attributable to the current single underlying portfolio of the Fund or a
new portfolio. Each further Class of Participating Shares may be offered on different
terms (including as to currency) to those on which the Participating Shares are being
offered pursuant to this Memorandum. Additionally, the Fund may, for administrative
convenience, issue sub-classes of Participating Shares. Hence, in this
Memorandum, unless the context otherwise requires, a reference to “Class” includes
any sub-class or sub-classes derived from that Class.
5.3.3 Series within a Class of Participating Shares
Generally, Participating Shares of each Class are issuable monthly in Series. A new
Series of the relevant Class of shares will be issued on each Subscription Day during
a fiscal year. The reason for the different Series is to equitably reflect the differing
Incentive Fees attributable to each Series (that result from the differing issue dates
throughout the fiscal year).
5.3.4 Series roll-ups
At the end of each fiscal year all Series of a particular Class for which an Incentive
Fee is then payable will be converted into the oldest Series of Participating Shares of
that Class for which an Incentive Fee is then payable. The conversion may be
effected by the current Series of Participating Shares being redeemed by the Fund
and the proceeds used to purchase Participating Shares of the new Series.
5.4 Records
The Fund must separately record in its books each Class and Series of Participating
Shares with its own distinct designation. Further, the Fund must record in its books
the proceeds from the allotment and issue of each Class and Series of Participating
Shares to the credit of that Class and Series of shares. Also, at the end of each
fiscal period, the Fund must record the assets, profits, gains, income and liabilities,
losses and expenses attributable to a particular Class and Series against that Class
and Series.
47

See Section VII headed “Financial Information and Reports – Fiscal periods”.
5.5 Rights of shareholders
All shareholders are entitled to the benefit of, are bound by and are deemed to have
notice of, the Fund’s memorandum and articles of association.
Under those documents, the liability of the shareholders is limited to the amount, if
any, unpaid on their shares. As the Participating Shares may only be issued if they
are fully paid, the holders of participating Shares will not be liable for any debt,
obligation or default of the Fund beyond their interests in the Fund.
The Fund’s objects are set out in clause 3 of its memorandum of association. Those
objects are unrestricted.
The Fund’s articles of association have been drafted in broad and flexible terms to
allow the directors:
(i) the flexibility to re-organise the Fund into a master-feeder structure, if they
consider it advantageous to do so; and
(ii) the authority to determine, in their discretion, a number of issues including

the period of notice to be given for redemptions, and whether or not to charge
subscription or redemption fees generally or in any particular case. The
directors have already exercised a number of these discretions in approving
the offering of the Offered Shares on the terms set out in this Memorandum.
5.5.1 Management Shares
As an exempted company, the Fund is not required to hold scheduled annual general
meetings of shareholders. General meetings may be called by the directors and will
be called at the request of the holders of shares holding a simple majority of shares
entitled to vote on the business to be considered at such meeting. All shareholder
meetings will be held in the Cayman Islands, unless the directors determine to hold
them elsewhere. Those meetings require seven days’ prior notice which may be
given by hand, mail, fax or email, or alternatively, where the recipient has agreed, by
posting the notice on a secure nominated website.
Unless the Companies Law (Revised) of the Cayman Islands requires a special
resolution, all decisions of the holders of shares entitled to vote on the business to be
considered at such meeting will be made by an ordinary resolution on condition that a
quorum of the holders of one-third of those shares is present in person or by proxy.
Any matter may also be adopted by resolution in writing of all of the holders entitled
to vote on the business to be considered.
5.5.2 Participating Shares
The Participating Shares have no conversion or pre-emptive rights. When duly

issued, all Participating Shares will be fully paid and non-assessable. By subscribing
for Participating Shares, a subscriber will have irrevocably authorised and directed
the Fund to convert those shares (unless they have been redeemed) into the oldest
Series of Participating Shares of the relevant Class that are not subject to a carry-
forward loss at the end of each fiscal year.
48

5.5.3 Other matters
From time to time, the Fund may increase its authorised share capital so that at all
times a substantial number of Participating Shares is available for issue. This may
be done by ordinary resolution.
At any time, the Fund may amend its memorandum and articles of association or
resolve that it be wound up by the holders of the Management Shares passing a
special resolution to that effect.
5.6 Modification of Class rights
Whether or not the Fund is being wound up, the rights attaching to any Class of
shares may be modified:
(i) with the consent in writing of the holders of two-thirds of the issued shares of
that Class; or
(ii) with the sanction of a resolution passed by a two-thirds majority of the

holders of the issued shares of that Class at a separate meeting of the
holders of the shares of that Class.
5.7 Variation of offering terms
Subject to applicable law and without the approval of any holders of Participating
Shares, the Fund may amend this Memorandum to vary the offering terms applicable
to any Participating Shares (as distinct from modifying Class rights attaching to those
shares, as discussed above) in any of the following ways:
(i) by making any change that the directors consider, in their sole discretion, will
not adversely affect the shareholders in any material respect; or
(ii) by making a change that is necessary or desirable to satisfy any

requirements, conditions or guidelines contained in any opinion, directive,
order, statute, ruling or regulation of any applicable regulator, court of
competent jurisdiction, government or government entity (including any tax
authority). However, that change must be made in a manner that minimizes,
to the extent practicable as determined by the directors in their sole
discretion, any adverse effect on the shareholders; or
(iii) by making any change that the directors consider, in their sole discretion, is
likely to adversely affect the shareholders in a material respect (including
amendments to the trading program, fees charged to the Fund by service
providers and the liquidity terms of the shares). However, that amendment
does not become effective until after the affected shareholders have been
given prior written notice of the change and have had the opportunity,
following receipt of that notice, to request the redemption of their shares so
affected. If they request that those shares be redeemed, the Fund must do
so.
Despite the foregoing, the Fund (if required, with the consent of the Investment
Manager) may enter into a written agreement with an existing or prospective investor
in respect of Participating Shares of a certain Class that provides for offering terms
that vary from those applicable to other shareholders of the same Class. The ways
49

in which the offering terms may vary include the following: (i) the waiver, reduction or
rebate of fees or allocations payable in respect of those shares; (ii) the provision of
additional information or reports; (iii) more favourable transfer rights; and (iv) more
favourable liquidity rights, including additional permitted dates for redemptions and
the waiver or reduction of notice periods, or proceeds payment periods and different
redemption terms. In those circumstances, the directors may issue shares of the
same Class to that shareholder or may issue a separate Class (or sub-class) of
shares to that shareholder.
50

SECTION VI - SUBSCRIPTION, REDEMPTION AND TRANSFER OF SHARES
6.1 Subscription for shares
6.1.1 Some defined terms used in this Section
This Section uses a number of defined terms, particularly as they relate to the
subscription, redemption and transfer of shares in the Fund. Of those, the following
expressions are defined in the Executive Summary:
“Subscription Agreement”
“Closing Date”
“Initial Offering Period”
“Net Asset Value”
“Net Asset Value per Share”
“Redemption Day”
“Subscription Day”
When reading this Section, you should also note the following defined terms:
“Redemption Request” means a redemption request in the form appearing in

Appendix IV of this Memorandum or such other form determined by the directors
from time to time;
“Redemption Price” means the redemption price of Offered Shares described in this
Memorandum and calculated in accordance with the Fund’s articles of association;
and
“Valuation Day”, with respect to the Offered Shares, means any one or more of the
following having regard to the context:
(a) each Redemption Day;
(b) the business day immediately preceding each Subscription Day;
(c) the other day or days that the directors determine is or are to apply, whether
generally or in a particular case.
6.1.2 Offering of shares
The Fund is offering its Class A shares (“Offered Shares”) privately to a limited
number of Eligible Investors. The purchase of Offered Shares is not open to the
general public. The description of an Eligible Investor appears in Appendix I.
The minimum initial investment for Offered Shares is US$1,000,000. The directors
may, in their sole discretion, determine some other amount to be the minimum
investment in respect of a particular shareholder or group of shareholders. However,
if the Fund is registered as a regulated mutual fund under Section 4(3) of the Mutual
Funds Law of the Cayman Islands and its shares are not listed on any stock
exchange approved by the Cayman Islands Monetary Authority, the minimum
investment must not be less than US $100,000 or its equivalent in any other
currency.
51

6.1.3 Offer price, sales changes
During and after the Initial Offering Period, Offered Shares will be offered at a
Subscription Price of $1,000 per Offered Share.
On each Subscription Day on which any new shares are issued, shares will be
issued in a new Series.
During and after the Initial Offering Period, both of the following must be received by
the Administrator by 5:00 pm (Cayman Islands time) one business day before the
Closing Date or applicable Subscription Day:
(i) Subscription Agreement; and
(ii) payment for those subscriptions (including the initial charge, if any) in cleared
funds in US dollars.
However, following consultation with the Administrator and Investment Manager, the
directors may waive those requirements in any particular case or generally if they
determine that to do so will not materially prejudice the remaining holders of
Participating Shares. But in no event will subscriptions be accepted for processing
as of the Closing Date or on a particular Subscription Day, if the Subscription
Agreement is received by the Administrator after 5:00 pm (Cayman Islands time) on
the Closing Date or on that Subscription Day. Similarly, payment for those
subscriptions must be received by the Administrator in cleared funds in US dollars no
later than 5:00 pm (Cayman Islands time) on the Closing Date or on the applicable
Subscription Day. If any Subscription Agreement or payment is received late, it will
be dealt with on the next Subscription Day.
6.1.4 Payment
Payment for Offered Shares must be made in cash by electronic transfer, net of bank
charges, and is due in cleared funds in US dollars. Payment must be sent to the
Administrator’s bank account, details of which are noted on the Subscription
Agreement.
However, the directors may accept payments in another currency and subscriptions
in kind. No subscriptions in kind will be accepted unless the directors are satisfied of
the following:
(a) that the investments to be transferred are valued in accordance with the
valuation provisions set out in the Fund’s articles and summarised in this
Memorandum; and
(b) that the terms of that transfer do not materially prejudice the remaining
shareholders.
If subscription monies are received in any currency other than US dollars, conversion
into US dollars will be arranged by the Administrator at the risk and expense of the
applicant. Any bank charges in respect of electronic transfers will be deducted from
subscriptions and only the net amount will be invested in Offered Shares.
52

6.1.5 Prevention of Money Laundering
United States: To ensure compliance with statutory and other generally accepted
principles relating to anti-money laundering regulations and policies, including the
Fund’s and the Investment Manager’s obligations under the USA Patriot Act, the
Fund requires verification of identity and source of funds from all prospective
investors in the Fund. Pending the provision of evidence satisfactory to the Fund,
admission of an investor may be delayed in the sole discretion of the Investment
Manager. If the Investment Manager or the Administrator has not received
satisfactory evidence of an investor’s identity within a reasonable period of time
following a request for such evidence, the Investment Manager may refuse to admit
the investor, in which event any subscription proceeds received by the Fund from
such investor will be returned to the account of such investor. If the Investment
Manager has suspicion that a payment to the Fund (by way of subscription or
otherwise) contains the proceeds from criminal conduct, it may be required under
applicable anti-money laundering laws and regulations to report its suspicions to one
or more enforcement or regulatory agencies, including various US governmental
agencies. In addition, in accordance with the USA Patriot Act and certain
interpretations there under, certain US financial institutions, such as SEC-registered
broker-dealers, may seek to rely on customer identification procedures undertaken
by the Investment Manager in order to discharge certain of their own anti-money
laundering obligations. In such situations, the Investment Manager may elect to
undertake such procedures or to permit such reliance, which may involve sharing of
customer identification information between the Investment Manager and the relying
financial institution.
Cayman Islands: To ensure compliance with applicable statutory requirements

relating to anti-money laundering and anti-terrorism initiatives, the Fund or the
Administrator will require verification of identity, address and source of funds from all
prospective investors. Depending on the circumstances of each application and the
anti-money laundering policies and procedures of the Administrator, a detailed
verification might not be required where (1) the applicant is a qualified financial
institution; or (2) the applicant makes the payment by electronic funds transfer from
an account held in the applicant’s name at a qualified financial institution, and such
institution provides an instruction letter or copy of SWIFT notification on behalf of the
applicant in a form acceptable to the Company and Administrator; or (3) a qualified
financial institution provides an introducer’s letter on behalf of the applicant. Such
exceptions will only apply if the financial institution or intermediary referred to above
is within a country recognized as having sufficient anti-money laundering regulations.
In the case of (1) above, the applicant should ensure that its remitting bank includes
the applicant’s full name and account number in any confirmation sent to avoid any
delays.
As mentioned above, the Fund, or the Administrator reserves the right to request
such evidence as is necessary to verify the identity, address and source of funds of a
prospective investor. The Fund or the Administrator also reserves the right to
request such verification evidence in respect of a transferee of Offered Shares. In
the event of delay or failure by the prospective investor or transferee to produce any
evidence required for verification purposes, the Fund or the Administrator may refuse
to accept the application or (as the case may be) to register the relevant transfer, and
(in the case of a subscription of Offered Shares) any funds received will be returned
without interest to the account from which such funds were originally debited.
53

The Fund or the Administrator also reserves the right to refuse to make any
redemption payment or distribution to a shareholder if any of the Directors of the
Fund or the Administrator suspects or is advised that the payment of any redemption
or distribution moneys to such shareholder might result in a breach or violation of any
applicable anti-money laundering or other laws or regulations by any person in any
relevant jurisdiction, or such refusal is considered necessary or appropriate to ensure
the compliance by the Fund, its Directors or the Administrator with any such laws or
regulations in any relevant jurisdiction. The Fund and the Administrator also reserve
the right to request such verification evidence in respect of a redemption request.
If, as a result of any information or other matter which comes to his attention, any
person resident in the Cayman Islands or elsewhere (including the Fund, its
Directors, its compliance officer, its money laundering reporting officer and/or the
administrator) knows or suspects that payment to the Fund (by way of subscription or
otherwise) is the proceeds of criminal conduct, such person is required to report such
information or other matter pursuant to the Proceeds of Crime Law, 2008 of the
Cayman Islands and such report shall not be treated as a breach of any restriction
upon the disclosure of information imposed by law or otherwise.
6.1.6 Data protection/confidentiality
Each subscriber and shareholder will also be required to acknowledge and consent
that the Fund, the Administrator and/or the Investment Manager may disclose to
each other, to any regulatory body, to a delegate, agent or any other service provider
to the Fund or the Administrator in any jurisdiction, including those outside of the
United States, the Cayman Islands or the European Economic Area, copies of the
subscriber’s subscription application and any information concerning the subscriber
provided by the subscriber to the Fund, the Administrator and/or the Investment
Manager. Any such disclosure shall not be treated as a breach of any restriction
upon the disclosure of information imposed on such person by law or otherwise.
6.1.7 Electronic communication consent
The Fund, the Investment Manager, the Administrator or any agent of the foregoing
may communicate with investors (e.g. financial statements, performance reports,
manager letters) by using a variety of means including, but not limited to, by
telephone, e-mail, password protected Internet website, regular mail and facsimile.
An investor may, at any time, notify the Fund that it does not wish to receive
electronic communication and that it wishes to receive paper communication instead.
6.1.8 Procedure for the purchase of Offered Shares
Subscriptions are subject to the terms of this Memorandum, the Fund’s

memorandum and articles of association and the Subscription Agreement attached in
Appendix II.
Persons interested in purchasing Offered Shares of the Fund should inform

themselves as to (i) the legal requirements within their own countries for the
purchase of such Offered Shares, and (ii) any foreign exchange restrictions which
they might encounter.
Only Eligible Investors may subscribe for Offered Shares. Further, Offered Shares
purchased for those under 18 years of age must be registered in the name of the
parent or legal guardian.
54

Subscriptions must be made in the form of the attached Subscription Agreement and
should be sent to the Administrator at the address or facsimile number appearing in
the Subscription Agreement.
With respect to certain countries, special requirements may have to be observed with
respect to subscriptions. In the event that subscription monies are received in any
currency other than US Dollars, conversion into US Dollars will be arranged by the
Administrator at the risk and expense of the applicant. Any bank charges in respect
of electronic transfers will be deducted from subscriptions and the net amount will be
invested in the Fund.
If subscriptions are made by facsimile, the original written form should be forwarded
without delay to the Administrator. Offered Shares will not be issued until the original
Subscription Agreement and all other relevant due diligence documents have been
received by the Administrator.
Offered Shares will be issued to two decimal places. Any smaller fraction of a
Participating Share that would otherwise arise will be rounded down, with the
relevant subscription monies being retained for the benefit of the Fund.
Any subscription may be rejected or scaled down in the sole discretion of the
directors. If subscriptions are scaled down or rejected, subscription monies received
by the Fund will be returned to the account from which the monies were initially
remitted, without interest.
The subscription documents to be executed and delivered by prospective subscribers

contain the subscriber’s agreement to indemnify the Fund, the Investment Manager,
the Administrator and their respective affiliates, directors, members, partners,
shareholders, officers, employees and agents against any and all losses, liabilities,
damages, penalties, costs, fees and expenses (including legal fees and
disbursements) that may result, directly or indirectly, from any inaccuracy in or
breach of any representation, warranty, covenant or agreement set forth therein or in
any other document delivered by the subscriber to the Fund.
6.1.9 Form of shareholding
Offered Shares will be held in registered form. Generally, share certificates will not
be issued nor will any other documentation be issued, other than confirmation
notices. Confirmation notices will include a Shareholder Identification Number and
details of the Offered Shares that have been allotted. However, confirmation notices
will be sent to a subscriber only after that subscriber’s Subscription Agreement has
been approved and due diligence in respect of that subscriber has been satisfactory
completed.
6.2 Redemption of Offered Shares
6.2.1 General
Offered Shares may be redeemed on any Redemption Day at the Redemption Price.
A shareholder holding Participating Shares wishing to redeem its Offered Shares

should deliver an executed Redemption Request to the Administrator at the address
specified in the Redemption Request. The completed Redemption Request must be
actually received by the Administrator no later than the 30th day before the
55

Redemption Day on which the redemption is to occur. If it is received after that date
it will be held over and dealt with on the next Redemption Day. The directors may
provide for a redemption notice period of less than 30 days in a particular case or
generally if they determine that, under the circumstances, to waive that requirement
will not have an adverse effect on the Fund’s portfolio. But in no event will
redemption requests be accepted for processing as of a particular Redemption Day if
the Redemption Form is received by the Administrator after 5:00 pm (Cayman
Islands time) on that Redemption Day.
The Redemption Request may be delivered to the Administrator by facsimile, so long

as the original Redemption Request is forwarded immediately to the Administrator.
None of the Fund, the Fund’s directors, the Administrator or any other agents of the
Fund accepts any responsibility for any errors in facsimile transmissions. If a
Redemption Request is forwarded by facsimile, no redemption proceeds will be paid
to the shareholder until the original Redemption Request has been received by the
Administrator.
Cayman Islands law imposes certain restrictions on the redemption of shares,

particularly where the Fund does not permit the redemption out of profits or the
proceeds of a fresh issue of shares made for the purposes of redemption. In
particular, a redemption payment out of capital is only possible if the Fund remains
able to pay its debts as they fall due in the ordinary course of business after that
redemption payment.
The Fund, or the Administrator on its behalf, may refuse to make a redemption
payment or distribution to a shareholder if:
(i) a director of the Fund or the Administrator suspects or is advised that the
payment of any redemption or distribution moneys to that shareholder may
result in a breach or violation of an applicable anti-money laundering or other
law or regulation by any person in any relevant jurisdiction; or
(ii) that refusal is considered necessary or appropriate to ensure the compliance

by the Fund, its directors or the Administrator with any of those laws or
regulations in any relevant jurisdiction.
Once given, a Redemption Request may not be revoked by the shareholder unless
determination of the Net Asset Value is suspended by the directors in the
circumstances set out below or the directors otherwise agree.
On giving at least 30 calendar days’ notice to shareholders holding Participating

Shares, the directors may amend the frequency of redemptions, but that change only
takes effect on the Redemption Day immediately following that notice.
6.2.2 Redemption Proceeds
At redemption, shareholders will be paid the Redemption Price. The Redemption

Price is calculated in accordance with the Fund’s articles of association and is based
on the Net Asset Value per Share on the preceding Valuation Day.
The Redemption Price will be paid in US dollars by electronic transfer at the request
and expense of the redeeming shareholder. It will usually be paid within 30 business
days of the relevant Redemption Day.
56

The Fund aims to pay all redemption proceeds in cash. However, under
circumstances of low liquidity or adverse market conditions, the directors may choose
to satisfy redemptions by transferring assets of the Fund. But no Investment will be
transferred to a shareholder unless the directors are satisfied that:
(a) the value of the Investments to be transferred (together with any cash
redemption proceeds) is equal to, and does not exceed, the Net Asset Value
of the shares to be redeemed less all duties and charges incurred as a result
of the transfer. For this purpose, the Investments will be valued in
accordance with the valuation provisions set out in the Articles and
summarised in this Memorandum; and
(b) the terms of the transfer do not materially prejudice the interests of the
remaining shareholders.
Investments may be transferred directly to the redeeming shareholder or may be

transferred to a liquidating account and sold by the Fund for the benefit of the
redeeming shareholder. In the latter case, payment of the proportion of the
Redemption Price attributable to those Investments will be delayed until they are
sold, and the amount payable in respect of those Investments will depend on their
performance until they are sold. The cost of operating the liquidating account and
selling the Investments will be deducted from the proceeds of sale paid to the
redeeming shareholder.
6.2.3 Compulsory redemption
A shareholder holding Participating Shares must notify the Fund and the
Administrator immediately if it ceases to be an Eligible Investor. If that happens, at
the next Redemption Day after that notification, the Fund may redeem its
Participating Shares at the Net Asset Value per share. Without limitation to the
previous sentence, the Fund may redeem any shares that are or become owned,
directly or indirectly, by or for the benefit of a person who is not an Eligible Investor.
Further, on giving notice in writing to a shareholder holding Participating Shares, the

Fund may redeem all or any shares of that shareholder on a day appointed by the
directors for that purpose. It may do so with or without cause but the Redemption
Day must not be less than 5 days after the date of that notice.
6.3 Determining Net Asset Value
The Administrator will calculate the Net Asset Value of each Class and Series of the
Fund and the Net Asset Value per share as of the close of business on each
Valuation Day. Those calculations will be made in accordance with the valuation
provisions set out in the articles and summarised below and will be reported to
shareholders to two decimal places.
The Net Asset Value of a share of the relevant Series is calculated by dividing the
assets of the Fund attributable to the Series to which that share belongs, less the
liabilities attributable to that Series, by the number of issued shares in that Series.
Unless the directors consider some other basis of valuation is more appropriate, the
Fund’s assets will be valued based on accrual accounting using generally accepted
accounting principles applied in the United States (“GAAP”) (apart from amortisation
57

of organisational costs) as a guideline and otherwise in accordance with the

principles set out in the articles and summarised below.
6.3.1 Assets
For the purpose of any valuation, the Fund’s assets include, without limitation:
(a) all cash on hand or on deposit, including any paid or unpaid accrued interest;
(b) all bills and demand notes and accounts receivable (including the proceeds
of investments and other assets sold);
(c) all investments and other assets owned by or contracted for by the Fund;
(d) all dividends and distributions payable in stock, cash or other property
receivable by the Fund. However, the Administrator may make adjustments
with respect to fluctuations in the market value of investments caused by
trading ex-dividend or ex-rights or by similar practices;
(e) all interest accrued on any interest-bearing instruments owned by the Fund,
except to the extent that interest is already included or reflected in the
valuation of those instruments; and
(f) all other assets of every kind and nature, including prepaid expenses
(although goodwill is deemed to have no value).
6.3.2 Liabilities
Once again, for the purpose of any valuation, the Fund’s liabilities include, without
limitation:
(a) all loans, bills and accounts payable;
(b) all accrued or payable expenses and fees chargeable to the Fund including
amortised organisational expenses and accrued Management Fees and
Incentive Fees. Regular or recurrent expenses may be estimated for yearly
or other periods in advance and accrued over that period;
(c) gross acquisition cost of investments and other property contracted to be

purchased by the Fund;
(d) such sum (if any) the directors consider appropriate on account of anticipated
brokerage, stamp duty and any other governmental taxes or charges;
(e) Dividends declared on the Participating Shares but not yet paid; and
(f) all other liabilities, including contingencies and such reserves as the
directors, acting reasonably, consider advisable.
6.3.3 Valuation principles
In valuing the Fund’s investments, the following principles apply:
(a) Unless US GAAP require otherwise:
58

(i) Net Asset Value shall include any unrealized profit or loss on open
positions;
(ii) securities (other than options and warrants) which are listed on a
recognized exchange or included in an automated quotation system
generally shall be valued at the closing sale price on the date of
determination; options, warrants and other securities for which no
sale occurred on the date of determination, or other securities which
are not so listed or included shall be valued at the mean between the
“bid” and “asked” price on the date of determination based on
quotations obtained by the Administrator or its delegatee from one or
more brokers or dealers regularly making markets in and issuing
quotations for such securities, it being within the sole discretion of the
Administrator or its delegatee applied in good faith to determine
whether an exchange is recognized for valuation purposes;
(iii) all open futures positions and options thereon shall be calculated at
their then-market value which means, with respect to open futures
positions, the settlement price as determined by the exchange on
which the transaction is effected or the most recent appropriate
quotation as supplied by the broker through which the transaction is
effected, and means with respect to options on futures contracts the
liquidation value thereof; if there are no trades on the date of the
calculation due to the operation of the daily price fluctuation limits or
due to a closing of the exchange on which the transaction is
executed, the contract will be valued at fair market value as
determined by the Investment Manager in good faith;
(iv) in the case of forward contracts and options thereon traded on the
interbank market, forward contracts shall be valued at the mean
between the “bid” and “asked” price for all positions at the close of
business in New York City on the day on which the Net Asset Value
is determined as quoted by the banks or other brokers and dealers
through which such contracts were acquired, and options on forward
contracts shall be valued at the fair market value as determined by
the Investment Manager in good faith;
(v) swap agreements shall be valued at fair market value as determined

by the Investment Manager in good faith;
(vi) all other investments, assets and liabilities of the Fund and those
investments, assets and liabilities of the Fund the fair market value of
which the Investment Manager determine cannot be accurately
determined pursuant to any other provisions of this section, shall be
assigned such fair market value as the Investment Manager may
determine in good faith;
(vii) brokerage commissions on securities and futures trades shall be

accrued as incurred;
(viii) Management Fees and Incentive Fees and other fees and expenses
shall be accrued at least monthly;
59

(ix) the amount of any Dividends or distributions made by the Fund shall
be a liability of the Fund from the day when the Dividend or
distribution is declared until paid;
(x) interest income shall be accrued at least monthly; and
(xi) any value otherwise than in dollars shall be converted into dollars at a
prevailing rate (whether official or otherwise) which the Investment
Manager shall in good faith deem appropriate having regard to any
premium or discount which it considers may be relevant and to costs
of exchange.
(b) In calculating the Net Asset Value per Share, the Administrator may rely on
such automatic pricing services as it considers appropriate. Alternatively, if
so instructed by the directors, it may use information supplied by particular
pricing services, brokers, market makers or other intermediaries. The
Administrator shall be entitled to rely upon prices received from a reputable
pricing service. The Administrator will not be liable for any loss suffered by
the Fund or a shareholder due to an error in the calculation of the Net Asset
Value per share resulting from an inaccuracy in the information supplied by a
pricing service, broker, market maker or other intermediary. In addition and
with respect to securities valued by the directors or the Investment Manager,
the Administrator shall be entitled to rely without enquiry upon the valuations
submitted to it by the directors and/or the Investment Manager and shall have
no responsibility to determine the accuracy or otherwise thereof.
6.4 Temporary suspension of dealings
At any time, the Fund’s directors may declare that the issue or redemption of shares
of any Class is temporarily suspended. Also, in either case, they may (but need not)
declare that the determination of the Net Asset Value per Share of that Class is
simultaneously suspended.
Further, at any time, the directors may declare that the determination of the Net
Asset Value per Share of any Class is temporarily suspended. Also, they may (but
need not) declare that the redemption of shares of that Class is simultaneously
suspended.
The Fund’s directors may declare any of these suspensions in such circumstances
as they think fit. These circumstances include, but are not limited to, any of the
following:
(a) a stock exchange on which a substantial part of the Fund’s Investments is

traded is closed (apart from ordinary holidays) or dealings on that stock
exchange are restricted or suspended;
(b) a state of emergency exists as a result of which:
(i) disposal of a substantial part of the Fund’s investments is not

reasonably practicable and may seriously prejudice the shareholders;
or
(ii) it is not reasonably practicable for the Fund to determine fairly the
value of its net assets;
60

(c) none of the outstanding Redemption Requests is able to be lawfully satisfied

by the Fund in US dollars; or
(d) there is a breakdown in the means of communication normally used to

determine the prices of a substantial part of the Fund’s investments.
Any suspension takes effect at the earlier of:
(a) the time the directors specify in their declaration; and
(b) the close of business on the business day immediately following the day the
directors declare the suspension.
The suspension continues until the directors declare that it is ended.
As soon as practicable after declaring a suspension, the Fund’s directors will cause
notice to be given to the holders of Participating Shares of the affected Class of the
terms of that declaration. Similarly, when the period of suspension ends, they will
cause further notice of that fact to be given to those holders.
6.5 Transfer of Offered Shares
Offered Shares may not be transferred without the prior written consent of the
directors, which they may withhold in their absolute discretion. Furthermore,
transfers of Offered Shares may only be conducted in accordance with the policies
and procedures of the Administrator, including anti-money laundering policies and
procedures. A transferee must be an Eligible Investor and must complete a
Subscription Agreement and will be subject to the same requirements as all
subscribers for Offered Shares.
61

SECTION VII - FINANCIAL INFORMATION AND REPORTS
7.1 Fiscal year
The Fund’s fiscal year will end on December 31 of each year, with the first fiscal year
ending on December 31, 2010.
7.2 Fiscal periods
Because Participating Shares may be issued and redeemed, and dividends declared
on them, during the course of a fiscal year, the Fund’s articles of association provide
for fiscal periods that are portions of a fiscal year to enable net profits and net losses
to be allocated to each Class and Series.
A new fiscal period will commence on each of the following dates:
• the day immediately after the date a redemption of Participating Shares

occurs;
• the date that any Participating Shares are issued; and
• the day immediately after the date fixed by the directors for determining the
record of ownership of Participating Shares of a Class and Series in
connection with the payment of dividends.
When that happens, the prior fiscal period will end on the day immediately before the
first day of the new fiscal period.
7.3 Financial statements
Unless the directors in their discretion determine otherwise, the Fund’s financial
statements will be prepared using GAAP as a guideline. Despite this, because the
directors believe it is more equitable, organisational expenses will be amortised over
60 months from the date the Fund commences operations, rather than expensing the
entire amount during the first year of operations as required by GAAP. As a result,
the Fund’s financial statements may contain qualifications reflecting that treatment.
The books and records of the Fund will be audited at the end of each fiscal year by
auditors selected by the directors. The Fund’s first audit will be for the period
beginning when the Fund’s operations commenced and ending on December 31,
2010.
7.4 Auditors
McGladrey & Pullen are the auditors for the Fund and have consented in writing to
their appointment as auditors of the Fund. They have also consented to being
referred to as such in this Memorandum. The directors may replace the auditors
without prior notice to the holders of Participating Shares.
62

7.5 Reports to shareholders
Each fiscal year, holders of Participating Shares will be sent audited financial
statements of the Fund within six months after the end of that fiscal year (or as soon
as practicable thereafter). The financial statements will include a statement of profit
or loss for that fiscal year as well as a statement of the unaudited status of the
shareholder’s holdings in the Fund at that time.
The Fund will also provide a shareholder with a monthly report on the investment
performance of the Fund if the shareholder requests that report from the Investment
Manager.
On behalf of the Fund, the Administrator offers authorised persons, including relevant
service providers and investors the opportunity to review confidential fund
information, including but not limited to investor and investment information, via
electronic delivery. Although this may be of benefit, it is important to note that;
i. electronic communications may not be secure, may contain computer viruses or

other defects, may not be accurately replicated on other systems, or may be
intercepted, deleted or interfered with without the knowledge of the sender or the
intended recipient; and
ii. the information may be located outside of the Cayman Islands and may need to
be disclosed to third parties; e.g. those involved with the maintenance of the
information, and could be accessed by unauthorised persons.
As such, the person to whom the information belongs by investing in the Fund agrees
that the Administrator, on behalf of the Fund, may employ the applicable method of
communication. The person will also be required to release the Administrator and the
Fund from any form of liability or loss associated with the communication or
publication of fund information, including but not limited to investor and investment
information. The Administrator makes no warranties in relation to these matters and
the use of the alternative methods of communication will be at the sole risk of the
person to whom the information belongs. The Administrator also reserves the right to
intercept, monitor and retain communications to and from its systems as permitted by
applicable law.
63

SECTION VIII - TAXATION
8.1 General
What follows is a general discussion of some of the anticipated Cayman Islands and
United States tax consequences to the Fund arising from its operation. The
statements as to Cayman Islands taxation are based on advice from Ogier, George
Town, Grand Cayman, Cayman Islands. The statements as to United States taxation
are based on advice from Arnold & Porter LLP.
Each summary that follows is considered by the applicable advisor to be a correct

interpretation of existing laws, regulations promulgated under those laws, published
administrative findings and judicial decisions applied at the date of this
Memorandum. However, the Fund does not represent that those laws, regulations,
rulings or decisions, or their application or interpretation, will not change in the future,
possibly with retroactive effect.
Furthermore, in view of the number of different jurisdictions where local laws may
apply to holders of Participating Shares, the discussion that follows does not address
all the tax consequences, including income tax consequences, to potential investors
of purchasing, holding, redeeming or disposing of Offered Shares.
Prospective investors are urged to consult their own tax advisors to determine the
possible tax consequences, including income tax consequences, to them under the
laws of any of the following jurisdictions: jurisdictions of which they are citizens,
residents or domiciliaries; jurisdictions in which they conduct business; and
jurisdictions in which they purchase, hold, redeem or dispose of Offered Shares.
The following discussion does not constitute tax advice.
8.2 Cayman Islands
8.2.1 Fund Level
The Fund is not subject to any income, withholding or capital gains taxes in the
Cayman Islands. The Fund has applied for and is expecting to receive an
undertaking from the Governor-in-Cabinet of the Cayman Islands pursuant to the Tax
Concessions Law (Revised) of the Cayman Islands that for a period of twenty years
from the date of the grant of the undertaking, no law which is thereafter enacted in
the Cayman Islands imposing any tax to be levied on profits or income or gains or
appreciations will apply to the Fund or its operations; and, in addition, that no tax to
be levied on profits, income, gains or appreciations or which is in the nature of estate
duty or inheritance tax will be payable on or in respect of the shares, debentures or
other obligations of the Fund, or by way of the withholding in whole or in part of any
relevant payment as defined in Section 6(3) of The Tax Concessions Law (Revised).
No capital or stamp duties are levied in the Cayman Islands on the issue, transfer or
redemption of Participating Shares.
8.2.2 Shareholder Level
Shareholders holding Participating Shares will not be subject to any income,

withholding or capital gains taxes in the Cayman Islands, with respect to their
64

Participating Shares and dividends received on those shares, nor will they be subject
to any estate or inheritance taxes in the Cayman Islands.
8.2.3 European Union Savings Directive
The EU member states have adopted a Savings Directive (2003/48/EC) (“Directive”),

which came into effect on 1 July 2005. The Directive requires that “paying agents” in
one member state provide to the tax authorities of another member state details of
payments of interest or other similar income (including income, by way of distribution
or redemption, made by or on behalf of certain investment funds) paid by them to or
for the benefit of an individual resident in that other member state. (Instead of
providing that information, certain states operate a withholding system in relation to
payments of that kind.)
The implementation of the Directive affects certain dependencies and territories of

EU member states, including the Cayman Islands, which have voluntarily agreed to
apply the same or equivalent measures to those contained in the Directive. In the
Cayman Islands, those measures came into effect on July 1, 2005. In common with
the Directive, the Cayman Islands legislation applies to “interest payments” made by
a “paying agent” to an individual resident in the EU. Under the Cayman Islands
legislation, “interest payment” includes income paid (by way of distribution or
redemption) by or on behalf of certain UCITS or “equivalent undertakings for
collective investment established in the Cayman Islands” (called a “UCITS
equivalent”).
For the purpose of the Directive, the Administrator will make the payments to
investors and will usually be the paying agent. The Administrator is located in the
Cayman Islands, and the payments will be subject to the laws that implement the
Directive in the Cayman Islands. But, the Administrator will be able to treat the Fund
as a non-UCITS equivalent, and therefore outside the scope of the Directive.
However, an investor may become a paying agent for purpose of the Directive if (a)
that investor is based in the EU or certain states that have agreed to implement
measures equivalent to those contained in the Directive (including Switzerland, the
Channel Islands and Monaco); and (b) that investor makes an investment in the Fund
on behalf of other underlying investors who are individuals or certain unincorporated
entities resident in the EU.
In those circumstances, under implementing legislation in that investor’s country of

residence, the investor may be required to (i) obtain all relevant information relating
to its underlying investors and their indirect investment in the Fund; and (ii) make
returns to the appropriate tax authorities, or withhold tax at applicable rates from any
distribution made to underlying investors in respect of a payment received from the
Fund.
An investor of this kind should seek tax advice from an independent tax advisor,
based on its own circumstances.
8.3 United States
8.3.1 US Treasury Circular 230 Notice
The tax discussion contained in this Memorandum was not intended or written to be
used, and cannot be used, for the purpose of avoiding US federal tax penalties. This
65

discussion was written to support the promotion or marketing of the transactions or

matters addressed in this Memorandum. You should seek advice based on your
particular circumstances from an independent tax advisor.
8.3.2 US Federal Taxation
The following is a brief summary of certain United States federal (“Federal”) income
tax consequences that may be relevant to prospective investors. This summary is
not a full description of the complex tax rules involved and is based upon the sections
of the US Internal Revenue Code of 1986, as amended (“Code”), US Treasury
regulations, published US Internal Revenue Service (“Service”) rulings, published
administrative positions of the Service and court decisions that are currently
applicable, any or all of which could be materially and adversely changed, possibly
on a retroactive basis, at any time. This summary does not take into account or
anticipate any state, local or non-US tax considerations. No assurance can be given
that forthcoming legislation, administrative changes or court decisions will not
significantly modify the tax consequences discussed in this summary. A change in
the tax law may or may not be applied retroactively to transactions entered into or
completed prior to the adoption of any such change. This summary is of a general
nature only and is not intended to be, nor should it be construed to be, legal or tax
advice to any particular investor. The Fund has not obtained any private letter ruling
from the Service or analogous ruling from any other authority concerning the tax
consequences set forth herein. Accordingly, prospective purchasers of Participating
Shares should consult their own tax advisers with respect to the tax treatment of the
acquisition, ownership and disposition of Participating Shares in light of their
particular circumstances.
This summary does not purport to be a complete analysis of all the potential Federal
income tax considerations relating to the purchase, ownership and disposition of
Participating Shares, and does not address all aspects of taxation that may be
relevant to a particular investor in light of the investor’s individual circumstances
(including the effect of any non-US, state or local tax laws) or to certain types of
purchasers (including dealers or traders in securities, insurance companies, financial
institutions, regulated investment companies, real estate investment trusts, investors
liable for the alternative minimum tax, persons whose functional currency is not the
US dollar, holders in straddles, hedging or conversion transactions and tax-exempt
entities) subject to special treatment under Federal income tax laws. The Fund’s
policies do not permit the ownership or transfer of Participating Shares to United
States persons (as defined in Appendix I). Accordingly, tax consequences to US
Holders (as hereinafter defined), including investors that are citizens but not
residents of the United States, are not discussed herein. Special rules may apply in
the case of investors that are former citizens of the United States or that are
considered, for Federal tax purposes, to be personal holding companies, controlled
foreign corporations, passive foreign investment companies or corporations subject
to the accumulated earnings tax, and in some situations special rules may also apply
to shareholders of the foregoing. Additionally, special rules regarding certain Federal
income tax consequences may apply to an investment in the Fund by a beneficial
owner of Participating Shares which is or becomes, for Federal income tax purposes,
a citizen or resident of the United States, a US corporation, or a holder otherwise
subject to Federal income tax on a net income basis in respect of Participating
Shares. This summary does not address any such special rules and, accordingly,
such investors are urged to consult their tax advisers concerning the Federal tax
treatment of an investment in the Fund in light of their particular circumstances.
66

Participating Shares may not be purchased by United States persons. Accordingly,

the tax consequences to US Holders, including individuals who are citizens of the
United States but not residents of the United States, are not discussed herein.
The Fund is a company incorporated under the laws of the Cayman Islands. Based
on the structure and operations of the Fund, it generally should not be subject to
Federal income tax, except as provided below.
The Fund generally will be subject to Federal income tax on income and gain
realized by it only if it is viewed for Federal income tax purposes as being “engaged
in a trade or business within the United States,” either directly or through one or more
non-corporate master fund in which it may invest. Whether the Fund will be viewed to
be engaged in a trade or business within the United States is a question of fact the
answer to which will depend principally upon the activities that the Fund (or any non-
corporate master fund or other investment vehicle in which the Fund may invest)
conducts within the United States. However, a “safe harbor” found in the Code
provides that a non-US corporation (other than a dealer in securities or commodities)
that engages in the United States in trading securities (including contracts or options
to buy or sell securities) and commodities for its own account is not deemed to be
engaged in a US trade or business (with the further requirement, in the case of
commodities, that (a) the commodities are of a kind customarily dealt in on an
organized commodities exchange and (b) the transaction is of a kind customarily
consummated at such place). The Fund intends to use reasonable efforts to conduct
its business in a manner so as to meet the requirements of the safe harbor. On that
basis, trading activity of the Fund generally should not constitute a US trade or
business, and the Fund does not expect to be subject to Federal income taxation on
any of its trading profits.
If, however, the Fund were deemed to be engaged in a US trade or business, income
and gain deemed to be effectively connected with such investment would potentially
be subject to Federal income tax at graduated rates and, in addition, subject to a flat
30% branch profits tax. The Fund will, to the extent practicable, attempt to limit its
activities within the United States and otherwise conduct its affairs and structure
investments so as not to be treated as engaged in a trade or business within the
United States. Nonetheless, there can be no assurance that the Fund will be
successful in that attempt, nor that any non-corporate master fund or other
investment vehicles in which the Fund may invest will similarly limit their activities,
affairs and investments.
In general, under the Code, a non-US corporation (such as the Fund) which does not
conduct a US trade or business nonetheless is subject to Federal tax at a flat rate of
30% on the gross amount of certain US-source income which is not effectively
connected with a US trade or business, generally payable through withholding.
Income subject to such a flat tax rate is described in the Code as being of a fixed or
determinable annual or periodic nature, including dividends and certain interest
income. There presently is no tax treaty between the United States and the Cayman
Islands relating to withholding tax that would reduce the withholding rate.
Certain types of income specifically are exempted from the 30% tax, and thus
withholding is not required on payments of such income to a non-US corporation.
The 30% tax does not apply to interest on deposits with US banks, nor to interest
which qualifies as “portfolio interest.” The term “portfolio interest” generally includes
interest (including original issue discount) on an obligation in registered form with
respect to which the United States person who would otherwise be required to
67

deduct and withhold the 30% tax receives the required statement that the beneficial
owner of the obligation is not a United States person. Under certain circumstances,
interest on bearer obligations also may be considered portfolio interest. Contingent
interest, however, is never “portfolio interest.” Also exempt from the 30% tax is
income from original issue discount obligations and interest-bearing obligations which
are payable no more than 183 days from the date of issue.
As used herein, the term “US Holder” means an investor that, for Federal income tax
purposes, is (a) an individual citizen or resident of the United States, (b) a
corporation, partnership, limited liability company or other entity created or organized
in or under the laws of the United States, any State thereof or the District of
Columbia, (c) an estate the income of which is subject to Federal income taxation
regardless of its source or (d) a trust (i) as to which one or more United States
persons (as defined for Federal tax purposes) have the authority to control all
substantial decisions and over which a court within the United States is able to
exercise primary supervision, or (ii) that was in existence on August 20, 1996, was
considered a US trust as of that date, and has in effect an election to continue to be
so treated. The term “Non-US Holder” means an investor that is not a US Holder.
For purposes of this summary, any discussion relating to Non-US Holders should be
understood to pertain solely to investors that will own Participating Shares as capital
assets within the meaning of the Code.
Subject to the discussion of “backup withholding” below, a Non-US Holder that is not
considered to be engaged in a trade or business within the United States should
generally not be subject to Federal income, branch profits or withholding taxes on
Fund distributions or any gain realized on a disposition of its Shares. However, in the
case of a nonresident alien individual, such gain will be subject to Federal tax at a
30% rate (or lower tax treaty rate) if such individual is present in the United States for
183 days or more during the taxable year (on a calendar year basis unless the
nonresident alien individual has previously established a fiscal year) and has a “tax
home” (within the meaning of the Code) in the United States and certain other
conditions are satisfied.
A 28% US “backup withholding” tax and information reporting may apply to any
dividends on, and gross proceeds from the sale or redemption of, Participating
Shares held in the United States by a custodian or nominee unless the investor
properly certifies that it is a Non-US Holder for Federal income tax purposes or
otherwise establishes an exemption from backup withholding.
8.4 Other jurisdictions
Dividends, interest and other income received by the Fund from sources within
certain countries may be subject to withholding taxes imposed by those countries.
The Fund may also be subject to capital gains taxes or other taxes in some of the
countries where it purchases and sells securities or otherwise conducts business.
It is impossible to predict in advance the rate of tax that the Fund will pay since the
amount of the Fund’s assets to be invested in various countries is unknown.
68

SECTION IX - GENERAL
9.1 Directors’ report
At the date of this Memorandum, the Fund has not, nor since its corporation has it,
commenced operations, declared any dividends or made up any accounts. The
Fund does not have, nor since its corporation has it had, any employees, nor is it
expected to have any in the future.
Since its incorporation, the Fund has not been, nor is it currently, engaged in any
litigation or arbitration. Also, so far as the directors are aware, no litigation or claim is
pending or threatened against the Fund.
9.2 Material Contracts
The Fund has entered into the following contracts:
(a) Management Agreement with the Investment Manager under which the
Investment Manager is appointed to provide certain investment management
services to the Fund;
(b) Administration Agreement with the Administrator under which the

Administrator is appointed administrator, registrar and transfer agent of the
Fund; and
(c) Custodian Agreement with the Custodian under which the Custodian is
appointed as custodian of the Fund’s assets.
These contracts are summarised in the Section IV headed “Management and

Administration”. They are, or may be, material.
9.3 Documents available for inspection
The following documents are available for inspection during the Fund’s normal
business hours, on weekdays (Saturdays, Sundays and public holidays excepted) at
the registered office:
(i) the Fund’s memorandum and articles of association;
(ii) the Companies Law (Revised) and the Mutual Funds Law (Revised) of the
Cayman Islands;
(iii) the Material Contracts referred to above; and
(iv) the most recent interim financial statements and audited financial statements
of the Fund.
Copies of these documents may be obtained free of charge.
69

APPENDIX I
Eligible Investors
From time to time, the directors may amend the criteria for determining who is an Eligible Investor for the purpose
of an investment in the Fund. Initially, all subscribers are “Eligible Investors” except the following:
(i) any subscriber whose acquisition of Offered Shares would cause a breach of the law or requirements of any
country or governmental authority, including anti-money laundering regulations or conventions;
(ii) any subscriber on behalf of terrorists or terrorist organisations, including those persons or entities that are
included on the List of Specially Designated Nationals and Blocked Persons maintained by the US Treasury
Department’s Office of Foreign Asset Control 1 (“OFAC”);
(iii) any subscriber who acts, directly or indirectly, for a senior foreign political figure, any member of a senior
foreign political figure’s immediate family or any close associate of a senior foreign political figure 2 unless the
Fund, after being specifically notified by the subscriber in writing that it is such a person, conducts further due
diligence, and determines that the investment is permitted;
(iv) any subscriber or any entity acting as trustee, agent, representative or nominee for a subscriber that is a
foreign shell bank 3;
(v) any subscriber who makes representations in a Subscription Agreement that are not true when given or have
ceased to be true;
(vi) any subscriber whose circumstances are such that, in the opinion of the directors, its continued ownership of
Offered Shares would cause an undue risk of adverse tax or other consequences to the Fund or another
shareholder. Those circumstances include those that affect that subscriber directly or indirectly, whether
taken alone or in conjunction with another person or persons, connected or not, or any other circumstance
that appears to the directors to be relevant; and
(vii) any subscriber, or any subscriber that is an entity acting as trustee, agent, representative or nominee for a
person, who (A) is a “United States person” (within the meaning of Regulation S under the United States
Securities Act or for purposes of US Federal income taxation) or (B) is not a Non-US Person as defined in US
Commodity Futures Trading Commission (“CFTC”) Rule 4.7 under the US Commodity Exchange Act, as
amended (“CE Act”). The subscriber must notify the Fund immediately if the subscriber becomes a United
States person or becomes aware that any person for whom the subscriber holds shares as trustee, agent,
representative or nominee has become a United States person.
All persons who do not come into any of the above categories are “Eligible Investors”. All persons who do come
within any of those categories are known collectively as “Prohibited Persons”.
Definition of “United States person” within the meaning of Regulation S under the United States Securities Act for
purposes of category (vii) above:
1. Any natural person resident in the United States, including any United States resident who is temporarily
outside the United States;
2. Any corporation, partnership or other entity organized or incorporated under the laws of the United
States;
3. Any estate of which any executor or administrator is a United States person;
1
The OFAC list may be accessed on the web at http://www.treas.gov/ofac.
2
Senior foreign political figure means a senior official in the executive, legislative, administrative, military or judicial branches of a foreign government
(whether elected or not), a senior official of a major foreign political party or a senior executive of a foreign government-owned corporation. In addition
a senior foreign political figure includes any corporation, business or other entity that has been formed by, or for the benefit of, a senior foreign political
figure. The immediate family of a senior foreign political figure typically includes the political figure’s parents, siblings, spouse, children and in-laws. A
close associate of a senior foreign political figure is a person who is widely and publicly known internationally to maintain an unusually close
relationship with the senior foreign political figure, and includes a person who is in a position to conduct substantial domestic and international financial
transactions on behalf of the senior foreign political figure.
3
Foreign shell bank means a foreign bank without a physical presence in any country, but does not include a regulated affiliate.
70

4. Any trust of which any trustee is a United States person;
5. Any agency or branch of a foreign entity located in the United States;
6. Any non-discretionary account or similar account (other than an estate or trust) held by a dealer or other
fiduciary for the benefit or account of a United States person;
7. Any discretionary account or similar account (other than an estate or trust) held by a dealer or other
fiduciary organized, incorporated, or (if an individual) resident, in the United States; and
8. Any corporation, partnership or other entity if (a) organized or incorporated under the laws of any foreign
jurisdiction; and (b) formed by a United States person principally for the purpose of investing in securities
not registered under the United States Securities Act unless it is organized or incorporated, and owned,
by “accredited investors” (as such term is defined in Rule 501(a) under the Securities Act) which are not
natural persons, estates or trusts.
Definition of the term “United States person” for US Federal income tax purposes for purposes of category (vii)
above:
1. An individual citizen or resident of the United States;
2. A partnership, corporation or any other entity formed under the laws of the United States or any political
subdivision thereof;
3. An estate the income of which is subject to US Federal income tax regardless of its source, or
4. A trust (a) the administration of which is subject to the primary supervision of a court within the United
States and for which one or more United States persons have the authority to control all substantial
decisions, or (b) that has elected to be treated as a domestic trust for US Federal income tax purposes.
Definition of “Non-US Person” under CFTC Rule 4.7 under the CE Act for purposes of category (vii) above:
1. A natural person who is not a resident of the United States;
2. A partnership, corporation or other entity, other than an entity organized principally for passive
investment, organized under the laws of a foreign jurisdiction and which has its principal place of
business in a foreign jurisdiction;
3. An estate or trust, the income of which is not subject to US Federal income tax regardless of source;
4. An entity organized principally for passive investment such as a pool, investment company or other
similar entity, provided that units of participation in the entity held by persons who do not qualify as Non-
US Persons or otherwise as qualified eligible persons (as defined in CFTC Rule 4.7) represent in the
aggregate less than 10% of the beneficial interest in the entity, and that such entity was not formed
principally for the purpose of facilitating investment by persons who do not qualify as Non-US Persons in
a commodity pool with respect to which the commodity pool operator is exempt from certain requirements
of Part 4 of the CFTC’s regulations by virtue of its participants being Non-US Persons; and
5. A pension plan for employees, officers or principals of an entity organized and with its principal place of
business outside the United States.
71

APPENDIX II
Subscription Agreement
Short Term Liquidity Fund I, Ltd.
Once completed, this form should be sent by fax, with the original to follow by mail or courier to:

c/o Michael Kenwood Capital Management, LLC
350 Bedford Street, Suite 405
Stamford, CT 06901
USA
Facsimile: +1 (203) 327-8725

Telephone: +1 (203) 327-8700
Dear Administrator:
1. Subscription
(a) The undersigned subscriber (“Subscriber”) irrevocably applies for that number of Class A non-voting
participating shares (“Shares”) in Short Term Liquidity Fund I, Ltd. (“Fund”) that may be subscribed for with
the subscription amount that appears below in accordance with the terms of the private offering memorandum
of the Fund dated May 2010 (as amended or supplemented, the “Memorandum”). (Note: Unless defined
otherwise in this Subscription Agreement, capitalised terms have the meanings given to them in the
Memorandum.)
Subscription Amount $ ________________
Subscription Agreements may be sent by facsimile transmission to the facsimile number stated in the
Subscription Agreement, provided that the original Subscription Agreement is forwarded to the
Administrator forthwith. Neither the Fund nor the Administrator accepts any responsibility for any loss
arising from the non-receipt by the Administrator of any Subscription Agreement sent by facsimile
transmission.
(b) Subscription in cash: The Subscriber undertakes to settle in full the subscription amount invested, net of
bank charges, by electronic transfer for value on ________________ to the following bank account of the
Fund (for a straight-through MT 103):
Correspondent Bank Name: Deutsche Bank Trust Company Americas, New York
Correspondent Bank Swift: BKTRUS33
Beneficiary Bank Name: Deutsche bank, Amsterdam
Beneficiary Bank Swift DEUTNL2A
Account DBA with corr.bank: 04-410-816
Name account: Short Term Liquidity Fund I, Ltd.
Account number: 265141648-0000USD000
IBAN NL05DEUT0265049113
Free Text: “From the Account of <INSERT Investor Name / Account Number
72

Subscriptions should be made only by wire transfer in US dollars, cheques will not be accepted. In the
event that subscription monies are received in any currency other than US dollars, conversion into US
dollars will be arranged by the Administrator at the risk and expense of the applicant. Any bank charges in
respect of electronic transfers will be deducted from subscriptions and the net amount only invested in
Shares.
Please effect the wire by either SWIFT MT100 or MT103 and ensure the bank charges are charged
separately to your account and not netted from the payment. To avoid return of funds, the wire transfer
must be sent from an account in the name of the Investor. The Investor’s name must be included on line 50
of the SWIFT wire transfer message or the wire transfer must state “From the Account of ____________
(Investor name)”. Please also note that there are varying length restrictions on Field 70 so the Sender of
the SWIFT message must ensure the Receiver of the SWIFT message will be passing on the information to
Michael Kenwood Capital Management, LLC to avoid delays in processing or return of funds.
Please note that in order for the Administrator to comply with Anti-Money Laundering Legislation in the
Cayman Islands, the Administrator must be able properly to identify the source of funds sent to it for
investment. Accordingly, the Subscriber is required to complete both the “Ordering Customer” (field 50) and
the “Ordering Institution” (field 52D) when sending a wire payment through the international SWIFT system.
The Administrator strongly suggests not to send SWIFT FIN 910 “Confirmation of Credit” messages that do
not include both of the above mentioned fields. Instead, the Subscriber should send a SWIFT FIN 103
“Customer Transfer Message” or to instruct its bank to use this format and to include the “Ordering
Customer” in field 50 and the “Ordering Institution” in field 52D (or equivalent CHIPS or Fed Wire
indication).
Subscription in kind: The Subscriber undertakes to transfer the following investments to those of the
Fund’s accounts that the Fund notifies the Subscriber in writing.
Submitted Securities Number of Securities Identification Number Estimated Total Value

(ISIN, Common No., as at Applicable
Cedel or Euroclear) Valuation Day
Note:
If insufficient space for all securities that are being transferred, please complete and attach to this
Subscription Agreement additional sheets setting forth the information requested above in respect of the
securities being transferred.
2. Representations, warranties acknowledgements and undertakings
The Subscriber (or, if more than one, each of them) gives the following representations, warranties,
acknowledgements and undertakings:
(a) The Subscriber acknowledges that it has received and considered the Memorandum and that this
subscription is made on the terms of the Memorandum and subject to the Fund’s Memorandum and
Articles of Association. It undertakes to observe and be bound by the Memorandum and Articles of
Association (as amended from time to time) of the Fund and applies to be entered in the register of
shareholders as the holder of the Participating Shares issued in relation to this subscription.
(b) The Subscriber acknowledges that:

(i) it has read and fully considered and understands the Memorandum in connection with this
subscription for Participating Shares in the Fund; and
(ii) it has evaluated its proposed investment in the Fund in the light of its financial condition and
Resources.
(c) The Subscriber confirms that:

(i) it is aware of the risks involved in investing in the Fund and that an inherent risk in this investment is
the potential to lose all of its investment;
(ii) it is applying for Participating Shares on the basis of the Memorandum and that it has not relied on
any representations or statements made or information supplied by or on behalf of the Fund other
than information contained in the Memorandum;
73

(iii) it has knowledge and experience in financial, investment and business matters so as to be capable
of evaluating the merits and risks associated with an investment in the Participating Shares, and is
able to bear the economic risk of that investment; and
(iv) the Fund has made available to it all material contracts described in the Memorandum together with
(where applicable) the most recent annual report and accounts of the Fund and has given it an
opportunity to verify and to clarify any information contained in the Memorandum and those
documents.
(d) The Subscriber represents and warrants to the Fund that:

(i) it is an Eligible Investor as defined in Appendix I to the Memorandum; and
(ii) it is not acting on behalf of or for the benefit of, nor does it intend transferring any Participating
Shares in the Fund that it may purchase to, any person who is not an Eligible Investor;
(e) The Subscriber acknowledges that the Fund or the Administrator has the right to reject this subscription, in
whole or in part, without giving a reason for that rejection. In those circumstances, the full amount of
funds tendered, or the excess in respect of a scaled down subscription, will be refunded without interest
to the bank account from which the original subscription funds were remitted.
(f) Due to anti-money laundering requirements, the Subscriber acknowledges that the Administrator and the
Fund (as the case may be) may require further verification of the identity and source of Subscriber’s
funds before the subscription can be processed. If the verification evidence supplied is not satisfactory,
the Administrator will return the subscription money, without interest and at the Subscriber’s expense, to
the bank account from which they were remitted. The Subscriber releases and waives any claim against
the Fund or the Administrator for any loss that it suffers as a result of that action. The Subscriber
indemnifies both the Administrator and the Fund against all loss arising out, or in connection, with of a
failure to process this subscription.
(g) The Subscriber acknowledges and understands that under the Proceeds of Crime Law, 2008 of the
Cayman Islands, if a person who is a resident in the Cayman Islands (including the Administrator) knows
or suspects that a payment to the Fund (by way of subscription or otherwise) represents criminal property,
that person must report his or her knowledge or suspicion to the reporting authority, and that report is not
treated as a breach of any restriction on the disclosure of information imposed by law or otherwise.
(h) The Subscriber agrees to accept the number of Shares that are allotted by the Fund for the subscription
amount tendered, in accordance with the Memorandum and subject to the Fund’s memorandum and
articles of association and to have those Shares registered exactly as provided in the registration details
in section 9 below.
(i) If the Subscriber acts as trustee, agent, representative or nominee for another person
(“Beneficial Owner”):
(i) the Subscriber understands and acknowledges that the representations, warranties and agreements
made in this Subscription Agreement are made by the Subscriber (1) with respect to the Subscriber
and
(2) with respect to the Beneficial Owner;
(ii) the Subscriber represents and warrants that it has all requisite power and authority from Beneficial
Owner to execute and perform the obligations under this Subscription Agreement;
(iii) the Subscriber indemnifies the Fund, the Investment Manager, the Administrator and their respective
directors, members, partners, officers and agents against all costs, fees and expenses (including
legal fees and disbursements) in connection with any damages arising out of, or in connection with:
• any misrepresentation or misstatement by the Subscriber in this Subscription Agreement; or
• the improper assertion of the Subscriber’s proper authorisation from the Beneficial Owner to enter
into this Subscription Agreement or perform its obligations.
(j) The Subscriber acknowledges that payments in respect of subscription and redemption will be made in
United States dollars and that adverse fluctuations in exchange rates could reduce the return to it upon
the redemption of the Shares.
(k) The Subscriber understands and agrees that any redemption proceeds paid to it will be paid to the same
account from which the Subscriber’s investment in the Fund was originally remitted, unless the Fund or
the Administrator, in its sole discretion, determines otherwise.
(l) The Subscriber acknowledges and agrees to its personal data (as set out under “Data Protection”) being
used in the manner set out in section 8 below.
(m) The Subscriber must notify the Administrator or the Fund immediately if:
(i) the Subscriber becomes aware that it or any person for whom it holds the Shares has ceased to be
an Eligible Investor; or
(ii) any of the representations, declarations or statements in this Subscription Agreement are no longer
74

accurate and complete in all respects.
(n) The Subscriber agrees to provide these representations, warranties, acknowledgements and
undertakings to the Fund at any time the Fund requests, and to provide on request such certifications,
documents or other evidence as the Fund may reasonably require to substantiate representations,
warranties, acknowledgements and undertakings.
3. Anti-money laundering
(a) The Subscriber (or, if more than one, each of them) gives the following representations, warranties,
acknowledgements and undertakings:
(i) it is not, nor is any person or entity controlling, controlled by or under common control with the
Subscriber, a Prohibited Person (as defined in Appendix I of the Memorandum); and
(ii) to the extent the Subscriber has any Beneficial Owners 4 :
(1) it has carried out thorough due diligence to establish the identities of those Beneficial Owners;
(2) based on that due diligence, the Subscriber reasonably believes that no Beneficial Owner is a
Prohibited Person;
(3) it holds the evidence of those identities and status and will maintain all of that evidence for at least
five years from the date of the Subscriber’s complete redemption from the Fund; and
(4) it will make available that evidence and any additional evidence that the Fund may require upon
request in accordance with applicable regulations;
(b) If any of the representations, warranties, acknowledgements and undertakings in paragraph (a) above
ceases to be true or if the Fund no longer reasonably believes that it has satisfactory evidence as to their
truth, despite any other agreement to the contrary, the Fund may, in accordance with applicable
regulations, be obligated to do one or more of the following:
(i) to take certain actions relating to the Subscriber’s holding of Shares;
(ii) to report that action; and
(iii) to disclose the Subscriber’s identity to OFAC or other authority.
If the Fund is required to take any of those actions, the Subscriber understands and agrees that it has no
claim against the Fund, the Investment Manager, the Administrator, and their respective affiliates,
directors, members, partners, shareholders, officers, employees and agents for any of damages as a
result of any of the those actions; and
(c) In order to comply with the anti-money laundering regulations applicable to the Fund and the
Administrator, the Subscriber acknowledges that Shares will not be issued until the Administrator or the
Fund is satisfied that evidence regarding the source of the subscription amounts, the identity of the
Subscriber and the payment instructions for redemptions, is satisfactory. Wire confirmations for
subscriptions from the Subscriber must match the information provided below. Redemption proceeds will
only be made to an account identified below. Subscriptions may be rejected if this information is
incomplete or the wire confirmation does not match the information given below. If any of the following
information changes, the Subscriber or an authorized representative of the Subscriber must notify the
Fund or Administrator in writing of that change.
To: ______________________________________
Fed Routing #: ______________________________________

Swift address: ______________________________________
For account of: ______________________________________
Account #: ______________________________________
In favour of: ______________________________________
Account #: ______________________________________
Note:
To avoid return of funds, the wire transfer must be sent from an account in the name of the investor. The
investor’s name must be included in line 50 of the SWIFT wire transfer message (or equivalent CHIP or Fed
Wire indication), OR the wire transfer must state “From the Account of: (Investor Name)”. The wire should
be made by SWIFT MT103.
4
For these purposes, beneficial owners will include, but not be limited to: (i) shareholders of a corporation; (ii) partners of a partnership; (iii) members
of a limited liability company; (iv) investors in a fund-of-funds); (v) the grantor of a revocable or grantor trust; (vi) the beneficiaries of an irrevocable
trust; (vii) the individual who established and IRA; (viii) the participant in a self-directed pension plan; (ix) the sponsor of any other pension plan; and
(x) any person being represented by the Subscriber in an agency, representative, intermediary, nominee or similar capacity. If the beneficial owner is
itself an entity, the information and representations set forth herein must also be given with respect to its individual beneficial owners. If the
Subscriber is a publicly-traded company, it need not conduct due diligence as to its beneficial owners.
75

4. Power and authority
(a) The following applies if the Subscriber is an entity.

(i) The person executing this Subscription Agreement on behalf of the Subscriber represents that it has
the full power and authority under the Subscriber’s governing instruments to do so and that the
Subscriber has the full power and authority under its governing instruments to acquire Shares of the
Fund.
(ii) Furthermore, the Subscriber represents and agrees that:
(1) it is duly organized, validly existing and in good standing under the laws of its jurisdiction of
organization;
(2) the execution, delivery and performance by it of terms of this Subscription Agreement are within
its powers, have been duly authorised by all necessary actions on its behalf, require no action by
or in respect of, or filing with, any governmental body, agency or official (except as disclosed in
writing to the Fund) in order to make this investment, and does not contravene, or constitute a
breach of or default under any provision of applicable law or governmental rule, regulation or
policy statement or of its certificate of incorporation or other comparable organizational documents
or any agreement, judgment, injunction, order, decree or other instrument binding upon it; and
(3) The terms of this Subscription Agreement constitute a valid and binding agreement of the
Subscriber and is enforceable against the Subscriber in accordance with its terms.
(b) If the Subscriber is an individual, the Subscriber agrees that terms of this Subscription Agreement constitute
a valid and binding agreement of the Subscriber and is enforceable against the Subscriber in accordance
with its terms, and that the Subscriber has legal competence and capacity to execute this Form.
(c) In addition to paragraph (a) or (b), if the Subscriber is acting as trustee, agent, representative or nominee
for another person or entity, the Subscriber understands and acknowledges that the representations,
warranties, acknowledgements and undertakings in this Subscription Agreement are made by the
Subscriber (i) with respect to the Subscriber and (ii) with respect to that other person or entity.
5. Proper instructions
(a) Appearing below are the names of persons authorised by the Subscriber to give and receive instructions
between the Fund (or the Administrator) and the Subscriber, together with their respective signatures.
Those persons are the only persons so authorised until further written notice to the Administrator signed by
one or more of them.
Names Signatures
(b) The Subscriber authorises and instructs each of the Administrator and the Fund to accept and execute any
instructions in respect of the Shares to which this Subscription Agreement relates given by the Subscriber in
writing or by facsimile. If instructions are given by facsimile, the Subscriber undertakes to send the original
letter of instructions to the Administrator and the Fund and agrees to indemnify each of them against
whatever loss either of them suffers as a result of acting on those facsimile instructions. Each of the
Administrator and the Fund may rely conclusively upon, and incurs no liability in respect of, any action taken
upon any notice, consent, request, instructions or other instrument it believes, in good faith, is genuine or is
signed by properly authorised persons.
6. Indemnity
The Subscriber indemnifies the Fund, the Investment Manager, the placement agent(s), if any, the
Administrator and their respective affiliates, directors, members, partners, shareholders, officers, employees
and agents against any and all losses, liabilities, damages, penalties, costs, fees and expenses (including,
without limitation, legal fees and disbursements) that may result, directly or indirectly, from any inaccuracy in
or breach of any representation, warranty, covenant or agreement set forth herein or in any other document
delivered by the Subscriber to the Fund.
7. Data Protection
(a) A Subscriber’s personal data may be utilised by the Administrator for any of the following purposes:
(i) to properly identify the Subscriber in accordance with anti-money laundering regulatory
76

requirements;
(ii) to properly record the Subscriber’s interest in the Fund in accordance with relevant corporate laws
and regulations;
(iii) to advise the Subscriber of matters relative to its investment in the Fund, including current values
and changes to Fund documentation etc; and
(iv) unless the Subscriber notifies the Administrator otherwise, to advise the Subscriber of other
investment opportunities that may be or become available from the Fund’s sponsors; and
(b) By agreeing to invest in the Fund, Subscriber acknowledges and accepts that the Administrator may hold
and process personal data for the purposes outlined above and further acknowledges and accepts that
the Administrator may, in order to fulfil its duties to the Fund and comply with regulatory requirements: (i)
retain such personal data for prescribed periods after the Subscriber has redeemed its holding in the
Fund; (ii) transfer such personal data, by any method including electronically, to the Fund’s registered
agent in its country of incorporation, including countries which may not have enacted data protection
legislation; (iii) transfer such information to the directors, Investment Manager, legal advisors or any other
agent of the Fund entitled to receive such information; (iv) transfer such personal data to any person or
entity to which the Administrator has a legal obligation to disclose such information; (v) maintain such
information on the Administrator’s computer systems which may be based or maintained in countries
which have not enacted data protection legislation.
(c) By executing this document, Investor is consenting to electronic delivery and giving permission for the Fund
and its service providers and other representatives, to deliver via email any documentation, reports and
other information to be delivered to Investor in connection with Investor’s investment in the Fund. Such
information may include confidential information regarding the Fund, including but not limited to investor and
investment information. Certain information, at the discretion of the Fund, may be delivered to Investor by
regular mail, facsimile or courier. Investor also consents to the Fund transmitting information by email to
any of Investor’s or the Fund’s service providers, advisors, accountants or others to whom Investor has
requested that such information be provided.
Investor understands that contact via non-encrypted email, such as that expected to be used by the Fund,
and the transmission of email data take place over public networks and therefore will be unprotected.
Although the Fund and its service providers will take reasonable precautions regarding the integrity,
confidentiality and security of information sent by email, neither the Fund nor any of its service providers or
other representatives will be liable for interception, system failure or other problems that may result in
incomplete or incorrect transmission. In addition, information transmitted by email may need to be
disclosed to third parties, including regulatory authorities with jurisdiction over the Fund or its service
providers, and could be accessed by unauthorized persons.
Investor agrees to release the Fund and its service providers from any form of liability or loss associated
with the communication of Fund information by email, including but not limited to investor and investment
information. The Fund and its service providers make no warranties in relation to these matters and
Investor accepts the risks associated with the use of email. The Fund and its service providers also reserve
the right to intercept, monitor and retain communications to and from their systems as permitted by
applicable law.
Investor understands that to receive information by email, Investor will need Internet access, a valid email
address and the ability to install or download such applications as the Fund may specify. If Investor wishes
to retain information sent by email, Investor will need access to a printer or other device to download and
print or save such information. Investor also understands that it is Investor’s obligation to inform the Fund in
the event that any of Investor’s or Investor’s service providers’ email addresses change. Investor may
update any of Investor’s or Investor’s service providers’ email addresses by contacting an appropriate
representative of the Fund and requesting an update.
This consent will be effective immediately and will remain in effect unless and until Investor revokes it. At
any time, Investor may revoke this consent and/or request paper copies of any documents, at no additional
cost to Investor, by sending a written revocation and/or request to Michael Kenwood Capital Management,
LLC, 350 Bedford Street, Suite 405, Stamford, CT 06901, USA. Investor acknowledges that it may take up
to three (3) days to process a revocation of consent to electronic delivery (or request for paper copies) from
the date that Investor’s revocation or request is received by the Fund.
77

8. Subscriber Details
(Complete in block letters please)
(a) Registration details
Name of _________________________________________
Subscriber:
Registered _________________________________________
Address:
_________________________________________
Telephone No: ________________ Facsimile No: ________________
Email address: ________________ Contact name: ________________
(b) Correspondence details
If you wish your correspondence to be sent to an address other than the registered address in (a) above,
please state below.
________________________________________________________
Name
________________________________________________________
Address
________________________________________________________
Daytime Tel No. Daytime Fax No.
________________________________________________________
Email Address
Note:
In the case of joint Subscribers, please use separate sheets for each Subscriber.
9. General
(a) In this Subscription Agreement, unless the contrary intention appears:

(i) a reference to a statute includes references to that statute as amended or re-enacted and to other
statutes that modify its application as well as references to any subordinate legislation made or to be
made under that statute; and
(ii) a reference to the singular includes the plural and vice versa; and
(iii) a reference to a gender includes the other genders; and
(iv) a reference to persons includes individuals, companies, firms, partnerships, government bodies or
agencies and corporations sole and aggregate; and
(v) obligations entered into by more than one person in this Subscription Agreement bind all of those
persons jointly and each of them severally; and
(vi) the headings do not affect the interpretation of this Subscription Agreement.
(b) This Subscription Agreement is binding on the Subscriber and its successors and permitted assigns and
inures for the benefit of the Fund’s successors and assigns.
(c) This Subscription Agreement survives the acceptance of the subscription.
(d) If a provision of this Subscription Agreement is invalid or unenforceable under any applicable law, it is
inoperable to that extent and its invalidity or inoperability does affect any other provision of this
Subscription Agreement.
(e) This Subscription Agreement is irrevocable.
(f) This Subscription Agreement is governed by, and is to be construed in accordance with, the laws of the
Cayman Islands.
THE SUBSCRIBER HAS EXECUTED THIS SUBSCRIPTION AGREEMENT ON , 20____
78

If more than one Subscriber, please check the appropriate box:
• Joint shareholders (all shareholders must sign any Redemption Request Form)
• Joint and several shareholders (any one shareholder can sign any Redemption Request Form)
Signature(s) of Subscriber(s) Name(s) of Subscriber(s) in full and title
________________________________ ________________________________
________________________________ ________________________________
Notes:
(i) To be valid, this Subscription Agreement must be signed by each applicant, including all joint holders.
(ii) A corporation must complete this Subscription Agreement under seal or under the hand of a duly authorised
corporate officer(s) who should state his or her capacity.
(iii) In the case of a firm or partnership (not a limited company), this Subscription Agreement must be in the name
of and signed by all partners.
(iv) If this Subscription Agreement is signed under a power of attorney, that power of attorney or a duly certified
copy of it must accompany this Form.
(v) In respect of joint applicants only, on the death of one, the Shares will be held in the name of and to the order
of the survivor or survivors or the executor or administrator of the last survivor.
79

APPENDIX III
Anti-money laundering requirements
A. EXEMPTED SUBSCRIBERS - DECLARATIONS
At its discretion, the Fund or the Administrator or its agent may waive the provision of full subscriber
verification evidence where the Subscriber is regulated in a country that is recognized as having an adequate
anti-money laundering regime 5 or quoted on an approved stock exchange 6 or where payment has been made
from an account held in the Subscriber’s name from a financial institution based in a country that is recognized
as having an adequate anti-money laundering regime. If the Subscriber thinks that it falls within an
exemption, it should provide a letter to the Fund setting out the applicable declaration that follows:
(a) The Subscriber declares that we are licensed as [type of licence] by the [name of regulatory body]
and are subject to regulations and/or guidelines which, to the best of our knowledge and
understanding, are equivalent to the anti-money laundering laws and regulations of the Cayman
Islands; or
(b) The Subscriber declares that we are a company/mutual fund listed on an approved stock exchange
[name of stock exchange]; or
(c) We declare that the subscription funds have been made from an account held in our name at [name
of financial institution] in [name of country] –The Source of Funds Exemption Letter under Exhibit I of
this Appendix must be completed; or
(d) We attach an eligible introducer’s letter addressed to the Fund signed by an eligible introducer -
see Letter of Introduction under Exhibit II of this Appendix.
B. NON-EXEMPTED SUBSCRIBERS
The documentation listed below is required to verify the identity and source of funds of all subscribers who do
not qualify under the Exempted Subscribers Declaration in Section A. Those subscribers are required to
produce the documentation that appears below in the form of original certified copies. Those subscribers
should contact the Administrator’s agent (see contact details on page 1 of the Subscription Agreement) to
obtain a detailed update list of documents that they will be required to produce.
For individuals:
(i) evidence of true name, signature, date of birth and photographic identification
(ii) evidence of permanent address
(iii) evidence of nationality
(iv) evidence of source of subscription funds.
For companies:
(i) copy of certificate of incorporation or its equivalent and any change of name certificate
(ii) copy of the memorandum and articles of association or its equivalent
(iii) certificate of good standing or its equivalent
(iv) register or other acceptable list of directors and officers
(v) identification, as described for individuals above, of two directors
(vi) details of registered office and principal place of business
(vii) copy of signature list
(viii) additional details on the identity of the shareholders with 10% or more of the voting shares of that
company
(ix) source of subscription funds.
For partnerships and unincorporated businesses:
(i) certified copy of the partnership agreement, declaration of trust or its equivalent
5
The list of acceptable countries can be found in the Third Schedule of the Cayman Islands Money Laundering Regulations (as amended), which may
be accessed on the Cayman Islands Monetary Authority website at www.cimoney.com.ky.
6
A list of approved stock exchanges can be found under Appendix H of the Cayman Islands Money Laundering Regulations (as amended) which may
be accessed on the Cayman Islands Monetary Authority website at www.cimoney.com.ky.
80

(ii) details of principal place of business

(iii) copy of any certificate of registration and certificate of good standing, if registered
(iv) identification, as described for individuals and companies above, of the general partner, or its
equivalent, and the authorised signatories
(v) additional details on the identity of the limited partners, or their equivalent, if considered necessary
by the Administrator
(vi) source of subscription funds.
81

EXHIBIT I to APPENDIX III
Source of fund exemption
PLEASE GIVE THIS LETTER TO YOUR REMITTING FINANCIAL INSTITUTION FOR RETURN TO THE
ADMINISTRATOR AT THE SAME TIME THAT THE SUBSCRIPTION MONIES ARE WIRED.
(IMPORTANT: In order for this exemption to be effective, the remitting financial institution must be based in a
country recognized as having an adequate anti-money laundering regime and the ‘Subscriber Account’ being
debited must be in the name of the Subscriber.)
SAMPLE LETTER
[To be replaced on letterhead of the financial institution remitting payment]
Date
Via mail and facsimile
350 Bedford Street, Suite 405,
Stamford, CT 06901
USA
Facsimile: +1 (203) 327-8725

Telephone: +1 (203) 327-8700
Dear Administrator:
RE: Short Term Liquidity Fund I, Ltd.

Name of Remitting Financial Institution:
Address of Remitting Financial Institution:
Name of Subscriber:
Address of Subscriber:
Name of Subscriber Account to be Debited:
Account Number to be Debited:
We have credited your account at [Name of bank], Account Number [number] for [amount] by order of
[subscriber] on [date].
The above information is given in strictest confidence for your own use only and without any guarantee,
responsibility or liability on the part of this institution or its officials.
Yours faithfully,
Signed _______________________
Full Name _______________________
Position _______________________
82

EXHIBIT II to APPENDIX III
Letter of introduction
[On Introducer’s letterhead such to include their full address]

350 Bedford Street, Suite 405,
Stamford, CT 06901
USA
Facsimile: +1 (203) 327-8725

Telephone: +1 (203) 327-8700
Date:
Dear Administrator:
RE: Short Term Liquidity Fund I, Ltd.

[Name and Address of Client] ______________________ (“Client”)
We confirm that the Client has a relationship with this company/firm since [date].
We confirm that we are a [type of financial institution] based in [the Cayman Islands or an approved
jurisdiction] and subject to the anti-money laundering regime of this jurisdiction.
[OR]
We confirm that we are a professional intermediary (i.e. a firm of lawyers, or chartered accountants, or a
member of a recognised professional body), based in [the Cayman Islands or an approved jurisdiction]. We
further confirm we are required by the rules of our professional body to observe the requirements of the anti-
money laundering regime of this jurisdiction and we are subject to a disciplinary procedure for failure to so
observe.
We confirm that we have obtained satisfactory evidence of the identity of the Client in accordance with
applicable anti-money laundering requirements. We confirm that we will provide you a copy of the evidence of
the identity of the Client upon your request.
[OR]
We confirm that under the laws of [the Cayman Islands or approved jurisdiction], we are not required to
undertake identification and verification procedures in respect of the Client as the relationship pre-existed the
implementation of our anti-money laundering regime. We further confirm that we are not aware that the Client
has been found to be or has been suspected of activity that would presently constitute a money laundering
offence.
We confirm that we are compliant with the anti-money laundering requirements of this jurisdiction.
Yours faithfully,
Name: ______________________ Job Title: ______________________
Signature: ______________________ Date: ______________________
83

APPENDIX IV
Subscription Agreement for subsequent subscriptions

Stamford, CT 06901
USA
Facsimile: +1 (203) 327-8725

Telephone: +1 (203) 327-8700
Dear Administrator:
1. Subscription
(a) The undersigned subscriber (“Subscriber”) irrevocably applies for that number of Class A non-voting
participating shares
(“Shares”) in Short Term Liquidity Fund I, Ltd. (“Fund”) that may be subscribed for with the
subscription amount that appears below in accordance with the terms of the private offering
memorandum of the Fund dated May 2010 (as amended or supplemented, the “Memorandum”).
(Note: Unless defined otherwise in this Subscription Agreement, capitalised terms have the meanings
given to them in the Memorandum.)
Subscription Amount US$ ________________
(b) The Subscriber undertakes to settle the full amount invested, net of bank charges, by electronic
transfer for value on ________________ to:
Free Text: “From the Account of <INSERT Investor Name / Account Number>”
Subscriptions should be made only by wire transfer in US dollars, cheques will not be accepted. In the
event that subscription monies are received in any currency other than US dollars, conversion into US
dollars will be arranged by the Administrator at the risk and expense of the applicant. Any bank charges
in respect of electronic transfers will be deducted from subscriptions and the net amount only invested in
Shares.
must be sent from an account in the name of the Investor. The Investor’s name must be included on line
50 of the SWIFT wire transfer message or the wire transfer must state “From the Account of
____________ (Investor name)”. Please also note that there are varying length restrictions on Field 70
so the Sender of the SWIFT message must ensure the Receiver of the SWIFT message will be passing
on the information to Michael Kenwood Capital Management, LLC to avoid delays in processing or return
of funds.
investment. Accordingly, the Subscriber is required to complete both the “Ordering Customer” (field 50)
84

and the “Ordering Institution” (field 52D) when sending a wire payment through the international SWIFT
system. The Administrator strongly suggests not to send SWIFT FIN 910 “Confirmation of Credit”
messages that do not include both of the above mentioned fields. Instead, the Subscriber should send a
SWIFT FIN 103 “Customer Transfer Message” or to instruct its bank to use this format and to include the
“Ordering Customer” in field 50 and the “Ordering Institution” in field 52D (or equivalent CHIPS or Fed
Wire indication).
Notes:
(i) Any sales charge payable will be deducted by the Administrator from subscription money
remitted to the Fund, prior to the investment of that money in the Fund.
(ii) The Subscription Agreement must be received one business day before the relevant
Subscription Day.
(c) The investor’s Subscriptions will be delivered from the following account:
To:
Fed Routing #:
Swift address:
For account of:
Account #:
In favour of:
Account #:
Notes:
To avoid return of funds, the wire transfer must be sent from an account in the name of the investor.
The investor’s name must be included in line 50 of the SWIFT wire transfer message (or equivalent
CHIP or Fed Wire indication), OR the wire transfer must state “From the Account of: (Investor Name)”.
The wire should be made by SWIFT MT103.
2. Reaffirmation
BY EXECUTING AND DELIVERING THIS SUBSCRIPTION AGREEMENT FOR SUBSEQUENT

SUBSCRIPTIONS, THE SUBSCRIBER REAFFIRMS, AS OF THE DATE OF THIS FORM, THE
REPRESENTATIONS, WARRANTIES, ACKNOWLEDGEMENTS AND UNDERTAKINGS IN THE SUBSCRIBER’S
ORIGINAL SUBSCRIPTION AGREEMENT IN RESPECT OF THE SUBSCRIBER’S INITIAL INVESTMENT IN
CLASS A SHARES.
3. General
(a) In this Subscription Agreement, unless the contrary intention appears:

(i) a reference to a statute includes references to that statute as amended or re-enacted and to other
statutes that modify its application as well as references to any subordinate legislation made or to
be made under that statute; and
(ii) a reference to the singular includes the plural and vice versa; and
(iii) a reference to a gender includes the other genders; and
(iv) a reference to persons includes individuals, companies, firms, partnerships, government bodies or
agencies and corporations sole and aggregate; and
(v) obligations entered into by more than one person in this Subscription Agreement bind all of those
persons jointly and each of them severally; and
(vi) the headings do not affect the interpretation of this Subscription Agreement.
(b) This Subscription Agreement is binding on the Subscriber and its successors and permitted assigns
and
inures for the benefit of the Fund’s successors and assigns.
(c) This Subscription Agreement survives the acceptance of the subscription.
(d) If a provision of this Subscription Agreement is invalid or unenforceable under any applicable law, it is
inoperable to that extent and its invalidity or inoperability does affect any other provision of this
Subscription Agreement.
(e) This Subscription Agreement is irrevocable.
(f) This Subscription Agreement is governed by, and is to be construed in accordance with, the laws of
85

the Cayman Islands.
THE SUBSCRIBER HAS EXECUTED THIS SUBSCRIPTION AGREEMENT ON , 20____
If more than one Subscriber, please check the appropriate box:
• Joint shareholders (all shareholders must sign any Redemption Request Form)
• Joint and several shareholders (any one shareholder can sign any Redemption Request Form)
________________________________ ________________________________
________________________________ ________________________________
Notes:
(i) To be valid, this Subscription Agreement must be signed by each applicant, including all joint holders.
(ii) A corporation must complete this Subscription Agreement under seal or under the hand of a duly
authorised
corporate officer(s) who should state his or her capacity.
(iii) In the case of a firm or partnership (not a limited company), this Subscription Agreement must be in the
name of
and signed by all partners.
(iv) If this Subscription Agreement is signed under a power of attorney, that power of attorney or a duly
certified copy
of it must accompany this Form.
(v) In respect of joint applicants only, on the death of one, the Shares will be held in the name of and to the
order of the survivor or survivors or the executor or administrator of the last survivor.
86

APPENDIX V
Redemption request form

Stamford, CT 06901
USA
Facsimile: +1 (203) 327-8725

Telephone: +1 (203) 327-8700
Date
Dear Administrator:
1. The undersigned requests redemption of a certain number of Class A non-voting participating shares in
the capital of Short Term Liquidity Fund I, Ltd. (“Fund”) at a Redemption Price equal to the Net Asset
Value of those shares on the relevant Redemption Day and otherwise on the terms of the private offering
memorandum dated May 2010 as amended or supplemented from time to time, (“Memorandum”) and
the Fund’s
memorandum and articles of association. The number of shares that it requests redemption of is
that number (where appropriate, rounded to the nearest whole share):
(a) with a Net Asset Value equal to the amount that appears below; or
(b) shown below.
(Note: Unless defined otherwise in this Redemption Request Form, capitalised terms have the meanings
given to them in the Memorandum.)
Amount to be redeemed: US$___________________
OR
Number of Class A shares requested to be redeemed: ___________________
2. I (or, if more than one, each of us), either in my individual capacity or as an authorised
representative of an entity, if applicable, represent and warrant that:
(a) I am the true, lawful and beneficial owner or registered holder, as the case may be, of the
shares to which this Redemption Request Form relates;
(b) I have full power and authority to request redemption of those shares;
(c) I have full lawful power and authority, as a duly authorised officer or representative of
________________ [name of corporation etc] to request redemption of those shares; and
(d) those shares are not subject to any pledge or otherwise encumbered in any fashion.
3. In addition to the above, by executing and delivering this Redemption Request Form, the
undersigned reaffirms, as of the date of this Form, the representations, warranties,
acknowledgements and undertakings in the original Subscription Agreement in respect of its initial
investment in Class A shares.
87

Please complete the following information in block letters. Name(s) and signature(s) must be
identical to the name(s) in which the shares are registered.
________________________________ ________________________________
________________________________ ________________________________
Notes:
(i) To be valid, this Redemption Request Form must be signed by each registered holder of the Shares
to be redeemed. If the Redemption Request Form is signed under a power of attorney, that power
of attorney or a duly certified copy of it must accompany this Form;
(ii) Despite the above, the shareholder acknowledges that any redemption proceeds paid to the
shareholder will be paid to the same account from which its investment in the Fund was originally
remitted, unless the Fund, in its sole discretion, agrees otherwise. This is in order to comply with the
anti-money laundering regulations applicable to the Fund and the Administrator and is as set forth in
the shareholder’s Subscription Agreement for shares;
(iii) Additional shareholder-verification evidence may be required before redemption proceeds can be
made, if the shareholder was exempted from providing full verification evidence when it originally
subscribed for shares because payment was made from an account held in the shareholder’s name
at a financial institution based in a country which is recognized as having an adequate anti-money
laundering regime;
(iv) The shareholder acknowledges that redemption proceeds will not be paid until the Administrator or
the Fund is satisfied that verification of the identity of the shareholder and the payment instructions
for the redemption is sufficient; and
(v) Redemption requests may be made by mail or facsimile. An executed copy of the Redemption
Request Form must be sent to the Administrator, at the address given above, and if it is sent via
facsimile the original should be sent via overnight mail or courier. Although redemption requests may
be sent by facsimile, shareholders should be aware of the risks associated with sending documents
in this manner. The Administrator will not accept any responsibility for any loss as a result of the non-
receipt of any Redemption Notice sent by facsimile transmission. Where a Redemption Notice is sent by
facsimile transmission, the Fund will not release the redemption proceeds to the redeeming Participating
Shareholders until such time as both the original Redemption Notice and Subscription Agreement are
received by the Administrator.
88

cheques will not be accepted. In the event that subscription monies are received in any currency other than
US dollars, conversion into US dollars will be arranged by the Administrator at the risk and expense of the
applicant. Any bank charges in respect of electronic transfers will be deducted from subscriptions and the
net amount only invested in Shares.
must be sent from an account in the name of the Investor. The Investor’s name must be included on line 50
of the SWIFT wire transfer message or the wire transfer must state “From the Account of ____________
(Investor name)”. Please also note that there are varying length restrictions on Field 70 so the Sender of
the SWIFT message must ensure the Receiver of the SWIFT message will be passing on the information to
Michael Kenwood Capital Management, LLC to avoid delays in processing or return of funds.
investment. Accordingly, the Subscriber is required to complete both the “Ordering Customer” (field 50) and
the “Ordering Institution” (field 52D) when sending a wire payment through the international SWIFT system.
The Administrator strongly suggests not to send SWIFT FIN 910 “Confirmation of Credit” messages that do
not include both of the above mentioned fields. Instead, the Subscriber should send a SWIFT FIN 103
“Customer Transfer Message” or to instruct its bank to use this format and to include the “Ordering
Customer” in field 50 and the “Ordering Institution” in field 52D (or equivalent CHIPS or Fed Wire
indication).
For US based users of FedWire, please use the following instructions:

Reference: [name of investor]
Subscription in kind: The Subscriber undertakes to transfer the following investments to those of the
Fund’s accounts that the Fund notifies the Subscriber in writing.
89

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Case 3:11-cv-00078-JBA Document 4-2 Filed 01/14/11 Page 1 of 90

Case 3:11-cv-00078-JBA Document 4-2 Filed 01/14/11 Page 2 of 90

Copy No: _1____

Furnished to: ___MK Special Opportunities Fund Ltd.__

SHORT TERM LIQUIDITY FUND I, LTD.

PRIVATE OFFERING MEMORANDUM

MICHAEL KENWOOD CAPITAL MANAGEMENT, LLC

Confidential Treatment Requested by Arnold & Porter LLP MKG00261811

SECTION I - THE FUND .........................................................................................................16

SECTION II - INVESTMENT OBJECTIVE AND STRATEGY ................................................19

SECTION III - CERTAIN RISK FACTORS .............................................................................21

SECTION IV - MANAGEMENT AND ADMINISTRATION .....................................................36

SECTION V - DESCRIPTION OF THE FUND’S SHARES ....................................................46

SECTION VI - SUBSCRIPTION, REDEMPTION AND TRANSFER OF SHARES ...............51

SECTION VII - FINANCIAL INFORMATION AND REPORTS ..............................................62

SECTION VIII - TAXATION .....................................................................................................64

Confidential Treatment Requested by Arnold & Porter LLP MKG00261812

Confidential Treatment Requested by Arnold & Porter LLP MKG00261813

Directors: Registered Office:

Octavio Calvo Ogier Fiduciary Services (Cayman) Limited

Investment Manager and Administrator: Auditors:

Michael Kenwood Capital Management, LLC McGladrey & Pullen, Cayman

US Legal Advisors to the Investment Manager: Cayman Islands Legal Advisors:

Arnold & Porter LLP Ogier

Confidential Treatment Requested by Arnold & Porter LLP MKG00261814

IMPORTANT NOTICE TO POTENTIAL INVESTORS

This Private Offering Memorandum

This Memorandum is strictly confidential. It is intended to be read only by the person to

Reliance on this Memorandum

Confidential Treatment Requested by Arnold & Porter LLP MKG00261815

No offer in restricted jurisdictions

• to anyone to whom it is unlawful to make such offer or solicitation.

Confidential Treatment Requested by Arnold & Porter LLP MKG00261816

(b) understand the high degree of risk involved;

(d) have no need of liquidity of investment.

Confidential Treatment Requested by Arnold & Porter LLP MKG00261817

These forward-looking statements, as well as the information contained in this Memorandum,

FOR CAYMAN ISLANDS PROSPECTIVE INVESTORS

Confidential Treatment Requested by Arnold & Porter LLP MKG00261818

The Fund’s authorised share capital is US $100,000 which is

• 100 management shares of US $0.01 par value per share

• 9,999,900 participating shares of US $0.01 par value per

Initially, the directors have designated one class of

The Class A shares will be issued in series to accommodate an

(In the rest of this Memorandum, the expressions “Class” and

See Section V headed “Description of the Fund’s Shares” for

Confidential Treatment Requested by Arnold & Porter LLP MKG00261819

invest in G-20 government securities and derivatives

In addition, the Fund may, from time to time, take a

The Fund may invest in securities denominated in different

The Investment Manager generally intends to limit the leverage

Service Providers Directors: Octavio Calvo

Investment Manager Michael Kenwood Capital Management,

Custodian: Deutsche Bank AG (“Custodian”)

See Section IV headed “Management and Administration” for

After the Closing Date, the Offered Shares will be issued in

If the directors so determine, subscriptions for Offered Shares

Confidential Treatment Requested by Arnold & Porter LLP MKG00261820

may be subject to an initial charge. Subscription amounts will

See Section VI headed “Subscription, Redemption and

Subject to the Law, and in the sole discretion of the Directors,

Redemptions Generally, on the holder of Offered Shares giving at least 30

“Net Asset Value”, in respect of the Fund or each Class or

Furnished to: _MK Special Opportunities Fund Ltd.