restrictions on the strategies, leverage or markets which may be
incorporated into the Multi-Strat Funds' portfolio or the percentage of a Multi-Strat
Fund's assets that ... committed to any particular strategy type, market or
instrument. The composition of a Multi-Strat Fund's portfolio, as well as the liquidity
profile and the expected position duration ... strategies implement by Hudson Bay Capital continue to
evolve.
Co-Invesonenis
The Multi-Strat Funds may co-invest in the same investment opportunity together with
Other Accounts and may offer
https://www.justice.gov/epstein/files/DataSet%2010/EFTA01384540.pdf
which the Multi-Strategy Funds may invest. The strategies in which the
Multi-Strat Funds invest are constantly evolving and new strategies may appear within
the Multi-Strat Funds' portfolio ... with some regularity.
Side Letters
The Multi-Strat Funds and, in certain cases, Hudson Bay Capital, have the discretion to
waive or modify the application of, or grant special ... rights with respect
to, the terms or provisions applicable to investment in the Multi-Strat Funds to the extent
permitted by applicable law and have done so. Such terms
https://www.justice.gov/epstein/files/DataSet%2010/EFTA01384527.pdf
does not attempt to hedge all market or other risks inherent in a
Multi-Strat Fund's portfolio, and hedges certain risks, if at all, only partially.
General Risks
Investment ... Trading Risks in General
All investments made by a Multi-Strat Fund risk the loss of capital. No guarantee or
representation is made that a Multi-Strat Fund's program ... past performance of speculative
trading strategies such as those implemented by the Multi-Strat Funds is not necessarily
indicative of their future results.
Leverage Risk
The use of leverage
https://www.justice.gov/epstein/files/DataSet%2010/EFTA01384541.pdf
financing and credit
agreements, regulatory investigations and/or proceedings attributable or relating to the
Multi-Strat Funds or any Trading Vehicle, and regulatory reporting and compliance costs
attributable or relating ... Multi-Strat Funds, such as filing fees and expenses relating
to Form PF and Section 13 filings); professional fees and expenses (including, without
limitation, fees and expenses of consultants ... members, officers
and employees of the general partner/boards of directors of the Multi-Strat Funds, any
Trading Vehicle and Hudson Bay Capital; fees and expenses (including, without
limitation, director registration
https://www.justice.gov/epstein/files/DataSet%2010/EFTA01384531.pdf
HUBUS133 Alpha Group Capital
the company. In addition, such investments could subject the Multi-Strat Fund to certain
additional potential liabilities that may exceed the value of the Multi-Strat ... original
investment therein.
Directional Trading
Certain of the positions taken by the Multi-Strat Funds may be directional (Le., designed
to profit from forecasting absolute price movements in a particular ... Risks Related to Certain Instruments Traded
Equity Securities
The investment portfolio of the Multi-Strat Funds includes positions in common stocks,
preferred stocks and convertible securities principally ofU.S. issuers
https://www.justice.gov/epstein/files/DataSet%2010/EFTA01384544.pdf
investments for a specified period of time.
Valuation Risk; Use of Estimates
The Multi-Strat Funds' positions are valued using the methodologies set forth in the
Feeder Funds' PPMs ... Fees received by Hudson Bay Capital and its affiliates.
The values of the Multi-Strat Funds' positions are based, to the extent possible, on
independent third-party pricing sources, which ... into transactions. This discrepancy can cause
unexpected net asset value declines if a Multi-Strat Fund is required to sell a position
which it had been valuing based upon dealers
https://www.justice.gov/epstein/files/DataSet%2010/EFTA01384548.pdf
EFTA01384526Set 10
2018-01-311p496w
wish to invest on
a levered basis) (along with their affiliates, the "Multi-Strat Funds"); (ii) Hudson Bay
Cap Structure Arbitrage Enhanced Fund LP (operating primarily for the benefit ... herein as a "Fund" and collectively,
as the "Funds" or the "Clients." The Multi-Strat Funds are currently open to new
investors; the MLP and Corporate Value Funds ... begin accepting new investors at any time in the future
without notice.
The Multi-Strat Funds
The Multi-Strat Funds are organized in a master-feeder structure, whereby: (i) Hudson
https://www.justice.gov/epstein/files/DataSet%2010/EFTA01384526.pdf
Capital
Funds' or third-party valuation models. Market disruptions may also force a Multi-Strat
Fund to close out one or more positions. Such disruptions have in the past resulted ... substantial losses for funds employing relative value strategies. Even if a Multi-Strat
Fund's relative value investment strategies are successful, they may result in high
portfolio turnover, and, consequently ... decide not to, hedge its positions, and, in such event, a Multi-Strat
Fund might sustain a significant risk of loss as a result of changes in the price
https://www.justice.gov/epstein/files/DataSet%2010/EFTA01384543.pdf
HUBUS133 Alpha Group Capital
The Multi-Strat Funds may also buy credit default protection with respect to a referenced
entity if, in the judgment of Hudson Bay Capital, there ... likelihood of credit
deterioration. In such instance, the Multi-Strat Funds will pay a premium regardless of
whether there is a credit event. As a buyer of credit default swaps ... circumstances in
which the Multi-Strat Funds do not own the debt securities that are deliverable under a
credit default swap, the Multi-Strat Funds are exposed to the risk
https://www.justice.gov/epstein/files/DataSet%2010/EFTA01384547.pdf
from any broker-dealer.
In addition, the Third-Party Ventures in which the Multi-Strat Funds may participate may
make use of "soft dollar" services, and any additional transaction expenses ... services obtained by
Hudson Bay Capital — would generally constitute incremental expenses to the Multi-Strat
Funds. Such "soft dollar" services may also fall outside of the "safe harbor" provisions ... Each Multi-Strat investor, as a condition of investing in a Multi-Strat
Fund, consents to such "soft dollar" arrangements and, if applicable, to Hudson Bay
Capital consenting to such
https://www.justice.gov/epstein/files/DataSet%2010/EFTA01384574.pdf
Capital
As of the date of this Brochure, Hudson Bay Capital categorizes its Multi-Strat Fund
strategies into the following groups in its reports to investors: (i) event-driven/merger ... strategies and techniques (including sub-strategies) that
have historically been used for the Multi-Strat Funds are outlined below for illustrative
purposes. The following does not purport ... complete list of all trading strategies
employed, and certain of the Multi-Strat Funds' trades may involve a combination of, or
a departure from, these strategies.
• Event/Merger Arbitrage - involves investing
https://www.justice.gov/epstein/files/DataSet%2010/EFTA01384538.pdf