Contract analysis

I. EXECUTIVE SUMMARY OF THE MANAGEMENT FEE WAIVER For the tax year ended December 31, 2021, Ironside Capital GP LLC elected to waive $23.8 million of management fees that would otherwise have been payable to it under Section 4.1 of the Amended and Restated Limited Partnership Agreement of Ironside Capital Management LP, dated as of September 1, 2016, as further amended through the Fourth Amendment dated March 15, 202

II. DETAILED FACTUAL NARRATIVE A. Fund Structure and Management Fee Framework Ironside Capital Management LP is a Delaware limited partnership formed on June 14, 2016, pursuant to a Certificate of Limited Partnership filed with the Delaware Secretary of State. ICM operates as a multi-strategy hedge fund employing a diversified array of investment strategies, including global macro, event-driven equity, and credit str

III. LEGAL FRAMEWORK AND DISTINCTION FROM ABUSIVE STRUCTURES A. IRC § 707(a)(2)(A) — Disguised Payments for Services IRC Section 707(a)(2)(A) provides that, if a partner performs services for the partnership and there is a related direct or indirect allocation and distribution to such partner, the transaction will be treated as occurring between the partnership and a person who is not a partner (i.e., as a payment fo

1. Whether the arrangement lacks significant entrepreneurial risk, taking into account the overall arrangement and whether the allocation is subject to substantial risk of reduction or loss based on the entrepreneurial risks of partnership operations;

2. Whether the partner's status as a partner is transitory — i.e., whether the partner's interest in the partnership is of such brief duration or limited scope that it suggests the partner's status is merely nominal;

3. Whether the allocation and distribution to the partner are close in time to the performance of services, which may suggest that the allocation is, in substance, a fee;

4. Whether, under all the facts and circumstances, the partner became a partner primarily to obtain tax benefits that would not have been available if the services had been rendered in a third-party capacity;

5. Whether the value of the partner's interest in the partnership is small relative to the allocation; and

6. Any other facts and circumstances that are relevant under all the facts and circumstances, including the relationship between the allocation and distribution and the services performed. The regulations make clear that the most important of these factors is whether the arrangement lacks significant entrepreneurial risk. If the arrangement subjects the service-providing partner to genuine entrepreneurial risk — that

IV. INDEX OF ENCLOSED DOCUMENTS The following documents are enclosed with this response, organized by IDR #2 item number. The enclosed documents constitute a subset of the approximately 4,600 pages produced across all IDR responses in this examination. Item 1. Amended and Restated Limited Partnership Agreement of Ironside Capital Management LP — certified excerpts of Section 4.1 (Management Fee Provisions), including

V. RESERVATION OF RIGHTS Ironside Capital Management LP, by and through its undersigned counsel, expressly reserves all rights, privileges, objections, and defenses available to it in connection with this examination and the production of documents and information described herein, including, but not limited to: (a) The attorney-client privilege, as applicable to communications between ICM, its General Partner, and t

VI. CLOSING We trust that the foregoing narrative and the enclosed documents are responsive to the items set forth in IDR #2. We have endeavored to provide a thorough and transparent account of the management fee waiver mechanics employed by the General Partner, the economic substance of the arrangement, and the legal basis for the tax treatment reflected on the Fund's 2021 Form 1065. Should you, or any member of the