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NOTES TO THE FINANCIAL STATEMENTS
C A M B R I D G E I N D U S T R I A L T R U S T
A N N U A L R E P O R T 2 0 1 5
1.
General (Cont’d)
(B)
Management fees (Cont’d)
(ii)
The performance fee calculation methodology was revised and approved at the Extraordinary
General Meeting on 19 May 2015, from a total return based formula to a DPU growth model. The
Manager has voluntarily waived any performance fee entitlement for FY2015 and FY2016 under
the new structure (“Performance Fee Waiver”).
The performance fee under the DPU growth model (“Performance Fee”) is computed at 25% of
the growth in DPU for such financial year multiplied by the weighted average number of units in
issue for such financial year.
The DPU growth is measured by the excess of DPU for such financial year to the highest DPU
achieved by the Trust in the previous years for which a performance fee was payable (“Highest DPU
Threshold”). Whenever a performance fee is earned, the Highest DPU Threshold will be adjusted
to the highest DPU achieved. In order to be eligible for a performance fee in future, the Trust would
have to outperform the adjusted Highest DPU Threshold.
For the purpose of calculation of the performance fee payable under the revised performance fee
structure, the Highest DPU Threshold is initially set at 6.000 cents, or if the DPU achieved during
the Performance Fee Waiver period is higher, then such higher DPU.
The Performance Fee, whether payable in any combination of cash and Units or solely in cash or
Units, will be payable in arrears within 30 days after the last day of each financial year. If a trigger
event occurs resulting in the Manager being removed, the Manager is entitled to payment of any
Performance Fee in cash to which it might otherwise have been entitled for that financial year
in cash, which shall be calculated, as if the end of the financial year was the date of occurrence
of the trigger event, in accordance with the Trust Deed. If a trigger event occurs at a time when
any accrued Performance Fee has not been paid, resulting in the Manager being removed, the
Manager is entitled to payment of such accrued Performance Fee in cash.
Management fees (Base Fee and Performance Fee, including any accrued Performance Fee which
have been carried forward from previous financial years but excluding any acquisition fee or
disposal fee) to be paid to the Manager in respect of a financial year, whether in cash or in Units or
a combination of cash and Units, are capped at an amount equivalent to 0.8% per annum of the
value of Deposited Property as at the end of the financial year (referred to as the “annual fee cap”).
The total amount of performance fee accruing to the Manager under the previous performance fee
structure was approximately $5.6 million as at 31 December 2015 and will be paid in instalments
every six months in January and July, subject to the fee cap arrangement under the Trust Deed. Full
settlement of the total fee payable is expected by January 2017.
If the amount of such fees for a financial year exceeds the annual fee cap, the Base Fee of the
financial year shall be paid to the Manager and only that portion of the Performance Fee equal to
the balance of an amount up to the annual fee cap will be paid to the Manager.
Please refer to Note 11 for the Manager’s base fees payable in units.
