Agreements

12 Months Ended

Dec. 31, 2019

3. Agreements:

Limited Partnership Agreement:

The General Partner administers the business and affairs of the Partnership, including, among other things, (i) selecting, appointing and terminating the Partnership’s commodity trading advisors, (ii) allocating and reallocating the Partnership’s assets among the commodity trading advisors and (iii) monitoring the activities of the commodity trading advisors. The Partnership pays the General Partner a monthly administrative fee equal to 1/12 of 1% (1.0% per year) of

month-end

net assets.

Month-end

net assets, for the purpose of calculating the General Partner fee, are Net Assets, as defined in the Limited Partnership Agreement, prior to the reduction of the current month’s ongoing selling agent fees, management fees, incentive fee accruals, the General Partner fee and any redemptions or distributions as of the end of such month.

The Partnership will also pay the General Partner an incentive fee payable annually equal to 5% of the Partnership’s overall New Trading Profits, as defined in the Limited Partnership Agreement, earned in each calendar year. For the years ended December 31, 2019, 2018 and 2017, there were no incentive fees earned by the General Partner.

Management Agreement:

The General Partner, on behalf of the Partnership, entered into management agreements (each, a “Management Agreement”) with the Advisors, each of which is a registered commodity trading advisor. The Advisors are not affiliated with one another, are not affiliated with the General Partner or MS&Co. and are not responsible for the organization or operation of the Partnership. Independent View receives a monthly management fee equal to 1.25% per year of

month-end

net assets allocated to Independent View. Katonah receives a monthly management fee equal to 1.00% per year of the

month-end

net assets allocated to Katonah.

From January 1, 2018 until its termination on June 30, 2019, SECOR received a monthly management fee equal to 1.15% per year of

month-end

net assets allocated to SECOR. Prior to January 1, 2018, SECOR received a monthly management fee equal to 1.75% per year. From January 1, 2018 until its termination on March 31, 2019, Harbour Square received a monthly management fee equal to 1.15% per year of

month-end

net assets allocated to Harbour Square. Prior to January 1, 2018, Harbour Square received a monthly management fee equal to 1.25% per year. Prior to its termination, AE Capital

received a monthly management fee equal to 1.50% per year of the

month-end

net assets allocated to AE Capital. From October 1, 2018 until its termination on October 31, 2018, Mesirow received a monthly management fee equal to 1.00% per year of

month-end

net assets allocated to Mesirow. From January 1, 2018 to September 30, 2018, Cambridge received a monthly management fee equal to 1.00% per year of

month-end

net assets allocated to Cambridge. Prior to January 1, 2018, Cambridge received a monthly management fee equal to 1.50% per year of

month-end

net assets allocated to Cambridge. From March 1, 2018 until its termination on April 30, 2018, Buttonwood received a monthly management fee equal to 1.00% per year of the

month-end

net assets allocated to Buttonwood. Prior to its termination on March 1, 2018, Launchpad received a monthly management fee equal to 1.00% per year of the

month-end

net assets allocated to Launchpad. Prior to its termination on February 28, 2017, Willowbridge received a monthly management fee equal to 1.50% per year of

month-end

net assets allocated to Willowbridge.

Month-end

net assets, for the purpose of calculating management fees are Net Assets, as defined in the Limited Partnership Agreement, prior to the reduction of the current month’s management fees, incentive fee accruals, the General Partner fee, ongoing selling agent fee and any redemptions or distributions as of the end of such month.

In addition, the Partnership is obligated to pay each Advisor an incentive fee. The Partnership pays Katonah an incentive fee, payable semi-annually, equal to 20% of New Trading Profits as defined in its Management Agreement, earned by Katonah for the Partnership during each half year. The Partnership pays Independent View an incentive fee, payable quarterly, equal to 20% of New Trading Profits, as defined in its Management Agreement, earned by Independent View for the Partnership during each calendar quarter.

Prior to their respective terminations, Harbour Square and AE Capital were eligible to receive an incentive fee, payable quarterly, equal to 20% of New Trading Profits, as defined in each Management Agreement, earned by the relevant Advisor for the Partnership during each calendar quarter. From January 1, 2018 until its termination on June 30, 2019, SECOR was eligible to receive an annual incentive fee of 25% of New Trading Profits, as defined in its Management Agreement, earned by SECOR for the Partnership during each calendar year. Prior to January 1, 2018, SECOR was eligible to receive an incentive fee, payable quarterly, equal to 20% of New Trading Profits, as defined in its Management Agreement, earned by SECOR for the Partnership during each calendar quarter. Prior to its termination on October 31, 2018, Mesirow was eligible to receive an incentive fee payable annually, equal to 15% of New Trading Profits, as defined in its Management Agreement, earned by Mesirow for the Partnership each calendar year. From January 1, 2018 to September 30, 2018, Cambridge was eligible to receive an incentive fee, payable annually, equal to 15% of New Trading Profits, as defined in its Management Agreement, earned by Cambridge for the Partnership during each calendar year. Prior to January 1, 2018, Cambridge was eligible to receive an incentive fee, payable quarterly, equal to 15% of New Trading Profits, as defined in its Management Agreement, earned by Cambridge for the Partnership during each calendar quarter. From March 1, 2018 until its termination on April 30, 2018, Buttonwood was eligible to receive an incentive fee, payable quarterly, equal to 20% of New Trading Profits, as defined in its Management Agreement, earned by Buttonwood for the Partnership during each calendar quarter. Prior to March 1, 2018, Launchpad was eligible to receive an incentive fee, payable quarterly, equal to 20% of New Trading Profits, as defined in its Management Agreement, earned by Launchpad for the Partnership during each calendar quarter. Prior to its termination on February 28, 2017, Willowbridge was eligible to receive an incentive fee, payable quarterly, equal to 20% of New Trading Profits, as defined in its Management Agreement, earned by Willowbridge for the Partnership during each calendar quarter. To the extent an Advisor incurs a loss for the Partnership, the Advisor will not receive an incentive fee until the Advisor recovers the net loss incurred and earns additional trading profits for the Partnership. Each Management Agreement may be terminated upon notice by either party.

In allocating the assets of the Partnership among the Advisors, the General Partner conducts proprietary research and considers, among other factors, the background of the Advisors’ principals, as well as the Advisors’ trading styles, strategies and markets traded, expected volatility, trading results (to the extent available) and fee requirements. The General Partner may modify or terminate the allocation of assets among the Advisors and may allocate assets to additional advisors at any time.

Customer Agreement:

The Partnership has entered into a customer agreement with MS&Co. (the “Partnership Customer Agreement”). Under the Partnership Customer Agreement and the foreign exchange brokerage account agreement (described in Note 1, “Organization”), the Partnership, directly and through its investment in the Funds, pays MS&Co. (or will reimburse MS&Co. if previously paid) its allocable share of all trading fees for the clearing and, where applicable, execution of transactions as well as exchange, user,

give-up,

floor brokerage and National Futures Association fees (collectively, “clearing fees”). Clearing

fees are allocated to the Partnership based on its proportionate share of each Fund. Clearing fees will be paid for the life of the Partnership, although the rate at which such fees are paid may be changed. All of the Partnership’s assets available for trading in commodity interests not held in the Funds’ accounts at MS&Co. and JPMorgan are deposited in the Partnership’s accounts at MS&Co. The Partnership’s cash deposited with MS&Co. is held in segregated bank accounts to the extent required by Commodity Futures Trading Commission regulations. The Partnership’s restricted cash is equal to the cash portion of assets on deposit to meet margin requirements, as determined by the exchange or counterparty, and required by MS&Co. At December 31, 2019 and 2018, the amount of cash held for margin requirements was $4,003,185 and $2,756,546, respectively. Cash that is not classified as restricted cash is therefore classified as unrestricted cash. MS&Co. has agreed to pay the Partnership interest on 100% of the average daily equity maintained in cash in the Partnership’s (or the Partnership’s allocable portion of a Fund’s) brokerage account at the rate equal to the monthly average of the

4-Week

U.S. Treasury bill discount rate. The Partnership Customer Agreement may generally be terminated upon notice by either party.

Selling Agreement:

The Partnership has entered into a selling agent agreement with Morgan Stanley Smith Barney LLC, doing business as Morgan Stanley Wealth Management (“Morgan Stanley Wealth Management”) (the “Selling Agreement”). Under the Selling Agreement, the Partnership pays Morgan Stanley Wealth Management a monthly ongoing selling agent fee. The monthly ongoing selling agent fee is equal to (i) 4/24 of 1% (2.00% per year) for Class A Redeemable Units and (ii) 3/48 of 1% (0.75% per year) for Class D Redeemable Units. Morgan Stanley Wealth Management pays a portion of its ongoing selling agent fees to properly registered or exempted financial advisors who have sold Class A and Class D Redeemable Units. Class Z Redeemable Units are not subject to an ongoing selling agent fee.

Month-end

Net Assets, for the purpose of calculating ongoing selling agent fees are Net Assets, as defined in the Limited Partnership Agreement, prior to the reduction of the current month’s ongoing selling agent fees, incentive fee accruals, the monthly management fees, the General Partner fee and other expenses and any redemptions or distributions as of the end of such month. The General Partner fee, management fees, incentive fees and all other expenses are allocated proportionally to each Class based on the net asset value of each Class.

EMERGING CTA PORTFOLIO LP 10-K