R25 Vault Management Fee Policy

Effective Date: November 5, 2026, at 00:00 (UTC+8)

This policy applies to all existing standardized R25 Vaults from the effective date and time stated above.

1. Overview

Management fees are ongoing fees for platform services and the Curator’s management of a Vault. They are calculated at annual rates over the actual elapsed time and paid by issuing new Vault Shares.

Management fees use the TVL recorded at the previous fee checkpoint as their calculation base. R25’s and the Curator’s fees are calculated separately, then combined to determine the total fee shares to issue.

2. Management Fee Rates

The Vault’s total annual management fee rate must be at least 1.00%. Of that total, 1.00 percentage point is allocated to R25, and any remaining portion is allocated to the Curator. R25’s allocation is included in the total rate, rather than charged on top of it.

$R_p=1.00\%,\qquad R_c=R_{\mathrm{total}}-R_p,\qquad R_{\mathrm{total}}\geq1.00\%$

Here, $R_p$ is R25’s annual fee rate, $R_c$ is the Curator’s annual fee rate, and $R_{\mathrm{total}}$ is the Vault’s total annual fee rate.

For example:

Total annual management fee rate	R25 annual fee rate	Curator annual fee rate
1.00%	1.00%	0.00%
1.50%	1.00%	0.50%

3. When Management Fees Accrue and Crystallize

First accrual period

Management fees begin accruing after the Vault’s first subscription successfully settles and the first fee checkpoint is established. This checkpoint records the initial calculation base and timestamp. No management fee is calculated using uninitialized checkpoint data.

Crystallization triggers

Management fees are settled and crystallized when any of the following occurs:

• The fixed daily cutoff configured by the system.
• A Vault subscription successfully settles.
• A Vault redemption successfully settles.

The same calculation rules apply to all three triggers. Submitting a subscription or redemption request alone is not a settlement trigger.

Each successful fee settlement updates the checkpoint for the next accrual period. This prevents overlapping periods from being charged again when multiple triggers occur.

Time calculation

Fees are calculated using the actual elapsed seconds since the previous successful management fee settlement. A year is fixed at 365 days, or 31,536,000 seconds. Partial days are included without rounding to whole days.

$\Delta t=t_{\mathrm{current}}-t_{\mathrm{prev}}$

$T=365\times24\times60\times60=31{,}536{,}000\ \text{seconds}$

Here, $t_{\mathrm{current}}$ is the current settlement timestamp and $t_{\mathrm{prev}}$ is the previous successful settlement timestamp. For the first accrual period, the starting timestamp is the first fee checkpoint timestamp.

4. How Management Fees Are Calculated

Fee base

The calculation uses the TVL recorded at the previous fee checkpoint, rather than the live TVL at the current settlement.

For each accrual period:

$F_p=TVL_{\mathrm{prev}}\times R_p\times\frac{\Delta t}{T}$

$F_c=TVL_{\mathrm{prev}}\times R_c\times\frac{\Delta t}{T}$

$F_{\mathrm{total}}=F_p+F_c$

Where:

Symbol	Meaning
$TVL_{\mathrm{prev}}$	TVL recorded at the previous fee checkpoint
$R_p$	R25’s annual management fee rate
$R_c$	Curator’s annual management fee rate
$\Delta t$	Actual elapsed seconds for the accrual period
$T$	31,536,000 seconds
$F_p$	R25’s management fee for the period
$F_c$	Curator’s management fee for the period
$F_{\mathrm{total}}$	Total management fee for the period

Management fees are calculated proportionally to elapsed time. They do not use the hurdle rate or high-water mark tests used for performance fees.

5. How Management Fees Are Paid

Issuing fee shares

Management fees are paid by issuing new Vault Shares. USDC is not transferred out of the Vault’s underlying assets when these fee shares are issued.

The total number of shares issued is calculated so that their theoretical value at the NAV immediately after issuance equals the total management fee:

$M=\frac{F_{\mathrm{total}}\times S}{A-F_{\mathrm{total}}}$

Here, $A$ is the Vault’s total assets immediately before management fee share issuance, $S$ is its total outstanding shares immediately before issuance, and $M$ is the total management fee shares issued.

The current asset value $A$ is used to calculate the number of shares to issue. It is distinct from $TVL_{\mathrm{prev}}$, which is used to calculate the fee amount.

After issuance:

$S_{\mathrm{after}}=S+M$

$NAV_{\mathrm{after}}=\frac{A}{S+M}$

$M\times NAV_{\mathrm{after}}=F_{\mathrm{total}}$

Your existing share count stays the same. However, issuing fee shares increases the total outstanding shares, reducing your proportional ownership and NAV per share to reflect the fee. Issuance itself does not change the Vault’s total assets.

Allocating fee shares

The total fee shares are allocated according to each party’s share of the management fee amount:

$M_p=M\times\frac{F_p}{F_{\mathrm{total}}}$

$M_c=M\times\frac{F_c}{F_{\mathrm{total}}}$

$M_p+M_c=M$

Here, $M_p$ and $M_c$ are the fee shares allocated to R25 and the Curator, respectively. Management fee allocations follow their respective fee amounts; they do not use the performance fee allocation percentages.

Actual amounts are subject to contract precision and rounding. Allocations must add up to the total shares issued. If the total fee is zero, no management fee shares are issued or allocated.

6. Calculation Example

Assume the following:

Item	Value
TVL at the previous fee checkpoint	100,000 USDC
Current Vault assets before fee share issuance	100,000 USDC
Outstanding shares before fee share issuance	100,000 shares
R25 annual management fee rate	1.00%
Curator annual management fee rate	0.50%
Total annual management fee rate	1.50%
Elapsed time	86,400 seconds, or one day

R25’s fee:

$F_p=100{,}000\times0.01\times\frac{86{,}400}{31{,}536{,}000}\approx2.739726\ \text{USDC}$

Curator’s fee:

$F_c=100{,}000\times0.005\times\frac{86{,}400}{31{,}536{,}000}\approx1.369863\ \text{USDC}$

Total management fee:

$F_{\mathrm{total}}=F_p+F_c\approx4.109589\ \text{USDC}$

Total shares issued:

$M=\frac{F_{\mathrm{total}}\times100{,}000}{100{,}000-F_{\mathrm{total}}}\approx4.109758\ \text{shares}$

R25 receives two-thirds of the issued fee shares, and the Curator receives one-third:

$M_p=M\times\frac{2}{3}\approx2.739839\ \text{shares}$

$M_c=M\times\frac{1}{3}\approx1.369919\ \text{shares}$

These are illustrative theoretical values. Calculations use unrounded values; actual results depend on contract precision and final rounding rules.

7. Fee Checkpoints and Settlement Exceptions

After management fee calculation and share issuance succeed, the system updates the settlement timestamp and records the current settlement’s TVL, measured before management fee share issuance, as the calculation base for the next accrual period.

The next period therefore uses this new checkpoint, rather than continuing to use the earlier checkpoint’s TVL. Newly issued fee shares are not treated as additional assets for the next fee base.

If fee calculation, validation, or share issuance fails, the checkpoint’s timestamp and fee base are not updated. On retry, fees are recalculated using the last successful checkpoint and the actual elapsed time up to the new settlement time.

Share issuance requires:

$A>F_{\mathrm{total}}$

If this condition is not met, the system must not proceed directly with fee share issuance. Invalid calculations or failed issuances are handled as settlement exceptions rather than recorded as successful fee payments.

8. Management Fee Withdrawals

Curators can request a withdrawal through Withdraw Management Fees on the Vault management page.

Only management fee shares that have been successfully crystallized, allocated to the Curator, and become eligible for withdrawal are included in the withdrawable balance.

Each batch of management fee shares must complete a 15-day waiting period from crystallization. Only shares crystallized at least 15 days before the withdrawal request are eligible for withdrawal. Shares crystallized within the preceding 15 days and accrued fees that have not yet been crystallized are excluded.

The withdrawal process is as follows:

1. The Curator submits a management fee withdrawal request.
2. The system checks the eligible fee share balance, including the crystallization time of each batch.
3. The contract initiates redemption of the eligible shares under the Vault’s existing redemption rules.
4. After redemption completes, the corresponding USDC is transferred to the Curator’s wallet.
5. The available balance and withdrawal records are updated.

A withdrawal request cannot be initiated if no eligible fee shares are available. Completing the 15-day waiting period does not guarantee an immediate USDC transfer. Actual receipt depends on completion of the Vault’s redemption and settlement process and any other applicable withdrawal conditions.