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interest rate hikes by the Fed, and global geopolitical catalysts (e.g. elections, referendums) in 2017 to contribute to a rise in market volatility. These factors should help us to approach our target daily VaR of 0.80%, and also provide an attractive environment for many of our strategies to generate alpha. While having more risk on the balance sheet does imply that our return volatility and drawdowns will be larger, it is reasonable to expect that any positive returns would increase as well. Manager Attribution: e For the fourth quarter of 2016, 42% of “Fundamental L/S,” 45% of “Quantitative,” and 67% of “Other” managers were profitable. e The top five performing managers contributed 38% of the quarterly total positive return, with the largest single manager positively contributing 9%. The bottom five performing managers made up 56% of negative returns, with the largest single manager negatively contributing 17%. ° While 2015 was a stronger year for our strategy overall compared to 2016, we were pleased to see a continual diversification of return attribution across our managers in 2016. The below statistics compare 2016 with 2015 and present a similar picture of limited return concentration. Positive Negative Attribution Attribution 2016 | Total 15.94% -7.42% Top 5 Contributors 6.48% -2.54% Largest Contribution 2.25% -0.67% 2015 | Total 22.77% -6.92% Top 5 Contributors 7.31% -3.55% Largest Contribution 1.82% -1.03% e As of December 2016, the Multi-Strategy platform had 28 Fundamental L/S Equity managers, 23 Quantitative managers, 10 “Other” managers (these Multi-Strategy platform figures include 9 Hybrid allocations’), and 13 First-Loss managers. Assets Under Management As of January 1, 2017, Boothbay’s total AUM was approximately $190 million ($230 million including capital from First-Loss share class). As always, I am available to answer all investment and business inquiries. Peter Bremberg and Daniel Bloom are available to answer any questions related to financial operations. Sincerely, Pe oa Ari Glass Managing Member Boothbay Fund Management LLC 6 “Hybrid allocations” refers to accounts for which we have both a First-Loss and Multi-Strategy investment. HOUSE_OVERSIGHT_026670