Och-Ziff Capital Management Group LLC Reports First Quarter 2009 Results

05/04/2009
First Quarter 2009 Dividend of $0.05 per Class A Share
NEW YORK, May 4, 2009 /PRNewswire-FirstCall via COMTEX/ -- Och-Ziff Capital Management Group LLC (NYSE: OZM) (the "Company" or "Och-Ziff") today reported its results for the first quarter ended March 31, 2009, and the declaration of a $0.05 first quarter cash dividend on its Class A Shares.

Summary Highlights

  • Distributable Earnings of $27.2 million, or $0.07 per Adjusted Class A Share, for the 2009 first quarter
  • Assets under management of $20.3 billion as of April 1, 2009, 8% lower than as of January 1, 2009 and 38% lower than as of April 1, 2008
  • Year-to-date net returns through March 31, 2009 of the OZ Master Fund of 4.4%, the OZ Europe Master Fund of -0.2%, the OZ Asia Master Fund of 4.4% and the OZ Global Special Investments Master Fund of 0.7%

 

"Despite continued challenging market conditions, we delivered strong absolute returns during the first quarter and in April," said Daniel Och, Chairman and Chief Executive Officer of Och-Ziff. "We see the current environment -- which places a premium on investment performance, fund infrastructure and investment process transparency to fund investors -- as an excellent one in which to continue to generate strong absolute returns for our fund investors. The number of compelling investment opportunities remains greater than it has been in many years, and there is a smaller universe of investors pursuing those ideas. While it may take some time for investors to begin to re-allocate capital to alternative asset managers, we believe that we will benefit from our competitive strengths and gain market share as a result."

For the first quarter ended March 31, 2009, Och-Ziff reported a GAAP net loss of $81.9 million, or $1.07 per basic and diluted Class A Share, compared with a GAAP net loss of $268.1 million, or $3.62 per basic and diluted Class A Share for the first quarter ended March 31, 2008. The primary driver of the year-over-year reduction in the GAAP net loss was an increase in Net Loss Allocated to Partners' and Others' Interests in Income of Consolidated Subsidiaries resulting from the adoption of FAS 160, partially offset by a decline in Management Fees due to lower assets under management.

The 2009 first quarter GAAP net loss primarily resulted from non-cash expenses of $419.9 million associated with the Company's reorganization in connection with its initial public offering ("IPO") in November 2007. These expenses are related to the amortization of Och-Ziff Operating Group A Units ("Group A Units"), which represent equity interests in the Company's principal operating subsidiaries ("Och-Ziff Operating Group") that were issued to the Company's pre-IPO owners in exchange for their pre-IPO interests in those subsidiaries. The Group A Units vest annually over five years from the closing of the IPO. Accordingly, amortization of these expenses is expected to result in a GAAP net loss each quarter through 2012. Once vested, the Group A Units may be exchanged on a one-to-one basis for Class A Shares. To date, none of the vested Group A Units have been exchanged for Class A Shares.

Also contributing to the GAAP net loss in the 2009 first quarter were non-cash expenses of $25.9 million for the amortization of equity-based compensation, primarily related to Class A Restricted Share Units ("RSUs") awarded to all of the Company's employees in connection with the IPO. These RSUs vest annually over four years from the closing of the IPO. Each RSU represents the right to receive one Class A Share upon vesting.

Management uses Economic Income to evaluate the financial performance of and make operating decisions for the Och-Ziff Funds segment and Other Operations. Management believes that investors should review the same performance measures that it uses to analyze the Company's operating performance. Economic Income is a pre-tax measure that does not include income allocations to the pre-IPO interests of the partners and Ziff Brothers Investments (the "Ziffs"), reorganization expenses related to the Company's IPO, equity-based compensation expenses, taxes, the impact of consolidated Och-Ziff funds, or amounts allocated to the partners and the Ziffs on their direct interests in the Och-Ziff Operating Group, among other adjustments. For further information regarding these adjustments, please see Exhibit 5 of the financial tables that accompany this press release. For reconciliations of Economic Income of the Och-Ziff Funds segment, Other Operations and Total Company to the respective GAAP net losses for the periods discussed below, please see Exhibits 3 and 4 of the financial tables that accompany this press release.

The Company's Distributable Earnings for the first quarter ended March 31, 2009 were $27.2 million, or $0.07 per Adjusted Class A Share, compared with $49.7 million, or $0.12 per Adjusted Class A Share in the 2008 first quarter. The year-over-year reduction in Distributable Earnings was primarily attributable to a decline in Management Fees due to lower assets under management, partially offset by lower Non-compensation Expenses. Distributable Earnings is a supplemental non-GAAP financial measure that management believes provides a meaningful basis for comparison of the after-tax operating performance of the Company. Additionally, management uses Distributable Earnings, among other financial data, to determine the earnings available to distribute as dividends to holders of the Company's Class A Shares and to the Company's partners and the Ziffs with respect to their Group A Units.

Distributable Earnings is equal to Economic Income less Adjusted Income Taxes. Adjusted Income Taxes are estimated assuming all Group A Units and RSUs were converted on a one-to-one basis into Class A Shares ("Adjusted Class A Shares"). Distributable Earnings per Share is equal to Distributable Earnings divided by the weighted-average number of Adjusted Class A Shares. Neither Economic Income nor Distributable Earnings should be considered as an alternative to GAAP earnings before income taxes, net earnings or cash flow, or as indicative of liquidity or the cash available to fund operations.

Prior to 2009, Distributable Earnings and Distributable Earnings per Share were determined using Economic Income for the Och-Ziff Funds segment. As a result of the growing significance of Och-Ziff's Other Operations, which is comprised of additional investments in new businesses, principally the Company's investment in its Asia real estate business, Economic Income, Distributable Earnings and Distributable Earnings per Share now include the results of the Company's Other Operations on a basis comparable to Economic Income of the Och-Ziff Funds segment. Amounts in the prior year have been restated to conform to the new presentation. For a reconciliation of Economic Income to Distributable Earnings, please see Exhibit 6 of the financial tables that accompany this press release.

Och-Ziff's assets under management were $22.6 billion as of March 31, 2009, 16% lower than the $27.0 billion in assets under management as of December 31, 2008 and 32% lower than the $33.3 billion in assets under management as of March 31, 2008. The $10.7 billion year-over-year decrease was driven by net outflows of $6.1 billion and performance-related depreciation of $4.6 billion. During the 2009 first quarter, the $4.4 billion decrease in assets under management was driven by net outflows of $5.1 billion partially offset by performance-related appreciation of $733 million. The net outflows for the first quarter 2009 include redemption requests received for December 31, 2008, but exclude redemption requests received for March 31, 2009 as these redemptions are reflected in assets under management as of April 1, 2009.

Assets under management as of April 1, 2009 were $20.3 billion, which reflects redemptions for the month of March 2009 (net of April 1, 2009 capital inflows) of $2.3 billion. Virtually all redemptions for a quarter generally are paid on the first day of the month following the quarter in which the redemption notice was submitted, and capital inflows for that month are accepted on the same day. Redemptions remained elevated in the 2009 first quarter as global market conditions continued to be unsettled, particularly in January and February. The Company believes that redemptions also continued to be adversely impacted due to the continued effect of other alternative asset managers that imposed gates, or who otherwise restricted access to investor capital. Och-Ziff has provided, and continues to provide, liquidity to its fund investors in accordance with the pre-defined terms of its funds.

Estimated assets under management as of May 1, 2009 were $20.6 billion, which reflects redemptions for the month of April 2009 (net of May 1, 2009 capital inflows) of $84.8 million, and performance-related appreciation of $391.7 million.

    Assets under management by fund:
                                                          % Change (1)
                                                          ------------
                                                        Mar. 2009   Mar. 2009
    (dollars in      March 31, December 31,  March 31,     vs.         vs.
     billions)          2009        2008        2008    Dec. 2008   Mar. 2008
                     --------- ------------- --------- ----------  ----------
    OZ Master Fund      14.3        16.4       19.9       -13%        -28%
    OZ Europe
     Master Fund         3.5         5.1        6.2       -31%        -44%
    OZ Asia Master Fund  1.7         2.4        3.8       -30%        -55%
    OZ Global Special
     Investments
     Master Fund         1.9         1.9        2.1         0%         -8%
    Other (1) (2)        1.2         1.2        1.3        NM          NM

    (1) Rounding differences may occur.
    (2) Includes real estate funds, managed accounts and other funds not
        significant to the Company's assets under management.


    Performance by fund(1):
                                                  2009
                                                  ----
                                   January   February   March     YTD
                                   -------   --------   -----     ---
    OZ Master Fund                   3.09%      0.35%   0.88%   4.36%
    OZ Europe Master Fund            0.98%     -1.09%  -0.04%  -0.16%
    OZ Asia Master Fund              2.70%      1.22%   0.38%   4.35%
    OZ Global Special Investments
       Master Fund                   0.84%     -0.49%   0.35%   0.70%

    (1) Please see important disclosures on Exhibit 9 of the financial
        supplement accompanying this press release.

In the 2009 first quarter, performance-related appreciation was due

primarily to improved investment opportunities in U.S. and Asian equities,

convertible arbitrage, and credit, all of which are core strategies in the

Company's master funds.

Summary results OF THE OCH-ZIFF FUNDS SEGMENT

The Company conducts substantially all of its business through the Och-Ziff Funds segment, which is currently the Company's only reportable segment. This segment provides management and advisory services to the Company's hedge funds and separately managed accounts.

Economic Income

Economic Income Revenues

First quarter 2009 Economic Income Revenues were $92.6 million, a 37% decrease from first quarter 2008 Economic Income Revenues of $146.5 million. Management Fees were $92.4 million, 36% lower than first quarter 2008 Management Fees of $145.0 million.

Economic Income Revenues were lower year-over-year as a result of the decline in assets under management, primarily due to performance-related depreciation and investor redemptions in the second half of 2008. Redemption requests made in March 2009 had no impact on first quarter 2009 results as they reduced assets under management as of April 1, 2009 in accordance with the Company's practices. Therefore, the effect of these redemptions on Management Fees will be recognized in the Company's second quarter 2009 results.

Economic Income Expenses

Compensation and Benefits

First quarter 2009 Compensation and Benefits expenses totaled $20.4 million, 14% lower than first quarter 2008 Compensation and Benefits expenses of $23.7 million. The decrease in Compensation and Benefits in the 2009 first quarter was almost entirely attributable to the decline in cash bonus expense. First quarter 2009 Compensation and Benefits included $4.9 million of cash bonus expense, which was 40% lower than first quarter 2008 cash bonus expense of $8.1 million due to a lower level of one-time, non-recurring bonus payments.

Non-Compensation Expenses

First quarter 2009 Non-compensation Expenses were $24.1 million, a 31% decrease from first quarter 2008 Non-compensation Expenses of $35.1 million. The decrease was driven principally by lower professional services fees, lower interest expense on the Company's $750 million term loan due to the decline in the loan's LIBOR-based borrowing rate, and lower business development costs, partially offset by higher occupancy expense and insurance costs.

Economic Income

First quarter 2009 Economic Income for the Och-Ziff Funds segment totaled $48.2 million, a 45% decrease from first quarter 2008 Economic Income of $87.7 million.

Summary results OF THE COMPANY's OTHER OPERATIONS

The Company's Other Operations are comprised of its real estate business, which manages and provides advisory services to its real estate funds, and investments in new businesses established to expand certain of the Company's private investments platforms which includes the Company's investment in its Asia real estate business. The businesses within Other Operations are currently in early growth stages, and are not included in the results of the Och-Ziff Funds segment discussed above.

First quarter 2009 Economic Income for the Company's Other Operations was a net loss of $3.7 million, a 6% increase from a $3.4 million net loss in the 2008 first quarter. The 2009 first quarter net loss was primarily related to compensation costs associated with the Company's Asia real estate business. The 2008 first quarter net loss was primarily related to the Company's share of the start-up costs associated with establishing its African joint venture.

CAPITAL

As of March 31, 2009, the number of Class A Shares outstanding was 76,373,392. For purposes of calculating Distributable Earnings per Share, the Company assumes that all Group A Units and RSUs outstanding as of March 31, 2009 have been converted on a one-to-one basis into Class A Shares. For the first quarter ended March 31, 2009, the total weighted-average Adjusted Class A Shares outstanding was 403,114,691.

DIVIDEND

The Board of Directors of Och-Ziff declared a first quarter 2009 dividend of $0.05 per Class A Share, to be paid on May 11, 2009 to holders of record at the close of business on April 1, 2009.

For U.S. federal income tax purposes, the dividend will be treated as a partnership distribution. Based on the best information currently available, the Company estimates that when calculating withholding taxes, the entire amount of the first quarter 2009 dividend will be treated as U.S. source dividend income.

Non-U.S. holders of Class A Shares are generally subject to U.S. federal withholding tax at a rate of 30% (subject to reduction by applicable treaty or other exception) on their share of U.S. source dividends and certain other types of U.S. source income realized by the Company. With respect to interest, however, no withholding is generally required if proper certification (on an IRS Form W-8) of a beneficial owner's foreign status has been filed with the withholding agent. In addition, non-U.S. holders must generally provide the withholding agent with a properly completed IRS Form W-8 to obtain any reduction in withholding.

Och-Ziff will host a conference call today, May 4, 2009, at 8:30 a.m. Eastern Time to discuss the Company's 2009 first quarter results. The call will be open to the public and can be accessed by dialing 888-713-4213 (callers inside the U.S.) or 617-213-4865 (callers outside the U.S.). The number should be dialed at least ten minutes prior to the start of the call. The passcode for the call will be 12943340. A simultaneous webcast of the call will be available to the public on a listen-only basis on the For Shareholders page of the Company's website at www.ozcap.com.

For those unable to listen to the live broadcast, a replay will be available by dialing 888-286-8010 (callers inside the U.S.) or 617-801-6888 (callers outside the U.S.), passcode 23642962, beginning approximately two hours after the event for two weeks. A webcast replay of the event will also be available on the For Shareholders page of the Company's website.

Forward-Looking Statements

The information contained in this press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect the current views of the Company with respect to, among other things, its future financial or business performance, events, strategies or expectations, including but not limited to its ability to generate returns and preserve capital and its ability to expand its investment platforms. Such forward-looking statements are generally identified by the use of words such as "outlook," "believe," "expect," "potential," "continue," "may," "will," "should," "could," "seeks," "approximately," "predicts," "intends," "plans," "estimates," "anticipates," "opportunity," "assume," "remain," "sustain," "achieve" or the negative version of those words or other comparable words.

Any forward-looking statements contained in this press release are based upon historical performance of the Company and its subsidiaries and on current plans, estimates and expectations of the Company and its subsidiaries. The inclusion of this forward-looking information should not be regarded as a representation by the Company or any other person that the future plans, estimates or expectations contemplated by the Company will be achieved. Such forward-looking statements are subject to various risks and uncertainties, including but not limited to global and domestic market and business conditions, the Company's ability to successfully compete for fund investors, talent and investment opportunities, successful formulation and execution of its business and growth strategies, the Company's ability to appropriately manage conflicts of interest, and tax and other regulatory factors relevant to the Company's structure and status as a public company, as well as assumptions relating to the Company's operations, financial results, financial condition, business prospects, growth strategy and liquidity.

If one or more of these or other risks or uncertainties materialize, or if the Company's assumptions prove to be incorrect, the Company's actual results may vary materially from those indicated in these statements. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements and risks that are included in the Company's filings with the Securities and Exchange Commission, including but not limited to the Company's Annual Report on Form 10-K for the year ended December 31, 2008 and its

Quarterly Reports on Form 10-Q. Any forward-looking statements contained in this press release are made only as of the date hereof. The Company does not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.

This press release does not constitute an offer of any Och-Ziff fund.

About Och-Ziff Capital Management Group LLC

Och-Ziff Capital Management Group LLC is one of the world's largest institutional alternative asset managers with offices in New York, London, Hong Kong, Tokyo, Bangalore and Beijing. Och-Ziff's funds seek to deliver consistent, positive, risk-adjusted returns throughout market cycles, with a strong focus on capital preservation. Och-Ziff's multi-strategy approach combines global investment strategies, including merger arbitrage, convertible and derivative arbitrage, equity restructuring, credit and distressed investments, private investments and real estate.

As of May 1, 2009, Och-Ziff had approximately $20.6 billion in assets under management with approximately 600 investor relationships. For more information, please visit www.ozcap.com.

                                 Exhibit 1
                  OCH-ZIFF CAPITAL MANAGEMENT GROUP LLC
      Consolidated and Combined Statements of Operations (Unaudited)
             (dollars in thousands, except per share amounts)

                                                Three Months Ended March 31,
                                                ----------------------------
                                                       2009        2008
                                                       ----        ----
    Revenues
      Management fees                               $94,305    $146,275
      Incentive income                                    -          32
      Other revenues                                    268       1,519
      Income of consolidated Och-Ziff funds           2,615           1
                                                      -----         ---
      Total Revenues                                 97,188     147,827
                                                     ------     -------
    Expenses
      Compensation and benefits                      51,876      52,955
      Allocations to non-equity partner interests      (340)     (1,850)
      Reorganization expenses                       419,949     425,584
      Profit sharing                                    (17)       (834)
      Interest expense                                4,595      10,817
      General, administrative and other              22,250      25,775
      Expenses of consolidated Och-Ziff funds           754         360
                                                        ---         ---
      Total Expenses                                499,067     512,807
                                                    -------     -------
    Other Loss
      Net losses on deferred balances and
       investments in Och-Ziff funds and
       joint ventures                               (11,547)     (5,164)
      Net gains (losses) of consolidated
       Och-Ziff funds                                   277        (913)
                                                        ---        ----
      Total Other Loss                              (11,270)     (6,077)
                                                    -------      ------

    Loss before Income Taxes                       (413,149)   (371,057)
    Income taxes                                      2,829       3,226
                                                      -----       -----
    Consolidated Net Loss                         $(415,978)  $(374,283)
                                                  =========   =========

    Net Loss Allocated to Partners' and
     Others' Interests in Income of
     Consolidated Subsidiaries                    $(334,124)  $(106,165)
                                                  =========   =========

    Net Loss Allocated to Parent                   $(81,854)  $(268,118)
                                                   ========   =========

    Net Loss per Class A Share
      Basic and Diluted                              $(1.07)     $(3.62)
                                                     ======      ======

    Weighted-Average Class A Shares
     Outstanding (1)
      Basic and Diluted                          76,547,204  74,138,572
                                                 ==========  ==========

    (1)  Includes fully-vested RSUs that have not been exchanged into Class A
         Shares as of the end of the period.


                                   Exhibit 2
                     OCH-ZIFF CAPITAL MANAGEMENT GROUP LLC
                          Economic Income (Unaudited)
                             (dollars in thousands)

                                         Three Months Ended March 31, 2009
                                         ---------------------------------
                                                                   Total
                                                                  Company
                                          Och-Ziff      Other     Economic
                                       Funds Segment Operations    Income
                                       ------------- ----------  ---------
    Economic Income Revenues
      Management fees                        $92,424     $1,330    $93,754
      Incentive income                             -          -          -
      Other revenues                             214         54        268
                                                 ---         --        ---
      Total Economic Income Revenues          92,638      1,384     94,022
                                              ------      -----     ------
    Economic Income Expenses
      Compensation and benefits               20,376      3,427     23,803
      Non-compensation expenses               24,093      1,020     25,113
                                              ------      -----     ------
      Total Economic Income Expenses          44,469      4,447     48,916
                                              ------      -----     ------

      Net losses on joint ventures (1)             -       (548)      (548)
      Partners' and others' interests
       in income of consolidated
       subsidiaries (2)                            -         47         47

    Economic Income                          $48,169    $(3,658)   $44,511
                                             =======    =======    =======


                                         Three Months Ended March 31, 2008
                                         ---------------------------------
                                                                   Total
                                                                  Company
                                          Och-Ziff      Other    Economic
                                       Funds Segment Operations    Income
                                       ------------- ----------  ---------
    Economic Income Revenues
      Management fees                       $144,964     $1,311   $146,275
      Incentive income                            32          -         32
      Other revenues                           1,503         16      1,519
                                               -----         --      -----
      Total Economic Income Revenues         146,499      1,327    147,826
                                             -------      -----    -------

    Economic Income Expenses
      Compensation and benefits               23,695        339     24,034
      Non-compensation expenses               35,107        147     35,254
                                              ------        ---     ------
      Total Economic Income Expenses          58,802        486     59,288
                                              ------        ---     ------

      Net losses on joint ventures (1)             -     (4,069)    (4,069)
      Partners' and others' interests
       in income of consolidated
       subsidiaries (2)                            -        210        210

    Economic Income                          $87,697    $(3,438)   $84,259
                                             =======    =======    =======

    (1) Represents the Company's losses in joint ventures established to
        expand certain of the Company's private investments platforms.
    (2) Represents the residual interests in the domestic real estate
        management business not owned by the Company.


                                      Exhibit 3
                        OCH-ZIFF CAPITAL MANAGEMENT GROUP LLC
         Reconciliation of Economic Income to U.S. GAAP Net Loss (Unaudited)
                               (dollars in thousands)

                                        OCH-ZIFF FUNDS SEGMENT
                                        ----------------------
                                Reconciling Adjustments (1)
                                ---------------------------
    Three Months      Economic                                        U.S.
     Ended March       Income       Funds              Other          GAAP
     31, 2009           Basis   Consolidation       Adjustments       Basis
    ------------      --------  -------------       -----------       -----

    Revenues
      Management fees  $92,424           $(56)        $626 (a)      $92,994
      Incentive income       -              -            -                -
      Other revenues       214              -            -              214
      Income of
       consolidated
       Och-Ziff funds        -              -            -                -
      Total Revenues    92,638            (56)         626           93,208
                        ------            ---          ---           ------

    Expenses
      Compensation
       and benefits     20,376              -       22,814 (b)(c)    43,190
      Allocations
       to non-equity
       partner interests     -              -         (340)(d)         (340)
      Reorganization
       expenses              -              -      419,949 (e)      419,949
      Profit sharing         -              -          (17)(f)          (17)
      Interest expense   4,595              -            -            4,595
      General,
       administrative
       and other        19,498              -        1,547 (a)(g)    21,045
      Expenses of
       consolidated
       Och-Ziff funds        -              -            -                -
      Total Expenses    44,469              -      443,953          488,422
                        ------            ---      -------          -------

    Other Income (Loss)
      Net earnings (losses)
       on deferred balances
       and investments
       in Och-Ziff funds
       and joint ventures    -              -      (10,999)(h)      (10,999)
      Net gains (losses)
       of consolidated
       Och-Ziff funds        -         (1,292)           -           (1,292)
      Total Other
       Income (Loss)         -         (1,292)     (10,999)         (12,291)
                           ---         ------      -------           -------
    Income (Loss)
     Before
      Income Taxes      48,169         (1,348)    (454,326)        (407,505)
    Income taxes             -              -        2,788 (g)        2,788
                           ---            ---        -----            -----
    Consolidated
     Net Income (Loss) $48,169        $(1,348)   $(457,114)       $(410,293)
                       =======        =======    =========         =========

    Net Income (Loss)
     Allocated to
     Partners' and
     Others'
     Interests in
     Income of
     Consolidated
     Subsidiaries           $-        $(1,348)   $(336,209)(i)    $(337,557)
                            ==        =======    =========         =========

    Net Income (Loss)
     Allocated to
     Parent            $48,169             $-    $(120,905)        $(72,736)
                       =======             ==    =========          ========


                                           OTHER OPERATIONS
                                           ----------------
                                Reconciling Adjustments (1)
                                ---------------------------
    Three Months      Economic                                        U.S.
     Ended March       Income       Funds              Other          GAAP
     31, 2009           Basis   Consolidation       Adjustments       Basis
    ------------      --------  -------------       -----------       -----

    Revenues
      Management fees   $1,330           $(19)          $- (a)       $1,311
      Incentive income       -              -            -                -
      Other revenues        54              -            -               54
      Income of
       consolidated
       Och-Ziff funds        -          2,615            -            2,615
                           ---          -----          ---            -----
      Total Revenues     1,384          2,596            -            3,980
                         -----          -----          ---            -----

    Expenses
      Compensation
       and benefits      3,427              -        5,259 (b)(c)     8,686
      Allocations
       to non-equity
       partner interests     -              -            - (d)            -
      Reorganization
       expenses              -              -            - (e)            -
      Profit sharing         -              -            - (f)            -
      Interest expense       -              -            -                -
      General,
       administrative
       and other         1,020              -          185 (a)(g)     1,205
      Expenses of
       consolidated
       Och-Ziff funds        -            754            -              754
                           ---            ---          ---              ---
      Total Expenses     4,447            754        5,444           10,645
                         -----            ---        -----           ------

    Other Income (Loss)
      Net earnings (losses)
       on deferred balances
       and investments in
       Och-Ziff funds and
       joint ventures     (548)           (34)          34 (h)         (548)
      Net gains
       (losses) of
       consolidated
       Och-Ziff funds        -          1,569            -            1,569
                           ---          -----          ---            -----
      Total Other
       Income (Loss)      (548)         1,535           34            1,021
                          ----          -----           --            -----

    Income (Loss)
     Before
     Income Taxes       (3,611)         3,377       (5,410)          (5,644)
    Income taxes             -              -           41 (g)           41
                           ---            ---           --               --
    Consolidated
     Net Income (Loss) $(3,611)        $3,377      $(5,451)         $(5,685)
                       =======         ======      =======           =======

    Net Income (Loss)
     Allocated to
     Partners' and
     Others'
     Interests in
     Income of
     Consolidated
     Subsidiaries          $47         $3,377           $9 (i)       $3,433
                           ===         ======           ==           ======

    Net Income (Loss)
     Allocated to
     Parent            $(3,658)            $-      $(5,460)         $(9,118)
                       =======             ==      =======           =======



                                                TOTAL COMPANY
                                                -------------

                                             Economic
                                              Income   U.S. GAAP
    Three Months Ended March 31, 2009          Basis     Basis
    ---------------------------------        --------  ---------

    Revenues
      Management fees                         $93,754    $94,305
      Incentive income                              -          -
      Other revenues                              268        268
      Income of consolidated Och-Ziff funds         -      2,615
                                                  ---      -----
      Total Revenues                           94,022     97,188
                                               ------     ------

    Expenses
      Compensation and benefits                23,803     51,876
      Allocations to non-equity partner
       interests                                    -       (340)
      Reorganization expenses                       -    419,949
      Profit sharing                                -        (17)
      Interest expense                          4,595      4,595
      General, administrative and other        20,518     22,250
      Expenses of consolidated Och-Ziff
       funds                                        -        754
                                                  ---        ---
      Total Expenses                           48,916    499,067
                                               ------    -------

    Other Income (Loss)
      Net earnings (losses) on deferred
       balances and investments in
       Och-Ziff funds and joint ventures         (548)   (11,547)
      Net gains (losses) of consolidated
       Och-Ziff funds                               -        277
                                                  ---        ---
      Total Other Income (Loss)                  (548)   (11,270)
                                                 ----    -------

    Income (Loss) Before Income Taxes          44,558   (413,149)
    Income taxes                                    -      2,829
                                                -----      -----
    Consolidated Net Income (Loss)            $44,558  $(415,978)
                                              =======  =========

    Net Income (Loss) Allocated to
     Partners' and Others' Interests in
     Income of Consolidated Subsidiaries          $47  $(334,124)
                                                  ===  =========

    Net Income (Loss) Allocated to Parent     $44,511   $(81,854)
                                              =======   ========

    (1) See Exhibit 5 for a description of the adjustments made to arrive at
        total Company U.S. GAAP Net Income (Loss).


                                      Exhibit 4
                        OCH-ZIFF CAPITAL MANAGEMENT GROUP LLC
         Reconciliation of Economic Income to U.S. GAAP Net Loss (Unaudited)
                               (dollars in thousands)

                                        OCH-ZIFF FUNDS SEGMENT
                                        ----------------------
                                Reconciling Adjustments (1)
                                ---------------------------
    Three Months      Economic                                        U.S.
    Ended              Income       Funds              Other          GAAP
    March 31, 2008      Basis   Consolidation       Adjustments       Basis
    --------------    --------  -------------       -----------       -----

    Revenues
      Management fees $144,964             $-           $- (a)     $144,964
      Incentive income      32              -            -               32
      Other revenues     1,503              -            -            1,503
      Income of
       consolidated
       Och-Ziff funds        -              1            -                1
                           ---            ---          ---              ---
      Total Revenues   146,499              1            -          146,500
                       -------            ---          ---          -------
    Expenses
      Compensation
       and benefits     23,695              -       28,921 (b)(c)    52,616
      Allocations to
       non-equity
       partner interests     -              -       (1,850)(d)       (1,850)
      Reorganization
       expenses              -              -      425,584 (e)      425,584
      Profit sharing         -              -         (834)(f)         (834)
      Interest expense  10,817              -            -           10,817
      General,
       administrative
       and other        24,290              -        1,151 (a)(g)    25,441
      Expenses of
       consolidated
       Och-Ziff funds        -              -            -                -
                           ---            ---          ---              ---
      Total Expenses    58,802              -      452,972          511,774
                        ------            ---      -------          -------
    Other Loss
      Net earnings
       (losses) on
       deferred balances
       and investments
       in Och-Ziff funds
       and joint ventures    -              -       (1,095)(h)       (1,095)
      Net losses of
       consolidated
       Och-Ziff funds        -             (7)           -               (7)
                           ---             --          ---                --
      Total Other Loss       -             (7)      (1,095)          (1,102)
                           ---             --       ------            ------
    Income (Loss)
     Before Income
     Taxes              87,697             (6)    (454,067)        (366,376)
    Income taxes             -              -        3,093 (g)        3,093
                           ---            ---        -----            -----
    Consolidated
     Net Income (Loss) $87,697            $(6)   $(457,160)       $(369,469)
                       =======            ===    =========         =========

    Net Income (Loss)
     Allocated to
     Partners' and
     Others' Interests
     in Income of
     Consolidated
     Subsidiaries           $-            $(6)   $(105,155)(i)    $(105,161)
                            ==            ===    =========         =========

    Net Income (Loss)
     Allocated to
     Parent            $87,697             $-    $(352,005)       $(264,308)
                       =======             ==    =========         =========



                                           OTHER OPERATIONS
                                           ----------------
                                Reconciling Adjustments (1)
                                ---------------------------
    Three Months      Economic                                        U.S.
    Ended              Income       Funds              Other          GAAP
    March 31, 2009      Basis   Consolidation       Adjustments       Basis
    --------------    --------  -------------       -----------       -----

    Revenues
      Management fees   $1,311             $-           $- (a)       $1,311
      Incentive income       -              -            -                -
      Other revenues        16              -            -               16
      Income of
       consolidated
       Och-Ziff funds        -              -            -                -
                           ---            ---          ---              ---
      Total Revenues     1,327              -            -            1,327
                         -----              -            -            -----

    Expenses
      Compensation
       and benefits        339              -            -  (b)(c)      339
      Allocations to
       non-equity
       partner
       interests             -              -            - (d)            -
      Reorganization
       expenses              -              -            - (e)            -
      Profit sharing         -              -            - (f)            -
      Interest expense       -              -            -                -
      General,
       administrative
       and other           147              -          187 (a)(g)       334
      Expenses of
       consolidated
       Och-Ziff funds        -            360            -              360
                           ---            ---          ---              ---
      Total Expenses       486            360          187            1,033
                           ---            ---          ---            -----

    Other Loss
      Net earnings
       (losses) on
       deferred
       balances and
       investments
       in Och-Ziff
       funds and
       joint ventures   (4,069)            13          (13)(h)       (4,069)
      Net losses of
       consolidated
       Och-Ziff funds        -           (906)           -             (906)
                           ---           ----          ---              ----
      Total Other Loss  (4,069)          (893)         (13)          (4,975)
                        ------           ----          ---            ------

    Income (Loss)
     Before Income
     Taxes              (3,228)        (1,253)        (200)          (4,681)
    Income taxes             -              -          133 (g)          133
                           ---            ---          ---              ---
    Consolidated
     Net Income (Loss) $(3,228)       $(1,253)       $(333)         $(4,814)
                       =======        =======        =====           =======

    Net Income (Loss)
     Allocated to
     Partners' and
     Others'
     Interests in
     Income of
     Consolidated
     Subsidiaries         $210        $(1,253)         $39 (i)      $(1,004)
                          ====        =======          ===           =======

    Net Income (Loss)
     Allocated to
     Parent            $(3,438)            $-        $(372)         $(3,810)
                       =======             ==        =====           =======


                                                TOTAL COMPANY
                                                -------------
                                             Economic
                                              Income   U.S. GAAP
    Three Months Ended March 31, 2009          Basis     Basis
    ---------------------------------        --------  ---------

    Revenues
      Management fees                        $146,275   $146,275
      Incentive income                             32         32
      Other revenues                            1,519      1,519
      Income of consolidated Och-Ziff funds         -          1
                                                  ---        ---
      Total Revenues                          147,826    147,827
                                              -------    -------

    Expenses
      Compensation and benefits                24,034     52,955
      Allocations to non-equity partner
       interests                                    -     (1,850)
      Reorganization expenses                       -    425,584
      Profit sharing                                -       (834)
      Interest expense                         10,817     10,817
      General, administrative and other        24,437     25,775
      Expenses of consolidated Och-Ziff funds       -        360
                                                  ---        ---
      Total Expenses                           59,288    512,807
                                               ------    -------

    Other Loss
      Net earnings (losses) on deferred
       balances and investments in
       Och-Ziff funds and joint ventures       (4,069)    (5,164)
      Net losses of consolidated Och-Ziff
       funds                                        -       (913)
                                                 ----       ----
      Total Other Loss                         (4,069)    (6,077)
                                               ------     ------

    Income (Loss) Before Income Taxes          84,469   (371,057)
    Income taxes                                    -      3,226
                                               ------      -----
    Consolidated Net Income (Loss)            $84,469  $(374,283)
                                              =======  =========
    Net Income (Loss) Allocated to
     Partners' and Others' Interests in
      Income of Consolidated Subsidiaries        $210  $(106,165)
                                                 ====  =========

    Net Income (Loss) Allocated to Parent     $84,259  $(268,118)
                                              =======  =========

    (1) See Exhibit 5 for a description of the adjustments made to arrive
        at total Company U.S. GAAP Net Income (Loss).



                                      Exhibit 5
                           OCH-ZIFF CAPITAL MANAGEMENT GROUP LLC
      Description of Adjustments Made to Reconcile Economic Income to U.S.
                                      GAAP Net Loss

    Funds Consolidation
    Economic Income excludes the impacts of consolidated Och-Ziff funds,
    including the related eliminations.

    Other Adjustments
    (a) Economic Income presents management fees net of recurring assets
    under management placement fees, as management considers these fees
    a reduction in management fees, not as an expense.

    (b) Economic Income recognizes deferred cash compensation expense in the
    period in which it is awarded, as management determines the total amount
    of compensation based on the Company's performance in the year of the
    award.

    (c) Economic Income excludes equity-based compensation expense, as
    management does not consider these expenses when evaluating the
    performance of the Company.

    (d) Economic Income excludes allocations to non-equity partner interests.
    Management reviewed the performance of the Company before it made any
    allocations to the Company's non-equity founding partners for periods
    prior to the Reorganization.  For these periods, allocations to the
    founding partners, other than Mr. Och, were treated as expenses for U.S.
    GAAP purposes.  Following the Reorganization, only allocations related
    to earnings on previously deferred incentive income allocations to non-
    equity partner interests are incurred and these allocations are excluded
    from Economic Income.

    (e) Economic Income excludes Reorganization expenses, which are non-cash
    expenses directly attributable to the reclassification of interests held
    by the founding partners and the Ziffs prior to the Reorganization as
    Och-Ziff Operating Group A Units.

    (f) Economic Income excludes the profit sharing expense related to the
    Ziffs' interest in the Company.  Management reviewed the performance of
    the Company before it made any allocations to the Ziffs for periods prior
    to the Reorganization.  Following the Reorganization, only profit sharing
    expense related to the allocation of earnings on previously deferred
    incentive income allocations to the Ziffs are incurred and these
    allocations are excluded from Economic Income.

    (g) Economic Income excludes depreciation, changes in the tax receivable
    agreement liability and income taxes, as management does not consider
    these items when evaluating the performance of the Company.

    (h) Economic Income excludes the net earnings (losses) on the deferred
    income receivable from Och-Ziff funds and net earnings (losses) on
    investments in Och-Ziff funds, as these amounts primarily relate to
    earnings (losses) on amounts due to affiliates for deferred or reinvested
    incentive income previously allocated to the founding partners and the
    Ziffs, and earnings (losses) on amounts due to employees under deferred
    cash compensation arrangements.

    (i) Economic Income excludes amounts allocated to the partners and the
    Ziffs on their interests in the Och-Ziff Operating Group, as management
    reviews the performance of the Company at the Och-Ziff Operating Group
    level.  The Company conducts substantially all of its activities through
    the Och-Ziff Operating Group.  Additionally, Economic Income excludes
    amounts allocated to investors in consolidated Och-Ziff funds, as
    Economic Income excludes the impacts of consolidated Och-Ziff funds.


                                   Exhibit 6
                     OCH-ZIFF CAPITAL MANAGEMENT GROUP LLC
          Reconciliation of Economic Income to Distributable Earnings
                                  (Unaudited)
               (dollars in thousands, except per share amounts)

                                                       Three Months Ended
                                                            March 31,
                                                       ------------------
                                                         2009         2008
                                                         ----         ----
    Total Economic Income                             $44,511      $84,259
    Adjusted income taxes(1)                          (17,325)     (34,546)
                                                      -------      -------
    Distributable Earnings                            $27,186      $49,713
                                                      =======      =======

    Distributable earnings                            $27,186      $49,713
    Weighted-Average Adjusted Class A Shares(1)   403,114,691  399,143,178
                                                  -----------  -----------
    Distributable Earnings Per Share                    $0.07        $0.12
                                                        =====        =====

    (1) Includes 76,547,204 and 74,138,572 weighted-average Class A
     Shares and, assumes the conversion of 311,099,524 weighted-average
     Group A Units held by the Company's partners and the Ziffs, and
     15,467,963 and 13,905,082 weighted-average RSUs for the three months
     ended March 31, 2009 and 2008, respectively, into Class A Shares on a
     one-to-one basis.


                              Exhibit 7
                OCH-ZIFF CAPITAL MANAGEMENT GROUP LLC
                  Financial Supplement (Unaudited)
                        (dollars in millions)

                                                    Three Months
                                                   Ended March 31,
                                                  ---------------
                                                        2009
                                                        ----
    Total Assets Under Management (1)
      Beginning of Period Balance                    $26,955
      Net Flows                                       (5,087)
      Appreciation (Depreciation) (2)                    733
                                                         ---
      End of Period Balance                          $22,601
                                                     =======

    Total Assets Under Management by Fund
      OZ Master Fund                                 $14,346
      OZ Europe Master Fund                            3,504
      OZ Asia Master Fund                              1,707
      OZ Global Special Investments Master Fund        1,904

    Och-Ziff Funds - Net Returns (3)
      OZ Master Fund                                     4.4%
      OZ Europe Master Fund                             -0.2%
      OZ Asia Master Fund                                4.4%
      OZ Global Special Investments Master Fund          0.7%


                                                 Year Ended December 31,
                                                 -----------------------
                                             2008     2007     2006     2005
                                             ----     ----     ----     ----
    Total Assets Under Management (1)
      Beginning of Period Balance         $33,387  $22,621  $15,627  $11,251
      Net Flows                              (722)   7,591    4,135    3,117
      Appreciation (Depreciation) (2)      (5,710)   3,175    2,859    1,259
                                           ------    -----    -----    -----
      End of Period Balance               $26,955  $33,387  $22,621  $15,627
                                          =======  =======  =======  =======

    Total Assets Under Management by
     Fund
      OZ Master Fund                      $16,396  $19,771  $15,449  $12,001
      OZ Europe Master Fund                 5,084    6,416    3,481    1,887
      OZ Asia Master Fund                   2,439    3,852    2,332      605
      OZ Global Special Investments Master
       Fund                                 1,910    2,082      195       43

    Och-Ziff Funds - Net Returns (3)
      OZ Master Fund                        -15.9%    11.5%    14.8%     8.8%
      OZ Europe Master Fund                 -17.4%    14.8%    22.3%    15.7%
      OZ Asia Master Fund                   -30.9%    12.2%    14.0%    14.2%
      OZ Global Special Investments Master
       Fund                                  -8.3%    17.2%    13.9%     0.2%

    (1) Includes deferred incentive income receivable from the offshore funds
    and amounts invested by the Company, its partners and certain other
    affiliated parties for which the Company charged no management fees and
    received no incentive income for the periods presented.  Amounts
    presented in this table are not the amounts used to calculate Management
    Fees and Incentive Income for the respective periods.

    (2) Appreciation (depreciation) reflects the aggregate net capital
    appreciation (depreciation) for the entire period and is presented on a
    total return basis, net of all fees and expenses (except incentive income
    on certain unrealized private investments that could reduce returns on
    these investments at the time of realization), and includes the
    reinvestment of all dividends and income.  Management Fees and Incentive
    Income vary by product.  Past performance is no guarantee of future
    results.

    (3) Reflects a composite of the monthly return and year-to-date return
    for the feeder funds comprising each of the Company's most significant
    master funds and is presented on a total return basis, net of all fees
    and expenses of the relevant fund (except incentive income on certain
    unrealized special investments that could reduce returns at the time
    of realization), and includes the reinvestment of all dividends and
    income.  Performance includes realized and unrealized gains and losses
    attributable to certain private and initial public offering investments
    that are not allocated to all investors in the funds.  Investors that do
    not participate in such investments or that pay different fees may
    experience materially different returns.  Past performance is no
    guarantee of future results.


                                          Exhibit 8
                            OCH-ZIFF CAPITAL MANAGEMENT GROUP LLC
                          Returns of OZ Master Fund During Negative
                               Return Months of S&P 500 Index
                                         (Unaudited)


                                 Total Return of
           Number of Months of      S&P 500         Total Return of OZ Master
           Negative Returns      During Negative      Fund During Negative
    Year     of S&P 500           Return Months     Return Months of S&P 500

    1994           3                  -8.5%                    1.7%
    1995           1                  -0.4%                    0.1%
    1996           2                  -6.4%                    3.9%
    1997           3                 -13.1%                    4.0%
    1998           3                 -17.2%                   -2.7%
    1999           5                 -11.8%                    6.2%
    2000           8                 -27.1%                   12.0%
    2001           6                 -33.2%                    0.4%
    2002           8                 -41.9%                   -5.0%
    2003           3                  -5.2%                    4.6%
    2004           3                  -6.4%                    1.1%
    2005           5                  -8.7%                    0.7%
    2006           1                  -2.9%                    0.5%
    2007           5                 -11.6%                    1.4%
    2008           8                 -51.8%                  -16.3%
    1Q09           2                 -19.1%                    3.4%


     Distribution of Net Monthly Returns since April 1, 1994

              Net Monthly Return                      Number of
               of OZ Master Fund                        Months
               -----------------                        ------
                  less than -3%                            5
                     -2% to -3%                            2
                     -1% to -2%                            3
                      0% to -1%                           17
                       0% to 1%                           61
                       1% to 2%                           44
                       2% to 3%                           29
                       3% to 4%                           11
                       4% to 5%                            5
                greater than 5%                            3

    Total net return for the OZ Master Fund (the "Fund") represents a
    composite of the average return of the feeder funds that comprise the
    Fund.  Returns are presented on a total return basis, net of all fees and
    expenses (except incentive income on certain unrealized private
    investments that could reduce returns on these investments at the time
    of realization), and include the reinvestment of all dividends and
    income. Performance includes realized and unrealized gains and losses
    attributable to certain private and initial public offering investments
    that are not allocated to all investors in the Fund.  Investors that do
    not participate in such investments or that pay different fees may
    experience materially different returns.  Past performance is no
    guarantee of future results.

    For the period from 1994 through 1997, performance represents the
    performance of Och-Ziff Capital Management, L.P., a Delaware limited
    partnership that was managed by Daniel Och following an investment
    strategy that is substantially similar to that of the Fund.  In addition,
    during this period, performance was calculated by deducting Management
    Fees on a quarterly basis and Incentive Income on a monthly basis.
    Beginning January 1998, performance has been calculated by deducting both
    Management Fees and Incentive Income on a monthly basis from the
    composite returns of the Fund.

    Readers should not assume that there is any material overlap between
    those securities in the portfolio of the Fund and those that comprise the
    S&P 500 Index.  It is not possible to invest directly in the S&P 500
    Index.  Returns of the S&P 500 Index have not been reduced by fees and
    expenses associated with investing in securities and include the
    reinvestment of dividends.  The S&P 500 Index is an equity index owned
    and maintained by Standard & Poor's, a division of McGraw-Hill, whose
    value is calculated as the free float-weighted average of the share
    prices of 500 large-cap corporations listed on the NYSE and Nasdaq.
    The comparison of S&P 500 Index performance relative to the Fund's
    performance during months in which the S&P 500 Index declined is for the
    limited purpose of illustrating how the Fund has performed during periods
    of declines in the broad equity market.  It should not be considered an
    indication of how the Fund will perform relative to the S&P 500 Index in
    the future.

    Please note that the Fund's investment objective is not to beat the S&P
    500 Index.  Furthermore, the Fund's performance has frequently trailed
    that of the S&P 500 Index in periods of positive performance.



                                   Exhibit 9
                     OCH-ZIFF CAPITAL MANAGEMENT GROUP LLC
                        Fund Performance (Unaudited) (1)

                                                 2008
                                                 ----
                             January  February   March    April      May
                             -------  --------   -----    -----      ---
    Och-Ziff Funds - Net
     Returns
    OZ Master Fund             -1.12%     1.02%  -0.73%      0.96%    1.11%
    OZ Europe Master Fund      -2.00%     0.81%  -0.54%      0.31%    1.69%
    OZ Asia Master Fund        -1.95%     1.78%  -2.41%     -0.18%   -0.16%
    OZ Global Special
     Investments Master Fund   -0.72%     0.57%  -0.45%      0.64%    0.43%

    S&P 500 Index - Total
     Return (2)                -6.00%    -3.25%  -0.43%      4.87%    1.30%


                                                 2008
                                                 ----
                               June     July    August  September  October
                               ----     ----    ------  ---------  -------
    Och-Ziff Funds - Net
     Returns
    OZ Master Fund             -0.45%    -0.59%  -0.58%     -5.41%   -6.71%
    OZ Europe Master Fund       0.20%    -1.35%  -0.38%     -7.22%   -5.12%
    OZ Asia Master Fund        -2.19%    -1.17%  -4.18%     -7.53%  -11.76%
    OZ Global Special
     Investments Master Fund   -0.34%     0.06%  -0.45%     -2.73%   -2.60%

    S&P 500 Index - Total
     Return (2)                -8.43%    -0.84%   1.45%     -8.91%  -16.80%



                                                         2008
                                                         ----
                                              November  December   FY2008
                                              --------  --------   ------
    Och-Ziff Funds - Net Returns
    OZ Master Fund                               -2.35%    -2.02%  -15.92%
    OZ Europe Master Fund                        -2.67%    -2.31%  -17.39%
    OZ Asia Master Fund                          -1.69%    -4.13%  -30.86%
    OZ Global Special Investments Master Fund    -1.72%    -1.22%   -8.27%

    S&P 500 Index - Total Return (2)             -7.18%     1.06%  -37.00%


                                                         2009
                                                         ----
                                         January  February   March      YTD
                                         -------  --------   -----      ---
    Och-Ziff Funds - Net Returns
    OZ Master Fund                          3.09%    0.35%    0.88%    4.36%
    OZ Europe Master Fund                   0.98%   -1.09%   -0.04%   -0.16%
    OZ Asia Master Fund                     2.70%    1.22%    0.38%    4.35%
    OZ Global Special Investments
     Master Fund                            0.84%   -0.49%    0.35%    0.70%

    S&P 500 Index - Total Return (2)       -8.43%  -10.65%    8.76%  -11.01%


    (1) Fund performance reflects a composite of the return for the feeder
    funds comprising each of the Company's most significant master funds and
    is presented on a total return basis, net of all fees and expenses of the
    relevant fund (except incentive income on certain unrealized private
     investments that could reduce returns on these investments at the time
    of realization), and includes the reinvestment of all dividends and
    income. Performance includes realized and unrealized gains and losses
    attributable to certain private and initial public offering investments
    that are not allocated to all investors in the funds.  Investors that do
    not participate in such investments or that pay different fees may
    experience materially different returns.  Past performance is no
    guarantee of future results.

    (2) Readers should not assume that there is any material overlap between
    those securities in the portfolios of the funds and those that comprise
    the S&P 500 Index. It is not possible to invest directly in the S&P 500
    Index.  Returns of the S&P 500 Index have not been reduced by fees and
    expenses associated with investing in securities and include the
    reinvestment of dividends. The S&P 500 Index is an equity index owned and
    maintained by Standard & Poor's, a division of McGraw-Hill, whose value
    is calculated as the free float-weighted average of the share prices of
    500 large-cap corporations listed on the NYSE and Nasdaq. The comparison
    of S&P 500 performance relative to the funds' performance should not be
    considered an indication of how the fund will perform relative to the S&P
    500 in the future. Please note that the funds' investment objective is
    not to beat the S&P 500 Index. Furthermore, the funds' performance has
    frequently trailed that of the S&P 500 Index in periods of positive
    performance.

SOURCE Och-Ziff Capital Management Group LLC