Hedge fund compensation is typically less complicated than private equity fund compensation: partners receive a share in a fund’s distributable profits while portfolio managers negotiate over levels of guaranteed compensation, expenses that are covered under the definition of “net profits” and their “buying power.” Private fund managers also routinely utilize non-compete agreements to bind employees, and although certain states disfavor non-compete agreements, they are generally enforceable. A recent program hosted by Brian T. Davis and Dimitri G. Mastrocola, partners at international recruiting firm Major, Lindsey & Africa (MLA), and featuring McDermott Will & Emery partners Ian M. Schwartz, Evan A. Belosa and Alejandro Ruiz, discussed these issues, among others. This article, the second in a two-part series, explores hedge fund compensation, including profit shares, and restrictive employment covenants. The first article discussed carried interest, taxation thereof and deferred compensation arrangements. For coverage of recent compensation surveys, see “RCA Compensation Trends Panel Discusses Strong Market for Private Fund Compliance and Legal Personnel” (Jan. 25, 2018); and “2017 Compliance Salary Survey: How Do Fund Managers Compare?” (Jan. 4, 2018). For additional commentary from Schwartz, see “Private Equity in 2017: How to Seize Upon Rising Opportunity While Minimizing Compliance and Market Risk” (Jun. 8, 2017). For coverage of a prior program hosted by MLA, see our two-part series featuring commentary from former SEC attorneys: “Chair Clayton’s Priorities and the Current Enforcement Climate” (Dec. 7, 2017); and “Current Regulatory Climate, Adviser Examinations and the Enforcement Referral Process” (Dec. 21, 2017).