"June, 2001

Dear Investor,

The purpose of this mailing is to notify our shareholders of a change in the

Administrator of P.A.W. Offshore Fund, Ltd. (the "Fund"). The Fund has ended

its Administration Agreement with Fortis Fund Services (Bahamas) Limited

Effective July 1, 2001, The Fund will be administered by Citco Fund Services

(Bermuda) Limited.

The Fund will have its principal office changed to the offices of Citco Fund

Services (Bermuda) Limited in Bermuda, and will maintain its registered office

in the Bahamas. Arthur Andersen has been hired to audit the Fund for the fiscal

year ending June 30, 2002.

A new Confidential Explanatory Memorandum for P.A.W. Offshore Fund Limited is

attached.

Specific changes in the Offering Memorandum are as follows:

1) Changes in Directors, Contact and Banking Information to reflect the

changes in

Administrator and Auditor.

2) Modification to Section 9. (iv)(e) to provide for the use of

independent "fair value" prices for certain illiquid securities.

3) Changes to Appendix A to clarify the description of Equalization (no

calculations affected).

Please note that any new subscriptions by shareholders for Shares in the Fund

for the July 1 subscription date should be sent to Citco Fund Services (Bermuda)

Limited, and wire transfer payments should be sent to the Fund's new

subscription account, details of both of which appear in the enclosed 1-page

summary.

Enclosed is a 1-page summary of the Administrator, Banking and Investment

Advisor information for your records. Please call Ian Pilgrim at Citco Fund

Services (Bermuda) Limited (441-295-7149), or John Ernenwein at P.A.W. Capital

Partners (203-531-5694) if you have any further questions.

Best Regards,

John Ernenwein, PAW Partners

Ian Pilgrim, Citco

P.A.W. Offshore Fund Limited

Administrator:

Name: Citco Fund Services (Bermuda) Limited

Address: Wessex House, 5th Floor

45 Reid Street

Hamilton HM12, Bermuda

Phone: 441-295-7149

Fax: 441-295-0992

Shareholder Services: Rachael Sousa

Phone: 441-294-1634

Email Address: rsousa@citco.com

Operations Manager: Brian Francoeur

Phone: 441-294-1632

Email Address: bfrancoeur@citco.com

Managing Director: Ian Pilgrim

Phone: 441-294-1630

Email Address: ipilgrim@citco.com

Banking Information:

Effective June 15, 2001, wire transfer payments for investments in the Fund

should be paid

to:

Chase Manhattan Bank New York

ABA# 021000021

Account of Citco Banking Corporation, N.V.

Account# 001-1-627502

Further Credit to: P.A.W. Offshore Fund Limited

Account # 0012-522105-200

Reference: {Shareholder Name}

Investment Advisor:

Name: P.A.W. Capital Partners, LP

Address: 10 Glenville Street

Greenwich , CT 06831 USA

Chief Operating Officer/Director: John Ernenwein

Phone: 203-531-5694

Fax: 203-531-8932

Email Address: jernenwein@pawpartners.com"