Item 5 – Fees and Compensation
A. Fees
PRIVATE FUND MANAGEMENT. The Firm receives, as compensation for its services,
a management fee, payable each month, at an annual rate of 1.00% of the net asset value
of the Fund (before fees have been assessed) for the month on which payment is being
made. The Firm also receives, as compensation for performance, an incentive fee, payable
each month, at an annual rate of 10.0% of the Managed Fund's new high net profits per
share per series of shares for the then current calendar year multiplied by the number of
outstanding shares per series.
SEPARATELY MANAGED ACCOUNTS. For advisory services to the SMA, the Firm
charges a management fee, estimated and accrued monthly in arrears, and payable
quarterly, at an annual rate of 1.00% of the net asset value of the SMA (before fees have
been assessed) for the month of the estimation. The Firm also charges, as compensation
for performance, an incentive fee, calculated and accrued each calendar month and paid
quarterly, at an annual rate of 10.0% of each SMA’s new historic high net profits. Fees are
non-negotiable.
LOWER FEE DISCLOSURE. Lower fees for comparable management services may be
available from other sources.
B. Termination of Service
Agreements for SMA services commence on the effective date and continue in effect until
the date on which the agreement is terminated. The agreement is subject to immediate
termination at any time by the client for “Cause” which means (i) a material violation of
law, (ii) intentional misconduct or gross negligence, (iii) a breach of a material provision
of the agreement, (iv) an occurrence of a Key Man Event (which term is described in the
agreement), (v) the issuance to the client of a Regulatory Notice by the Firm, and (vi) a
change in control of the Firm. The agreement is also subject to termination at any time by
Interamerican Advisors, Inc.
Form ADV Part 2A Brochure
the client or the Firm upon 31 days’ prior written notice to the Firm or client, respectively.
Upon termination and with client authorization, the Firm shall conduct an orderly
disposition and/or transfer of all account positions.
C. Other Fees
All expenses incurred directly in connection with the transactions effected for positions
held in the SMA on behalf of the client pursuant to the agreement (including, without
limitation, trading losses, custodial fees, brokerage commissions, costs of the third party
valuation services, bank service fees, interest expenses and expenses related to proposed
investments that have not been consummated and income, withholding or transfer taxes)
are paid from the account or reimbursed by the client. Any expenses attributable to the
client and one or more other accounts managed or advised by the Firm or any of its affiliates
will be allocated on an equitable basis among all such accounts.
Any expenses arising in connection with the Firm’s services to the client, other than those
specified above and the fees payable to the Firm, are the responsibility of the Firm.
Neither the Firm nor any of its personnel receive any portion of any other fees or expenses
charged.
D. Broker/Dealer Charges
Item 12 further describes the factors that Interamerican considers in selecting
broker/dealers for client transactions and determining the reasonableness of their
compensation (e.g., commissions).