Item 5 – Fees and Compensation
LAM’s income is derived from investment management fees and incentive payments, where
applicable. The fee schedules for separate accounts and the funds are described below.
SEPARATE ACCOUNTS
Fees for accounts other than the funds are charged quarterly, typically in arrears, and are based
upon a percentage of the net asset value of the account. For purposes of computing the fee (when
based on assets under management), the value of securities and cash, adjusted for payables and
receivables, in the client's account is equal to the market value of the securities at the market close
on the last day of the billing period or, in the absence of a market value, the fair value as determined
in good faith by LAM.
LAM is entitled to asset-based fees and performance-based fees for separate accounts managed in
accordance with micro-cap or concentrated products. Fees begin at 1% of assets under
management, apportioned quarterly throughout the year, and accounts are subject to an incentive
allocation of 10% of net profits paid at year-end, subject to a "high water mark."
The annual fee for separate accounts managed in accordance with the Smaller Cap product begin
at 1% annually of assets under management and a performance fee equal to 15% of the excess
performance over the Russell 2000 Index, subject to a “high water mark.”
The annual fee schedule for separate accounts managed in accordance with SMID cap product
begins at 1%.
THE FUNDS
Investment management fees for the funds are paid monthly, in advance, and are due at the start
of each month. The fees are based on the assets in the respective funds at the beginning of each
billing period. In addition to management fees, certain funds may be required to pay LAM an
incentive allocation equal to 10% of net profits allocated to them in any fiscal year, subject to a
"high water mark." Incentive allocation arrangements are in compliance with the Investment
Advisers Act of 1940 and regulations promulgated thereunder. Fees charged to fund Investors
are neither negotiable nor refundable. No investment advisory fees are charged to retirement
accounts of employees of LAM, or their immediate family members.
Dovetail Equity Partners - LAM is the general partner and investment adviser to Dovetail Equity
Partners, L.P. ("Dovetail"), an investment fund whose partners are primarily individuals. Dovetail
primarily invests in small/mid-capitalization stocks. Dovetail's investment fees are 1 1/2%
annually. The fees are taken out of the fund at a rate of 1/8 of 1% per month, based on assets under
management and determined as described above. Additional information on Dovetail can be found
in the Offering Memorandum.
Einbeita Partners - LAM is the general partner and investment adviser to Einbeita Partners, L.P.
("Einbeita"). Einbeita primarily invests in a concentrated portfolio of small/mid-capitalization
stock. The investment management fee is 1% annually. The fee is taken out of the fund at a rate
of 1/12 of 1% per month, based on assets under management and determined as described above.
Additional information on the Einbeita Partnership can be found in the Offering Memorandum for
the fund.
In addition to management fees, Einbeita pays LAM an incentive allocation equal to 10% of the
net profits allocated to its limited partners in any calendar year, subject to a "loss carryforward"
provision, sometimes referred to as a "high water mark."
microLAM Partners - LAM is the general partner and investment adviser to microLAM Partners,
L.P. ("microLAM"). microLAM primarily invests in micro capitalization stocks. The investment
management fee is 1% annually. The fees are taken out of the respective funds at a rate of 1/12 of
1% per month, based on assets under management and determined as described above. Additional
information on microLAM can be found in the Offering Memorandum.
In addition to management fees, microLAM pays LAM an incentive allocation equal to 10% of
the net profits allocated to its limited partners in any year, subject to a "loss carryforward"
provision, sometimes referred to as a "high water mark.”
Ti Bouchon Partners - LAM is the general partner and investment adviser to Ti Bouchon Partners,
L.P. (“Ti Bouchon”). Ti Bouchon primarily invests in smaller capitalization stocks. The
investment management fee is 1% annually. The fees are taken out of the respective funds at a
rate of 1/12 of 1% per month, based on assets under management and determined as described
above. Additional information on Ti Bouchon can be found in the Offering Memorandum.
In addition to management fees, Ti Bouchon is required to pay LAM an incentive allocation equal
to 10% of the net profits allocated to its limited partners in any year, subject to a "loss
carryforward" provision, sometimes referred to as a "high water mark.”
Tucek Partners - LAM is the general partner and investment adviser to Tucek Partners, L.P.
(“Tucek”). Partners in this investment fund are primarily individuals. Tucek invests primarily in
small capitalization stocks. The investment fee is 1 1/2 % annually. The fee is taken out of the
fund at a rate of 1/8 of 1% per month, based on assets under management and determined as
described above. Tucek has been managed exclusively by Steven M. Wilson since Tucek began in
1990. Additional information on Tucek can be found in the Offering Memorandum for the fund.
Fee Payment Options
LAM typically bills separate accounts quarterly, in arrears. Unless otherwise stated, fees are based
on assets under management, which is defined as the market value of securities and cash, adjusted
for payables and receivables, in the client's account on the last day of the billing period. In the
event of an account's termination, fees are assessed on a pro-rata basis, unless the investment
agreement provides otherwise. LAM may amend its fee schedule from time to time.
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