Item 5 – Fees and Compensation
A. Describe how you are compensated for your advisory services. Provide your fee schedule. Disclose
whether the fees are negotiable.
Simplon International pays TAMCO an annual management fee and a performance fee (if
applicable) on an annual basis. The management fee amounts to 0.714% per annum of Simplon
International’s Net Asset Value. The management fee is paid quarterly in advance and calculated on the
basis of Simplon International’s Net Asset Value at the beginning of each calendar quarter. TAMCO is
entitled to be paid a performance fee equal to 20% of annual profits above a 5% cumulative, compound
preferred return to investors. In other words, unless and until investors receive a 5% compound return on
their investment, no performance fee is due and payable. Simplon International is also charged an annual
administration fee of 0.1% by its administrator, Fidinam (Monte Carlo) SAM. During the period Simplon
International is in liquidation, it is subject to the same fees as aforementioned. During the period Simplon
Partners L.P. is in liquidation, it is not subject to any management or performance fees.
B. Describe whether you deduct fees from clients’ assets or bill clients for fees incurred. If clients may
select either method, disclose this fact. Explain how often you bill clients or deduct your fees.
The management fee of 0.714%, and the administrative fee of 0.1%, are paid quarterly in
advance, calculated on the basis of Simplon International's Net Asset Value at the beginning of each
calendar quarter, and are deducted from its assets.
The performance fee is drawn from the fund’s assets at the beginning of the year succeeding each
year in which the fund’s performance is sufficient for TAMCO to earn a performance fee.
During its liquidation, Simplon International will be subject, starting January 1, 2019, to its
management fee, administrative fee, and performance fee (if earned).
During its liquidation, Simplon Partners has not been and will not be charged for management or
performance fees.
C. Describe any other types of fees or expenses clients may pay in connection with your advisory
services, such as custodian fees or mutual fund expenses. Disclose that clients will incur brokerage and
other transaction costs, and direct clients to the section(s) of your brochure that discuss brokerage.
Auditing and transaction-related legal fees are passed on to investors. Brokerage fees become
part of each investment’s cost basis. For further discussion concerning brokerage, see Items 12 and 13
below.
D. If your clients either may or must pay your fees in advance, disclose this fact. Explain how a client may
obtain a refund of a pre-paid fee if the advisory contract is terminated before the end of the billing
period. Explain how you will determine the amount of the refund.
Prior to adoption of its plan of liquidation, investors in Simplon International could redeem their
shares only on June 30th and December 31st on sixty days’ notice. On those dates, any pre-paid quarterly
fees would have been entirely amortized. Accordingly there is no occasion for a refund of a pre-paid fee.
E. If you or any of your supervised persons accepts compensation for the sale of securities or other
investment products, including asset-based sales charges or service fees from the sale of mutual funds,
disclose this fact and respond to Items 5.E.1, 5.E.2, 5.E.3 and 5.E.4.
1. Explain that this practice presents a conflict of interest and gives you or your supervised persons an
incentive to recommend investment products based on the compensation received, rather than on a
client’s needs. Describe generally how you address conflicts that arise, including your procedures for
disclosing the conflicts to clients. If you primarily recommend mutual funds, disclose whether you will
recommend “no-load” funds. Explain that clients have the option to purchase investment products that
you recommend through other brokers or agents that are not affiliated with you.
2. If more than 50% of your revenue from advisory clients results from commissions and other
compensation for the sale of investment products you recommend to your clients, including asset-based
distribution fees from the sale of mutual funds, disclose that commissions provide your primary or, if
applicable, your exclusive compensation.
3. If you charge advisory fees in addition to commissions or markups, disclose whether you reduce your
advisory fees to offset the commissions or markups.
Neither TAMCO nor its employees receive, directly or indirectly, any compensation from the sale of
securities or investments that are purchased or sold for either of the Funds. TAMCO is compensated, as
described above, exclusively through the stated management fee and performance compensation agreed
upon in the governing documents of the respective Funds. Accordingly, TAMCO believes that it does not
have any conflicts of interest regarding the receipt of additional compensation relating to the Funds.