Governance &
Structure

Permanent capital. Structured to perform.

Tetragon is a Guernsey closed-ended investment company, with an external investment manager, Tetragon Financial Management LP. The company is listed on Euronext in Amsterdam N.V. and traded on the Specialist Fund Segment of the Main Market of the London Stock Exchange.

Our structure

Types of shareholder Listed entity External manager Ways we invest      Investments in managed funds      Ownership stakes in asset managers      Direct investments TFG Asset Management Non-voting public shareholders (Euronext, SFS London Stock Exchange) Tetragon Financial Group Limited $2.8bn Net Asset Value* Permanent capital Tetragon Financial Group’s investment manager Tetragon Financial Management LP Direct investments Externally managed funds Investments in managed funds TFG Asset Management $37bn Assets Under Management* Ownership stakes in asset managers
Non-voting public shareholders (9) Tetragon Financial Management LP Tetragon Financial Group’s investment manager (Euronext, SFS London Stock Exchange) Tetragon Financial Group Limited Non-voting public shareholders TFG Asset Management $37bn Assets Under Management Types of shareholder Listed entity External manager Ways we invest       Investments in managed funds       Ownership stakes in asset managers       Direct investments TFG Asset Management Externally managed funds Internal funds $2.8bn Net Asset Value Permanent capital (2) Ownership stakes in asset managers Direct investments Investments in managed funds
Capital Structure

Tetragon has an authorised share capital of $1,000,000 divided into 10 voting shares, having a par value of $0.001 each, and 999,999,990 non-voting shares, or Shares, having a par value of $0.001 each. The Shares are listed on Euronext Amsterdam N.V. under the ticker symbol “TFG.NA” and on the Specialist Fund Segment of the Main Market of the London Stock Exchange plc under the symbols “TFG.LN” and “TFGS.LN”. The 10 voting shares in issue were issued at par and are owned by Polygon Credit Holdings II Limited, or the Voting Shareholder, which is a non-U.S. affiliate of Tetragon’s investment manager and is ultimately controlled by Reade Griffith and Paddy Dear. Tetragon’s voting shares are the only shares of Tetragon entitled to vote for the election of Tetragon’s board of directors and on all other matters, subject to the limited rights of the Shares described in Tetragon’s Memorandum and Articles of Incorporation. Tetragon’s voting shares are not entitled to receive dividends.

Except as described in Tetragon’s Memorandum and Articles of Incorporation, the Shares are not entitled to vote on any matter. The Shares carry a right to any dividends or other distributions declared by Tetragon.

Memorandum and Articles of Incorporation

31 Dec 2018 – Memorandum and Articles of Incorporation Download PDF

Our Board

The Board of Directors currently comprises five Directors, including three Independent Directors.

Steven Hart

Independent Director

Read more

Steven Hart

Independent Director

Steven Hart serves as president of Hart Capital LLC, which he founded in 1998 as a family office to invest in a diversified portfolio of assets with a strong education industry focus. Steven was the co-owner (1999-2010) and member of the Board of Directors (1999-2007) of Lincoln Educational Services Corporation. From 1983 to 1997, he was co-founder of a family-owned conglomerate where he acquired and managed manufacturing and distribution companies involved in automotive, printing, apparel and industrial textiles, electronics, synthetic foam, and home furnishing industries. Steven served as chairman of the State of Connecticut Investment Advisory Council from 1995 to 2003, which oversees the State of Connecticut Retirement Plans and Trust Funds, and, as a trustee (1996-2003), and chairman (2003) of the Stanford University Graduate School of Business Endowment Trust. From 2011-2020, he served as a member of the Boards of Directors of several funds connected with Blue Harbour Group, L.P. Steven earned an M.B.A. degree from Stanford University Graduate School of Business and a B.A. degree in Math/Economics from Wesleyan University.

David O’Leary

Independent Director

Read more

David O’Leary

Independent Director

David O’Leary retired from State Street Corporation in Boston, Massachusetts in 2012, where he was Executive Vice President – Chief Administrative Officer (2010-2012) and Executive Vice President – Global Head of Human Resources (2005-2010). At State Street, he managed a global team of 325 staff across 15 countries and was a member of its 10-person Operating Group and Management Committee, reporting directly to its Chief Executive Officer. From 1985 to 2004, David was at Credit Suisse First Boston, serving as Managing Director, Global Head of Human Resources from 1988 to 2003, where he managed a global team of 250 staff in 13 countries responsible for all aspects of Human Resources in the Americas, Europe, and Asia. David began his career in financial services at Merrill Lynch & Company in New York, where he was Vice President – Executive Compensation from 1981 to 1985. He earned a M.B.A. degree from the University of Massachusetts, where he graduated first in his class, a M.S. degree from the State University of New York and a B.S. degree from Union College.

Deron J. Haley

Independent Director

Read more

Deron J. Haley

Independent Director

Deron Haley, also known as D.J., is a founding Partner and Chief Operating Officer at Durational Capital Management, LP, a New York-based private equity firm that specializes in consumer buy-outs. Prior to Durational Capital Management, he was the Chief Operating Officer of Hound Partners, LLC, a New York-based global equity fund. Prior thereto, he was a senior executive of Ziff Brothers Investments, LLC, a global, single-family office that invested directly in private and public equities, fixed income, global-macro, and commodities, and led firm-wide operational and management initiatives. D.J. began his finance career as an equity research analyst, and later a registered trader before taking on senior managerial roles. Prior to finance, he served five years active duty in the United States Navy. He is a founding Director of the Navy SEAL Foundation, and sits on the Investment Committee of The Heinz Endowments. D.J. recently served as an independent director on the Boards of Directors of several funds managed by TFG Asset Management. He holds a B.S. degree in Mechanical Engineering from Carnegie Mellon University in Pittsburgh and a M.B.A. degree from Harvard Business School.

paddy-dear

Paddy Dear

Tetragon Co-Founder

Read more
paddy-dear

Paddy Dear

Tetragon Co-Founder

Paddy Dear co-founded Tetragon in 2005, is based in London and is a member of Tetragon’s Board of Directors and its investment manager’s Investment and Risk Committee.

Prior to co-founding Tetragon in 2005, Paddy co-founded Polygon, a multi-strategy hedge fund management business, in 2002. In 2012, Tetragon acquired Polygon and it became part of TFG Asset Management, Tetragon’s diversified alternative asset management business – which now has more than $37 billion of assets under management.(9)

Paddy received a BSc in Petroleum Engineering from Imperial College London, graduating top of his year. He started his career as a Petroleum Engineer with Marathon Oil working in London, Denver and offshore in the North Sea. He later moved into finance and prior to setting up Polygon was a Managing Director at UBS Investment Bank, where he worked for 14 years in London and New York.

Paddy believes strongly in the importance of educational opportunity and was a beneficiary of a bursary at Winchester College himself. To this end much of Paddy’s charitable giving has an educational and social mobility focus. He also actively supports and mentors young, aspiring UK entrepreneurs with a special interest in those with a technology bias and a social benefit.

Paddy, together with his wife Janie, are livestock farmers in Gloucestershire and Scotland and are advocates for local, sustainable, regenerative farming methods.

Paddy is a fan of the arts and is supporter of the National Gallery and the Royal Opera House. He continues to be an avid and active sportsperson in particular tennis, cycling, skiing, and hiking.

Reade Griffith

Tetragon Co-Founder and
Chief Investment Officer

Read more

Reade Griffith

Tetragon Co-Founder and
Chief Investment Officer

Reade Griffith is Co-Founder and Chief Investment Officer of Tetragon Financial Group and TFG Asset Management. Reade is also a member of Tetragon’s Board of Directors.

Prior to co-founding Tetragon in 2005, Reade co-founded Polygon, a multi-strategy hedge fund management business, in 2002. In 2012, Tetragon acquired Polygon and it became part of TFG Asset Management, Tetragon’s diversified alternative asset management business – which now has more than $37 billion of assets under management(9).

In addition to his roles at Tetragon and TFG Asset Management, Reade continues to manage Polygon’s European Event-Driven Equities strategy.

Reade holds an A.B. degree in Economics from Harvard College and a J.D. degree from Harvard Law School. Reade also served as an officer in the U.S. Marine Corps and left as a Captain following the 1991 Gulf War. Reade was previously the founder and chief executive officer of the European office of Citadel Investment Group, a multi-strategy hedge fund that he joined in 1998.

Reade is currently a member of the Dean’s Advisory Board at Harvard Law School and was a member of the Financial Sector Forum at the Bank of England from 2017 until 2020.

Reade is based in London with his wife, Elizabeth, and their three daughters. Reade and Elizabeth have a strong interest in creating educational and athletic opportunities for young people, having benefitted from being club and varsity sport participants during their time as Harvard undergraduates. Together they have endowed a fund to support Harvard’s efforts to promote inclusion and broaden access to organized sports and recreational activity. Their education-focused philanthropy also includes funding a 100% bursary in perpetuity at St Paul’s Girls’ School in London.

Reade is passionate about fly fishing and tennis, and, together with Elizabeth, manages a farm in Gloucestershire focused on sustainable and regenerative methods to encourage biodiversity in the environment.

Size, Independence and Composition of the Board of Directors of Tetragon

The structure, practices and committees of the Board of Directors of Tetragon, including matters relating to the size, independence and composition of the Board of Directors, the election and removal of Directors, requirements relating to board action and the powers delegated to board committees, are governed by Tetragon’s Memorandum and Articles of Incorporation.

Tetragon has five directors, or the Directors. As set out below and as elsewhere described in the risk factors found on Tetragon’s website at www.tetragoninv.com/investors/risk-factors, not less than a majority of the Directors are independent. A Director will be an “Independent Director” if the Board of Directors determines that the person satisfies the standards for independence contained in the Corporate Governance Code 2018 in all material respects. If the death, resignation or removal of an Independent Director results in the Board of Directors having less than a majority of Independent Directors, the vacancy must be filled promptly. Pending the filling of such vacancy, the Board of Directors may temporarily consist of less than a majority of Independent Directors and those Directors who do not meet the standards for independence may continue to hold office.

A Director who is not an Independent Director will not be required to resign as a Director as a result of an Independent Director’s death, resignation or removal. In addition, Tetragon’s Memorandum and Articles of Incorporation prohibit the Board of Directors from consisting of a majority of Directors who are resident in the United Kingdom.

Election and Removal of Directors of Tetragon

Each member of Tetragon’s Board of Directors is elected annually by the holder of Tetragon’s voting shares. All vacancies on the Board of Directors, including by reason of death or resignation, may be filled, and additional Directors may be appointed, by a resolution of the holder of Tetragon’s voting shares.

A Director may be removed from office for any reason by notice requesting resignation signed by all other Directors then holding office, if the Director is absent from four successive meetings without leave expressed by a resolution of the Directors or for any reason by a resolution of the holder of Tetragon’s voting shares. A Director will also be removed from the Board of Directors if they become bankrupt, if they become of unsound mind, if they become a resident of the United Kingdom and such residency results in a majority of the Board of Directors being residents of the United Kingdom or if they become prohibited by law from acting as a Director. A Director is not required to retire upon reaching a certain age.

Action by the Board of Directors of Tetragon

The Board of Directors of Tetragon may take action in a duly convened meeting, for which a quorum is five Directors, or by a written resolution signed by at least five Directors. When action is to be taken by the Board of Directors, the affirmative vote of five of the Directors then holding office is required for any action to be taken. As a result, the Board of Directors will not be able to act without the affirmative vote of both of the Directors affiliated with the holder of Tetragon’s voting shares.

The Directors are responsible for the management of Tetragon. They have delegated to the investment manager certain functions, including broad discretion to adopt an investment strategy to implement Tetragon’s investment objective. However, certain matters are specifically reserved for the Board of Directors under the Memorandum and Articles of Incorporation.

Transactions in which a Director has an Interest

Provided that a Director has disclosed to the other Directors the nature and extent of any such Director’s interests in accordance with the Companies (Guernsey) Law, 2008, as amended, a Director, notwithstanding his office: (a) may be a party to, or otherwise interested in, any transaction or arrangement with Tetragon or in which Tetragon is otherwise interested; (b) may be a director or other officer of, or employed by, or a party to any transaction or arrangement with, or otherwise interested in, any body corporate promoted by Tetragon or in which Tetragon is otherwise interested; and (c) shall not be accountable to Tetragon for any benefit derived from any such transaction or arrangement or from any interest in any such body corporate, and no such transaction or arrangement shall be void or voidable on the grounds of any such interest or benefit or because such Director is present at or participates in the meeting of the Directors that approves such transaction or arrangement, provided that (i) the material facts as to the interest of such Director in such transaction or arrangement have been disclosed or are known to the Directors and the Directors in good faith authorise the transaction or arrangement and (ii) the approval of such transaction or arrangement includes the votes of a majority of the Directors that are not interested in such transaction or such transaction is otherwise found by the Directors (before or after the fact) to be fair to Tetragon as of the time it is authorised. Under the Investment Management Agreement, the Directors have authorised the investment manager to enter into transactions on behalf of Tetragon with persons who are affiliates of the investment manager, provided that in connection with any such transaction that exceeds $5 million of aggregate investment the investment manager informs the Directors of such transaction and obtains either (i) the approval of a majority of the Directors that do not have a material interest in such transaction or (ii) an opinion from a recognised investment bank, auditing firm or other appropriate professional firm substantively to the effect that the financial terms of the transaction are fair to Tetragon from a financial point of view.

Compensation

The remuneration for Directors is determined by resolution of the holder of Tetragon’s voting shares.

Currently, the Directors’ annual fee is $125,000, in compensation for service on the Board of Directors of Tetragon. The Directors affiliated with the holder of Tetragon’s voting shares have waived their entitlement to a fee. The Directors are entitled to be repaid by Tetragon for all travel, hotel and other expenses reasonably incurred by them in the discharge of their duties.

On 1 January 2020, the Independent Directors were awarded shares each in Tetragon which vested on 31 December 2022. The fair value of the award, as determined by the share price on grant date of $12.25 per share, was $300,000 per Independent Director. In November 2022, a further 7,724 shares were awarded to each Independent Director with one-third of the shares vesting on each of 31 December 2023, 31 December 2024 and 31 December 2025. The fair value of the award, as determined by the relevant share price of $9.71 per share, is approximately $75,000 per Independent Director. The Independent Directors have deferred the settlement of all the awards to earlier of five years from the vesting date or separation from service with Tetragon.

Certain Corporate Governance Rules

Tetragon is required to comply with all provisions of the Companies (Guernsey) Law, 2008, as amended, relating to corporate governance to the extent that the same are applicable and relevant to Tetragon’s activities. In particular, each Director must seek to act in accordance with the “Code of Practice – Company Directors”. Tetragon reports against the AIC Code of Corporate Governance (AIC Code). The 2019 AIC Code has been endorsed by, amongst others, the Financial Reporting Council and the Guernsey Financial Services Commission (GFSC). This means that Tetragon may make a statement that by reporting against the AIC Code it is meeting its applicable obligations under the UK Corporate Governance Code 2018, the 2011 GFSC Finance Sector Code of Corporate Governance and any associated disclosure requirements under paragraph 9.8.6 of the London Stock Exchange’s Listing Rules. No formal corporate governance code applies to Tetragon under Dutch law.

Indemnity

Each present and former Director or officer of Tetragon is indemnified against any loss or liability incurred by the Director or officer by reason of being or having been a Director or officer of Tetragon. In addition, the Directors may authorise the purchase or maintenance by Tetragon for any Director or officer or former Director or officer of Tetragon of any insurance, in respect of any liability which would otherwise attach to the Director or officer or former Director or officer.

Audit Commitee

The Audit Committee of Tetragon is responsible for, among other items, assisting and advising Tetragon’s Board of Directors with matters relating to Tetragon’s accounting and financial reporting processes and the integrity and audits of Tetragon’s financial statements. The Audit Committee is also responsible for reviewing and making recommendations with respect to the plans and results of each audit engagement with Tetragon’s independent accountants, the audit and non-audit fees charged by the independent accountants and the adequacy of Tetragon’s internal accounting controls.

Sebastian Maloney, Investor Relations

Our Investment Manager

Tetragon Financial Management 

Tetragon Financial Management LP has been appointed the investment manager of Tetragon pursuant to an investment management agreement dated 26 April 2007 (see “Summary of Key Terms of Tetragon’s Investment Management Agreement”). The investment manager’s general partner, Tetragon Financial Management GP LLC, is responsible for all actions of the investment manager. The general partner is ultimately controlled by Reade Griffith and Paddy Dear, who also control the holder of Tetragon’s voting shares and are the voting members of the investment manager’s Investment and Risk Committees. Reade Griffith acts as the authorised representative of the general partner and the investment manager.

Summary of Key Terms of Tetragon’s Investment Management Agreement

Under the terms of the Investment Management Agreement, the investment manager has full discretion to invest the assets of Tetragon in a manner consistent with the investment objective of Tetragon. The investment manager has the authority to determine the investment strategy to be pursued in furtherance of the investment objective, which strategy may be changed from time to time by the investment manager in its discretion. The investment manager is authorised to delegate its functions under the Investment Management Agreement.

The Investment Management Agreement continues in full force and effect unless terminated (i) by the investment manager at any time upon 60 days’ notice or (ii) immediately upon Tetragon giving notice to the investment manager or the investment manager giving notice to Tetragon in relation to such entity in the event of (a) the party in respect of which notice has been given becoming insolvent or going into liquidation (other than a voluntary liquidation for the purpose of reconstruction or amalgamation upon terms previously approved in writing by the other party) or a receiver being appointed over all or a substantial part or of its assets or it becoming the subject of any petition for the appointment of an administrator, trustee or similar officer, (b) a party committing a material breach of the Investment Management Agreement which causes a material  adverse effect to the non-breaching party and (if such breach shall be capable of remedy) not making good such breach within 30 days of service upon the party in breach of notice requiring the remedy of such breach or (c) fraud or wilful misconduct in the performance of a party’s duties under the Investment Management Agreement.

The Investment Management Agreement provides that none of the investment manager, its affiliates or their respective members, managers, partners, shareholders, Directors, officers and employees (including their respective executors, heirs, assigns, successors or other legal representatives) (each, as an indemnified party) will be liable to Tetragon or any investor in Tetragon for any liabilities, obligations, losses (including, without limitation, losses arising out of delay, mis-delivery or error in the transmission of any letter, cable, telephonic communication, telephone, facsimile transmission or other electronic transmission in a readable form), damages, actions, proceedings, suits, costs, expenses (including, without limitation, legal expenses), claims and demands suffered in connection with the performance by the investment manager of its obligations under the Investment Management Agreement or otherwise in connection with the business and operations of Tetragon, in the absence of fraud or wilful misconduct on the part of an indemnified party, and Tetragon has agreed to indemnify each indemnified party against any such liabilities, obligations, losses, damages, actions, proceedings, suits, costs, expenses, claims and demands, except as may be due to the fraud or wilful misconduct of the indemnified party.

The investment manager may act as investment manager or advisor to any other person, so long as its services to Tetragon are not materially impaired thereby, and need not disclose to Tetragon anything that comes to its attention in the course of its business in any other capacity than as investment manager. The investment manager is not liable to account for any profit earned or benefit derived from advice given by the investment manager to other persons. The investment manager will not be liable to Tetragon for any loss suffered in connection with the investment manager’s decision to offer investments to any other person, or failure to offer investments to Tetragon.

The investment manager is authorised to enter into transactions on behalf of Tetragon with persons who are affiliates of the investment manager, provided that in connection with any such transaction that exceeds $5 million of aggregate investment, the investment manager obtains either (i) the approval of a majority of the Directors that do not have a material interest in such transaction (whether as part of a Board of Directors resolution or otherwise) or (ii) an opinion from a recognised investment bank, auditing firm or other appropriate professional firm substantively to the effect that the financial terms of the transaction are fair to Tetragon from a financial point of view.

Management and Incentive Fees; Expenses

All fees and expenses of Tetragon, except for the incentive fees for the investment manager (as described below), will be paid by Tetragon, including management fees relating to the administration of Tetragon.

The investment manager is entitled to receive management fees equal to one and one-half percent (1.5%) per annum of the NAV of Tetragon payable monthly in advance prior to the deduction of any accrued incentive fees.

Tetragon will also pay to the investment manager an incentive fee for each Calculation Period (as defined below) equal to 25% of the increase in the NAV of Tetragon during the Calculation Period (before deduction of any dividend paid or the amount of any redemptions or repurchases of shares (or other relevant capital adjustments) during such Calculation Period) above (i) the Reference NAV (as defined below) plus (ii) the Hurdle (as defined below) for the Calculation Period. If the Hurdle is not met in any Calculation Period (and no incentive fee is paid), the shortfall will not carry forward to any subsequent Calculation Period.

A “Calculation Period” is a period of three months ending on March 31, June 30, September 30 and December 31 of each year, or as otherwise determined by the Board of Directors of Tetragon.

The “Reference NAV” is the greater of (i) NAV at the end of the Calculation Period immediately preceding the current Calculation Period and (ii) the NAV as of the end of the Calculation Period ending three months earlier than the Calculation Period referred to in clause (i). For the purposes of determining the Reference NAV at the end of a Calculation Period, the NAV shall be adjusted by the amount of accrued dividends and amounts of any redemptions or repurchases of shares (or other relevant capital adjustments) and incentive fees to be paid with respect to that Calculation Period.

The “Hurdle” for any Calculation Period will equal (i) the Reference NAV multiplied by (ii) the Hurdle Rate (defined below).

The “Hurdle Rate” for any Calculation Period equals 3-month U.S. Dollar LIBOR determined as of 11:00 a.m. London time on the first London business day of the then-current Calculation Period plus the hurdle spread of 2.647858%, in each case multiplied by (x) the actual number of days in the Calculation Period divided by (y) 365. (In Tetragon’s initial public offering in April 2007, the Hurdle Rate was fixed at 8% per annum for the 12-month period following IPO with it then being adjusted as specified above. The referenced hurdle spread of 2.647858% is the difference between 8% and the average three-month U.S. Dollar LIBOR at 11:00 a.m. London time on the 20 London business days preceding the IPO pricing date.)

The incentive fee in respect of each Calculation Period is calculated by reference to the increase in NAV of the shares before deduction of any accrued incentive fee. The incentive fee is normally payable in arrears within 14 calendar days of the end of the Calculation Period. If the Investment Management Agreement is terminated other than at the end of a Calculation Period, the date of termination will be deemed to be the end of the Calculation Period. The investment manager does not charge separate fees based on the NAV of Tetragon.

An incentive fee of $104.1 million was accrued in the fourth quarter of 2021 in accordance with Tetragon’s investment management agreement. The hurdle rate for the first quarter of the 2022 incentive fee has been reset at 2.863858% (Q4 2021: 2.780988%) as per the process outlined above and in accordance with Tetragon’s investment management agreement.

Tetragon generally bears all costs and expenses directly related to its investments or prospective investments, such as brokerage commissions, interest on debit balances or borrowings, custodial fees and legal and consultant fees. Tetragon also generally bears all out-of-pocket costs of administration, including accounting, audit, administrator and legal expenses, costs of any litigation or investigation involving their activities, costs associated with reporting and providing information to existing and prospective investors and the costs of liability insurance.

The Investment Manager’s Role with respect to TFG Asset Management

The investment manager’s responsibilities with respect to Tetragon include, inter alia:

  • investing and reinvesting the assets of Tetragon in securities, derivatives and other financial instruments and other investments of whatever nature and committing the assets of Tetragon in relation to agreements with entities, issuers and counterparties;
  • holding cash balances or investing them directly in any short-term investments, and reinvesting any income earned thereon in accordance Tetragon’s investment strategy;
  • purchasing, holding, selling, transferring, exchanging, mortgaging, pledging, hypothecating and otherwise acting to acquire and dispose of and exercise all rights, powers, privileges and other incidents of ownership or possession with respect to investments held or owned by Tetragon, with the objective of the preservation, protection and increase in value thereof;
  • exercising any voting or similar rights attaching to investments purchased on behalf of Tetragon;
  • borrowing or raising monies from time to time without limit as to the amount or manner and time of repayment;
  • engaging consultants, attorneys, independent accountants or such other persons as the investment manager may deem necessary or advisable; and;
  • entering into any other contracts or agreements in connection with any of the foregoing activities.

TFG Asset Management is an investment of Tetragon, and, as such, the investment manager is responsible for exercising any of Tetragon’s voting or similar rights with respect to TFG Asset Management as an investment and is responsible for the management, oversight and/or supervision of such investment. As with any other category of investments, the investment manager is also responsible for decisions with respect to acquisitions of asset management businesses to be added to TFG Asset Management using Tetragon’s cash (which may include minority interests in asset management businesses, joint ventures or other similar arrangements) – as investment decisions with respect to Tetragon’s cash or other assets. Following the acquisition of an asset management business, that business then becomes a part of TFG Asset Management and TFG Asset Management is responsible for the management, oversight and/or supervision of such business, including amendments to or modifications of the terms or arrangements of its ownership of such business (except, where relevant, to the extent of decisions with respect to Tetragon’s cash), and any decision to sell or otherwise dispose of all or any portion of such business.

TFG Asset Management seeks to generate income and value from its asset management businesses by having these businesses manage third-party investor capital. TFG Asset Management has an internal management team that is responsible for the TFG Asset Management business as a whole, including the management, oversight and/or supervision of its various asset management businesses as they form and grow the funds and vehicles that they manage, and is responsible for its own costs.

Tetragon may invest in the various funds and other vehicles managed by a TFG Asset Management business. It may also provide financial support to any fund managed by a TFG Asset Management business (such as a “seeding” arrangement), or provide equity, loans or other financial support to TFG Asset Management or its asset management businesses. The investment manager is responsible for any decision to invest cash into any fund or other vehicle managed by a TFG Asset Management business and is also responsible for decisions regarding financial support for TFG Asset Management.

In connection with the management, oversight and/or supervision of asset management businesses within TFG Asset Management, TFG Asset Management (rather than the investment manager) is responsible for, inter alia, business development, marketing, legal and compliance, risk management and governance, as well as guidance on business issues faced by a new fund or vehicle and the strategic direction of such businesses. As such, TFG Asset Management is responsible for any restructuring or reorganisation of these asset management businesses from time to time (to the extent that such arrangements do not involve the acquisition of asset management businesses using Tetragon’s cash), any disputes or litigation with respect to the ownership arrangements of such businesses and any decision to sell or otherwise dispose of all or any portion of such businesses.

Services Agreement between Tetragon's Investment Manager and Certain Subsidiaries of TFG Asset Management

The investment manager relies on two TFG Asset Management entities(i) for a broad range of services to support its activities. The services provided to the investment manager under a Services Agreement by TFG Asset Management, through these entities, include infrastructure services such as operations, financial control, trading, marketing and investor relations, legal, compliance, office administration, payroll and employee benefits. One of those entities, TFG Asset Management UK LLP, which is authorised and regulated by the United Kingdom Financial Conduct Authority, also provides services relating to the dealing in and management of investments, arrangement of deals and advising on investments.

(i) These TFG Asset Management subsidiaries also provide infrastructure services to LCM and Contingency Capital, infrastructure and investment management services to Polygon, Acasta Partners, Hawke’s Point, the TCI General Partner and Banyan Square Partners, and oversight services with respect to Equitix.

Cost Recovery by TFG Asset Management for Services Provided to Tetragon’s Investment Manager

TFG Asset Management has implemented a cost-allocation methodology with the objective of allocating service-related costs, including to the investment manager, in a consistent, fair, transparent and commercially based manner.(i)

TFG Asset Management then charges fees to the investment manager for the services allocated to the investment manager on a cost-recovery basis designed to achieve full recovery of the allocated costs. In 2021, the total amount recharged to the investment manager, excluding direct expenses, was $23.9 million.

Most of the costs related to these services are directly or indirectly attributable to personnel or “human capital”, with compensation typically being the largest single cost.(ii)

Consequently, one of the most critical cost allocations relates to professionals’ time, which is commonly expressed as Full Time Equivalents or “FTEs”. On a monthly basis, each TFG Asset Management employee(iii), directly or via their team head, provides a breakdown of the approximate percentage of time spent supporting the various businesses for the previous month (this excludes certain functions such as office management and technology that are charged to business users on a standard basis (e.g., space used or global headcount) which removes any need on the part of those teams to allocate their FTEs to business lines). TFG Asset Management employees should not be incentivised to either over- or under-allocate to any business, as their time allocation is not a consideration in the determination of their overall compensation. Once allocated percentages are determined and agreed, an FTE is derived, subject to adjustments for items determined by contractual arrangements. Core personnel costs, including salary, bonus, pension and healthcare, are charged on an actual employee cost basis to each business line (including the investment manager) based on the FTE allocation described above.

In addition to FTE costs, there are a number of other costs that reflect the use of resources by TFG Asset Management personnel on behalf of the investment manager (in addition to the other TFG Asset Management businesses), including real property costs, technology and market data. A standard cost methodology is used to allocate these costs across the various business lines that are supported, including the investment manager. The setting of standard costs is designed to reflect what those costs would be on an arm’s-length basis. The methodology is designed to create consistency in order to provide a fair allocation of resource costs to all businesses.

Employee FTE data is collated and used to process monthly cost allocations. Such allocations are invoiced monthly to users of the TFG Asset Management platform that are not owned by TFG Asset Management, including the investment manager, or allocated within the TFG Asset Management general ledger for businesses owned by TFG Asset Management.

TFG Asset Management’s cost allocation methodology is documented and updated annually by TFG Asset Management’s finance team in consultation with its legal and compliance teams and is approved each year by TFG Asset Management’s executive committee.

KPMG LLP, reporting directly to Tetragon’s Audit Committee, are currently engaged to periodically test that the costs allocated to (and therefore recovered from) the investment manager have been properly calculated in accordance with the approved cost-allocation methodology. Tetragon’s Board of Directors has adopted procedures for related-party transactions that require approval of a majority of disinterested Directors. Accordingly, Tetragon’s Independent Directors are required to approve the methodology for allocating costs and in their sole discretion the application of that methodology as part of their oversight processes. The annual cost allocation methodology update and the actual annual cost allocations that result based on these cost methodology policies and procedures are separately approved by the Independent Directors.

(i) This cost allocation methodology also applies to the other TFG Asset Management businesses.

(ii) Employee compensation will also include TFG Asset Management’s long-term incentive plan and its other equity-based awards.

(iii) Amounts paid by TFG Asset Management to Reade Griffith in connection with services provided by him to TFG Asset Management are not allocated to the investment manager.

The information contained in this webpage supersedes any previous disclosure by Tetragon with respect to such information.

Investment & Risk Committee

The investment manager’s Investment & Risk Committee is responsible for the investment and risk management of Tetragon’s portfolio. The committee performs active and regular oversight and risk monitoring. The Committee determines the investment strategy of Tetragon and approves each significant investment by it. The Committee currently consists of Reade Griffith, Paddy Dear and Stephen Prince.

TFM Executive Committee

The investment manager’s Executive Committee oversees all key non-investment and risk activities of the investment manager and currently consists of: Reade Griffith, Co-Founder and Chief Investment Officer; Paddy Dear, Co-Founder; Stephen Prince, Chief Executive Officer of TFG Asset Management; Paul Gannon, Chief Financial Officer; Sean Côté, General Counsel and Co-Head of Legal Regulatory and Compliance; and Greg Wadsworth, Head of Business Development and Investor Relations.

Welcome to Tetragon Financial Group Limited

Please read the Terms of Use below carefully. You must accept these terms before you can proceed.

TERMS OF USE OF THIS WEBSITE

Compliance with Applicable Laws and Regulations

The information on this website is for information purposes only. It does not constitute an offer to sell any security or investment product, nor does it constitute professional advice. Any product and service mentioned in this website are not offered to any person or entity in any jurisdiction or country where the advertisement, offer, solicitation, provision or sale of such product and service is restricted or prohibited by law or regulation or where Tetragon or any of its respective affiliates would be subject to any regulation or licensing requirement.

Users of this website are responsible for observing all applicable laws and regulations in their relevant jurisdictions before proceeding to access the information contained herein. By proceeding to access the information, users are deemed to have represented and warranted that the applicable laws and regulations of their relevant jurisdiction allow them to do so. No information contained on this website constitutes or would be deemed to constitute an invitation in any jurisdiction to invest or otherwise deal in Tetragon’s non-voting shares.

Restrictions on Ownership by U.S. Persons

Tetragon’s shares have not been and will not be registered under the United States Securities Act of 1933. Consequently, Tetragon shares may not be offered, sold or otherwise transferred within the United States or to, or for the account or benefit of, “U.S. persons” as defined in Regulation S under the Securities Act absent registration or an exemption from registration under the Securities Act. No public offering of any Tetragon shares is being, or has been, made in the United States.

In addition, Tetragon has not been and will not be registered under the United States Investment Company Act of 1940. Direct or indirect beneficial ownership of securities issued by Tetragon to any U.S. person who is not a “qualified purchaser” as defined in the Investment Company Act and applicable rules thereunder is prohibited. Under Tetragon’s Articles of Incorporation, the directors of Tetragon may in certain circumstances compel the transfer of any Tetragon shares owned directly or beneficially by any person who is not a “qualified purchaser”.

Furthermore, Tetragon shares may not be held by any “benefit plan investor” that is subject to Title I of the United States Employee Retirement Income Security Act of 1974. Tetragon’s Articles of Incorporation prohibit any “ERISA Person” from acquiring or holding Tetragon shares. The consequences of failing to comply with this prohibition include the divestment of the relevant shares and the forfeiture of any dividends previously received with respect to such shares, as well as any gains from their disposition.

Ownership by Persons in Europe

Tetragon’s non-voting shares are not intended for European retail investors. Tetragon anticipates that its typical investors will be institutional and professional investors who wish to invest for the long term in a predominantly income-producing investment and who have experience in investing in financial markets and collective investment undertakings and are capable themselves of evaluating the merits and risks of Tetragon shares and who have sufficient resources both to invest in potentially illiquid securities and to be able to bear any losses (which may equal the whole amount invested) that may result from the investment.

No Representation, Warranty or Reliance

No representation or warranty (including liability towards third parties), express or implied, is made as to the accuracy, reliability or completeness of any information contained on this website. Tetragon undertakes no duty to update any such information. Nothing contained on this website constitutes investment, legal, tax or other advice and is not to be relied on in making an investment or other decision. You should obtain relevant and specific professional advice before making any investment decision.

The information and opinions contained in this website are provided without any warranty of any kind, either expressed or implied, to the fullest extent permissible pursuant to applicable law. Neither Tetragon nor any of its affiliates further assumes any responsibility for, and makes any warranties that, information and supplies contained on this website will be uninterrupted or error-free, that defects will be corrected, or that this website or the servers that make it available will be free of viruses or other harmful components.

Forward-Looking Statements

Nothing in this website is, or should be relied on as, a promise or representation as to the future. This website contains forward-looking statements, which reflect the views of Tetragon with respect to, among other things, Tetragon’s operations. Investors can identify these forward-looking statements by the use of words such as “believe”, “expect”, “potential”, “continue”, “may”, “will”, “should”, “seek”, “approximately”, “predict”, “intend”, “plan”, “estimate”, “anticipate” or other comparable words. These forward-looking statements are subject to various risks, uncertainties and assumptions. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. Should any assumptions underlying the forward-looking statements contained on this website prove to be incorrect, the actual outcome or results may differ materially from outcomes or results projected in these statements. Neither Tetragon nor any of its affiliates undertakes any obligation to update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by applicable law or regulation.

Linked Sites

Tetragon has not reviewed any website linked to this website and Tetragon is not responsible for the contents of off-site pages or any other websites linked or linking to this website. If you follow any links off this website you do so at your own risk.

Links to this website may not be established without the prior written consent of Tetragon.

Liability Waiver

To the maximum extent permitted by applicable law, you agree that under no circumstances, including, but not limited to, negligence, shall Tetragon or any of its affiliates be liable for any direct, special or consequential damages that result from the access or use of, or the inability to access or use, the materials on this website.

If you proceed to access the information included in this website, you acknowledge that you have read and agree with the above Terms of Use.

I Accept I Do Not Accept

B. This site uses cookies to improve your experience.

We use cookies to personalise content and to analyse our traffic. We also share information about your use of our site with our analytics partners. View our privacy policy.

C. Manage cookie preferences

Strictly necessary cookies

Required

These cookies allow the website to remember choices you make and provide enhanced, more personal features. The information these cookies collect may be anonymized and they cannot track your browsing activity on other websites.

Optional cookies

These optional cookies include all cookies which are not strictly necessary to the operation of the website, for example Analytics Cookies which are used to understand the performance of the site. To see the details of the cookies within this category, please view our privacy policy. The cookies collect information in an anonymous form.