Thomas Morgan

About Thomas K. Morgan

Thomas K. Morgan is Chief Compliance Officer (CCO) and Assistant Secretary of The Herzfeld Caribbean Basin Fund, Inc. (“CUBA”) and is an officer/employee of the external adviser, Thomas J. Herzfeld Advisors, Inc. (the “Adviser”) . He has served as CCO since 2018 and was 65 years old as of the 2024 proxy; he is also Managing Partner of TMorgan Advisers LLC, providing compliance consulting and outsourced CCO services since 2015 . As context for alignment and execution risk, CUBA’s board approved a strategic pivot from a Caribbean Basin equity strategy to a CLO equity/junior debt strategy in early 2025, citing a persistent trading discount to NAV and low prospects for policy change on Cuba; this shift introduces leverage and incentive-fee dynamics at the Adviser level that can influence fund-level risk-taking .

Past Roles

External Roles

Fixed Compensation

• Executive officer cash compensation for Mr. Morgan (base salary, target/actual bonus, perquisites) is not disclosed by CUBA; fund officers are officers/employees of the Adviser, and the fund discloses director fees but not executive pay tables for fund officers .

Performance Compensation

• CUBA does not disclose individual incentive metrics or equity awards for Mr. Morgan. At the fund level, the proposed Amended Advisory Agreement compensates the Adviser with: (i) a 1.25% annual fee on “Managed Assets,” and (ii) a 10% quarterly incentive fee on pre-incentive fee net investment income above a 2.25% quarterly (9% annualized) hurdle with a catch-up; no incentive fee would have been due in FY2024/S1 FY2025 under pro forma calculations .
• The proxy flags “Incentive Fee Risk”—the structure may encourage higher-risk, income-generating assets and leverage; these incentives live at the Adviser (where Mr. Morgan is CCO), not as disclosed personal comp, but they can influence organizational behavior and thus the risk context around his role .

Equity Ownership & Alignment

• Additional context: Directors and executive officers as a group owned 28.8% as of 2024 and 41.8% as of 2025, driven largely by beneficial holdings associated with Thomas J. and Erik M. Herzfeld; Mr. Morgan personally had no reported share ownership in these tables .

Employment Terms

Investment Implications

• Alignment and selling pressure: No reported personal share ownership reduces direct equity alignment and implies minimal insider selling pressure risk from Mr. Morgan specifically .
• Pay-for-performance visibility: CUBA does not report officer-level compensation; incentives are primarily at the Adviser level. The new advisory structure (1.25% of Managed Assets + 10% NII incentive above 9% hurdle with catch-up) may bias the platform toward income generation and leverage, elevating monitoring needs around valuation, asset selection, and compliance oversight—areas where Mr. Morgan’s CCO function is central .
• Retention and execution risk: The fund expressly notes reliance on the Adviser’s senior personnel; turnover could impair execution. Mr. Morgan has served since 2018 and maintains a longstanding compliance practice, but the key person risk resides broadly at the Adviser per the fund’s risk disclosures .
• Governance and disclosure: CUBA’s board maintains Audit and Nominating/Governance committees; directors received $133,800 aggregate fees in FY2024; there is no distinct compensation committee and no say‑on‑pay framework for fund officers, limiting transparency into individual executive incentives .
• Strategic pivot risk: The CLO equity/junior debt strategy introduces leverage and incentive‑fee dynamics that require robust compliance, valuation, and risk controls. As CCO at both the Fund and Adviser, Mr. Morgan’s oversight is a key mitigant; investors should monitor Section 16 compliance (no issues noted for executives in 2024) and the fund’s valuation/derivatives/leverage controls as the strategy transitions .