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First Eagle Funds has lost four top executives in an apparent dispute over compensation.

Charles "Chuck" de Lardemelle, research director and co-manager of three First Eagle funds; Simon Fenwick, co-manager of the company's gold fund; Michael Malafronte, senior analyst; and Lawrence Borsanyi, head of product development, all left in late September, just days after TA Associates announced it had acquired a minority stake in Arnhold & S. Bleichroeder Holdings, First Eagle's ultimate parent company, for an undisclosed sum.

The departures also came just six months after the

mysterious March disappearance of the firm's Chief Investment Officer Charles de Vaulx.

Although all parties remain tight-lipped on de Vaulx's departure, the deal may point to the cause of his disappearance.

A press release issued jointly by TA Associates and Arnhold & S. Bleichroeder trumpeted the introduction of "substantial equity incentives for (Arnold & S. Bleichroeder's) key investment and operational personnel." Or in simpler language, big pay packages for money management wizards.

But the four executives who left clearly disagreed with that characterization. "There was a deal on the table and personally I felt the deal was unacceptable for me," de Lardemelle told

in an interview. "The treatment to the team as a whole was unacceptable."

He added, "I was confronted with the dilemma of being a hired gun for the rest of my life, albeit a very well-treated one."

While neither he nor Fenwick will comment on the cause of the rift, it could have been the compensation structure. Private equity deals often stipulate high performance hurdles that must be met before key personnel get paid.

de Lardemelle was the man tipped as the likely successor to the head of the investment team, Jean-Marie Eveillard, a legendary money manger and the driving force behind First Eagle for much of its history. He co-managed the firm's flagship $21.75 billion

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First Eagle Global as well as the $686 million

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First Eagle Overseas and the $11.3 billion

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First Eagle U.S. Value.

First Eagle Global is up 8.4% year to date through Friday and has returned an annualized 22.7% over the past give years, according to Morningstar. Its biggest holding is gold bullion, followed by

Berkshire Hathaway




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, Sanofi-Aventis and

Johnson & Johnson

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Fenwick was a co-manager of the $1.14 billion

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First Eagle Gold fund, which is 18.3% year to date through Friday and an annualized 25% over the past five years, according to Morningstar.

The fund has nearly one-quarter of its assets in bullion, but also has big stakes in Barrick Gold,

Newmont Mining

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, Gold Fields and Newcrest Mining.

de Lardemelle, Fenwich and Malafronte made up 30% of Eveillard's 10-person investment team.

Neither de Lardemelle nor Fenwick have concrete plans, but they say they may take a look at reforming the team at some point in the future.

"Value investing is in our blood. We definitely want to return to the business and we are exploring our options," says Fenwick. "But given that the four of us get along with each other, it makes sense for us to consider starting our own shop."

Borsanyi echoed the comments of Fenwick and Lardemelle, while Malafronte was said to be travelling in Africa on honeymoon.

First Eagle has already filled two of the three investment team vacancies. Columbia Business School professor Bruce Greenwald will take the role of research director, while Abhay Deshpande will move from a senior research role at First Eagle into a money management role.

Eveillard, who says he has committed to staying through March 2009, says the firm is still looking for one more manager.