Item 5 – Fees and Compensation
BCM’s investment management fees are generally calculated as a percentage of the assets
under management within each client account. All fees are subject to negotiation.
The specific manner in which fees are charged by BCM is established in a client’s written
agreement with us. BCM will generally bill its fees on a quarterly basis. In most cases we
bill clients in arrears but in some cases, we bill clients in advance of the calendar quarter.
BCM has in some cases the authority to directly debit fees from client accounts, but in most
cases, we bill clients directly for management fees. Management fees shall be prorated for
each capital contribution and withdrawal made during the applicable calendar quarter
(with the exception of de minimis contributions and withdrawals). Accounts initiated or
terminated during a calendar quarter will be charged a prorated fee. Upon termination of
any account, any prepaid, unearned fees will be promptly refunded, and any earned, unpaid
fees will be due and payable, based on the number of days in the period for which BCM
acted as investment manager for the account.
BCM’s fees are exclusive of brokerage commissions, transaction fees, and other related
costs and expenses which shall be incurred by the client. Clients will incur certain charges
imposed by custodians, brokers, and other third parties such as custodial fees, odd-lot
differentials, transfer taxes, wire transfer and electronic fund fees, and other fees and taxes
on brokerage accounts and securities transactions. Such charges, fees, and commissions are
exclusive of and in addition to BCM’s fee, and BCM shall not receive any portion of these
commissions, fees, and costs.
Bares Capital Management, Inc.
The concentrated Mid/Large-Cap and Mid/Large-Cap Extended strategies have a fee
structure of 0.50% of assets under management per annum. Both Mid/Large-Cap
Strategies’ minimum account size is $20 million. The Global Allocators strategy has a fee of
1% of assets under management per annum and a minimum account size of $25 million.
Fees are negotiable based on a range of factors, including relationship dynamics, capital
commitment and the resources necessary for BCM to effectively serve client objectives and
service requirements.
Neither BCM nor its employees accept compensation for the sale of securities or other
investment products, including asset-based sales charges or service fees from the sale of
mutual funds.
If this Brochure is being delivered at the time of signing the contract, the client has the right
to terminate the investment advisory agreement without penalty within five business days
after entering into the contract. Otherwise, the client may terminate the investment
advisory agreement by written notice to BCM. If the agreement contains a notice period for
termination, BCM may waive such period at its discretion. BCM will cease billing its
investment management fee upon receipt of written notice of account termination from the
client or the client’s authorized representative. A prorated billing amount will be applied to
the closing value of the account (cash and securities holdings) on the day prior to the
effective date of termination. If the client directs BCM to liquidate the account following the
date of termination, we will do so in an orderly fashion, market conditions permitting, in a
manner and timeframe deemed appropriate by BCM in its discretion, in accordance with
client instructions. BCM will not charge an investment management fee during the
terminated account liquidation period, although terminating clients will be responsible to
pay any commissions, exchange fees, trade-level fees, or other costs incurred during the
liquidation period. Liquidation of terminated account holdings is managed by the Trader,
as directed by the designated Portfolio Manager, in accordance with BCM’s investment and
trading policies and procedures.