Item 5 Fees and Compensation
BHA MANAGED ACCOUNTS
Our fee for portfolio management services is based on a percentage of the assets in your
account. These fees are calculated using a breakpoint structure that declines as assets increase. You
are charged a flat percentage, based on your level of assets. At our discretion, we may combine
account values to determine the applicable advisory fee. For example, we may combine account
values for you and your minor children, joint accounts with your spouse, and other types of related
accounts. Combining account values increases the asset total, which may result in your paying a
reduced advisory fee based on the available breakpoints as set forth in the following annual fee
schedule:
BHA Model - Annual Fee Schedule*
Assets Under Management Annual Flat Fee
Assets up to $499,999 1.25%
$500,000 - $999,999 1.15%
$1,000,000 - $1,999,999 1.00%
$2,000,000 - $2,999,999 0.85%
$3,000,000 and above 0.75%
* Effective date 10/01/2010
The exception to the above fee schedule is the BHA Municipal Bond Portfolio. This portfolio has a
minimum account size of $1,000,000. The annual fee is 0.50%
These fees are in addition to fees paid directly by you to the custodian of your account for custodial
and trade execution services. Our annual portfolio management fee is billed and payable, monthly or
quarterly in arrears, based on the average daily balance.
If the portfolio management agreement is executed at any time other than the first day of a calendar
month or quarter, our fees will apply on a pro rata basis, which means that the advisory fee is payable
in proportion to the number of days in the month or quarter for which you are a client. Our advisory fee
is negotiable, depending on individual client circumstances.
We will deduct our fee directly from your account through the qualified custodian holding your funds
and securities. We will deduct our advisory fee only when you have given our firm written authorization
permitting the fees to be paid directly from your account. Further, the qualified custodian will deliver an
account statement to you at least quarterly. These account statements will show all disbursements
from your account. You should review all statements for accuracy.
RETIREMENT PLAN SERVICES
Our maximum annual client fee for investment advisory services in the retirement plan is 1.25% of
assets under management. This fee is charged to the individual employees and is deducted from the
employee's account on a quarterly basis in arrears. In certain circumstances, the employer may
choose to pay this fee on behalf of its employees. Employees may also incur additional costs from the
mutual funds in which their accounts are invested. Refer to the Fees and Compensation section below
for additional disclosures on this topic.
FINANCIAL PLANNING AND CONSULTING SERVICES
A. Financial Planning Services
Our fee for the preparation of a financial plan or the update of an existing plan may be a fixed fee or
based upon an hourly rate of $250 per hour. The fee arrangement (fixed or hourly) will be established
prior to services being rendered. A fixed fee is determined through a formal assessment of the number
of assets and liabilities to be analyzed, the complexity of your financial situation, and an estimate of the
hours necessary to complete and refine the plan. The range for a fixed fee is typically $500 to $2,000.
The maximum fixed fee is $15,000. We may, at our sole discretion, waive all or a portion of our fee for
such services. Our fees for financial planning services may be waived if your financial situation is not
complex or if you indicate an intention to use us as your ongoing advisor for the investment of your
assets (whether or not you ultimately decide to utilize our asset management services). Fixed fees are
payable one-half in advance and the balance due upon completion. Hourly fees are payable monthly in
arrears. If you terminate the relationship prior to the completion of services, you will receive a prorated
refund of any unearned fees.
B. Financial Consulting Services
Financial consulting services are provided at an hourly rate of $300 per hour. Fees are payable on a
monthly basis in arrears. Fees for financial consulting services may be waived if your financial situation
is not complex or if you indicate an intention to use us as your ongoing advisor for the investment of
your assets (whether or not you ultimately decide to utilize us for asset management services).
Additional Fees and Expenses
Our Investment Advisory fees, as described above, are exclusive of, and in addition to, other fees that
you may incur, including, but not limited to, the following types of fees: custody and transaction, legal,
accounting, and funds' internal investment expenses.
The custodian holding your funds and securities may, on occasion and solely at their discretion, charge
fees to you for other services you request in addition to the compensation they receive for custodial
services (such as wire transfers or bill pay fees) provided to you. Also, it is the current practice of
certain custodians to charge a "flat" transaction fee to the client on trades executed at other brokers.
We do not share in any portion of these additional fees. Refer to the Brokerage Practices section
below for additional disclosures on this topic.
The fees for the asset management programs we offer may result in higher costs than you may
otherwise incur by contracting separately for investment management, trade execution, custodial and
consulting services.
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