Item 5 Fees and Compensation
Investments
Fees for investment supervisory and portfolio management services are based upon a
percentage of assets under management and generally range from 0.50% to 1.6%.
We retain the discretion to negotiate fees on a client-by-client basis. Client facts,
circumstances and needs are considered in determining the fee schedule. These include the
complexity of the client’s situation; types of assets to be placed under management; anticipated
future additional assets; related accounts, among other factors. The annual fee schedule is
specified in the contract between the adviser and each client. Advisory fees are charged on a
quarterly basis, either in advance or in arrears as agreed with the client:
If in advance, fees are billed at the beginning of each calendar quarter based upon the
asset value (market or fair value in the absence of market value, plus any credit balance or minus
any debit balance), of the client's account equity at the end of the previous quarter.
If in arrears, fees are billed at the end of each calendar quarter based upon the quarter-end
asset value (market or fair value in the absence of market value), of the client's account.
If MPC recommends an investment with an independent manager, we do not charge a
separate fee for this service, nor do we charge a management fee on those assets, whether or not
an independent manager pays us for the referral. The independent investment adviser's
management fee is disclosed in the independent investment adviser's firm brochure or other
disclosure document.
Prime Growth Stocks LLC.
MPC charges Prime Growth Stocks LLC (“PGS”) a quarterly management fee, paid in
arrears, of 0.4% on average assets in the partnership during the preceding quarter. In turn, PGS
pays most of the management fees received to John Train, who is responsible for investment
decisions. PGS maintains its own brokerage accounts; fees and commissions incurred are paid
directly by PGS.
PGS also pays its own rent and expenses related to fund administration, including legal
and accounting fees, printing and mailing expenses and government filing fees. All third party
accounting, tax preparation, audit, bookkeeping, governmental fees and taxes and legal and
compliance costs, or costs relating to these items, are paid directly by PGS.
International Masters Investment Company
IMIC pays MPC two fixed fees, paid quarterly in advance, for investment advice on a
portfolio offered only to non-US investors, and for portfolio valuation. Most of the advisory fee
received from IMIC is paid to John Train, who is responsible for investment decisions. All
administration is done by KENDRIS Private Ltd. in Lausanne, Switzerland.
Financial Planning
Montrose Private Clients' fees for financial planning are determined by the nature of the
services being provided and the complexity of each client’s circumstances. All fees are agreed
upon prior to entering into a contract with the client.
Typically, financial planning fees are calculated and charged on a fixed fee basis, and
depend on the specific arrangement reached with the client. Fees are billed quarterly in
advance.
Montrose Private Clients may reduce or waive fees if a financial planning client chooses
to engage us for portfolio management services.
General Information
A client agreement may be canceled at any time, by either party, for any reason, upon
receipt of 30 days written notice. Upon termination of any account, any prepaid, unearned fees
will be promptly refunded. In calculating reimbursement of a client’s fees, we will pro rate the
reimbursement according to the number of days remaining in the billing period.
Clients are separately responsible for fees and expenses charged by custodians and broker
dealers. A client who has invested with an independent investment manager is responsible for
any transactions charges imposed by a broker dealer in connection with that account. Please refer
to the "Brokerage Practices" section (Item 12) of this Form ADV for additional information.
ERISA Accounts
Montrose Private Clients does not now have any clients that are employee benefit plans
or individual retirement accounts. For any future clients in this category, MPC will be deemed a
fiduciary pursuant to the Employee Retirement Income and Securities Act ("ERISA"), and
regulations under the Internal Revenue Code of 1986 (the "Code"), respectively.
General Advisory Fees
Clients are made aware that similar advisory services may (or may not) be available from
other registered (or unregistered) investment advisers for similar or lower fees. Under no
circumstances do we require or solicit payment of fees, in any amount, more than six months in
advance of services rendered.