FEES AND COMPENSATION
MASTERS FEES
Fees for Masters accounts are only offered on a wrap fee basis covering all of Brown Advisory
Securities' execution, consulting and custodial services as well as each Masters Advisor's
management fee for the advisor's services. WFCS, LLC negotiates each Masters Advisor's
management portion of the client fee with the Masters Advisor based on a variety of factors
including the amount of data processing facilities, software, marketing and other overhead
interface believed necessary. Currently, WFCS, LLC compensates advisors from 0.15% to 0.80%
annually based on total aggregate client dollars in Masters for each objective. Breakpoints lower
the advisory fees as aggregate assets increase. Therefore, WFCS, LLC has a potential conflict of
interest to recommend selections of management styles and advisors that would result in a lower
percentage of advisory fees being paid to the Masters Advisor. WFCS, LLC intends, however, to
make all recommendations independent of such fee consideration and based solely on its
obligations to consider a client's objectives and needs. Certain of WFCS, LLC's affiliates are
18 BROWN ADVISORY SECURITIES / FORM ADV PART 2A APPENDIX 1
currently included as advisors under Masters. Thus, WFCS, LLC or its affiliates receive the entire
Masters fee when such affiliates are selected as advisor for a client account.
The following standard fees, which are negotiable, are charged for the Masters accounts:
Total Account Value* Annualized Fee
First $500,000 2.50%
Next $500,000 2.50%
Next $1,000,000 2.50%
Over $2,000,000 2.50%
* Calculated as the value of the account on the last business day of the previous calendar
quarter.
The client authorizes Brown Advisory Securities and the Clearing Agent to deduct quarterly, in
advance, from each client’s account(s) the Masters fees at the rate indicated in the fee schedule.
The initial fee under the Masters fee schedule is calculated as of the date that the client executes
the Masters agreement and covers the remainder of the calendar quarter. Subsequent fees are
determined for calendar quarter periods and are calculated on the basis of the market value of the
securities and cash held for the particular account of the client on the last business day of the prior
calendar quarter. Should cash and/or securities be added between billing periods, a proportionate
fee is charged on the value added as of the date of the addition.
No fee adjustments are made during any fee period for appreciation or depreciation in the value of
assets in the client’s account during that period. WFCS, LLC processes flow fees for additions
and withdrawals. A “flow fee” is a fee generated when assets are added to, or withdrawn, from an
account. The account is charged or refunded a pro-rated quarterly fee on any net additions or net
withdrawals in the account during a month. Fees are charged or refunded if the net addition or net
withdrawal generates a fee or refund of at least $40 for that quarter. Fees are assessed in the month
following the net addition or net withdrawal. Fees are based on the value of the assets in the
client’s account and neither WFCS, LLC nor Brown Advisory Securities are compensated on the
basis of a share of capital gains upon or capital appreciation of the funds or any portion of the
funds of the client (i.e., performance fee). In the event of cancellation of client agreements, fees
previously paid pursuant to the fee schedule are refunded on a pro-rata basis, as of the date notice
of such cancellation is received by the non-canceling party.
Whenever there are changes to the fee schedule, the schedule charges previously in effect continue
until the next billing cycle. Established fees may not be increased unless the applicable client
executes a new agreement.
NETWORK FEES
Clients have a choice of selecting between two payment schedules for Brown Securities’ services:
Option #1 – Fee Schedule
19 BROWN ADVISORY SECURITIES / FORM ADV PART 2A APPENDIX 1
The standard fee schedule for option #1 is as follows:
Total Account Value* Annualized Fee
First $250,000 Negotiable
Next $750,000 Negotiable
Excess over $1,000,000 Negotiable
* Calculated as the value of the account on the last business day of the previous calendar
quarter.
For this option there is a separate charge for the investment management services provided by the
Network Advisor, but no separate charge for execution services when transactions are effected
through Brown Advisory Securities and the Clearing Agent except investment company, money
market or Bank Deposit Account (“BDA”) purchases, if any. The client receives management fee
information from the Network Advisor once a selection has been made. Such fees are charged
separately and billed to the client. In cases where Brown Advisory LLC is the Network Advisor,
trading takes place outside of Brown Advisory Securities and the Clearing Agent. Therefore, a
separate charge for execution services is incurred.
Option #2 – Execution Schedule
For this option, commissions are charged on trades, including mark-ups and mark-downs on
principal transactions. There is a separate charge for the investment management services
provided by the Network Advisor. The client receives management fee information from the
Network Advisor once a selection has been made. Such fees are charged separately and billed to
the client.
Payment of Network Fees
If a client selects the Network Fee Schedule, the client authorizes Brown Advisory Securities and
the Clearing Agent to deduct quarterly, in advance, from the account of the client the fee at the
rate indicated in the fee schedule. If the client selects the Execution Schedule, payment for
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