Item 5 Fees and Compensation
Callan bases its fees on a percentage of assets under management and/or fixed fees (not including subscription fees)
depending on the particular types of advisory services to be provided. The specific fees charged by Adviser for its
advisory services will be set forth in each client’s written Agreement(s) with Adviser. Although Adviser believes its
advisory fees are competitive, clients should be aware that lower fees for comparable services can be available from
other sources.
Asset Management
Adviser generally charges an annual fee for its asset management services based upon a percentage of the market value
of the assets being managed by Callan. The annual fee shall be prorated and charged quarterly, in arrears, based upon
the average daily balance of the client’s assets as valued by the custodian for the prior quarter. If a client leaves Callan
Capital or otherwise terminates the asset management engagement agreement mid-quarter the termination fee would be
prorated for the portion of the quarter for which assets were being managed by Callan. Clients who maintain a margin
balance will be billed on the gross margin balance of the account. For example, if the account value is $2 Million and
the account borrows money from the custodian on margin to purchase additional $1 Million in securities, Advisor will
bill the account on the Gross account value of $3 Million.
The asset management fee shall be on a tiered system based upon the following:
Annualized Investment Management Fees
Account Value From Account Value To Annual Percentage Fee
$0 $2,000,000 1.00%
$2,000,001 $ 5,000,000 .75%
$5,000,001 $10,000,000 .50%
$10,000,001 and above .30%
Minimum fee of $20,000 per year
For example, if the account(s) being managed for the household totaled $3 Million dollars in account value, the first $2
Million would have an annual percentage fee of 1%, while the remaining $1 Million would have an annual percentage
fee of 0.75%. It should be noted that Callan can have clients who were engaged prior to the incorporation of the fee
schedule disclosed herein. These clients are considered “legacy” clients and can pay a fee that is higher or lower
depending on the time at which the client engaged Callan to render investment management services.
Callan, in its sole discretion, can negotiate to charge a lesser management fee, and / or Callan can waive the annual
minimum fee based upon certain criteria (i.e., anticipated future earning capacity, anticipated future additional assets,
dollar amount of assets to be managed, related accounts, account composition, pre-existing client, account retention, pro
bono activities, etc.).
The client can make additions to and withdrawals from the account at any time, subject to Callan’s right to terminate an
account. Management fees shall be prorated for each capital contribution and withdrawal made during the applicable
Callan Capital Form ADV Part 2A
calendar quarter. Clients can withdraw account assets on notice to Callan, subject to the usual and customary securities
settlement procedures. However, Callan designs its portfolios as long-term investments and assets withdrawals can
impair the achievement of a client’s investment objectives.
For the initial quarter of investment management services, the first quarter’s fees shall be calculated on a pro rata basis.
The Agreement between Callan and the client will continue in effect until terminated by either party pursuant to the
terms of the Agreement. Callan’s annual fee shall be prorated through the date of termination and any remaining balance
shall be charged or refunded to the client, as appropriate, in a timely manner.
Additions can be in cash or securities provided that Callan reserves the right to liquidate any transferred securities or
decline to accept particular securities into a client’s account. Callan can consult with its clients about the options and
ramifications of transferring securities. However, clients are advised that when transferred securities are liquidated, they
are subject to transaction fees, fees assessed at the mutual fund level (i.e. contingent deferred sales charge) and/or tax
ramifications.
Payment for Callan’s investment management fees will be deducted from each client’s account on a quarterly basis by
their custodian and paid directly to Callan upon written authorization by the client. The consent for deduction of fees is
generally contained in the Agreement signed by the client. Clients’ custodians will deliver a periodic (at least quarterly)
account statement directly to clients, which will include all transactions that took place in the account during the period
covered and reflect any fees deducted and paid to Adviser. Clients can also choose to be billed for their quarterly fees.
Clients can incur certain charges imposed by third parties such as fees charged by Independent Managers (as defined in
Item 14 below), custodial fees, charges imposed directly by a mutual fund or exchange traded funds in the account,
which shall be disclosed in the fund’s prospectus (e.g., fund management fees and other fund expenses), deferred sales
charges, odd-lot differentials, transfer taxes, wire transfer and electronic fund fees, and other fees and taxes on brokerage
accounts and securities transactions. Additionally, for assets outside of any wrap fee programs, clients can incur
brokerage commissions and transaction fees. Such charges, fees and commissions are exclusive of and in addition to
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