ITEM 5 - FEES AND COMPENSATION
Investment Management Fees and Compensation
Consilium charges a fee as compensation for providing continuous Investment Advisory services
on accounts. These services include discretionary and non-discretionary advisory and consulting
services, and other account-maintenance activities. Our custodian may charge custodial fees,
redemption fees, retirement plan and administrative fees or commissions. See Additional Fees
and Expenses below for additional details.
In addition, some mutual fund assets deposited in accounts may have been subject to other
mutual fund annual management and administrative fees as described in the funds’ prospectuses.
These fees are independent of our fees and should be disclosed by the custodian or contained in
each fund’s prospectus. Clients should also note that fees for comparable services vary and lower
fees for comparable services may be available from other sources.
The fees for portfolio management are typically based on an annual percentage of assets under
management and are applied to the account asset value on a pro-rata basis and billed quarterly
in arrears. The initial fee will be based upon the date the account is accepted for management
by execution of the advisory agreement by Consilium or when the assets are transferred through
the last day of the current calendar quarter. Thereafter, the fee will be based at each previous
quarter’s last business day. The market value will be determined as reported by the Custodian.
Fees are assessed on all assets under management, including securities, cash and money market
balances.
Our maximum investment advisory fee is 1.0%. Fees may be subject to a minimum of $5,000
annually or as negotiated with client. The specific advisory fees are set forth in the Investment
Advisory Agreement. Fees may vary based on the size of the account, complexity of the portfolio,
extent of activity in the account or other reasons agreed upon by us and our clients. In certain
circumstances, our fees and the timing of the fee payments may be negotiated.
At our discretion, we will aggregate asset amounts in accounts from the same relationship
together to determine the advisory fee for all accounts. This consolidation practice is designed to
allow clients the benefit of an increased asset total, which could potentially cause accounts to be
assessed a lower advisory fee based on the asset levels available in our fee schedule
The independent qualified custodian holding client funds and securities will debit the account
directly for the advisory fee and pay that fee to us. Clients provide written authorization permitting
the fees to be paid directly from the account held by the qualified custodian. Further, the qualified
custodian agrees to deliver an account statement at least quarterly directly to the client indicating
all the amounts deducted from the account including our advisory fees. See Item 15 for details.
At our discretion, clients may pay the advisory fees directly either by check or some other
electronic means. Clients are encouraged to review your account statements for accuracy.
Either Consilium or clientele may terminate the management agreement immediately upon
written notice to the other party. The management fee will be pro-rated to the date of
termination, for the time period in which the cancellation notice was given and refunded. Upon
termination, clients are responsible for monitoring the securities in your account, and we will have
no further obligation to act or advise with respect to those assets.
Retirement Plan Services
We charge an annual fee as negotiated with the client and disclosed in the Investment Advisory
Agreement for our Retirement Plans Advisory Services. The compensation method is explained and
negotiated in advance before any services are rendered. Fees may vary based on the extent and
complexity of the services. Fees can range from $750 to $100,000 or from 0.25% to 1.00%
annually. Fees may be subject to a minimum of $5,000 or as negotiated with client. You will be
billed as services are rendered. Plan advisory services begin with the effective date of the
Agreement, which is the date the Investment Advisory Agreement is executed. For that calendar
quarter, fees will be adjusted pro rata based upon the number of calendar days in the calendar
quarter that the Agreement was effective. Our fee is billed in arrears on the last business day of the
calendar quarter. Invoices are sent out each quarter to either the client or the custodian of the Plan.
For Plans where our fee is billed to the custodian, the fee is deducted directly from the participant
accounts. Written authorization permitting us to be paid directly from the custodial account is
outlined in the Investment Advisory Agreement.
Either party may terminate the agreement. Upon termination, fees will be prorated to the date
of termination.
We do not expect to receive any other compensation, direct or indirect, for our Services. In the
case that we do receive other compensation for such Services, we will (i) offset that compensation
against our stated fees, and (ii) will disclose to the Client the amount of such compensation, the
Services rendered for such compensation, the payer of such compensation and a description of
Adviser’s arrangement with the payer.
Sub-Advisory Services for Collective Trust Investments
If applicable, the fees for managing the collective trusts are based on an annual percentage of
assets under management and are applied to the account asset value on a pro-rata basis and
billed quarterly in arrears. Our fees range from 0.15% to 0.25% annually. The specific advisory
fees are set forth in the Agreement with the CIT provider. Either party may terminate the
agreement. Upon termination, fees will be prorated to the date of termination.
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