Item 5 - Fees and Compensation
Investment Management Services
Standard Fee Schedule for EMC:
Assets Under Management Annual Fee
First $2 million 1.00%
Next $3 million 0.80%
Next $5 million 0.60%
Amount > $10 million 0.50%
In certain circumstances, fees, account minimums and their applications to family
circumstances may be negotiable.
Private Funds
Investors in the private funds should refer to the offering documents for a full description
of the fees to be charged by the funds. Only "qualified clients" will be eligible for
performance-based fee arrangements.
EMC Alpha Fund LP
The Company receives a management fee from the EMC Alpha Fund LP based on the
management fees charged to the investors, which are equal to an annual rate of 1.50% of
the value of each investor’s capital account as of the last day of each calendar month. The
management fee is payable monthly in arrears and will be charged pro rata for any
withdrawals made prior to the end of the calendar month or for contributions made other
than at the beginning of a calendar month. The General Partner receives additional
performance-based fees discussed below.
Employee Benefit Retirement Plan Services
The annual fee for plan services will be 1.00% of assets within the plan. In certain
circumstances, fees, account minimums and their applications to family circumstances may
be negotiable.
Additional Information
The specific manner in which fees are charged by EMC is established in a client’s written
agreement with EMC. Generally, clients will be invoiced in advance at the beginning of
each calendar quarter based upon the value of the client's account at the end of the previous
quarter. (Market value is based on independent third-party sources or fair market value in
the absence of market value; client account balances on which EMC calculates fees may
vary from account custodial statements based on independent asset valuations and other
accounting variances, including mechanisms for including accrued interest in account
statements.)
EMC will request authority from the client to receive quarterly payments directly from the
client's account held by an independent custodian. Clients may provide written limited
authorization to EMC to withdraw fees from the account.
All fees are calculated as described above and are not charged on the basis of a share of
capital gains upon or capital appreciation of the funds or any portion of the funds of an
advisory client.
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.
All fees paid to EMC for investment advisory services are separate and distinct from the
fees and expenses charged by mutual funds or ETFs to their shareholders. These fees and
expenses are described in each fund's prospectus. These fees will generally include a
management fee, other fund expenses, and a possible distribution fee. A client could invest
in mutual funds or ETFs directly, without the services of EMC. In that case, the client
would not receive the services provided by EMC which are designed, among other things,
to assist the client in
determining which mutual fund or funds are most appropriate to each client's financial
condition and objectives. Accordingly, the client should review both the fees charged by
the funds and the fees charged by EMC to fully understand the total amount of fees to be
paid by the client and to thereby evaluate the advisory services being provided.
EMC’s fees are exclusive of brokerage commissions, transaction fees, and other related
costs and expenses which shall be incurred by the client. Clients may incur certain charges
imposed by custodians, brokers, and other third parties such as custodial fees, 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. Such charges,
fees and commissions are exclusive of and in addition to EMC’s fee, and EMC shall not
receive any portion of these commissions, fees, and costs.