Item 5 Fees and Compensation
Asset Management and 401(k) Advisory Services
Each client’s specific fee schedule is disclosed in the client’s executed Investment Management
Agreement and reflects the VanceGray fee schedule that was in effect when the IMA was executed, or
as negotiated by the client. For new clients, VanceGray charges a management fee that includes a flat
fee plus a fee based on a percentage of assets under management for managing client portfolios. The
fee schedule is highlighted in the table below.
Investment Management Fee Schedule
Total Assets Under Management Annual Fee
First $1 Million..................................1% of Assets under Management
$1 Million to $2.5 Million..................$10,000 plus 0.75% of amount over $1M
$2.5 Million to $5 Million.................$21,250 plus 0.50% of amount over $2.5M
$5 Million to $10 Million...................$33,750 plus 0.25% of amount over $ 5 M
These fees are negotiable by the advisor under unusual circumstances, at the sole discretion of the
Firm. Asset management fees will be automatically deducted from the client account on a monthly
basis by the custodian, as authorized by the client in writing, and will appear as a line item on the
statement provided directly by their custodian.
If a client so elects, the client may be billed hourly, rather than charged a fee based on the client's total
assets under management. The hourly fee will be billed monthly at a rate of $300 per hour, although
this amount is negotiable in advance.
Most asset management accounts are held at Charles Schwab & Co., Inc., unless the client requests
that assets be held with another firm, or for 401(k) accounts which are held at the plan’s custodian. As
client assets are held on a brokerage platform, clients will generally incur additional expense from
brokerage-based activities. Clients should be aware that all custodial and execution fees remain
separate and distinct from those fees charged by the Firm for its asset management services.
All fees paid to the Firm for asset management or 401(k) advisory services are separate and distinct
from the fees and expenses charged by mutual funds to their shareholders (our clients). 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. If the fund also imposes sales
charges, a client will bear the cost of any initial or deferred sales charge.
Accordingly, clients should review both the fees charged by the mutual funds and the advisory fees
charged by the Firm to fully appreciate the total amount of fees to be paid by the client.
Asset Management Services - Billable Value and Timing of Fees
Fees for asset management services are charged monthly in arrears based on the fair market value of
assets, including cash, at the close of business on the last day of that month, with any cash flows in or
out of the portfolio prorated based on the date of occurrence. As applicable, the flat portion of the
annual fee is also charged monthly with 1/12 of the annual flat fee being charged each month. For any
partial month period on new and closed accounts, fees will be pro-rated based on the number of days
in which the account is open during the month, including the flat fee.
401(k) Advisory Services - Billable Value and Timing of Fees
Fees for 401(k) advisory services are charged in accordance with the method available to VanceGray
based on the custodian that holds the client assets.
If the custodian is able to provide VanceGray with holdings information on a daily basis, then fees are
charged monthly in arrears based on the fair market value of assets, including cash, at the close of
business on the last day of that month, with any cash flows in or out of the portfolio prorated based on
the date of occurrence. As applicable, the flat portion of the annual fee is also charged monthly with
1/12 of the annual flat fee being charged each month. For any partial month period on new and closed
accounts, fees will be pro-rated based on the number of days in which the account is open during the
month, including the flat fee.
If the custodian is not able to provide VanceGray with holdings information on a daily basis, then the
custodian will provide holdings information at each quarter end and fees are charged quarterly in
arrears based on the fair market value of assets, including cash, at the close of business on the last
business day of that quarter. As applicable, the flat portion of the annual fee is also charged quarterly
with 1/4 of the annual flat fee being charged each quarter. For any partial quarter period on new and
closed accounts, the flat fees will be pro-rated based on the number of days in which the account is
open during the quarter.
Clients will direct VanceGray as to which taxable account 401(k) advisory services fees should be
deducted. In rare cases, VanceGray may bill a client directly for 401(k) advisory services fees.
Financial Planning and Consultation Services
Clients who enter into an Investment Advisory Contract for financial planning or consultative services
will be charged an hourly fee for such services. The hourly fee will be billed at a rate of $300 per hour
which is negotiable in advance. Hourly fee-based clients are billed upon completion of work performed
and clients will receive an invoice from the Firm. Occasionally and at the client’s written instruction, the
Firm will deduct hourly fees directly from an investment account managed by the Firm. Upon client
request, the Firm will provide an estimate of expected charges in advance of commencement of
services.
Pension Consulting Services & Educational Seminars and Workshops
Fees for pension consulting services are negotiable, based on the amount and level of service to be
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