Item 5 – Fees and Compensation
Homrich Berg’s fee for providing Wealth Management Services (includes but not limited to
investment management and financial planning) depends on several factors. The two main
factors are (1) the scope, complexity, and frequency of the services to be provided, and (2)
the value of the investment capital placed under Homrich Berg’s management. Homrich
Berg generally imposes a minimum annual fee of $10,000 for its services but may
negotiate a fee below the annual minimum, or tiered schedule, where circumstances
warrant. Homrich Berg may request reimbursement of out-of-pocket expenses it incurs in
providing services to its clients.
Homrich Berg’s compensation for Wealth Management Services is calculated and payable
in accordance with the agreed upon fee schedule. The fee schedule is applied by Homrich
Berg to the market value of assets, which includes accrued interest and dividends, (in some
cases excluding margin balances; in other cases the margin balances are not excluded) of
the client's accounts as reasonably determined by Homrich Berg at the end of the
preceding calendar quarter. Fees are paid in advance at the beginning of each calendar
quarter. If a client terminates their advisory agreement during the quarter, HB will refund
the prorated amount of the fee that was paid in advance. Homrich Berg deducts fees from
client accounts as described in the client agreement. In some cases, the firm will allow a
client to pay by check instead of the account fee deduction. Homrich Berg occasionally
provides financial services to clients on an hourly rate basis. Our fees are negotiable.
Homrich Berg’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, third party investment managers and other third
parties such as margin interest, trade away fees, management fees, custodial fees,
deferred sales charges, odd-lot differentials, transfer taxes, wire transfer and electronic
fund fees, other fees and taxes on brokerage accounts and securities transactions, and
separate custody fees for maintaining Alternative Investments in taxable or retirement
accounts. Mutual funds and exchange traded funds also charge internal management fees,
which are disclosed in a fund’s prospectus. We advise each client to read the appropriate
prospectus for mutual funds & ETF’s in addition to the Operating Agreement and Offering
Memorandum of Private Investment Partnerships for a list of expenses. Such charges, fees
and commissions are exclusive of and in addition to Homrich Berg’s fee, and Homrich Berg
shall not receive any portion of these commissions, fees, and costs. Item 12 further
describes the factors that Homrich Berg considers in selecting or recommending brokers
for client transactions and determining the reasonableness of their compensation (e.g.,
commissions).
HB's current standard fee schedule for Financial Planning and Investment Management
Services is listed below. In some cases with financial planning clients, there may be an
agreed upon fixed annual minimum fee which would cause the total fees charged as a
percentage of investment capital under management to exceed the tiered fee schedule
below.
FINANCIAL PLANNING AND INVESTMENT MANAGEMENT SERVICES
Market Value of Portfolio Annual Fee
First $ 1,000,000 1.25%
Next $ 4,000,000 1.00%
Next $ 5,000,000 0.75%
Over $ 10,000,000 0.50%
HB's current standard fee schedule for Investment Management Services is listed below. In
some cases with Investment Management only clients, there may be an agreed upon fixed
annual minimum fee which would cause the total fees charged as a percentage of
investment capital under management to exceed the tiered fee schedule below.
INVESTMENT MANAGEMENT SERVICES
Market Value of Portfolio Annual Fee
First $ 1,000,000 1.25%
Next $ 1,000,000 1.00%
Next $ 3,000,000 0.75%
Over $ 5,000,000 0.50%
Payment of fees may be paid directly to HB by the client, or payment of fees may be made
by the independent custodian holding the client's investments.
When payment is to be made by the custodian:
(1) The client provides written authorization permitting the fees to be paid directly from the
client's account held by the custodian;
(2) HB provides the custodian the amount of the fee;
(3) HB sends to the client an invoice that shows the amount of the fee, the value of the
client's assets upon which the fee is based, and the specific manner in which the fee is
calculated;
(4) The custodian discloses to the client that it is the client's responsibility to verify the
accuracy of the fee calculation and that the custodian has not determined whether the
calculation is properly made; and
(5) The custodian sends to the client an account statement that shows all amounts
disbursed from the client's account.