Hutchinson & Ziegler Financial Advisors Inc

Item	5	–	Fees	and	Compensation

A.	Advisory	fees	are	charged	quarterly	in	advance.		The	fee	is	calculated	by	taking	the	quarter-end
portfolio	value,	assigning	the	following	rate	schedule,	and	then	dividing	by	four	to	arrive	at	a
quarterly	fee	amount.		The	annual	rates	are:

	           Assets	Under	Management	                     Fee

	           $0	-	$1,000,000	                         	 1.00%,		plus
	           $1,000,000	-	$3,000,000	                     0.75%,	plus
	           $3,000,000	-	$5,000,000	                     0.50%,	plus
	           $5,000,000	-	$10,000,000	                    0.35%,	plus
	           $10,000,000	and	above	       	       	       0.25%

The	minimum	fee	for	new	clients	is	$35,000	per	year.		Fees	are	negotiable.		The	specific	manner	in
which	fees	are	charged	by	HZFA	is	established	in	the	client’s	Investment	Management	Agreement.
Lower	fees	for	comparable	services	may	be	available	elsewhere.

Advisory	fees	include	the	provision	of	financial	planning	services	at	no	additional	charge.		HZFA
may	occasionally,	at	its	discretion,	provide	stand-alone	financial	planning	services	to	individuals
who	do	not	retain	our	investment	management	services.		These	financial	planning	services	will	be
charged	a	fee	for	service	at	an	hourly	rate	of	$500.

B.	Clients	may	elect	to	pay	fees	directly	by	cash	or	check,	or	authorize	HZFA	to	automatically	debit
fees	from	client	accounts.		Most	clients	authorize	HZFA	to	deduct	its	quarterly	investment	advisory
fee	directly	from	their	custodial	account.		This	authorization	is	granted	under	the	terms	of	the
client’s	signed	investment	management	agreement	and	the	client’s	instructions	to	the	custodian.
The	Firm	sends	an	itemized	fee	invoice	showing	the	fee	calculation	to	each	client	at	the	time	it
invoices	the	client’s	custodian	to	deduct	and	transmit	its	fees.		It	is	the	client’s	responsibility	to
verify	the	accuracy	of	the	fee	calculation,	as	the	custodian	will	not	determine	whether	the	fee	is
properly	calculated

C.	The	fees	listed	above	are	in	addition	to	any	fees	charged	by	the	account	custodian	or	costs
associated	with	the	implementation	of	the	investment	plan.		These	costs	may	include	brokerage
commissions,	transaction	fees,	mutual	fund	operating	expenses,	custodial	fees,	wire	transfer	and
electronic	fund	fees,	and	other	fees	and	taxes	on	brokerage	accounts	and	securities	transactions,	as
detailed	below.		HZFA	does	not	receive	any	portion	of	these	commissions,	fees	or	costs,	and	seeks	to
minimize	them	on	clients’	behalf	whenever	possible.

Custodian	and	Brokerage	Fees
Clients	incur	certain	charges	imposed	by	their	custodians	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.		Additionally,
clients	will	incur	charges	by	the	executing	broker-dealer	in	the	form	of	brokerage	commissions	and
transaction	fees	on	the	investment	transactions	entered	into	for	their	account(s).		All	of	these
charges,	fees	and	commissions	are	in	addition	to	Advisor’s	investment	management	fee.
Clients	whose	assets	are	invested	in	bonds	purchased	directly	from	an	underwriter	or	on	the
secondary	market	may	pay	a	sales	credit	or	sales	concession	on	the	trade	(in	lieu	of	a	sales
commission).		The	client’s	custodian	may	also	impose	a	fee	on	the	transaction.		Item	12	further
describes	the	factors	that	HZFA	considers	in	selecting	or	recommending	broker-dealers	for	client
transactions	and	determining	the	reasonableness	of	their	compensation	(e.g.,	commissions).

Mutual	Fund	Fees
Investment	vehicles	such	as	mutual	funds,	closed-end	funds,	exchange	traded	funds	and	alternative
investment	funds	offer	broad	diversification	using	a	variety	of	objectives	and	strategies.		These
investment	vehicles	incur	brokerage	and	other	expenses,	as	well	as	operating	expenses	in
connection	with	the	management	of	the	fund.		Investment	funds	pass	some	or	all	of	these	expenses
through	to	their	shareholders	(the	individual	investors	in	the	funds)	in	the	form	of	management
fees.		The	management	fees	charged	vary	from	fund	to	fund.		In	addition,	some	funds	charge
shareholders	other	types	of	fees	such	as	early	redemption	or	transaction	fees.		These	charges	also
vary	widely	among	funds.			Clients	are	provided	a	copy	of	a	fund	prospectus	for	each	fund	in	which
they	invest	by	their	custodian	or	by	the	fund	sponsor	rather	than	by	HZFA.		As	required	by	law,	a
prospectus	represents	the	fund’s	complete	disclosure	of	its	management	and	fee	structure.

General	Fee	Disclosure
We	believe	our	investment	management	fees	are	competitive	with	the	fees	charged	by	other
investment	advisors	in	the	San	Francisco	Bay	area	for	comparable	services.		However,	comparable
services	may	be	available	from	other	sources	for	lower	fees	than	those	charged	by	HZFA.
We	do	not	provide	clients	advice	as	to	the	tax	deductibility	of	our	advisory	fees.		Clients	are	directed
to	consult	a	tax	professional	to	determine	the	potential	tax	deductibility	of	advisory	fee	payments.

D.		Investment	Advisory	contracts	may	be	terminated	at	any	time	for	any	reason	with	written
notice	at	the	will	of	the	client	or	Hutchinson	&	Ziegler	Financial	Advisors,	Inc.		HZFA	will	refund	any
prepaid,	unearned	fees,	and	any	earned	but	unpaid	fees	will	be	promptly	due	and	payable.
Accounts	initiated	or	terminated	during	a	calendar	quarter	will	be	charged	a	pro-rated	fee,
calculated	based	on	a	30-day	month,	360-day	year	calendar.		Refunds	will	be	paid	by	check	and	sent
via	U.S.	mail	within	30	days	of	receipt	of	termination	notice.

E.	HZFA	and	its	advisors	do	not	receive	compensation	from	the	sale	of	securities	or	any
compensation	other	than	client	fees	as	described	above.

Item	7	–	Types	of	Clients

HZFA	provides	investment	management	and	financial	planning	services	to	individuals,	high	net
worth	individuals,	families,	trusts,	corporate	pension	and	profit-sharing	plans,	and	charitable
institutions.

HZFA	does	not	have	a	mandatory	minimum	account	size.		Rather,	we	charge	a	minimum	annual	fee,
which	is	currently	$35,000.		This	minimum	fee	may	be	negotiable	for	those	clients	with	less	than	$5
million	under	management.