Item 5: Fees and Compensation
Please note, unless a client has received the firm’s disclosure brochure at least 48 hours prior to signing
the investment advisory contract, the investment advisory contract may be terminated by the client
within five (5) business days of signing the contract without incurring any advisory fees. How we are paid
depends on the type of advisory service we are performing. Please review the fee and compensation
information below.
Investment Management Services (KA Manages)
Our standard advisory fee is based on the market value of the assets under management and is
calculated as follows:
Account Value Annual Advisory Fee Comp. Financial Planning &
Investment Management Clients
$0 - $3,000,000 0.90% 1.000%
$3,000,001- $5,000,000 0.50% 0.55%
$5,000,000 and above 0.35% 0.35%
The minimum Fee for Investment Management Services is $7,500 per year.
The annual fees are negotiable and are pro-rated and paid in advance on a quarterly basis. The advisory
fee is a blended fee and is calculated by assessing the percentage rates using the predefined levels of
assets as shown in the above chart and applying the fee to the account value as of the first business day
of the quarter resulting in a combined weighted fee. For example, an account valued at $6,000,000 would
pay an effective fee of 0.741667% with the annual fee of $44,500. The quarterly fee is determined by the
following calculation: (($3,000,000 x 1.00%) + ($2,000,000 x 0.55%) + ($1,000,000 x 0.35%)) ÷ 4 = $11,125.
No increase in the annual fee shall be effective without agreement from the client by signing a new
agreement or amendment to their current advisory agreement.
Advisory fees are directly debited from client accounts, or the client may choose to pay by check.
Accounts initiated or terminated during a calendar quarter will be charged a pro-rated fee based on the
amount of time remaining in the billing period. An account may be terminated with written notice at
least 30 calendar days in advance. Upon termination of the account, any unearned fee will be refunded
to the client.
Co - Investment Management Services (KA Advises)
Our standard advisory fee is based on the market value of the assets under management and is
calculated as follows:
Account Value Annual Advisory Fee
$0 - $3,000,000 $100 Annual Administrative Fee plus .50% of AUM
$3,000,001- $5,000,000 0.35%
$5,000,000 and above 0.25%
The advisory fee is a blended fee and is calculated by assessing the percentage rates using the
predefined levels of assets as shown in the above chart and applying the fee to the account value as of
the first business day of the quarter resulting in a combined weighted fee. For example, an account
valued at $6,000,000 would pay an effective fee of 0.41% with the annual fee of $24,600. The quarterly
fee is determined by the following calculation: (($3,000,000 x 0.50%) + ($2,000,000 x 0.35%) +
($1,000,000 x 0.25%)) ÷ 4 = $6,150. No increase in the annual fee rate shall be effective without
agreement from the client by signing a new agreement or amendment to their current advisory
agreement.
Advisory fees are directly charged to Client via AdvicePay, or other online payment system Advisor
utilizes on an on-going basis, unless otherwise agreed in writing.
Accounts initiated during a calendar quarter will be charged a pro-rated fee based on the amount of
time remaining in the billing period.
Upon termination of this Agreement by Client while there is still value in the account under Adviser’s
management, Client will be charged a fee equal to 4 times the last calendar quarter’s AUM fee.
Comprehensive Financial Planning
Comprehensive Financial Planning consists of an upfront charge of up to $5,000 and an ongoing fee that
is paid monthly, in arrears, at the rate of $250 - $1,000 per month based on the complexity and needs of
the client. The fee may be negotiable in certain cases depending on the specific needs of the client and
level of complexity involved. Fees for this service may be paid by electronic funds transfer or check. This
service may be terminated at any time upon written notice. Upon termination of any account, the fee will
be prorated, and any unearned fee will be refunded to the client.
The upfront portion of the Comprehensive Financial Planning fee is for client on boarding, data gathering,
and setting the basis for the financial plan. This work will commence immediately after the fee is paid and
will be completed within the first 30 days of the date the fee is paid. Therefore, the upfront portion of the
fee will not be paid more than 6 months in advance.
Financial Planning Fixed Fee
Financial Planning will generally be offered on a fixed fee basis. The fixed fee will be agreed upon before
the start of any work. The fixed fee can range between $5,000.00 and $20,000.00. The fee may be
negotiable based on the scope of the engagement and level of complexity. If a fixed fee program is
chosen, half of the fee is due at the beginning of process and the remainder is due at completion of
work, however, KA will not bill an amount above $1,200 more than 6 months in advance. Fees for this
service may be paid by electronic funds transfer or check. Upon termination, the half of the fee that is
due up front will be non-refundable, and no further fees will be charged.
Other Types of Fees and Expenses
Our fees are exclusive of brokerage commissions, transaction fees, and other related costs and expenses
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