Item 5 – Fees and Compensation
Portfolio Management Fees for Separately Managed Accounts
Patton is compensated for its separately managed account services via a fee expressed as a
percentage of the assets being managed (certain clients may also be assessed a performance-
based fee as further described in item 6). Patton considers cash to be a distinct asset class and
the value of such assets are included in the advisory fee calculations. When yields on cash/money
market funds are low enough, the amount of income those investments generate will not exceed
the dollar amount of the advisory fee that client accounts pay proportionately with respect to those
assets. Consequently, clients will indirectly experience a negative effective return on any cash
position during these periods of low interest rates.
These fees are generally negotiable, and the final fee schedule will be memorialized in the client’s
advisory agreement. Certain clients with substantial assets under management who pay
performance-based fees are eligible for meaningful fee reductions. Clients may terminate the
agreement without penalty for a full refund of Patton’s fees within five business days of signing
the Investment Advisory Contract. Thereafter, clients may terminate the Investment Advisory
Agreement immediately upon written notice.
Our advisory fees are exclusive of fees charged by the custodian, broker, or other service
providers. Such additional fees include custodial fees, brokerage commissions, transaction fees,
wire transfer and electronic fund fees, and other related costs and expenses which will be incurred
by the client. Exchange-traded funds and mutual funds also charge internal advisory and other
fees, which are disclosed in a fund’s prospectus. Such charges, fees and commissions are in
addition to Patton’s fee, and we will not receive any portion of these commissions, fees, and costs.
Super-Diversified Portfolios
Total Assets Under Management Annual Fees
$100,000 - $5,000,000 1.50%
$5,000,001 - $10,000,000 1.00%
$10,000,001 – and up .75%
Clients paying a Performance-Based fee (see Item 6 below) on a portion of their managed assets
are eligible for a negotiated discount on the fees shown in this table.
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Patton Flex Strategy and Audacity Strategy
Advisory fees are calculated using the value of the assets in the Account on the last business day
of the prior billing period.
Asset-based portfolio management fees are withdrawn directly from the client's accounts with
client's written authorization on a quarterly basis or may be invoiced and billed directly to the client
on a quarterly basis. Clients may select whether to be invoiced or billed directly from their account.
Prorated adjustments are processed for new deposits during the quarter when the resulting fee
is greater than $2.00. Fees are paid in advance unless otherwise negotiated.
Accounts started or terminated during a calendar quarter will be charged a prorated fee. Upon
termination of any account, any prepaid fees will be refunded, and any unpaid fees will be due
and payable. Performance-based fees, if applicable, will be accelerated upon termination.
Company Retirement Plan Services
Fee Schedule for 401(k) Plans
Plan Assets Fee (Annual % of Assets)
Up to $10 million 0.35%
Next $15 million 0.25%
Next $25 million 0.15%
Next $50 million 0.10%
And up 0.05%
Under special circumstances, Patton negotiates fees. The fees are payable in quarterly
installments after the end of each quarter. These fees are based on the market value of the Plan’s
assets as of the last day of the quarter. If the Plan is established or terminated during the quarter,
the fee for that quarter will be prorated. Payment options will vary depending on the
recordkeeper’s options and the Company’s preferences. Each Company’s Plan documents will
detail the payment methods chosen.
Our fees are exclusive of fees charged by the Plan’s custodian, broker, Recordkeeper, or other
service providers. Such additional fees include recordkeeping fees, document change fees,
participant loan fees, custodial fees, brokerage commissions, transaction fees, wire transfer and
electronic fund fees, and other related costs and expenses which will be incurred by the client.
Exchange-traded funds and mutual funds also charge internal advisory and other fees, which are
disclosed in a fund’s prospectus. Such charges, fees and commissions are in addition to Patton’s
fee, and we will not receive any portion of these commissions, fees, and costs.
Clients may select the recordkeeper of their choice. Patton will typically recommend a
recordkeeper, but it is not mandatory that a client select our recommendation. Patton’s fee is not
dependent on the recordkeeper selected.
Fees are either billed to the plan’s recordkeeper and withdrawn from plan assets or invoiced
directly to the plan sponsor per the agreement with the plan sponsor on a quarterly basis. Prorated
adjustments will be made for partial periods. Fees are paid in arrears unless otherwise negotiated.
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Item 12 further describes the factors that we consider when selecting or recommending a
recordkeeper/custodian for client transactions and determining the reasonableness of their
compensation (e.g., commissions). Please refer to Item 11 which describes additional conflicts of
interest.
Financial Planning Fees
Fixed Fees
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