Item 5. Fees and Compensation
a. Our Fees / Fee Schedule / Fees Negotiable
Pickwick is compensated by a fee that is calculated on the total market value of each client’s
account that is under Pickwick’s supervision. Any client assets that are to be excluded from
this fee calculation must be specifically identified and communicated to Pickwick in writing.
Pickwick’s fee is expressed as an annual percentage rate, but is calculated, billed and
deducted from client accounts quarterly in advance. The initial quarterly fee is calculated on
a prorated basis. For client accounts that are initially funded in whole, or in part, with
transferred in assets, the intended investment allocation will be used for billing purposes
whenever applicable.
The investment advisory fee is agreed upon by Pickwick and the client at the inception of the
relationship, as outlined by the Pickwick Client Agreement. Pickwick’s standard advisory fees
for client accounts are as follows:
First $1,000,000 under management 0.75% per year
Next $4,000,000 under management 0.65% per year
Over $5,000,000 under management 0.50% per year
The above schedule relates primarily to investment supervisory services for portfolios
consisting of actively managed investment products. Existing clients may be paying
different rates than those outlined above. Past or present Pickwick clients have been and
may be charged such different fees for supervisory services for portfolios consisting mainly
of passive investment products. Also, special circumstances may require the negotiation of
special fee arrangements different from the standard schedule outlined above. Such special
fee arrangements are based on time spent, specific client requirements, and the complexity
of the desired investment supervisory tasks or otherwise.
b. Deduction of Fees
For client accounts held at Pershing and invested using Envestnet’s wrap program, Pickwick’s
advisory fee is generally deducted from a client’s account once per calendar quarter as part
of the total fees deducted by Envestnet. The total fees applicable to the Envestnet program
(i.e. wrap fees), including third party investment manager fees, are described in the account
opening documents of the Envestnet program.
Generally, client accounts held at a firm other than Pershing or Envestnet are directly
utilizing the services of one or more sub-advisors that have been retained by Pickwick. In
these instances, Pickwick will rely upon the sub-advisor to calculate, bill, deduct and remit
Pickwick’s advisory fee. The billing practices of each sub-advisor are outlined in the sub-
advisor’s Form ADV Brochure. In addition, one or more sub-advisors may utilize a third party
pricing service in order to arrive at the applicable market value for a client’s account. While
the third party prices utilized by the sub-advisor are deemed to be obtained from reliable
sources, from time to time, small pricing differences may occur between the sub-advisors’
billed market value(s) and the market value listed on a client’s custodial statement. For
accounts held outside the Envestnet wrap program, clients are provided with an advisor fee
invoice on a quarterly basis. Additional information regarding Pickwick’s advisory fees is
contained in Pickwick’s Client Agreement.
c. Other Fees
Clients whose supervised assets are invested in mutual funds or separately managed
accounts at other investment advisory firms are paying two advisory fees--an investment
advisory fee to Pickwick and an additional advisory fee to the mutual fund managers and
managers of separately managed accounts. In addition, clients invested though the
Envestnet program are also paying a program fee to Envestnet Asset Management,
expressed as a percentage rate and also described and approved by the client at the time of
opening of the account, for services such as performance reporting, processing of portfolio
rebalancing and due diligence on investment products. Clients may be charged pay a
custodial and safekeeping fee to Pershing for assets invested through the Envestnet program
or, for assets invested outside the Envestnet program, to the client custodian. These fees to
the client’s custodian are also expressed as a percentage rate and are also described and
approved by the client at the time of opening of the account.
Through the Envestnet program clients don’t normally incur separate brokerage
commissions for transactions placed in their account. For those clients whose assets are
invested in accounts outside the Envestnet program, brokerage commissions are charged on
either a per transaction basis or if the client prefers, brokerage commissions can be based
upon an asset based commission fee schedule. For more information on brokerage and
brokerage fees please read Item 12 – Brokerage Practices on page 14 of this brochure.
Clients may also incur additional charges for other account services provided by their
custodial institutions These charges might include but are not limited to: IRA custodial fees,
safekeeping fees, and fees for legal or courtesy transfers of securities
Certain of the mutual funds and exchange-traded funds that may be acquired in customer
accounts may, in addition to assessing management fees, internally assess distribution,
administration and other service fees. The clients’ custodian(s) may collect such fees for
each year in which a balance is maintained in the mutual fund for the client accounts. These
fees are in addition to Pickwick Capital Advisors’ investment advisory fees. Such fees are
included in the calculation of operating expenses of a mutual fund. The existence of such
fees is disclosed in the prospectus for each mutual fund or exchange-traded fund.
Clients should be aware that all mutual funds and exchange-traded funds incur expenses for
portfolio management services and/or fund administration services. These internal fees are
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