Item 5 Fees and Compensation
A. Fee Schedule
Investment Management Services Fees and Compensation
Prism's fee for investment management services is based on a percentage of the assets in your
account and is set forth in the following annual fee schedule:
Total Assets Under
Annual Fee
Management
First $500,000 1.20%
Next $500,000 0.90%
Next $2,000,000 0.80%
Next $2,000,000 0.70%
Next $5,000,000 0.60%
Next $10,000,000 and Above 0.50%
Prism charges a fee as compensation for providing Investment Management services on your account.
These services include advisory and consulting services, trade entry, investment supervision, and
other account maintenance activities. We do not charge fees for completing transactions within your
account. However, the custodian may charge custodial fees, transaction costs, redemption fees,
retirement plan and administrative fees or commissions. See Additional Fees and Expenses below.
Furthermore, some existing variable annuities may be subject to mortality and administrative expense
fees. These fees are independent of our fees and should be disclosed by the custodian or contained in
each fund's prospectus. You should also note that fees for comparable services vary and lower fees for
comparable services may be available from other sources.
The fees for accounts are based on an annual percentage of assets under management. The fees are
applied to the account asset value on a prorated basis, billed quarterly in arrears. The initial fee will be
based upon the date the account is accepted for management by execution of the investment advisory
contract by Prism and the assets are transferred through the last day of the current calendar quarter.
The management fee is based on the size of the account at the end of each calendar quarter.
The fee is charged quarterly and is calculated on the market value of the account on the last day of the
calendar quarter and will cover the period from the first day of the calendar quarter through the last day
of the calendar quarter. The market value will be determined as reported by the Custodian. Fees are
assessed on all assets under management, including securities, cash and money market balances
(unless otherwise specified in the agreement).
Our investment advisory fees shall not exceed 1.20%. The specific advisory fees are set forth in your
Investment Management Services Agreement. Fees may vary based on the size of the account,
complexity of the portfolio, extent of activity in the account or other reasons agreed upon by us and you
as the client. In certain circumstances, our fees and the timing of the fees may be negotiated.
At our discretion, we may add (aggregate) asset amounts in accounts from your same household
together to determine the advisory fee for all your accounts. We may do this, for example, where we
also service accounts on behalf of your minor children, individual and joint accounts for a spouse,
and/or other types of related accounts. This consolidation practice is designed to allow you the benefit
of an increased asset total, which could potentially cause your accounts to be assessed a reduced
advisory fee based on the asset levels available in our fee schedule. You authorize us to debit your
account quarterly for our fee. The independent qualified custodian holding your funds and securities
will debit your account directly for the advisory fee and pay that fee to us.
Our agreement provides written authorization permitting the fees to be paid directly from your account
held by the qualified custodian. Further, the qualified custodian agrees to deliver an account statement
at least quarterly directly to you indicating all the amounts deducted from the account including our
advisory fees. You are encouraged to review your account statements for accuracy. We will receive a
duplicate copy of the custodian's statement that was delivered to you.
Either Prism or you may terminate the management agreement, upon 30 day written notice to the other
party. The management fee will be pro-rated to the date of termination, for the quarter in which the
cancellation notice was given, and any earned fees will be charged for the time the agreement was in
force. Upon termination, you are responsible for monitoring the securities in your account, and we will
have no further obligation to act or advise with respect to those assets.
Financial Planning Services
Fixed Fees
Prism charges a fixed fee for financial planning services, which generally ranges between $1,500 -
$10,000. The fee is negotiable depending upon the complexity and scope of the plan, your financial
situation, and your objectives. Fees are paid in arrears upon completion. Because fees are charged in
arrears, no refund policy is necessary. The final fee schedule is attached in the Financial Planning
Agreement.
Either Prism or you may terminate the financial planning agreement at any time by written notice. The
financial planning agreement terminates upon failure of the Client to pay agreed upon fee. Additionally,
any pro-rated earned fees will be charged through the termination date.
Hourly Fees
Depending upon the complexity of the situation and the needs of the client, the hourly fee for these
services is between $150 and $250. The fees are negotiable and the final fee schedule is attached in
the Financial Planning Agreement. Fees are paid in arrears upon completion. Because fees are
charged in arrears, no refund policy is necessary. Clients may terminate their agreements without
penalty within 5 business days of signing the Financial Planning Agreement.
An estimate of the total time/cost will be determined at the start of the advisory relationship. In limited
circumstances, the cost/time could potentially exceed the initial estimate. In such cases, we will notify
you and request that you approve the additional fee.
...