Item 5: Fees and Compensation
Methods of Compensation and Fees
Portfolio Management Services
For clients who retain the firm to provide portfolio management services, Promus Capital’s fee,
payable in advance, is computed based on the market value of or best available information for the
client’s portfolio assets on the last business day of the preceding quarter. The quarterly fee is
charged at one-fourth the annual rate specified in the client’s investment advisory agreement. The
initial quarterly fee, payable on the date the account is accepted, is computed based on the market
value of or best available information for such portfolio assets on the date of such acceptance. A
pro rata refund will be made to clients who terminate Promus Capital’s services prior to quarter
end. Promus Capital generally charges an annual fee starting at 1.00% on advised assets; however,
fees are negotiable, and fees charged to advisory clients are generally in accordance with the
following schedule:
Account Size Annual Fee
$0 – 5 million 1.00%
>$5 – 10 million 0.75%
>$10 – 20 million 0.65%
>$20 – 30 million 0.60%
>$30 – 40 million 0.55%
>$40 – 50 million 0.50%
>$50 – 100 million 0.45%
>$100 million 0.30%
Products managed by 0.25%
Advisory Affiliates1
For investment advisory services, Promus Capital generally imposes a minimum account size of
$5,000,000 in investable assets, which may be waived by the firm in its sole discretion. The current
1.00% fee for a $5,000,000 minimum account implies a minimum fee of $50,000. As such, clients
should be aware that for accounts with less than $5,000,000 in investable assets, they may be able
to find comparable services at more favorable pricing elsewhere.
Clients typically authorize the qualified custodian to automatically deduct the fee and all other
charges payable hereunder from the assets in the account when due, with such payments to be
reflected on the next account statement sent to the client. If the account lacks adequate cash to pay
such fees, the firm may liquidate securities in an amount equal to the balance of unpaid fees to pay
for the unpaid balance. Promus Capital may modify the fee at any time upon 30 days’ written
notice to the client. In the event the client has an ERISA-governed plan, fee modifications must be
approved in writing by the client.
Advisory fees are subject to the investment advisory agreement between the client and Promus
Capital. Such fees are charged quarterly in advance. The client and the client’s custodian or broker-
1“Advisory Affiliates” refers to investment managers affiliated with Promus Capital; please see Item 10 below for
additional information.
Part 2A of Form ADV: Promus Capital, LLC Brochure
dealer will be invoiced at the beginning of each calendar quarter, based upon the market value of
or best available information for (market value or best available information plus any credit
balance or minus any debit balance) the client’s account at the end of the prior quarter. The fees
will be prorated if the investment advisory relationship commences other than at the beginning of
a calendar quarter.
Client Payment of Fees
With respect to the payment of advisory fees, Promus Capital will not take possession of client
funds or securities at any time except to the extent that the firm may deduct fees directly from the
client’s account. Promus Capital will deduct advisory, reporting, administrative and reporting, and
custodial fees directly from the client’s account provided that (i) the client provides written
authorization to the qualified custodian, and (ii) the qualified custodian sends the client a
statement, at least quarterly, indicating all amounts disbursed from the account. The client is
responsible for verifying the accuracy of the fee calculation as the client’s custodian will not verify
the calculation.
The fees charged by Promus Capital are exclusive of administration expenses, brokerage
commissions, transaction fees, fund expenses and other related costs and expenses which shall be
incurred by a client. Custody fees will vary depending on the custodian. All brokerage charges and
related transaction costs are charged to the account(s) as they occur. Clients incur certain charges
imposed by custodians, brokers, third party managers (including managers affiliated with Promus
Capital) and other third parties such as fees charged by managers, 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.
Mutual funds, closed-end funds, ETFs, structured products and other pooled investment vehicles
are subject to commissions, fees and expenses which are disclosed in the fund’s prospectus or
offering documents. Such charges, fees and commissions are exclusive of and in addition to
Promus Capital’s advisory fee. Although clients will not bear any sales load for any proprietary or
affiliated funds, they may be charged a sales load for any unaffiliated funds.
Many funds offer multiple share classes available for investment based upon certain eligibility
and/or purchase requirements. For instance, in addition to more commonly offered retail mutual
fund share classes (typically, Class A (including load-waived A shares), B and C shares for mutual
funds), some funds offer institutional share classes or other share classes specifically designed for
purchase by an account for a fee-based investment advisory program. However, these share classes
may also have higher transaction costs and may have minimum purchase criteria that limit
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