Item 5 Fees and Compensation
SELECT INVESTOR
Advisory Fees
Fees will be payable in arrears at the conclusion of each quarter in which services
are rendered and will be based upon the market value of the assets managed by
Reik & Co. as follows:
Annual Rate Assets under Supervision
1.00% First $5,000,000
0.75% Next $5,000,000
0.50% Over $10 million
LARGE CAP STRATEGY
Annual Rate Assets under Supervision
0.75% All
Fees are negotiable in that fees may vary from the above schedule to reflect
special client circumstances, which may apply to a specific account.
Advisory fees are calculated based on the market value of the assets in the
client’s account as reported by the client’s qualified custodian. The value
used for billing purposes is based on the custodian’s account valuation at
the end of the applicable billing period. Assets included in the calculation of
advisory fees generally include all securities positions as well as cash and
cash equivalents held in the account.
Fixed Fees
Reik & Co. may also provide, in limited circumstances, advisory services on a fixed
annual advisory fee basis, which is billed on a quarterly basis in advance or in
arrears as agreed upon with a client in writing. A fixed annual fee will be based
upon the level of services, amount of client portfolio assets and other client specific
circumstances and agreed upon with the client. The Firm does not require a
retainer when accepting a fixed fee arrangement.
Conditions for Managing Accounts
Although not a requirement, Reik & Co. recommends that clients provide a minimum
asset level for new Select Investor accounts of $500,000.
General Information on Fees:
Clients generally elect to have fees directly debited by the client’s qualified
custodian from the client’s designated account and paid to our Firm. This authority
is granted to Reik & Co., Inc. by the client’s written authorization obtained in the
client’s investment management agreement. Additional information regarding the
Firm’s limited custody of client assets resulting from fee deduction is described in
Item 15 of this brochure.
No fee adjustments shall be made for partial withdrawals, account appreciation, or
depreciation within a billing period. If the relationship is closed within a billing
period, a pro-rata refund of fees charged shall be made. Our Firm does not impose
start-up, closing, or penalty fees in connection with the account. Clients may
alternatively choose to be invoiced separately.
Negotiability of Fees
In certain circumstances, Reik & Co.'s fees may be negotiable. Reik & Co. may
charge different clients receiving the same services different fees. The above fee
schedules are the Firm's basic fee schedules generally charged to clients absent
negotiable circumstances. Client facts, circumstances and needs are considered in
determining the fee schedule. These include the complexity of the client, assets to
be placed under management, anticipated future additional assets; related
accounts; portfolio style, account composition, reports, among other factors. The
specific annual fee schedule is identified in the contract between the adviser and
each client.
Calculation
Reik & Co. will directly debit fees, upon written permission of the client, or will bill
the client as agreed upon with the client. If we directly debit fees, the client's
custodian is advised of the amount of the fee to be deducted from that client's
account. On at least a quarterly basis, the custodian is required to send to the client
a statement showing all transactions within the account during the reporting period.
The fee charges are calculated as described above and are not charged on the
basis of a share of capital gains upon or capital appreciation of the funds or any
portion of the funds of an advisory client (Section 205(a)(1) of the Investment
Advisers Act of 1940, as amended).
Termination of Advisory Relationship
A client agreement may be canceled at any time by either party for any reason
upon thirty (30) days’ prior written notice. Clients have the right to terminate their
advisory agreement without penalty within five (5) business days after entering into
the agreement.
Advisory fees for portfolio management services based on assets under
management are billed quarterly in arrears. Because these fees are billed after
services are provided, any earned but unpaid fees through the termination date will
be due and payable.
In certain circumstances, the Firm may provide advisory services for a fixed fee.
Fixed fees may be billed either in arrears or in advance depending on the terms of
the client’s written advisory agreement.
If a fixed fee has been billed in advance and the advisory relationship is terminated
before the end of the billing period, the Firm will refund any unearned portion of the
prepaid fee as determined under the client’s advisory agreement.
Mutual Fund and ETF Fees
Reik & Co., LLC does not offer or recommend mutual funds as part of its
investment advisory services. However, some client accounts contain mutual funds
that were purchased before the client engaged the Firm or that were transferred
into the account from another financial institution.
Reik & Co., LLC does recommend and use exchange-traded funds (“ETFs”) as part
of its investment strategies where appropriate for the client. Mutual funds and ETFs
charge internal expenses that are separate from and in addition to the advisory
fees charged by Reik & Co., LLC. These expenses are paid by the mutual fund or
ETF and are indirectly borne by the investor. For mutual funds, these expenses are
described in the fund’s prospectus and generally include management fees,
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