Item 5 Fees and Compensation
A. The client can engage RCA to provide investment advisory services on a fee basis.
The fees pertaining to Investment advisory services for ERISA Clients are described
under the separate heading below.
INVESTMENT ADVISORY SERVICES (NON-ERISA CLIENTS)
If a client engages RCA to provide discretionary and/or non-discretionary
investment advisory services on a fee basis, RCA’s annual investment advisory fee
shall be based upon a percentage (%) of the market value and type of assets
placed under RCA’s management (between 1.00% and 0.75 %) as follows:
Account Assets Quarterly Fee
under Management (% of Assets)
First $5,000,000 .25% (1.00% per year)
Balance of Account .1875% (0.75% per year)
INVESTMENT ADVISORY SERVICES - PRIVATE CLIENT SERVICES (NON-ERISA CLIENTS)
If a client engages RCA to provide discretionary and/or non-discretionary
investment advisory Private Client Services on a fee basis (required minimum $10
million commitment) based upon a percentage (%) of the market value of the
assets placed under RCA’s management for Corporate/Muni Bond account(s) .25%
and for Hedge Fund/Private Placement/Equity account(s) .50% as follows:
Account Assets Quarterly Fee
under Management (% of Assets)
Corporate/Muni Bound Account(s) .0625% (0.25% per year)
Hedge Fund/Private Placement/
Equity Account(s) .125% (0.50% per year)
INVESTMENT ADVISORY SERVICES (ERISA CLIENTS)
RCA may negotiate fees on a case-by-case basis, based in part on the scope and
complexity of services being provided to the ERISA Plan, as well as the size of the
plan and other relevant factors. RCA typically provides services on an annual fee
basis based upon a percentage of plan assets. Plan asset value is based upon the
market value of included plan assets as reported by the plan custodian or record-
keeper. Included plan assets are the plan assets for which RCA provides services as
described in the plan advisory agreement. The fees may be billed in advance or in
arrears and are calculated either quarterly, monthly or semi-annually. In special
circumstances, other fee paying arrangements may be negotiated. The amount,
method of calculation, timing of payment, whether it is in arrears or in advance, the
payment source (plan or plan sponsor) and remittance procedures are all set forth
in the plan advisory agreement. As agreed to under the plan advisory agreement
between RCA and the ERISA Client, the ERISA Client may authorize the plan
custodian to automatically deduct the fee from the plan or the plan sponsor of the
ERISA Client may choose to pay the fee.
Either RCA or the ERISA Client can terminate the plan advisory agreement at any
time, without penalty, by sending the other party 30 days prior written notice. Both
parties remain liable for and held to any transactions initiated before the
agreement was terminated. If the ERISA Client is billed in arrears, RCA will deliver a
final billing statement for unbilled work performed prior to termination, and the ERISA
Client will have 30 days to pay the invoice. If the ERISA Client is billed in advance,
RCA will pro-rate the fee based upon the number of days in the fee period prior to
the effective date of the termination and refund to the ERISA Client any unearned
fee.
INVESTMENT CONSULTING SERVICES
The client may engage RCA to provide investment consulting services which may
include the development of a written report establishing investment policies and
objectives for the client. If engaged by the client, RCA will analyze the historical
performance of the client’s investments relative to his/her/its financial situation
investment objectives and identify and locate other investment advisors for the
client’s consideration. These investment advisors will have historically met or
exceeded RCA’s required performance and risk avoidance standards.
The fee includes all consulting services for performance monitoring, asset allocation
and manager searches. RCA’s annual investment consulting services fee is based
upon a percentage (%) of the market value of the assets placed under RCA’s
management (between 1.50% and 0.50 %) as follows:
Account Assets Quarterly Fee (% of Assets)
$0 to $250,000 .375% (1.50% per year)
Next $250,000 .3125% (1.25% per year)
Next $500,000 .25% (1.00% per year)
Next $2,000,000 .1875% (0.75% per year)
Next $2,000,000 .15% (0.60% per year)
$5,000,000 Plus .125% (0.50% per year)
FINANCIAL PLANNING AND CONSULTING SERVICES FEES
To the extent requested by a client, RCA may provide financial planning and/or
consulting services (including investment and non-investment related matters,
including estate planning, insurance planning, etc.) on a stand-alone fee basis.
RCA’s planning and consulting fees are negotiable, but generally range from $2,000
to $10,000 on a fixed fee basis, depending upon the level and scope of the
service(s) required and the professional(s) rendering the service(s).
B. Clients may elect to have RCA’s advisory fees deducted from their custodial
account. Both RCA's Investment Management Agreement and the
custodial/clearing agreement may authorize the custodian to debit the account
for the amount of RCA's investment advisory fee and to directly remit that
management fee to RCA in compliance with regulatory procedures. In the limited
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