Description of Services and Fees:
There are three primary services
offered by BREIT Services; namely, Fiduciary Advisory Services, Business
Brokerage, and Corporate Governance while serving as an Independent Board Member, as outline
below. In addition, real estate
brokerage, property management, real estate valuations and business valuations
may be provided in conjunction with these primary services.
Fiduciary Advisory Services.
a) Oversight of Closely
Held or Family Businesses. BREIT
Services assists institutional or individual fiduciaries with closely held or
family businesses that are held in trusts and estates.
By engaging BREIT Services as a sub-advisor, a bank or other institutional fiduciary can feel confident that they
are fully meeting their fiduciary obligations for these unique assets while
minimizing their liability. BREIT Services manages closely held assets in conformance
with Regulation 9 of the Comptroller of the Currency to include annual asset
reviews. Even for individuals and
institutions not regulated by the Comptroller of the Currency, these guidelines
provide reasonable standards that a trustee could be legally held to.
b) Trust and Estate Management.
BREIT Services is available to assist individuals and institutions in
trust and estate management. Most
often BREIT Services will serve as an agent for an institution or an individual
as trustee. In certain circumstances our staff may be available to serve
as an individual trustee utilizing an institution, such as a bank or trust
company, to hold custody of the assets and, perhaps, to manage the public
security portfolio. Either as an
agent or as a fiduciary, BREIT Services can assist you with as much as
management of an entire trust/estate or as little as providing oversight of an
individual private company.
are determined as a percentage of asset value.
Agency fees are set at 75 basis points (i.e. 75% of 1%).
Trustee fees are set at 100 basis points (i.e. 1%).
Discounts are available for institutions with multiple relationships.
The minimum fee per account/relationship is $15,000 per year.
Appropriate indemnifications are also required.
Business Brokerage. While
some may be tempted to have the existing management of a company undertake the
sale of the company or the purchase of other companies, managements’ time and
efforts should be more appropriately and effectively utilized in operating the
company. The relatively small
brokerage fee will likely be more than compensated for by a better price for our
client while not unnecessarily hampering business operations.
Our staff has brokered or facilitated the purchase or sale of
manufacturing, farming, leasing, and real estate based companies with annual
revenues of less than $1 million to $75 million.
Most appropriate businesses for
BRIET Services should be sold or purchased within the range of $1 million to $50
million. A nonrefundable
retainer of $15,000 will be credited towards the success fee when the
transaction is complete. The
retainer covers the preparation of an offering memorandum for sale transactions. Any additional expenses to be reimbursed will be pre-approved
by the client. The success fee will
be prorated between 4% to 2% based on where the final transaction value falls
between the value range of $1 million to $50 million. A minimum
success fee of $100,000 applies for transactions of less than $2.5 million.
For instance, a company being sold for $10 million would fall 20% into
the value range and would incur a 3.6% success fee.
Corporate Goverance as an Independent Board Member.
The staff of BREIT Services, is available to represent fiduciaries or
other shareholders/principals as a member of the Board of Directors of private
companies. Our staff has served as
directors of manufacturing, job shop, leasing, distribution and real estate
based companies with annual revenues of less than $1 million to $175 million.
Virtually all viable corporations
should have the benefit of at least some, if not a majority of, independent
board members. Independent board
members of a corporation do not also serve in an operating capacity for that
corporation and are therefore able to objectively hire, evaluate and compensate
management while representing the shareholders (assuming all shareholders do not
also serve as managers). In any
case, independent board members
also work with management in setting and evaluating the strategic direction of
the company and determining the company’s capital structure (i.e. how the
company is financed).
Compensation for serving as a member of a Board of Directors can be composed of a monthly retainer, attendance fees and stock options. The minimum annual value of the compensation is $15,000 for smaller companies. Appropriate indemnifications are also required.