Chaldon is an independent, pension consulting firm. Chaldon provides consulting services as its sole line of
business that is based on years of targeting its sales efforts to public officials, board members, union officers,
and administrators. Chaldon has an experienced and diverse team that provides proactive counsel to help their
clients meet or exceed their goals and objectives. Chaldon is owned and controlled by Arthur R. Marcus and
Bruce R. Piatt, its active partners.
In general, Chaldon does not provide investment management services in the context of managing a portfolio
of stocks, bonds or other instruments; rather, Chaldon provides customized pension consulting advice, which
may include recommendations of specific third-party investment managers.
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Chaldon offers fixed, hourly and asset-based fees. In addition, we offer success-based fees to certain clients.
When calculating either an asset-based fee, we rely on a valuation provided by an independent third party
(typically the client’s custodian bank) since Chaldon does not value assets. Success based fees are calculated
based on a variety of factors that are customizable per client.
Fees are generally quoted on a full retainer basis, encompassing all the services provided by Chaldon. On
occasion, fees are quoted on a project basis for a defined time or scope of work. Some clients choose to
reimburse us for reasonable travel expenses, while others prefer that our fee includes travel. Certain clients
may be subject to a minimum fee. In all cases, the fee is agreed upon prior to Chaldon’s retention and is
specified in a written agreement with each client.
Chaldon will generally bill its fees monthly, to be paid in advance. Accounts initiated or terminated during a
calendar quarter will be charged a prorated fee. Upon termination of any account, any prepaid, unearned fees
will be promptly refunded, and any earned, unpaid fees will be due and payable. All our fees are quoted, paid
and received in hard dollars.
Chaldon does not have a standard fee schedule, and all fees are subject to negotiation.
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Chaldon does not charge performance based fees in the traditional sense (based on the valuation of
securities portfolios), but rather on the success of the plan. The fee is calculated based on a variety of
factors and is agreed upon in a written agreement with each client.
Chaldon may also recommend that certain clients select one or more third party investment managers that
charge a performance-based fee.
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Chaldon provides customized pension advice to a variety of clients, including public funds, both State and
municipal and Taft-Hartley Funds. These clients include several plan types including defined benefit, defined
contribution, health and welfare and operating assets.
Chaldon does not have a minimum account size for its clients.
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Our client portfolios are generally designed to achieve specified target rates of return at predetermined risk
levels. Accordingly, these portfolios may contain domestic equities, fixed income and cash equivalents,
international equities and global fixed income, real estate, alternative assets and various hedging strategies.
In our role as a pension consultant, Chaldon does not become involved at the security level with a client.
Rather, we focus on the asset class, the interaction among asset classes and the third-party investment managers
who have demonstrated proficiency managing the various asset classes.
We believe that, like stocks or bonds evaluated by third party investment managers, we should have levels of
conviction about managers and their ability to outperform. The evaluation process along with the interviews
and due diligence we conduct allows us to form opinions about the third-party investment managers with
whom our clients work.
Managers that prove favorable may subsequently be recommended to clients, but only if they are a good “fit”
within the investment program based on return expectations, risk tolerance, liquidity needs, legal and/or
regulatory constraints, lack of “red flags”, and other factors.
Investing in securities involves a risk of loss that clients should be prepared to bear. Clients should also
understand that alternative assets (including hedge funds, real estate and private equity) may be illiquid or
subject to lock-ups, and are not subject to the same regulatory requirements as registered investment vehicles.
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Registered investment advisers are required to disclose all material facts regarding any legal or disciplinary
events that would-be material to your evaluation of Chaldon or the integrity of Chaldon’s management.
Chaldon has no information applicable to this Item.
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While Chaldon recommends/selects third party investment advisers for clients, the firm may receive
compensation from the advisors upon the successful selection by the client and is always acknowledged and
disclosed in writing to the client. In addition, Chaldon does not maintain any other business relationship with
selected advisers that would create a material conflict of interest.
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Chaldon maintains a Code of Ethics that provides all employees with guidance on proper conduct in fulfilling
its obligation as a fiduciary to its clients and in complying with SEC rules. The Code of Ethics stresses the
importance of avoiding activities, interests and relationships that might interfere with, or give the appearance
of interfering with, making decisions in the best interests of Chaldon clients. Employees are reminded that
they must always (1) place the interests of clients first, (2) conduct all personal securities transactions in full
compliance with the Code of Ethics, and (3) avoid taking inappropriate advantage of their position. Among
other things, the Code of Ethics requires employees to:
disclose material facts and actual or potential conflicts that may affect the services provided to
clients;
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act in the best interests of clients and place the interests of clients above the interests of
Chaldon personnel whenever a conflict may be present;
not engage in any activity that conflicts with the interests of clients;
avoid taking inappropriate advantage of their position (e.g., by using knowledge of a client’s
portfolio transactions to profit by the market effect of those transactions); and
conduct all personal trading in full compliance with the Code of Ethics, including all pre-trade
clearance and reporting requirements.
The Code of Ethics also requires employees to make certain disclosures regarding their trading and personal
portfolios, restricts investments in private placements and new issues, and restricts the acceptance of gifts.
Chaldon’s Code of Ethics is administered and enforced by its Chief Compliance Officer. All employees
must acknowledge the terms of the Code of Ethics annually, or as amended. A copy of the Code of Ethics
will be provided to any client or potential client upon request.
Chaldon's officers and employees may purchase, sell or hold investment accounts or interests in privately
offered investment funds that are managed by third party investment advisory firms recommended from time
to time by Chaldon to its clients. This may present a potential conflict of interest to Chaldon. Accordingly,
Chaldon has implemented policies pursuant to which such accounts and investments are reviewed prior to
opening and periodically thereafter. In addition, securities trading by employees (including any investments
in privately offered funds) is subject to the requirements of Chaldon's Code of Ethics.
From time to time, Chaldon may work with a client, or a client who has an affiliate, that could be considered
a money manager. Chaldon generally provides advice on the selection of third party investment managers,
and is not in any way involved with the operations or finances of the firms themselves.
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Chaldon reviews client accounts on a periodic basis and/or as scheduled at the request of each client. All client
relationships are covered on a team basis, ensuring both continuity and consistency.
Chaldon provides a suite of pension consulting services and as such client reviews include a thorough analysis
of each customizable service being provided to each client. With respect to securities, the appraisal can
include an evaluation of those third-party investment managers selected for clients, their performance and the
overall market environment.
In addition to regular meetings with clients, Chaldon will schedule supplementary meetings upon the
occurrence of extraordinary events within the client’s portfolio, such as the loss of key personnel.
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Chaldon does not use a third party to solicit business. Chaldon may accept referral fees or commissions on
successful recommendations as demonstrated in Item 10.
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As a matter of firm policy and practice, Chaldon does not have any authority to and does not vote proxies
on behalf of advisory clients. Plan sponsor clients retain the responsibility for receiving and voting proxies
for all securities maintained in client portfolios. Chaldon may from time to time provide advice to clients
regarding proxy voting services or the clients’ voting of proxies.
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As a registered investment adviser Chaldon is required in this Item to provide you with certain financial
information or disclosures about its financial condition. Chaldon has no financial condition that impairs its
ability to meet contractual and fiduciary commitments to clients, and has not been the subject of a bankruptcy
proceeding or petition. Chaldon does not require or solicit the prepayment of fees six months more in
advance for the rendering of advisory services.
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