Company Overview June 2012 www.sterlingtrustees.com
Sterling Trustees• Provides professionally administered services to the trust and its beneficiaries, as well as family offices, as a South Dakota-chartered trust company• Acts as an independent fiduciary – we don’t believe a trustee should act as your investment manager, there is an inherit conflict of interest• Works with best of breed money managers to ensure trusts assets conform to the investment needs of the client• Administers each trust by a professional from our highly experienced staff of trust officers – we maintain one of the lowest professional-to-client ratios in order to provide better and timely service to our clients• Uses state-of-the-art software to monitor trust performance across multiple custodians and trusts making our offering unique in the marketplace
Sterling Trustees - Services Sterling provides the following services when working with high net worth families: • Trust administration including all distributions, tax filings and any other necessary compliance to maintain the trust • Meet with the beneficiaries face-to-face at least once a year to develop relationships that enable us to make intelligent decisions regarding distributions and any other family issues that might arise • Meet quarterly with investment advisors to review portfolios and make any necessary adjustments as outlined in the investment policy statement • Monitor investment advisor performance daily using Sterling Connect™, our state-of-the-art trust and accounting platform and access to Morningstar Direct
Sterling Trustees – Role as Independent TrusteeTechnology Infrastructure and Independence Use of Best of Breed Money Managers Accounting & Administration Portfolio Performance Review Investment Manager Planning Opportunities Family Tax Reporting Securities Distributions Custody Client Reporting
Sterling Trustees – Role as Private Label Trust Co Family Small Accounting Community RIAs Law Firms Brokerage Firms Banks Firms Technology Infrastructure and Consolidated Reporting Accounting & Portfolio Client Performance Tax Reporting Distributions Administration Reporting Review
Sterling Trustees – Role in Family Office Services Family Technology Infrastructure and Consolidated Reporting Lawyers Accountants Estate & Tax Strategy | Corporate Governance Cash Flow Mgmt| Tax Preparation Compliance | Create Entities and Interests Partnership Accounting| Compliance Banks Consultants Banking services | Investment Process Family Meetings| Education Debt Financing | Mortgages Family Mission Investment Mgmt Concierge Services Portfolio Mgmt| Real Estate | Private Equity Gate Keeping| Bill Payment | Personal Services Investment Manager Review| Hedge Funds Personal Staff Mgmt | Private Shopper Financial Planner Insurance Family Gifting| Economic Modeling Risk Management| Policy Review Estate & Tax Strategy| Charitable Planning Offshore Insurance| Insurance Trusts
Sterling Trustees - Investment Oversight • We hire and methodically monitor third-party investment advisors often using multiple custodians based on the size of the trust. • Our fiduciary duty is to the trust/client and therefore we are not influenced by fees earned on investment management Establish Determine Select and Analyze and Understand Rebalance investment asset implement communicate your needs Portfolio objectives allocation strategy results Current Review trust Work with 3rd Careful Review of financial docs party advisor to consideration of current review Financial needs optimize asset tax implications situation Review of analysis allocation to Incorporate diverse Refinement of existing Financial goals meet any family investment original goals if investment and objectives needs vehicles appropriate portfolio established Monitor Continuous ID of all implementation monitoring and assets and through 3rd party communication liabilities advisor of results
Sterling Trustees - Money Managers• As an independent trustee, we enable our clients to work with best of breed money managers to ensure wealth preservation of trust assets for generations to come
Sterling Trustees - Value Proposition• Solely serves as the independent trustee.• Chartered in South Dakota, which provides clients with the most sophisticated trust law in the country.• Uses independent best of breed investment advisors to manage the trust’s assets.• Charges a fixed fee vs one that increases or decreases with AUM.• Open architecture investment style ensures that trusts can access best and most suitable investment products.• Trust reporting system allows us to report on any type asset on a t+1 basis even with multiple custodians.
Why Use an Independent Corporate Trustee?Choosing a trustee is one of the most significant decisions people face when establishing a trust. The trustee isresponsible for administering your assets according to the provisions you outline in the trust agreement. Although youcan designate any individual to oversee the administration of your trust, even sophisticated individuals or family membersoften find managing a trust to be burdensome and complex.A independent corporate trustee may be your best option and give you several advantages, including:Experience - Corporate trustees typically handle many trusts on a daily basis and are very familiar with applicable legalrequirements. They understand the intricacies of a wide range of trust types and have a great deal of knowledge in theadministration and investment management of trusts.Objectivity - The corporate trustee is bound by the terms of the trust document and will administer the trust as it iswritten. In many cases, individual trustees have a tendency to favor one class of beneficiaries over another. It can bedifficult for a trustee who is a parent, sibling, relative or friend to act objectively. A corporate trustee benefits from being anoutsider who can make decisions free from bias and family dynamics.Regulation - A corporate trustee is subject to many levels of oversight. Internal auditors, external auditors andgovernment regulators all make sure that the corporate trustee is carrying out the fiduciary duties that have been given tothem. This is all for the protection of the trust and its beneficiaries.
Why Use an Independent Corporate Trustee?A independent corporate trustee may be your best option and give you several advantages, including:Reliability - Duties are not interrupted due to illnesses, vacations or other disruptions that may distract a personal trusteefrom performing the responsibilities of trustee. Corporate trustees typically have a staff that is well versed in the differenttrusts that they oversee.Tax Management and Record Keeping - Administering a trust includes filing tax returns, issuing statements andkeeping records of trust activity. Most corporate trustees have tax and record keeping expertise, or have contracted withcompetent preparers, so they are able to handle trusts properly from a tax and reporting perspective.Longevity - Because one of the principal reasons for establishing a trust is to provide for the future, it’s important toremember that an individual trustee will eventually be unable to perform the duties of a trustee. Unlike an individualtrustee, a corporate trustee will not predecease you or otherwise be unable to administer the trust. By choosing acorporate trustee, you help ensure continuity for the full term of the trust.Liability – Most trust companies are well insured to handle law suits from beneficiaries or losses from gross negligence inthe administration of trusts. This is the number one area that is overlooked by individual trustees when they agreeto serve in a trustee capacity.
Pros and Cons of Individual and Corp TrusteesPros of Independent Corporate Trustee Cons of Independent Corporate Trustee- Specialist personnel for: - Lack of familiarity with family relationships and dynamics Investment management - Impersonal Financial advice and assistance for beneficiaries - Changes in personnel Tax planning and return preparation - Mandatory fees Applying required law to distribution determinations - Conservative investing philosophies Preparation of accounting - Inexperienced personnel - Extensive trust management experience and knowledge of applicable - Hostility to real property, closely held business, or single security law and procedures investments - Deep pockets in regard to liability for malfeasance - Bureaucratic delays - Long-term service capabilities (e.g., through multiple generations) - Government and association regulation and oversight - Fills a need when no suitable individual is available - Ability to act in an independent manner - Backup staffing in the event of death, illness, or unavailability of principal administrator - Computerized record keepingPros of Individual Trustee Cons of Individual Trustee- Knowledge of family relationships and dynamics - Limited or lack of knowledge of taxes, investments, and/or- May be willing to serve without or at a lower fee applicable law- May be knowledgeable regarding family investments or businesses - Risk of death, disability, absence- Comfort as to professionalism, knowledge, or skill set of known - Successor issues - Outsourcing investments, tax, and legal work may result in higher overall costs - Successor issues - Possible conflicts of interest with or between family members and/or beneficiaries
LeadershipSTANLEY JOFFEChairman and CEOP: 610.234.0627 | F: 610.825.1385 | email@example.comStanley M. Joffe is Chairman and Chief Executive Officer of Sterling Trustees, which he founded in 2008 after a long anddistinguished career as a trust and estates attorney. Mr. Joffe has always believed that there is an inherent conflict ofinterest between trustees who act in a fiduciary capacity as well as manage the investment of trust assets. As a result,Sterling Trustees today has fiduciary responsibility for over $500 million in client assets. Prior to founding SterlingTrustees, Mr. Joffe was CEO and Director of DM Trust Company, a trust company. Mr. Joffe formed in 2007 to fill a needin the U.S. market for independent corporate trustees.In addition to managing DM Trust, Mr. Joffe was a partner at Duane Morris LLP, where he focused on the areas ofinternational tax and estate planning and domestic estate planning. He has more than 25 years of experience in assistinghigh net worth individuals of foreign countries to resettle in the United States in the most tax-effective manner. He isadmitted to practice in Pennsylvania and South Africa, and is a published author and speaker on international tax andestate planning. Mr. Joffe is a member of the Society of Trust and Estate Practitioners (STEP).Mr. Joffe received an LL.M. in Income Tax and Estate Planning from Temple University School of Law. He is a graduate ofthe University of the Witwatersrand in South Africa, where he received a Bachelor of Commerce degree in 1962, aBachelor of Laws degree in 1965, and a Higher Diploma in South African Tax Law in 1976.
LeadershipANTONY JOFFEPresidentP: 610.234.0626 | F: 610.825.1385 | firstname.lastname@example.orgAntony Joffe founded Sterling Trustees with his father in 2008 and serves as its president. Antony is responsible for managingthe day-to- day activities of Sterling Trustees including operations, compliance and sales and marketing.Previously, Antony was President of DM Trust Company. Before starting his career in the trust service business, Antony spent15 years in the financial services industry including investment banking and private equity, most recently as a principal atBryant Park Capital, a New York-based boutique investment bank, where he helped to establish the firm’s new Philadelphiaoffice. Prior to Bryant Capital, Antony was a principal at FB Capital Partners, a $500 million private equity fund focused onnon-control investments in the industrial, business services, financial services and real estate markets. Before that, Antonyspent eight years in the investment banking group of Janney Montgomery Scott. His experience includes working withemerging growth companies to complete public and private equity offerings, mergers and acquisitions transactions, valuationsand other financial advisory work. Antony started his career as an auditor in the Business Advisory Group at Coopers &Lybrand.A native of South Africa, Antony received his B.B.A. in Accounting from Emory University and an M.B.A. with a concentration infinance from Temple University. He is a Certified Public Accountant.