Baird’s Placement of Client Trade Orders. Client understands and agrees that Baird will select the broker-dealers that will execute trade orders for Non-Discretionary Accounts and with respect to Accounts that are managed directly by Baird unless Client has provided instructions to Baird to the contrary. As investment adviser, Baird has an obligation to seek “best execution” of client trade orders. “Best execution” means that Baird must place client trade orders with those broker-dealers that Baird believes are capable of providing the best qualitative execution of client trade orders under the circumstances, taking into account the full range and quality of the services offered by the broker-dealer, including the value of the research provided (if any), the broker-dealer’s execution capabilities, the cost of the trade, the broker-dealer’s financial responsibility, and its responsiveness to Baird. Client understands and acknowledges that Baird’s best execution obligation does not require Baird to solicit competitive bids for each transaction or to seek the lowest available cost of trade orders, so long as Baird reasonably believes that the broker-dealer selected can be reasonably expected to provide Client with the best qualitative execution under the circumstances. Client understands and agrees that any commitment by Baird to provide Client with best execution does not impose any requirements upon Baird in addition to those that are imposed upon Baird under applicable law. Because Client does not pay commissions to Baird when Baird, acting as broker-dealer, executes Client’s trade orders, and because Client may incur commission costs in addition to the Advisory Program Fee if trade orders were to be executed by another broker-dealer firm, Client generally receives a cost advantage whenever Baird executes Client’s transactions. For this reason, and given Baird’s execution capabilities as broker-dealer, Baird expects that it will generally execute trade orders, as broker-dealer, for Client’s Non-Discretionary Accounts and Client’s Accounts that are directly managed by Baird. However, in some instances, circumstances may arise that may require Baird, in compliance with its best execution obligations to Client, to place Client’s trade order with a firm other than Baird. Client understands, acknowledges and agrees that if Baird places trade orders for Client’s Accounts for execution by a firm other than Baird, and the other firm imposes a commission or equivalent fee on the trade (including a commissi...
