Advisory Agreement

Transcription

Advisory Agreement
Advisory AgreementAdvisory
Agreement
This Advisory Agreement (“Agreement”), made this____ day of ___________, 20___between the below signed party(s) (hereinafter
referred to as the “Client”), and Phalanx Wealth Management, LLC (“Adviser”), an investment adviser subject to the primary
jurisdiction of the State of Massachusetts.
1) Recitals.
a)
b)
The Client hereby appoints the Adviser as an investment adviser to perform the services hereinafter described, and
the Adviser accepts such appointment; and
The Adviser shall be responsible for the implementation of the services for which it is engaged regarding those assets
(which assets, together with all additions, substitutions and/or alterations thereto are hereinafter referred to as the
“Assets” or “Account”) designated by the Client on Appendix C to be subject to the terms and conditions of this
Agreement.
2) Scope of Engagement.
a) Portfolio Management
i) On a discretionary or non-discretionary basis, as designated in Appendix D, the Adviser may perform ongoing
investment review and portfolio management services and, as such, the Adviser is authorized to buy, sell, and
trade in stocks, bonds, mutual funds, direct participation programs, other securities and/or contracts relating to
the same, and/or other financial/investment products, on margin or otherwise, and to give instructions in
furtherance of such authority to a registered broker-dealer, other financial institution, and/or the Custodian (see
paragraph 4 for further information regarding Custodian) of the Assets.
b) Pension Consulting Services
i) The Adviser may provide advisory services to pension plans or sponsors of such plans where such services may
include but would not be limited to, plan feasibility, plan design, plan review, document preparation, plan
amendments and assistance with Department of Labor and/or IRS issues, among others.
c) Financial Planning
i) The Adviser may prepare and provide Client with a written financial plan.
3) Client Acknowledgements.
a) The Client agrees to provide information and/or documentation requested by Adviser in furtherance of this
Agreement as it pertains to Client’s objectives, needs and goals, and to keep Adviser informed of any changes
regarding same. The Client acknowledges that Adviser cannot adequately perform its services for the Client unless the
Client diligently performs his responsibilities under this Agreement. Adviser is expressly authorized to rely on and act
upon any information obtained from the Client, Client’s attorney, accountant or other professionals, in connection
with the terms of this Agreement;
b) Client authorizes Adviser to respond to inquiries from, and communicate and share information with, Client’s
attorney, accountant and other professionals to the extent necessary in furtherance of Adviser’s services under this
Agreement; and
c) Client acknowledges that Appendix C and Appendix D are hereby incorporated into and considered part of this
Agreement.
4) Custodian.
a) The Assets shall be held by an independent, Qualified Custodian or issuer, not Adviser. At no time shall Adviser be
considered the Custodian of any client Assets.
b) The term "Qualified Custodian" for purposes of this Agreement shall mean the financial institution designated by
Adviser herein such as a broker-dealer or other financial institution maintaining Assets of the Client.
c) The Adviser is authorized to give instructions to Qualified Custodian or issuer with respect to all transactions deemed
appropriate by Adviser and in connection with its services provided under this Agreement.
d) Qualified Custodian or issuer, not Adviser, may send periodic statements (at least quarterly) showing all transactions
occurring on behalf of the Client.
e) Designation of Qualified Custodian. Please refer to Appendix E for the designation of the Qualified Custodian(s).
f) Unless specifically requested and agreed to otherwise, Qualified Custodian shall generally hold Assets in street name.
5) Adviser Compensation.
a) Advisory fees. Please refer to Appendix B for a description of Adviser’s fees.
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b)
Other fee considerations.
i) The Adviser is authorized to instruct the Qualified Custodian to deduct from Client’s account(s), the appropriate
dollar amount(s) necessary to satisfy Adviser’s fee(s) in connection with its services under this Agreement. The
Adviser shall not be entitled to cash or other Client Assets held by the Qualified Custodian except those monies
owed to Adviser in connection with the Adviser Compensation section of this Agreement.
ii) In addition to Adviser’s fees, and any custodial fees charged by Qualified Custodian or ssuer, the Client may also
incur, relative to certain investment products (such as mutual funds, variable contracts, direct participation
programs), charges imposed directly at the investment product level (e.g. advisory fees, administrative fees,
and/or other expenses).
iii) Any custodial fees charged to the Client by the Qualified Custodian or issuer is exclusive of, and in addition to,
Adviser Compensation as defined herein.
iv) Client acknowledges that he/she shall be solely responsible for the payment of Adviser’s fees and any other fees
associated with the Assets.
6) Risk Acknowledgment. Adviser does not guarantee the future performance of the investment product, strategy, or
recommendations related thereto. Client understands that investment products may be subject to various market, interest rate,
currency, economic, political and business risks, and that the purchase or sale of any investment products will not always result
in profitable performance.
7) Directions to Adviser. Adviser may request that all directions, instructions and/or notices from the Client to Adviser be submitted
in writing, including notification of a change in the Client’s investment objective(s). The Adviser shall be fully protected in relying
upon any direction, notice, or instruction until it has been duly advised in writing of changes thereto.
8) Adviser Liability. Except as otherwise provided by federal or state securities laws, Adviser, acting in good faith, shall not be liable
for any action, omission, investment recommendation/decision, or loss in connection with this Agreement including, but not
limited to, the investment of the Assets, or the acts and/or omissions of other professionals or third-party service providers
recommended to the Client by Adviser, including a broker-dealer, investment adviser, Qualified Custodian, issuer, or other party.
Adviser’s services under this Agreement shall not apply to assets not contemplated by this Agreement. Under certain
circumstances, federal and state securities laws impose liabilities on persons who act in good faith and, therefore, nothing
contained in this Agreement shall constitute a waiver of any rights that the client may have under federal and state securities
laws.
9) Assignment. This Agreement may not be assigned by either the Client or Adviser without the prior written consent of the other
party.
10) Termination. This Agreement will continue in effect until the earlier of the point at which:
a) it is terminated by either party by written notice to the other (email notice will not suffice), which written notice must
be signed by the terminating party and received by the other party at least ten (10) days in advance of the requested
termination date; or
b) the securities offering(s) in which the Client has invested are closed (as defined by the specific offering’s offering
memorandum).
c) Termination of this Agreement will not affect (i) the validity of any action previously taken by Adviser under this
Agreement; (ii) liabilities or obligations of the parties from transactions initiated before termination of this
Agreement; or (iii) Client’s obligation to pay advisory fees (prorated through the date of termination). Upon the
termination of this Agreement, Adviser will have no obligation to recommend or take any action with regard to the
securities, cash or other investments in the Account.
11) Non-Exclusive Services. Adviser, its officers, employees, and agents, may have or take the same or similar positions in specific
investments for their own account(s), or for the accounts of other clients, as Adviser does for the Assets of Client. Client
expressly acknowledges and understands that Adviser shall be free to render investment services to others and that Adviser
does not make its investment services available exclusively to Client. Nothing in this Agreement shall impose upon Adviser any
obligation to purchase or sell, or to recommend for purchase or sale, for or on behalf of Client any security which Adviser, its
principals, affiliates or employees, may purchase or sell for their own benefit or for the benefit of any other client, if in the
reasonable opinion of Adviser such investment would be unsuitable for the Client or if Adviser determines in the best interest
of the Client it would be impractical or undesirable.
12) Death or Disability. The death, disability or incompetence of Client will not terminate or change the terms of this Agreement.
However, Client’s executor, guardian, attorney-in-fact or other authorized representative may terminate this Agreement by
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giving thirty (30) days advance written notice to Adviser in accordance with the termination provisions described herein. The
Client recognizes that the Qualified Custodian or issuer may not allow any further transactions until such time as the necessary
documentation is provided to the Qualified Custodian or issuer.
13) Disclosure Document. The Client hereby acknowledges prior receipt of a copy of the Disclosure Document of the Adviser (i.e.
Part II of Form ADV). Client further acknowledges that he has had a reasonable opportunity (i.e. at least 48 hours) to review
said Disclosure Document, and to discuss the contents of same with professionals of his choosing, prior to the execution of this
Agreement. If the Client has not received copy of the Adviser’s Disclosure Document at least 48 hours prior to execution of this
Agreement, he/she/it shall have 5 business days from the date of execution of this Agreement to terminate Adviser’s services
without penalty under this Agreement.
14) Severability. Any term or provision of this Agreement which is invalid or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity or unenforceability without rendering invalid or unenforceable the
remaining terms or provisions of this Agreement or affecting the validity or enforceability of any of the terms or provisions of
this Agreement in such jurisdiction or any other jurisdiction.
15) Client Conflicts. If this Agreement is between Adviser and related clients (i.e. husband and wife, life partners, etc.), Adviser’s
services shall be based upon the joint goals communicated to Adviser. Adviser shall be permitted to rely upon instructions from
either party with respect to disposition of the Assets, unless and until such reliance is revoked in writing to Adviser. The Adviser
shall not be responsible for any claims or damages resulting from such reliance or from any change in the status of the
relationship between the clients.
16) Privacy Notice. Client acknowledges receipt and understanding of Adviser’s Privacy Policy. Please see Appendix A.
17) Electronic Delivery. Client authorizes Adviser to distribute materials and information to client in an electronic format to the
email address provided on the Investor Questionnaire or Fidelity Application or as otherwise provided by Client.
18) Verification of Customer Identity. Adviser may be required by federal law to take any necessary and appropriate measures to
confirm the identity of Client. Adviser may obtain information such as Client name; Client address; Client date of birth; and
Client identification number (i.e. driver’s license number, passport number, etc.) Adviser may require Client to provide a copy of
a current, government issued photo identification. Adviser may perform a background check or a credit report in an effort to
help confirm certain information provided by Client.
19) Emergency Contact Information. Name: Brian Woodland; Phone: 978-887-5981; Fax: 978-887-2928; Email:
[email protected].
20) Applicable Law. This Agreement supersedes and replaces, in its entirety, all previous investment advisory agreement(s) between
the parties. To the extent not inconsistent with applicable law, this Agreement shall be governed by and construed in
accordance with the laws of the State of Massachusetts.
21) Authority. The Client acknowledges that s/he/they/it has (have) all requisite legal authority to execute this Agreement, and that
there are no encumbrances on the Assets. The Client correspondingly agrees to immediately notify Adviser, in writing, if either
of these representations should change.
22) Arbitration.
a) Arbitration Provisions.
i) All parties to this Agreement are giving up the right to sue each other in court, including the right to a trial by
jury, except as provided by the rules of the arbitration forum in which a claim is filed.
ii) Arbitration awards are generally final and binding; a party’s ability to have a court reverse or modify an
arbitration award is very limited.
iii) The ability of the parties to obtain documents, witness statements and other discovery is generally more limited
in arbitration than in court proceedings.
iv) The arbitrators do not have to explain the reason(s) for their award.
v) The panel of arbitrators will typically include a minority of arbitrators who were or are affiliated with the
securities industry.
vi) The rules of some arbitration forums may impose time limits for bringing a claim in arbitration. In some cases, a
claim that is ineligible for arbitration may be brought in court.
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vii) The rules of the arbitration forum in which the claim is filed, and any amendments thereto, shall be incorporated
into this Agreement.
viii) The arbitration forum shall not be selected if traveling to its location would cause undue, not ordinary, hardship
or financial expense to the Client.
b) I Arbitration Notices.
i) If Adviser seeks to compel arbitration of such claims, Adviser must agree to arbitrate all of the claims contained
in the complaint if the customer so requests;
ii) No person shall bring a putative or certified class action to arbitration, nor seek to enforce any pre-dispute
arbitration agreement against any person who has initiated in court a putative class action; who is a member of a
putative class who has not opted out of the class with respect to any claims encompassed by the putative class
action until: (i) the class certification is denied; or (ii) the class is decertified; or (iii) the customer is excluded from
the class by the court. Such forbearance to enforce an agreement to arbitrate shall not constitute a waiver of any
rights under this Agreement except to the extent stated herein;
iii) You are entitled to keep a copy of this Agreement;
iv) You are entitled to request a copy of this Agreement at anytime; and
v) You are entitled to request the names of and information on how to contact or obtain the rules of all arbitration
forums in which
a claim may be filed under this Agreement.
23) Execution. IN WITNESS WHEREOF, the Client and Adviser have each executed this Agreement on the day, month and year
written on the facing page, by signing the on the facing page and below. By signing and dating below,
a) I acknowledge my receipt and understanding of this Agreement and all provisions (including those pertaining to any
pre-dispute arbitration clause) set forth within it; and
b) Agree to abide by the provisions set forth within this Agreement.
This Agreement contains a pre-dispute arbitration clause located in the Arbitration paragraph above.
Client Signature:
Date:
Joint Client signature:
Date:
Associated person’s signature:
Date:
Authorized supervisor’s signature:
Date:
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Appendix A – Privacy Policy
Phalanx Wealth Management, an independent financial advisory and management firm, is committed to safeguarding the
confidential information of its clients. We hold all personal information provided to our firm in the strictest confidence. These
records include all personal information that we collect from you in connection with any of the services provided by Phalanx
Wealth Management. We never disclose information to nonaffiliated third parties, and do not anticipate doing so in the
future. If we were to anticipate doing so in the future, we would be prohibited by law from doing so without advising you first.
As you know, we use health and financial information that you provide us to help you meet your personal financial goals while
guarding against any real or perceived infringements of your rights or privacy. Our policy with respect to personal information
about is listed below.
We limit employee and agent access to information only to those who have a business or professional reason for knowing, and
only to non affiliated parties as permitted by law. (For example, federal regulations permit us to share a limited amount of
information about you with a brokerage firm in order to execute transaction on your behalf.) If our firm is required to discuss
your financial situation with any other professional retained by you, such as an accountant or lawyer, we will obtain your
permission before doing so.
We maintain a secure office and computer environment to ensure that your information is safe.
The categories of nonpublic personal information that we collect from a client depend upon the scope of the client
engagement. It will include information about your personal finances, information about your health to the extent it may be
needed for financial planning, and information about transactions between you and third parties. For unaffiliated third parties
that require access to your personal information, including financial service companies, consultants and auditors, we also
require the strictest confidentiality in our agreements with them. Federal and state regulators may also review these records
as permitted by law.
We do not and will not provide your information to vendors or solicitors for any purpose.
Personal identifiable information about you will maintained during the time you are a client, and for the required time
thereafter that is required by law. After this time, all such information will be carefully destroyed.
Phalanx Wealth Management (“Phalanx”) is a Massachusetts Registered Investment Adviser. This communication is not a solicitation or offer to
sell investment advisory services except in states where we are registered or where an exemption or exclusion from such registration exists. This
material is provided for informational purposes only and may not constitute a complete description of available investment services. Investment
in securities involves the risk of loss. Past performance is no guarantee of future returns.
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Appendix B – Phalanx Wealth Management Tiered Fee Schedule
First
$500,000
1.0%
Next
$500,000
0.8%
Next
$2,000,000
0.7%
Next
$1,000,000
0.6%
Next
$1,000,000
0.5%
Over
$5,000,000
Negotiated Rate
This schedule is used as a guideline only; all fees are subject to negotiation at the sole
discretion of PWM.
Sample Amounts
$100,000
$250,000
$500,000
$750,000
$1,000,000
$1,250,000
$1,500,000
$1,750,000
$2,000,000
$2,250,000
$2,500,000
$2,750,000
$3,000,000
$3,250,000
$3,500,000
$4,000,000
$4,250,000
$4,500,000
$4,750,000
$5,000,000
>$5,000,000
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Management Fee
1.0%
1.0%
1.0%
0.93%
0.90%
0.86%
0.83%
0.81%
0.80%
0.79%
0.78%
0.77%
0.77%
0.75%
0.74%
0.73%
0.71%
0.70%
0.69%
0.68%
Negotiated Rate
Appendix C – Account Designation and Fee Schedule
Account Title
Account #
Fee Type
Rate/ Amount Billing Method
(Annual% or Hourly)
Appendix D – Advisory Service Description
Service Type
Service Description
Portfolio Management
Financial Planning
Discretion
___ Full ___ None
___ Full ___ None
Disclosures and Client Acknowledgement
• The Adviser is authorized to instruct the Qualified Custodian to deduct from Client’s account(s), the
•
•
•
•
•
appropriate dollar amount(s) necessary to satisfy Adviser’s fee(s) in connection with its services
under this Agreement and in connection with the preceding Fee Schedule.
Client authorizes Qualified Custodian of the Assets to charge the Account(s) for the amount of
the Adviser’s fee(s) (based on the terms contained in preceding Fee Schedule) and to remit such
fee(s) to the Adviser in accordance with the terms of this Agreement.
The Adviser shall not be entitled to cash or other Client Assets held by the Qualified Custodian
except those monies owed to Adviser in connection with the Adviser Compensation section of
this Agreement.
Client will have the opportunity to object to the fee amount or method of calculation by telephone
or in writing, should the client believe that such is erroneous.
The account statements provided by the Qualified Custodian (not less frequently than quarterly)
to the Client will reflect all fee deductions.
The Client may revoke this fee deduction authorization in writing at any time.
Client 1 Signature / Date
Client 2 Signature / Date
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Appendix E – Qualified Custodian List
National Financial Services, LLC
200 Seaport Blvd.
Boston, MA 02110
617-563-7000
American Funds
College America
5300 Robin Hood Road
Norfolk, VA 23513
1-800-421-9900 x529
Capital Bank & Trust Company
PO Box 6164
Indianapolis, IN 46206-6164
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