Horter Investment Management, LLC Client Agreement


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Horter Investment Management, LLC Client Agreement

  1. 1. HORTER INVESTMENT MANAGEMENT, L.L.C. CLIENT AGREEMENT This Agreement is entered into this ____ day of ______________, 2008, by and between Horter Investment Management, L.L.C. (herein called "Adviser"), a duly Registered Investment Adviser, whose principal office is 8316 Cornell Road, Cincinnati, Ohio 45249, and _______________________________________ with residence at _______________________________________________________ (herein called the "Client"). 1. Engagement Effective on the date set forth above, the Client retains the Adviser as a financial and investment adviser upon the terms and conditions set forth in this Agreement and the Adviser accepts said retention and agrees to perform the scope of services selected by the Client on the "SCHEDULE OF SERVICES AND FEES" attached hereto as Appendix A. In all levels of service the Adviser agrees to assess the Client's assets (including the investment portfolio), liabilities, income and expenses and to provide the Client analysis and/or advice in verbal and/or written form. In the case of comprehensive financial planning, the Adviser will provide the Client with a written financial plan. When requested, the financial plan will include recommendations to the Client regarding the Client's securities and other investments. The Adviser will not take possession or custody of any securities or other assets of the Client. 2. Adviser Compensation For the services to be rendered to the Client hereunder, the Adviser shall be entitled to such compensation as shall be agreed upon in writing from time to time by the Client and the Adviser. All fee arrangements shall be in writing and shall be deemed to be part of this Agreement, attached hereto as Appendix A. The Client further agrees that all fees due to the Adviser for providing continuous and regular supervisory management services (“Asset Management”) of the Client’s investment assets, shall be paid directly to the Adviser from the Client’s account which will be held by an independent custodian. The Client agrees to execute the authorization letter attached hereto as Appendix C authorizing the direct payment of fees to the Adviser by the independent custodian. In the event the Adviser is only providing the Client with comprehensive financial planning, and not Asset Management of the Client’s investment assets, all fees due to the Adviser detailed in Appendix A shall be payable by the Client upon presentation of a financial plan by the Adviser. 3. Investment Philosophy The Client shall retain the right to direct the Adviser as to the general type of investments that are to be utilized and to establish any general investment philosophy that is to be followed, with respect to the Account. It shall be the Client’s responsibility to advise the Adviser of the investment objectives of the Account and any changes thereto, as well as any specific investment restrictions applicable to the Client or the Account, and to give the Adviser prompt written notice if the Client deems any investments recommended or made for the Account to be inconsistent with such investment objectives or restrictions. 4. Periodic Reports The Adviser shall submit quarterly reports to the Client detailing the performance of the Client’s assets in the Account and provide such other information about the Account as the Client may reasonably request from time to time. 5. Client Information and Confidentiality The Client agrees to provide information regarding the Client's income, investments, other assets and interests, liabilities, income taxes, estate plan, and other pertinent information requested by the Adviser. (Appendix B). The Client also agrees to discuss their needs and goals candidly with the Adviser and to notify the Adviser of {H0869527.1 }
  2. 2. changes in the Client's situation, needs and goals. The Client acknowledges that the Adviser cannot adequately perform valid services for the Client based on incomplete or inaccurate information. The Client agrees to permit the Adviser to consult with and obtain information about the Client from the Client's accountant and other advisers and the Adviser is authorized to rely on such information. The Adviser agrees that all non-public confidential information pertaining to the Client, or its assets, that it obtains by reason of the existence of this relationship shall be held in confidence and shall not be disclosed without the consent of the Client, except as may otherwise be required by applicable law. 6. Adviser Recommendations Where the Adviser is providing Asset Management to the Client’s securities portfolio, the Client hereby grants the Adviser complete and unlimited discretionary authority with regard to the Client’s securities portfolio, subject to such limitations as the Client may specify from time to time by written notice. The Client hereby appoints the Adviser as his agent and attorney-in-fact with respect to this trading authorization. The Adviser, as agent and 2 attorney-in-fact with respect to the Client’s account, when it deems appropriate and without prior consultation with the Client, may (a) buy, sell, exchange, convert and otherwise trade in any stock, bonds, mutual funds and other securities including, but not limited to, money market instruments, (b) place orders for the execution of such securities transactions with or through brokers, dealers and issuers, and (c) direct custodians to subscribe for any such securities with or through any such brokers, dealers or issuers. This trading authorization is a continuing one and shall remain in full force and effect and be relied upon until the Adviser has received a copy of a written termination notice, which writing will be deemed to terminate this Agreement effective upon receipt. Client understands that the Adviser is prohibited from taking personal possession of Client securities, stock powers, monies or any other personal or real property in which the Client may have an interest. In addition, Client understands that the Adviser may not lend to or borrow from Client any monies or securities. Where the Adviser does not provide Asset Management services to the Client, the Client is free to obtain legal, accounting and brokerage services from any professional source to implement the recommendations of the Adviser. 7. Proxies The Adviser shall not be required to take any action or render any advice with respect to the voting of proxies relating to any securities in which the assets of the Account may be invested. 8. Material Non-Public Information The Client acknowledges that the Adviser obtains information from a wide variety of publicly available sources and that the Adviser has no sources of material non-public information. Additionally, the Adviser shall have no obligation to seek or use any material non-public or inside information for the benefit of the Account. 9. Conflicts The Client acknowledges that the Adviser performs investment advisory services for various other clients. The authority of the Adviser to invest and reinvest the assets in the Account shall not be affected by the fact that the Adviser may from time to time effect transactions in securities for its own account or for the accounts of its other clients that are similar or identical to securities in which it effects transactions for the Account. Nothing in this Agreement shall preclude or hinder the Adviser from rendering investment advisory or similar services to other clients, from using the investment knowledge it acquires while performing services for the benefit of the Account from being used for the benefit of itself or others, or from allocating investment opportunities among its various accounts as it deems appropriate. 10. Agreement Termination {H0869527.1 } Those Clients for whom the Adviser is providing continuous management of the Client’s investment assets may terminate this
  3. 3. Agreement by written notification received by the Adviser within five (5) business days of signing, without penalty and with any deposit refunded in full. After (5) business days, either party may terminate this Agreement by notifying the other party by registered or certified mail, and the Client is entitled to receive a refund less time and effort expended by the Adviser. If the client is only seeking financial planning services from the Adviser, and the client has received a written financial analysis and recommendations, no portion of any advisory fees will be refunded if the Client terminates this Agreement subsequent to receiving the written financial plan. This Agreement shall continue until terminated by the Client or Adviser. 11. Adviser Registration Adviser represents and warrants that it is registered as an investment adviser with the United States Securities and Exchange Commission. Adviser will either provide the Client with a current copy of Part II of its Form ADV or a similar written brochure not less than 48 hours prior to the execution of this Agreement or upon execution of this 3 Agreement. 12. Entire Agreement This Agreement, together with the Appendices, embodies the entire agreement between the Client and the Adviser with respect to the subject matter hereof and supersedes all prior and/or contemporaneous agreements and understandings, whether oral or written, with respect thereof. This Agreement may be amended either in whole or in part at any time only by a writing signed by the Client and the Adviser. Except as otherwise permitted by law, this Agreement may not be assigned or transferred by either party without the prior written consent of the other party. 13. Notices All communications hereunder shall be either in writing or confirmed in writing and mailed, telecopied or delivered to the appropriate recipient or recipients at the last authorized address or telecopier number of such recipient or recipients. Adviser and the Client agree to inform each other promptly of any change in their respective authorized addresses or telecopier numbers. Notices sent pursuant to this Agreement may be effected by regular mail, personal service, registered or certified mail. 14. Arbitration Client and Adviser both agree that all controversies which may arise between them concerning any transaction or construction, performance or breach of this agreement that cannot be settled, be submitted to binding arbitration in accordance with the rules, then in effect, of the American Arbitration Association. Client and Adviser agree that any such arbitration would be venued in Cincinnati, Ohio. All awards rendered by the arbitrators shall be final and judgment upon award may be entered in any court of competent jurisdiction. This Agreement is not intended to limit any right the Client may have under any provision of state and federal securities laws. 15. Governing Law This Agreement shall be construed and interpreted in accordance with the substantive laws of the State of Ohio. 16. Agreement Execution This Agreement may be executed and delivered in one or more counterparts, all of which together shall constitute one and the same instrument. 17. Severability {H0869527.1 } It is the intention of the Client and the Adviser that the terms and provisions of this Agreement be construed to be
  4. 4. separate and severable. If any term or provision of this Agreement shall be held void, invalid, unenforceable or in conflict with any applicable law, all of the other terms and provisions of this Agreement shall remain valid and fully enforceable. The Client and the Adviser represent and warrant that they have read this Agreement and know the contents thereof. 18. Limitation of Liability The Client understands that no guarantees are expressed or implied concerning the performance of investments, that investments may lose value, that the Adviser, it’s employees or associates, are not responsible for losses that may occur within any portfolio or investment account/s managed or recommended by the Adviser, which does not, however, waive any right the Client may have under any provision of state or federal securities laws. The Adviser cannot guarantee the results of any recommendations. The Client acknowledges and further understands that the Adviser has only been retained to provide those services selected by the Client in Exhibit A, attached hereto, and that the Adviser, its employees, officer and agents shall 4 have no liability and shall be held harmless to the Client for any other service(s) the Client may seek independent of this Agreement from any other adviser or person, including persons who may be an investment adviser representative of the Adviser. This provision in no way seeks to limit the Adviser’s liability resulting from those services provided to the Client pursuant to Exhibit A. IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first set forth above, and the Client hereby acknowledges that he/she/it has received and carefully reviewed a copy of Part II of the Form ADV, or a similar written brochure of Adviser, and the Adviser’s Privacy Policy. ____________________________________ Horter Investment Management, L.L.C. By:___________________________________ By:_________________________________ Its:___________________________________ Its:_________________________________ {H0869527.1 }
  5. 5. APPENDIX A SCHEDULE OF SERVICES AND FEES Financial Planning (initial plan) Estate Planning (initial plan) Asset Management Asset Management and annual financial plan updates Asset Management and bi-annual financial plan updates Asset Management by non-affiliated investment adviser Insurance review Investment review/consulting For a detailed description of these services please see Schedule F of Form ADV, 5 Part II. For hourly or project oriented engagements, fee(s) will be assessed as follows:       *For asset management services, fees will be assessed as follows: From To Quarterly Fee $0 $250,000 0.5% $250,001 $750,000 0.375% $750,001 $1,000,000 0.25% $1,000,001 + Negotiable * Fees for asset management services are based on the fair market value of the assets under management as of the last business day concluding each quarterly billing period. Fees are payable on the next calendar day following the end of prior quarterly billing period. Fees shall be pro-rated for additions or withdrawals during each quarterly billing period. Fees can only be changed in writing by agreement of the parties. Horter Investment Management, L.L.C. By:___________________________________ By:_________________________________ Its:___________________________________ Its:_________________________________ Date: Date: {H0869527.1 }
  6. 6. APPENDIX B - CLIENT INFORMATION GENERAL INFORMATION: Name             Social Security No./Tax ID             Address             City             State             Zip             TYPE OF ACCOUNT: (Check one) Individual Joint Rev Trust Irrev Trust CRT IRA Roth IRA SIMPLE IRA SEP IRA 401(K) Pension/PSP Other       6 FINANCIAL INFORMATION: What is your total net worth (exclusive of home)? What is your liquid net worth? Less than $25,000 Less than $25,000 Between $25,000 and $49,999 Between $25,000 and $49,999 Between $50,000 and $99,999 Between $50,000 and $99,999 Between $100,000 and $249,999 Between $100,000 and $249,999 Between $250,000 and $499,999 Between $250,000 and $499,999 Between $500,000 and $749,999 Between $500,000 and $749,999 Between $750,000 and $999,999 Between $750,000 and $999,999 $1,000,000 and over $1,000,000 and over What is your total annual income? What is your federal tax bracket? Less than $25,000 Between $25,000 and $49,999 Between $50,000 and $99,999 What is your source of wealth and income? Between $100,000 and $249,999 Employment salary Between $250,000 and $499,999 Inheritance Between $500,000 and $749,999 Sale of real estate Between $750,000 and $999,999 Other (describe) $1,000,000 and over INVESTOR HISTORY AND BACKGROUND: Have you ever invested in any type of financial product? No Yes (please continue below) How long have you been investing? Which types of investments have you owned? (Check all that apply) 1 – 5 yrs 11 – 20 yrs Stocks Partnerships 6 – 10 yrs 21 + yrs Bonds REITs Mutual Funds Private Equity Annuities Other How are your other assets being managed? Focus on conservative investments Focus on growth investments {H0869527.1 } Focus on aggressive investments
  7. 7. APPENDIX C AUTHORITY TO PAY INVESTMENT ADVISER FEES FROM ACCOUNT Horter Investment Management, L.L.C. 8316 Cornell Road Cincinnati, Ohio 45249 Gentlemen: This is to authorize you to have your investment advisory fees for the account you manage for us paid directly from the account, which is currently held by Pershing, LLC an independent custodian. This is subject to the requirement that you send us and the independent custodian, at the same time, a bill showing the amount of the 7 fee, the value of the assets on which the fee was based and the specific manner in which the fee was calculated. The independent custodian has agreed to send me a statement at least quarterly, indicating all amounts disbursed from the account including the amount of advisory fees paid directly to Horter Investment Management, LLC. This authority may be revoked at any time by written or oral notice to you or to the independent custodian. Sincerely, _______________________________ Client name (print) By: Authorized Signature(s) X ________________________________ Date:______________ NOTE: A separate letter to Horter Investment Management, L.L.C. should be signed for each account. If it is an individual account, the name or names of the owner of the account and signature(s) are needed. If it is an IRA or trust account, the name of the IRA or trust and an authorized signature(s) are needed. For example, “John Doe, IRA (Client), By John Doe (Signature)” or “Jones Company Pension Plan (Client), By Sam Smith, Trustee (Signature).” {H0869527.1 }