Financial Planning and Investment Management Agreement
1. Member Agreement
a. Member hereby appoints Facet Wealth, Inc. (“Facet”) as an Investment Adviser to perform the services hereinafter described, and Facet accepts such appointment.
b. Scope of Services
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Financial Planning
Facet shall provide Member with the financial planning services with different membership levels defined by the planning services offered at each level. Membership levels are named Foundations, Core, Plus and Complete, and are presented to the member prior to signing an agreement. The services provided depend on the nature and complexity of the Member’s situation and could include some or all of the following: financial goal setting, portfolio design and asset allocation, risk tolerance, cash flow and expense (resource) planning, debt management and planning, employee benefits planning, employer stock plan analysis, retirement planning, education planning, risk management, insurance planning, estate planning through Facet’s third party partner Wealth.com, beneficiary designation, and income tax planning. Specific additional services, such as estate planning that may be offered, may be governed by an agreement between each Member and the third party service.
Facet’s recommendations (i.e. debt management, emergency savings, retirement planning, investments, estate planning, taxes, insurance, etc.) shall be discussed by Facet with the Member and implemented, limited solely to the scope of the financial plan, at Member’s sole discretion with the corresponding professional advisors (i.e. broker, accountant, attorney, etc.) of Member’s choosing. Member acknowledges that in respect to estate planning matters, Facet’s role shall be that of a facilitator between the Member and their corresponding service or legal professionals. In addition, if a Member chooses to use a service offered by a third party through Facet, they acknowledge that they will be governed by a separate agreement with that party. No portion of Facet’s services should be interpreted as legal or accounting advice.
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Investment Management
Discretionary investment management is included as part of the planning fee for most, but not all, of Facet’s membership levels and it is the member’s choice if they want to engage Facet in investment management services or not. Facet will inform the member whether or not investment management is a part of their service prior to signing this agreement.
Although Facet’s discretionary investment management services are not considered in determining a Member’s annual fixed planning fee, Facet notes that, depending on a Member’s assets under management, the annual fixed planning fee that Facet charges in respect of financial planning services may be in excess of the 2% asset-based fee industry standard typically used solely for investment management services.
The Member acknowledges that past performance may not be indicative of future results, and understands that the future performance of any specific investment or investment strategy (including the investments and/or investment strategies recommended by Facet) may not be profitable or equal to historical performance level(s).
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Discretionary Basis
For accounts that the member has designated for Facet to manage on a discretionary basis, Facet is authorized, without prior consultation with the member to buy, sell, trade and allocate in and among stocks, bonds, mutual funds and exchange traded funds.
Facet shall be responsible for the investment and reinvestment of assets specifically designated by the Member to be subject to Facet’s discretionary management (which assets, together with all additions, substitutions and/or alterations thereto are hereinafter referred to as the “Assets” or “Account”). Member delegates to Facet all of Member’s powers with regard to the investment and reinvestment of the Assets and appoints Facet as Member’s attorney and agent in fact with full authority to buy, sell, or otherwise effect investment transactions involving the Assets in Member’s name for the Account and to give instructions in furtherance of such authority to the registered broker-dealer and the custodian of the Assets. In addition, Member shall execute a custodial agreement with a qualified custodian that will provide Facet with the ability and discretion to trade on behalf of the Member at the selected custodian.
Facet shall discharge its investment management responsibilities consistent with the Member’s designated investment objectives. Unless the Member has advised Facet to the contrary, in writing, there are no restrictions that the Member has imposed upon Facet with respect to the management of the Assets.
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Non-Discretionary Basis
For accounts that cannot be managed by Facet, the Member may be provided with portfolio review and investment consulting services by Facet. Facet shall review the Member’s existing investment portfolio, and then provide corresponding investment recommendations and advice consistent with the Member’s designated investment objective(s), all of which recommendations and advice shall be based exclusively upon the information provided to Facet by the Member. The Member acknowledges that Facet’s recommendations may be limited to certain investments. If Facet provides such service, Facet’s authority shall be limited to the allocation of the Assets among the investment alternatives available and, as such, Facet will not have, nor will it accept, any authority to effect any other type of transactions or changes via the account web site, including but not limited to changing beneficiaries or effecting Account disbursements or transfers to any individual or entity. The member acknowledges that it is their responsibility to implement and execute any recommendations made by Facet.
c. The Member agrees to provide information and/or documentation requested by Facet in furtherance of this Agreement as pertains to Member’s objectives, needs and goals, and to keep Facet informed of any changes regarding the same. The Member acknowledges that Facet cannot adequately perform its services for the Member unless the Member diligently performs their responsibilities under this Agreement. Facet shall not be required to verify any information obtained from the Member, Member’s attorney, accountant or other professionals, and is expressly authorized to rely thereon.
d. With a Member’s prior written authorization, Facet may respond to inquiries from, and communicate and share information with, Member’s attorney, accountant and other professionals to the extent necessary in furtherance of Facet’s services under this Agreement.
e. The Member is free to obtain legal, accounting, and brokerage services from any professional source to implement the recommendations of Facet. Member may impose reasonable restrictions on Facet’s authority.
f. In the event that a Member’s personal/financial situation or investment objective(s) change, it is the Member’s responsibility to notify Facet accordingly for the purpose of Facet reviewing, evaluating or revising previous recommendations. To the extent that any portion of the financial plan is not implemented by Facet, Member maintains absolute discretion as to whether or not to accept any of Facet’s investment recommendations.
2. Agreement Term and Facet Compensation
This agreement is effective for one year and will automatically renew at the end of the term. Facet will provide at least two weeks’ notice of the renewal date. In addition, Facet will notify members with a 30 day advance notice of any changes to fees. Finally, Facet will also notify Members of any material changes to terms of this agreement in a timely manner.
Member’s annual fixed fee is set forth in the electronic authorization of the Member agreement. Facet’s annual fixed fee for Financial Planning, for most membership levels is provided under this Agreement and shall be based upon the individual service needs of each member. Facet’s pricing includes tiers of service that account for various objective and subjective factors, including, but not limited to, the Financial Planning Services selected for and agreed to by the Member, the complexity of the financial planning to be rendered by Facet, the anticipated number of meetings, if any, servicing needs, and level and scope of the overall services to be rendered. Facet presents fees to its members prior to signing an agreement on its website and may maintain fees offered to members prior to the latest fee schedule. Facet charges an enrollment fee for members who select Core, Plus and Complete membership levels.
The fee for services is non-refundable, covers the full term (1 year) and shall be paid in advance. The full term begins on the day the Member executes this Planning agreement and continues for one year. The member is responsible for payment for the entire term (1 year) regardless of the payment frequency selected (monthly, quarterly, annually).After this period, all memberships are non-refundable. Facet will regularly engage the Member through communication (electronic messages, phone calls) and meeting appointments (depending on the membership level). Given the work involved in preparation and engagement, the fee paid for the period is in effect regardless of whether the Member takes advantage of the services. The fee may be paid either monthly, quarterly or annually dependent upon membership level. Monthly payment options are only available for Facet’s Foundations membership level. No increase in the annual fee shall be effective without prior written notice to the Member at least 30 days in advance. With notification, Facet may use negative election (i.e. the Member must opt out of the change) to automatically increase the fee for service after the notice period.
a. All fees are initially paid by credit card through Facet application. All credit card payments are processed through a third party and no credit card information is retained directly by Facet. Members will not be asked to provide credit card information via email, video conference or phone call. Members at the Core, Plus and Complete membership levels who take advantage of Facet’s investment management service, will have their annual fee switched to investment account debit, unless the member opts out or the fee is greater than 2% of assets. Investment account debit is not available to members who select the Facet Foundations tier. Eligible members will be notified of the change to investment account debit as their form of payment. Member authorizes the Custodian of the assets to charge the Account for the amount of Facet’s fee and to remit such fee to Facet in compliance with regulatory procedures. If Facet cannot collect fees via account debit, Facet will charge, using a third party, the previously used credit card. Please Note: In the event that there is not sufficient cash in the investment account to pay Facet’s fee, Facet shall sell Assets to pay the fee.
b. In addition to Facet’s membership fee, the Member shall also incur, relative to: [1] all mutual fund and exchange traded fund purchases, charges imposed directly at the fund level (e.g. management fees and other fund expenses); [2] custodians, any miscellaneous account fees, such as wire close out or block trading fees, charged directly by the custodian and disclosed upon account opening. A comprehensive list of custodian based fees can be found on our website.
Facet includes investment management services as part of its planning fee and at certain service tiers, Direct Indexing is offered as part of the service. Facet uses Orion Portfolio Solutions, LLC to provide sub-advisory services for Direct Indexing, members will sign a separate agreement for that service and as part of the service, Orion will charge a fee of up to 0.15% to cover recordkeeping expenses. Facet does not share in this fee.
c. Member acknowledges that Member will be solely responsible for accepting or rejecting Facet’s financial planning advice and for implementing any such investment recommendations or advice. Facet may recommend itself, or a third party to assist the Member with implementation of Facet’s financial planning advice. A conflict of interest exists where Facet recommends itself to implement any such advice. Member understands that Member may choose any advisor, brokerage firm, or other professionals to implement the recommendations and advice given by Facet.
Where Facet introduces to Member a third party to provide services in connection with the implementation of Facet’s financial planning advice (such as third party services pertaining to the preparation of estate planning documents or the preparation of tax documents), Facet can charge Member a fee for time and resources incurred by Facet in facilitating the provision of such services with the third party. Such a fee will be disclosed at the time of engagement in the service.
d. No portion of Facet’s compensation shall be based on capital gains or capital appreciation of the Assets.
e. Facet reserves the right to offer promotions which may include waived enrollment fees, investment account rewards or additional offers that may only be available to certain service tiers, or through specific referral or marketing programs. These promotions are subject to change and are bound by separate terms and conditions.
3. Investment Risk/No Guarantee
4. Termination
5. Disclosure Statement
6. Facet Liability
Facet, subject to the limitations set forth in this Agreement, 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 Member by Facet, including a broker-dealer and/or custodian, attorney, accountant, insurance agent, or any other professional. If the Account contains only a portion of the Member’s total assets, Facet shall only be responsible for those assets that the Member has designated to be the subject of Facet’s investment management services under this Agreement without consideration to those additional assets not so designated by the Member.
If, during the term of this Agreement, Facet purchases specific individual securities for the Account at the direction of the Member (i.e. the request to purchase was initiated solely by the Member), the Member acknowledges that Facet shall do so as an accommodation only, and that the Member shall maintain exclusive ongoing responsibility for monitoring any and all such individual securities, and the disposition thereof. Correspondingly, the Member further acknowledges and agrees that Facet shall not have any responsibility for the performance of any and all such securities, regardless of whether any such security is reflected on any quarterly Account reports prepared by Facet. In addition, with respect to any and all accounts maintained by the Member with other investment professionals or at custodians for which Facet does not maintain trading authority, the Member, and not Facet, shall be exclusively responsible for the investment performance of any such assets or accounts.
The Member further acknowledges and agrees that Facet shall not bear any responsibility whatsoever for any adverse financial consequences occurring during the Account transition process (i.e., the transfer of the Assets from the Member’s predecessor advisors/custodians to the Accounts to be managed by Facet), including, but not limited to, adverse consequences resulting from:
- Securities purchased by Member’s predecessor advisor(s);
- Failure to be protected or benefit from any market-related events, including market corrections or advances; or,
- Any account transfer, closing or administrative charges or fees imposed by the previous broker- dealer/custodian.
The federal and state securities laws impose liabilities under certain circumstances on persons who act in good faith, and therefore no portion of the above shall constitute a waiver or limitation of any rights which the Member may have under any federal or state securities laws, ERISA, or under the rules promulgated by the Employee Benefits Security Administration and/or the Department of Labor.
7. Assignment
8. Non-Exclusive Management
9. Fund Transfers
10. Proxies
11. Reports
12. Death/Disability/Incompetency
13. Arbitration
Subject to the conditions and exceptions noted below, and to the extent not inconsistent with applicable law, in the event of any controversy, dispute or claim arising out of or relating to this Agreement, both Facet and Member agree to submit the dispute to arbitration before a single arbitrator in accordance with the Commercial Rules of the American Arbitration Association (AAA) then in effect. Facet and Member understand that such arbitration shall be final and binding, and that by agreeing to arbitration, both Facet and Member are waiving their respective rights to seek remedies in court, including the right to a jury trial.
Member understands that this Agreement to arbitrate does not constitute a waiver of your right to seek a judicial forum where such waiver would be void under federal or applicable state securities laws. Member acknowledges that he/she/they has had a reasonable opportunity to review and consider this arbitration provision prior to the execution of this Agreement.
14. Severability
15. Member Conflicts
16. Amendments
17. Privacy Notice
18. Applicable Law/Venue
19. Electronic Delivery
Through prior electronic authorization and through this agreement, the Member authorizes Facet to deliver, and the Member agrees to accept, all required regulatory notices and disclosures via electronic mail and/or via Facet’s internet web site, as well as all other correspondence from Facet. Facet shall have completed all delivery requirements upon the forwarding of such document, disclosure, notice and/or correspondence to the Member’s last provided email address (or upon advising the Member via email that such document is available on Facet’s web site). Please Note: It is the Member’s obligation to notify Facet, in writing, of any changes to the Member’s email address. Until so notified, Facet shall rely on the last provided email address. The Member acknowledges that the Member has the ongoing ability to receive and open standard electronic mail and corresponding electronic documents. If, at any time, the Member’s electronic delivery situation changes, or the Member is unable to open a specific document, the Member agrees to immediately notify Facet so that the specific issue can be addressed and resolved. Please note that by executing this agreement, the Member releases and holds Facet harmless from any and all claims and/or damages of whatever kind resulting from Facet’s electronic transmission of information, provided that Facet has correctly addressed the electronic transmission to the Member and/or other intended recipient.
20. Representations/Authority
The parties respectively represent as follows, and agree to promptly notify the other party in writing, in the event that any representations should change:
a. If Member is an individual, Member represents that he/she/they: (i) is of legal age and capacity, (ii) has full authority and power to retain Advisor, (iii) the execution of this Agreement will not violate any law or obligation applicable to the Member, and, (iv) the Member owns the Assets, without restriction or encumbrance.