A. Midwestern Securities has created a model portfolio program called “Midwestern Securities
Lighthouse Portfolios™.” It is a total return portfolio and will invest in, but not be limited to, stocks,
bonds, money market, ETF, mutual funds, notes, SMAs, UITs, and REITs with active secondary markets
and indexes. The Investment Advisory (IA) Committee will have the latitude to build a total return
portfolio utilizing whatever avenues they think accomplish this objective. The service provided within
the program is active management by the IA Committee. They have the discretion to buy and sell based
on but not limited to their experience, market conditions, and independent, third-party analyst reports.
These allow the managers to remove or add holdings as deemed pertinent without contact and consent
with the account holder for more timely execution. The IA Committee will meet quarterly to review the
portfolios and their holdings. They will make strategic decisions around current holdings, cash
accumulation, and market opportunities. There may be times when securities selected for purchase by
the IA Committee will not be reflected in all accounts. There are various reasons why this could occur.
The IA Committee will utilize trading software with drift features and minimum purchase amounts to
assist in this review and trading process. The goal is for all accounts to have the same securities but
given that issues can arise limiting some accounts from purchasing securities it is disclosed in this
manner, so account holders are aware. They will share this information with the Investment Advisory
Representative (IAR) on each account, and the IAR will provide reviews, education, and updates from
the IA Committee. The IAR will serve as the point person managing the relationship and working with
the client. Other communication methods may be used as the IA Committee feels it necessary to
communicate changes in the portfolio or other information they deem appropriate to communicate to
the account owners.
The wrap fee we charge we base on account relationships, not on a household basis. Account owners
investing in the Midwestern Securities Lighthouse Portfolios™ will pay a platform fee of 30 basis points
(bps) for each account, which Midwestern Securities will deduct from the advisory fees agreed to on the
Midwestern Securities Investment Advisory Agreement. Accounts with over $1,000,000 within the
Midwestern Securities Lighthouse Portfolios™ will receive a reduced platform charge of 20bps. Accounts
with over $5,000,000 within the Midwestern Securities Lighthouse Portfolios™ will receive a reduced
platform charge of 15bps. Accounts with over $10,000,000 within the Midwestern Securities Lighthouse
Portfolios™ will receive a reduced platform charge of 10bps. The basic or default fee schedule which is
located in Midwestern Securities Investment Advisory Agreement and Midwestern Securities ADV Part2
5.A. is below. Fees are negotiable but cannot exceed the schedule below, and the Midwestern Securities
Lighthouse Portfolios™ platform fee (ranging from 10bps – 30bps) is netted against the negotiated fee
or default fee schedule representing the total fee not a fee in addition to 100 basis points (bps) equal
1.00%, so 10-30 bps are .10%-.30%. The remaining fee after the deduction of the platform is retained by
Advisor, Investment Advisor Representative, and in the event the representative resides within a bank
or credit union the institution will share in the fee based on
the third-party brokerage agreement. By
execution of the Agreement, the Client authorizes Advisor and National Financial Services, Inc. to debit
directly and/or indirectly, the Investment Account known as or the elective Billing Account for the fees
owed to the Advisor.
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Account size Fee (% of assets under management)
$0.00 to $999,999.99 2.00%
$1,00,000.00 to $4,999,999.99 1.75%
$5,000,000.00 to $9,999,999.99 1.50%
$10,000,000.00 and over 1.25%
B. The Midwestern Securities Lighthouse Portfolios™ may cost more or less than purchasing such
services separately. However, Midwestern Securities has reviewed this program relative to others and
found it to be competitive and actually less than some third-party managers. Factors that bear upon the
costs of the program are custodian fees, trading, and execution fees, etc. are absorbed by Midwestern
Securities not passed back to the client as other programs may choose to do.
C. In order to have a more transparent pricing structure, there won’t be commissions, annual
maintenance fees, or IRA custody/maintenance fees. Instead, Midwestern Securities will charge a
platform fee (ranging from 10bps-30bps) for these accounts, which will be deducted from the advisory
fees agreed to on the Investment Advisory Agreement as previously stated in Item 4.A. Other fees still
present are listed below. Some of these fees listed may not be applicable and you should consult your
investment advisory representative to discuss your specific account(s). These fees are also contained in
the Midwestern Securities Welcome Letter.
Annual Fees1 Other Fees1
IRA Fee per account $0 IRA Closing Fee $125
HSA Fee per account $0 HSA Closing Fee $25
Account Maintenance Fee $0 Transfer of Assets Delivery Fee $75
NFS Select Access Cash Management $10 Legal Transfer $100
with Debit Card +$5 Transfer and Ship DRS Registration $65
with Check Writing +$5 Transfer and Ship Non-DRS Registration $500
NFS Premier Access Cash Management
with Debit Card
$100 Mailgram $10
Midwestern Securities Beacon
Portfolio Annual Fee
$40 Physical Reorganizations $150
1 The fees and expenses are subject to change
with- out prior notification. Fee schedule update
effective 03/30/2023.
2 Your financial institution may charge to send or
receive wires. Please consult your financial
institution’s rate schedule for applicable wire
fees.
Write-off of Non-Marketable Security $35
Safekeeping of Physical Certificate $25
Legal Returns $100
Bounced Check Fee $30
Stop Payments $20
Securities Account Control Agreement
Set-up
$500
NFS Wires (incoming)2 $0
NFS Wires (outgoing)2 $15
Overnight Check Delivery $35
Printing & Postage Confirmation $0
D. The IAR recommending the Midwestern Securities Lighthouse Portfolios™ does not receive any
additional compensation for doing so and actually may receive less than other arrangements as the
program fee (ranging from 10bps- 30bps) is netted against the total fee agreed to on the Midwestern
Securities Investment Advisory Agreement.
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E. The Midwestern Securities Beacon Portfolios do have a minimum annual fee of $40. The fee will be
billed in $10 increments quarterly coinciding with the advisory fee charge.