Draft Form

Appendix A

FORM ADV (Paper Version)
UNIFORM APPLICATION FOR INVESTMENT ADVISER REGISTRATION
Form ADV: General Instructions

Read these instructions carefully before filing Form ADV. Failure to follow these instructions,
properly complete the form, and pay all required fees may result in your application being
delayed or rejected.
In these instructions and in Form ADV, “you” means the investment adviser (i.e., the advisory
firm) applying for registration or amending its registration. If you are a “separately identifiable
department or division” (SID) of a bank, “you” means the SID, rather than your bank, unless the
instructions or the form provide otherwise. Terms that appear in italics are defined in the
Glossary of Terms to Form ADV.
1.

Where can I get more information on Form ADV, electronic filing, and the IARD?
The SEC provides information about its rules and the Advisers Act on its website:

.

NASAA provides information about state investment adviser laws and state rules, and how to
contact a state securities authority, on its website: .
FINRA provides information about the IARD and electronic filing on the IARD website:
.

2.

What is Form ADV used for?
Investment advisers use Form ADV to:
• Register with the Securities and Exchange Commission
• Register with one or more state securities authorities
• Amend those registrations

3.

How is Form ADV organized?
Form ADV contains four parts:
• Part 1A asks a number of questions about you, your business practices, the persons who
own and control you, and the persons who provide investment advice on your behalf. All
advisers registering with the SEC or any of the state securities authorities must complete
Part 1A.
Part 1A also contains several supplemental schedules. The items of Part 1A let you know
which schedules you must complete.

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◦ Schedule A asks for information about your direct owners and executive officers.
◦ Schedule B asks for information about your indirect owners.
◦ Schedule C is used by paper filers to update the information required by Schedules A
and B (see Instruction 14).
◦ Schedule D asks for additional information for certain items in Part 1A.
◦ Disclosure Reporting Pages (or “DRPs”) are schedules that ask for details about
disciplinary events involving you or persons affiliated with you.
• Part 1B asks additional questions required by state securities authorities. Part 1B
contains three additional DRPs. If you are applying for registration or are registered only
with the SEC, you do not have to complete Part 1B. (If you are filing electronically and
you do not have to complete Part 1B, you will not see Part 1B.)
• Part 2A requires advisers to create narrative brochures containing information about the
advisory firm. The requirements in Part 2A apply to all investment advisers registered
with or applying for registration with the SEC. If you are registered with or applying for
registration with one or more of the state securities authorities, you should contact the
appropriate state securities authorities to determine whether the requirements in Part 2A
apply to you.
• Part 2B requires advisers to create brochure supplements containing information about
certain supervised persons. The requirements in Part 2B apply to all investment advisers
registered with or applying for registration with the SEC. If you are registered with or
applying for registration with one or more of the state securities authorities, you should
contact the appropriate state securities authorities to determine whether the requirements
in Part 2B apply to you.
4.

When am I required to update my Form ADV?

You must amend your Form ADV each year by filing an annual updating amendment within 90
days after the end of your fiscal year. When you submit your annual updating amendment, you
must update your responses to all items.
In addition to your annual updating amendment, you must amend your Form ADV by filing
additional amendments (other-than-annual amendments) promptly if:
• information you provided in response to Items 1, 3, 9, or 11 of Part 1A or Items 1, 2.A.
through 2.F., or 2.I. of Part 1B, becomes inaccurate in any way;
• information you provided in response to Items 4, 8, or 10 of Part 1A or Item 2.G. of Part
1B becomes materially inaccurate; or
• information you provided in your brochure becomes materially inaccurate.

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If you are submitting an other-than-annual amendment, you are not required to update your
responses to Items 2, 5, 6, 7, or 12 of Part 1A or Items 2.H. or 2.J. of Part 1B, even if your
responses to those items have become inaccurate.
Note: You must amend your brochure supplements (see Form ADV, Part 2B) promptly if any
information in them becomes materially inaccurate.
• If you are an SEC-registered adviser, you are required to file your brochure amendments
electronically through IARD. You are not required to file amendments to your brochure
supplements with the SEC, but you must maintain a copy of them in your files.
• If you are a state-registered adviser, you may be required to file your brochure
amendments and brochure supplement amendments with the appropriate state securities
authorities. You should contact the appropriate state securities authorities to determine
whether the states in which you have a filing obligation require filing of your brochure
amendments and brochure supplement amendments, and if so, whether these should be
filed electronically through IARD.
Failure to update your Form ADV, as required by this instruction, is a violation of SEC
rule 204-1 or similar state rules and could lead to your registration being revoked.
5.

Part 2 of Form ADV was amended recently. When do I have to comply with the
new requirements?

If you are applying for registration with the SEC:
• Beginning [
], your application for registration must include a narrative brochure
prepared in accordance with the requirements of (amended) Part 2 of Form ADV. See
SEC rule 203-1. After that date, the SEC will not accept any application that does not
meet this requirement.
• Until that date, you may (but are not required to) include in your application a narrative
brochure that meets the requirements of (amended) Part 2 of Form ADV. If you do not
do this, you must comply with the requirements for preparing, delivering, and offering
“old” Part II of Form ADV.
If you already are registered with or have submitted an application for registration with the SEC
by [
]:
• When you make the next annual updating amendment to your Form ADV after [
],
you must submit a narrative brochure that meets the requirements of (amended) Part 2 of
Form ADV. See SEC Rule 204-1(b).

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• Until that date, you may (but are not required to) submit a narrative brochure that meets
the requirements of (amended) Part 2 of Form ADV. If you do not do this, you must
comply with the requirements for preparing, delivering, and offering “old” Part II of
Form ADV.
Note: Until the amendments to Part 2 are effective, you can satisfy the requirements related to
“old” Part II by updating the information in your Part II whenever it becomes materially
inaccurate. You must deliver Part II or a brochure containing at least the information contained
in Part II to prospective clients and annually offer it to current clients. You are not required to
file “old” Part II with the SEC, but you must keep a copy in your files, and provide it to the SEC
staff upon request.
If you are applying for registration or are registered with one or more state securities authorities:
• Contact the appropriate state securities authorities for more information about the

compliance transition schedule applicable to you.

6.

Where do I sign my Form ADV application or amendment?

You must sign the appropriate Execution Page. There are three Execution Pages at the end of
the form. Your initial application and all amendments to Form ADV must include at least one
Execution Page.
• If you are applying for or are amending your SEC registration, you must sign and submit
either a:
◦ Domestic Investment Adviser Execution Page, if you (the advisory firm) are a
resident of the United States; or
◦ Non-Resident Investment Adviser Execution Page, if you (the advisory firm) are not a
resident of the United States.
• If you are applying for or are amending your registration with a state securities authority,
you must sign and submit the State-Registered Investment Adviser Execution Page.
7.

Who must sign my Form ADV or amendment?

The individual who signs the form depends upon your form of organization:
•
•
•
•

For a sole proprietorship, the sole proprietor.
For a partnership, a general partner.
For a corporation, an authorized principal officer.
For a “separately identifiable department or division” (SID) of a bank, a principal officer
of your bank who is directly engaged in the management, direction or supervision of your
investment advisory activities.

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• For all others, an authorized individual who participates in managing or directing your
affairs.
The signature does not have to be notarized, and in the case of an electronic filing, should be a
typed name.
8.

How do I file my Form ADV?

Complete Form ADV electronically using the Investment Adviser Registration Depository
(IARD) if:
• You are filing with the SEC (and submitting notice filings to any of the state securities
authorities), or
• You are filing with a state securities authority that requires or permits advisers to submit
Form ADV through the IARD.
Note: SEC rules require advisers that are registered or applying for registration with the
SEC to file electronically through the IARD system. See SEC rule 203-1. Check with
the state securities authorities of each state in which you have a filing obligation to
determine whether you can or must file Form ADV electronically through the IARD.
To file electronically, go to the IARD website (), which contains detailed
instructions for advisers to follow when filing through the IARD.
Complete Form ADV (Paper Version) on paper if:
• You are filing with the SEC or a state securities authority that requires electronic filing,
but you have been granted a continuing hardship exemption. Hardship exemptions are
described in Instruction 14.
• You are filing with a state securities authority that permits (but does not require)

electronic filing and you do not file electronically.

9.

How do I get started filing electronically?
• First, get a copy of the IARD Entitlement Package from the following web site:
. Second, request access to the IARD system for your firm by
completing and submitting the IARD Entitlement Package. The IARD Entitlement
Package must be submitted on paper. Mail the forms to: IARD Entitlement Requests,
FINRA, P.O. Box 9495, Gaithersburg, MD 20898-9495.
• When FINRA receives your Entitlement Package, they will assign a CRD number
(identification number for your firm) and a user I.D. code and password (identification
number and system password for the individual(s) who will submit Form ADV filings for

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your firm). Your firm may request an I.D. code and password for more than one
individual. FINRA also will create a financial account for you from which the IARD will
deduct filing fees and any state fees you are required to pay. If you already have a CRD
account with FINRA, it will also serve as your IARD account; a separate account will not
be established.
• Once you receive your CRD number, user I.D. code and password, and you have funded
your account, you are ready to file electronically.
• Questions regarding the Entitlement Process should be addressed to FINRA at

240.386.4848.

10.

If I am applying for registration with the SEC, or amending my SEC registration,
how do I make notice filings with the state securities authorities?

If you are applying for registration with the SEC or are amending your SEC registration, one or
more state securities authorities may require you to provide them with copies of your SEC
filings. We call these filings “notice filings.” Your notice filings will be sent electronically to
the states that you check on Item 2.B. of Part 1A. The state securities authorities to which you
send notice filings may charge fees, which will be deducted from the account you establish with
FINRA. To determine which state securities authorities require SEC-registered advisers to
submit notice filings and to pay fees, consult the relevant state investment adviser law or state
securities authority. See General Instruction 1.
If you are granted a continuing hardship exemption to file Form ADV on paper, FINRA will
enter your filing into the IARD and your notice filings will be sent electronically to the state
securities authorities that you check on Item 2.B. of Part 1A.
11.

I am registered with a state. When must I switch to SEC registration?

If you report on your annual updating amendment that your assets under management have
increased to $30 million or more, you must register with the SEC within 90 days after you file that
annual updating amendment. If your assets under management increase to $25 million or more but
not $30 million, you may, but are not required to, register with the SEC (assuming you are not
otherwise required to register with the SEC). Once you register with the SEC, you are subject to
SEC regulation, regardless of whether you remain registered with one or more states. Each of your
investment adviser representatives, however, may be subject to registration in those states in which
the representative has a place of business. See SEC rule 203A-1(b). For additional information,
consult the investment adviser laws or the state securities authority for the particular state in which
you are “doing business.” See General Instruction 1.
12.

I am registered with the SEC. When must I switch to registration with a state
securities authority?

If you report on your annual updating amendment that you have assets under management of
less than $25 million and you are not otherwise eligible to register with the SEC, you must

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withdraw from SEC registration within 180 days after the end of your fiscal year by filing Form
ADV-W. You should consult state law in the states that you are doing business to determine if
you are required to register in these states. See General Instruction 1. Until you file your Form
ADV-W with the SEC, you will remain subject to SEC regulation, and you also will be subject
to regulation in any states where you register. See SEC rule 203A-1(b).
13.

Are there filing fees?

Yes. These fees go to support and maintain the IARD. The IARD filing fees are in addition to
any registration or other fee that may be required by state law. You must pay an IARD filing fee
for your initial application and each annual updating amendment. There is no filing fee for an
other-than-annual amendment or Form ADV-W. The IARD filing fee schedule is published at
; ; and .
If you are submitting a paper filing under a continuing hardship exemption (see Instruction 14),
you are required to pay an additional fee. The amount of the additional fee depends on whether
you are filing Form ADV or Form ADV-W. (There is no additional fee for filings made on
Form ADV-W.) The hardship filing fee schedule is available by contacting FINRA at
240.386.4848.
14.

What if I am not able to file electronically?

If you are required to file electronically but cannot do so, you may be eligible for one of two
types of hardship exemptions from the electronic filing requirements.
• A temporary hardship exemption is available if you file electronically, but you
encounter unexpected difficulties that prevent you from making a timely filing with the
IARD, such as a computer malfunction or electrical outage. This exemption does not
permit you to file on paper; instead, it extends the deadline for an electronic filing for
seven business days. See SEC rule 203-3(a).
• A continuing hardship exemption may be granted if you are a small business and you
can demonstrate that filing electronically would impose an undue hardship. You are a
small business, and may be eligible for a continuing hardship exemption, if you are
required to answer Item 12 of Part 1A (because you have assets under management of
less than $25 million) and you are able to respond “no” to each question in Item 12. See
SEC rule 0-7.
If you have been granted a continuing hardship exemption, you must complete and
submit the paper version of Form ADV to FINRA. FINRA will enter your responses into
the IARD. As discussed in General Instruction 13, FINRA will charge you a fee to
reimburse it for the expense of data entry.
Before applying for a continuing hardship exemption, consider engaging a firm that
assists investment advisers in making filings with the IARD. Check the SEC’s web site

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() to obtain a list of firms that provide these services.
15.

I am eligible to file on paper. How do I make a paper filing?

When filing on paper, you must:
• Type all of your responses.
• Include your name (the same name you provide in response to Item 1.A. of Part 1A) and
the date on every page.
• If you are amending your Form ADV:
◦ complete page 1 and circle the number of any item for which you are changing your
response.
◦ include your SEC 801-number (if you have one) and your CRD number (if you have
one) on every page.
◦ complete the amended item in full and circle the number of the item for which you
are changing your response.
◦ to amend Schedule A or Schedule B, complete and submit Schedule C.
Where you submit your paper filing depends on why you are eligible to file on paper:
• If you are filing on paper because you have been granted a continuing hardship
exemption, submit one manually signed Form ADV and one copy to: IARD Document
Processing, FINRA, P.O. Box 9495, Gaithersburg, MD 20898-9495.
If you complete Form ADV on paper and submit it to FINRA but you do not have a
continuing hardship exemption, the submission will be returned to you.
• If you are filing on paper because a state in which you are registered or in which you are
applying for registration allows you to submit paper instead of electronic filings, submit
one manually signed Form ADV and one copy to the appropriate state securities
authorities.
16.

Who is required to file Form ADV-NR?

Every non-resident general partner and managing agent of all SEC-registered advisers, whether
or not the adviser is resident in the United States, must file Form ADV-NR in connection with
the adviser’s initial application. A general partner or managing agent of an SEC-registered
adviser who becomes a non-resident after the adviser’s initial application has been submitted
must file Form ADV-NR within 30 days. Form ADV-NR must be filed on paper (it cannot be
filed electronically).
Submit Form ADV-NR to the SEC at the following address:
Securities and Exchange Commission, 100 F Street, NE, Mail Stop 8031, Washington,
DC 20549; Attn: The Registrations Branch

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Failure to file Form ADV-NR promptly may delay SEC consideration of your initial
application.
Federal Information Law and Requirements
Sections 203(c) and 204 of the Advisers Act [15 U.S.C. §§ 80b-3(c) and 80b-4] authorize the
SEC to collect the information required by Form ADV. The SEC collects the information for
regulatory purposes, such as deciding whether to grant registration. Filing Form ADV is
mandatory for advisers who are required to register with the SEC. The SEC maintains the
information submitted on this form and makes it publicly available. The SEC may return forms
that do not include required information. Intentional misstatements or omissions constitute
federal criminal violations under 18 U.S.C. § 1001 and 15 U.S.C. § 80b-17.
SEC’s Collection of Information
An agency may not conduct or sponsor, and a person is not required to respond to, a collection of
information unless it displays a currently valid control number. The Advisers Act authorizes the
SEC to collect the information on Form ADV from applicants. See 15 U.S.C. §§ 80b-3(c)(1) and
80b-4. Filing the form is mandatory.
The main purpose of this form is to enable the SEC to register investment advisers. Every
applicant for registration with the SEC as an adviser must file the form. See 17 C.F.R. §
275.203-1. By accepting a form, however, the SEC does not make a finding that it has been
completed or submitted correctly. The form is filed annually by every adviser, no later than 90
days after the end of its fiscal year, to amend its registration. It is also filed promptly during the
year to reflect material changes. See 17 C.F.R. § 275.204-1. The SEC maintains the information
on the form and makes it publicly available through the IARD.
Anyone may send the SEC comments on the accuracy of the burden estimate on page 1 of the
form, as well as suggestions for reducing the burden. The Office of Management and Budget
has reviewed this collection of information under 44 U.S.C. § 3507.
The information contained in the form is part of a system of records subject to the Privacy Act of
1974, as amended. The SEC has published in the Federal Register the Privacy Act System of
Records Notice for these records.

Appendix B
GLOSSARY OF TERMS

1. Advisory Affiliate: Your advisory affiliates are (1) all of your officers, partners, or directors
(or any person performing similar functions); (2) all persons directly or indirectly controlling
or controlled by you; and (3) all of your current employees (other than employees performing
only clerical, administrative, support or similar functions).
If you are a “separately identifiable department or division” (SID) of a bank, your advisory
affiliates are: (1) all of your bank’s employees who perform your investment advisory
activities (other than clerical or administrative employees); (2) all persons designated by
your bank’s board of directors as responsible for the day-to-day conduct of your investment
advisory activities (including supervising the employees who perform investment advisory
activities); (3) all persons who directly or indirectly control your bank, and all persons
whom you control in connection with your investment advisory activities; and (4) all other
persons who directly manage any of your investment advisory activities (including directing,
supervising or performing your advisory activities), all persons who directly or indirectly
control those management functions, and all persons whom you control in connection with
those management functions. [Used in: Part 1A, Item 11; Part 1B, Item 2]
2. Annual Updating Amendment: Within 90 days after your firm’s fiscal year end, your firm
must file an “annual updating amendment,” which is an amendment to your firm’s Form
ADV that reaffirms the eligibility information contained in Item 2 of Part 1A and updates the
responses to any other item for which the information is no longer accurate. [Used in:
General Instructions; Part 1A Instructions, Introductory Text, Item 2; Part 2A, Instructions,
Appendix 1 Instructions; Part 2B, Instructions]
3. Brochure: A written disclosure statement that your firm is required to provide to clients and
prospective clients. See SEC rule 204-3; Form ADV, Part 2A. [Used in: General
Instructions; Used throughout Part 2 General Instructions; Part 2A, Instructions, Appendix 1
Instructions; Part 2B, Instructions]
4. Brochure Supplement: A written disclosure statement containing information about certain
of your supervised persons that your firm is required by Part 2B of Form ADV to provide to
clients and prospective clients. See SEC rule 204-3; Form ADV, Part 2B. [Used in: General
Instructions; Used throughout Part 2 General Instructions; Part 2A, Instructions, Appendix 1
Instructions; Part 2B, Instructions]
5. Charged: Being accused of a crime in a formal complaint, information, or indictment (or
equivalent formal charge). [Used in: Part 1A, Item 11; DRPs]
6. Client: Any of your firm’s investment advisory clients. This term includes clients from which
your firm receives no compensation, such as members of your family. If your firm also
provides other services (e.g., accounting services), this term does not include clients that are not
investment advisory clients. [Used throughout Form ADV and Form ADV-W]

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7. Control: Control means the power, directly or indirectly, to direct the management or policies
of a person, whether through ownership of securities, by contract, or otherwise.
• Each of your firm’s officers, partners, or directors exercising executive responsibility (or
persons having similar status or functions) is presumed to control your firm.
• A person is presumed to control a corporation if the person: (i) directly or indirectly has
the right to vote 25 percent or more of a class of the corporation’s voting securities; or (ii)
has the power to sell or direct the sale of 25 percent or more of a class of the corporation’s
voting securities.
• A person is presumed to control a partnership if the person has the right to receive upon
dissolution, or has contributed, 25 percent or more of the capital of the partnership.
• A person is presumed to control a limited liability company (“LLC”) if the person: (i)
directly or indirectly has the right to vote 25 percent or more of a class of the interests of the
LLC; (ii) has the right to receive upon dissolution, or has contributed, 25 percent or more of
the capital of the LLC; or (iii) is an elected manager of the LLC.
• A person is presumed to control a trust if the person is a trustee or managing agent of the
trust.
[Used in: General Instructions; Part 1A, Instructions, Items 2, 7, 10, 11, 12, Schedules A, B,
C, D; Regulatory DRP]
8. Custody: Your firm has custody if it directly or indirectly holds client funds or securities, has
any authority to obtain possession of them, or has the ability to appropriate them. Your firm
has custody, for example, if it has a general power of attorney over a client’s account or
signatory power over a client’s checking account. See SEC rule 206(4)-2. [Used in: Part 1A,
Item 9; Part 1B, Instructions, Item 2; Part 2A, Items 15, 18]
9. Discretionary Authority or Discretionary Basis: Your firm has discretionary authority or
manages assets on a discretionary basis if it has the authority to decide which securities to
purchase and sell for the client. Your firm also has discretionary authority if it has the
authority to decide which investment advisers to retain on behalf of the client. [Used in:
Part 1A, Instructions, Item 8; Part 1B, Instructions; Part 2A, Items 4, 16, 18; Part 2B,
Instructions]
10. Employee: This term includes an independent contractor who performs advisory functions
on your behalf. [Used in: Part 1A, Instructions, Items 1, 5, 7, 11]

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11. Enjoined: This term includes being subject to a mandatory injunction, prohibitory injunction,
preliminary injunction, or a temporary restraining order. [Used in: Part 1A, Item 11; DRPs]
12. Felony: For jurisdictions that do not differentiate between a felony and a misdemeanor, a
felony is an offense punishable by a sentence of at least one year imprisonment and/or a fine of
at least $1,000. The term also includes a general court martial. [Used in: Part 1A, Item 11;
DRPs; Part 2A, Item 9; Part 2B, Item 3]
13. FINRA CRD or CRD: The Web Central Registration Depository (“CRD”) system operated
by FINRA for the registration of broker-dealers and broker-dealer representatives. [Used in:
Part 1A, Item 1; Form ADV-W, Item 1]
14. Foreign Financial Regulatory Authority: This term includes (1) a foreign securities
authority; (2) another governmental body or foreign equivalent of a self-regulatory
organization empowered by a foreign government to administer or enforce its laws relating to
the regulation of investment-related activities; and (3) a foreign membership organization, a
function of which is to regulate the participation of its members in the activities listed above.
[Used in: Part 1A, Items 1, 11; DRPs; Part 2A, Item 9; Part 2B, Item 3]
15. Found: This term includes adverse final actions, including consent decrees in which the
respondent has neither admitted nor denied the findings, but does not include agreements,
deficiency letters, examination reports, memoranda of understanding, letters of caution,
admonishments, and similar informal resolutions of matters. [Used in: Part 1A, Item 11; Part
1B, Item 2; Part 2A, Item 9; Part 2B, Item 3]
16. Government Entity: Any state or political subdivision of a state, including (i) any agency,
authority, or instrumentality of the state or political subdivision; (ii) a plan or pool of assets
controlled by the state or political subdivision or any agency, authority or instrumentality
thereof; and (iii) any officer, agent, or employee of the state or political subdivision or any
agency, authority or instrumentality thereof, acting in their official capacity. [Used in: Part
1A, Item 5]
17. High Net Worth Individual: An individual with at least $750,000 managed by you, or whose
net worth your firm reasonably believes exceeds $1,500,000, or who is a “qualified purchaser”
as defined in section 2(a)(51)(A) of the Investment Company Act of 1940. The net worth of an
individual may include assets held jointly with his or her spouse. [Used in: Part 1A, Item 5]
18. Home State: If your firm is registered with a state securities authority, your firm’s “home
state” is the state where it maintains its principal office and place of business. [Used in: Part
1B, Instructions]

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19. Impersonal Investment Advice: Investment advisory services that do not purport to meet the
objectives or needs of specific individuals or accounts. [Used in: Part 1A, Instructions; Part
2A, Instructions; Part 2B, Instructions]
20. Investment Adviser Representative: Investment adviser representatives of SEC-registered
advisers are subject to state registration in each state in which they have a place of business.
Any of your firm’s supervised persons (except those that provide only impersonal investment
advice) is an investment adviser representative, if -• the supervised person regularly solicits, meets with, or otherwise communicates with
your firm’s clients,
• the supervised person has more than five clients who are natural persons and not high
net worth individuals, and
• more than ten percent of the supervised person’s clients are natural persons and not
high net worth individuals.
NOTE: If your firm is registered with the state securities authorities and not the SEC, your
firm may be subject to a different state definition of “investment adviser representative.”
[Used in: Part 2, General Instructions; Part 2A, Item 14; Part 2B, Item 1]
21. Investment-Related: Activities that pertain to securities, commodities, banking, insurance, or
real estate (including, but not limited to, acting as or being associated with an investment
adviser, broker-dealer, municipal securities dealer, government securities broker or dealer,
issuer, investment company, futures sponsor, bank, or savings association). [Used in: Part 1A,
Item 11; DRPs; Part 1B, Item 2; Part 2A, Item 9; Part 2B, Item 3]
22. Involved: Engaging in any act or omission, aiding, abetting, counseling, commanding,
inducing, conspiring with or failing reasonably to supervise another in doing an act. [Used in:
Part 1A, Item 11; Part 2A, Item 9; Part 2B, Item 3]
23. Management Persons: Anyone with the power to exercise, directly or indirectly, a
controlling influence over your firm’s management or policies, or to determine the general
investment advice given to the clients of your firm.
Generally, all of the following are management persons:
• Your firm’s principal executive officers, such as your chief executive officer, chief
financial officer, chief operations officer, chief legal officer, and chief compliance

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officer; your directors, general partners, or trustees; and other individuals with similar
status or performing similar functions;
• The members of your firm’s investment committee or group that determines general
investment advice to be given to clients; and
• If your firm does not have an investment committee or group, the individuals who
determine general investment advice provided to clients (if there are more than five
people, you may limit your firm’s response to their supervisors).
[Used in: Part 1B, Item 2; Part 2A, Items 9, 10]
24. Managing Agent: A managing agent of an investment adviser is any person, including a
trustee, who directs or manages (or who participates in directing or managing) the affairs of any
unincorporated organization or association that is not a partnership. [Used in: General
Instructions; Form ADV-NR]
25. Minor Rule Violation: A violation of a self-regulatory organization rule that has been
designated as “minor” pursuant to a plan approved by the SEC. A rule violation may be
designated as “minor” under a plan if the sanction imposed consists of a fine of $2,500 or less,
and if the sanctioned person does not contest the fine. (Check with the appropriate selfregulatory organization to determine if a particular rule violation has been designated as
“minor” for these purposes.) [Used in: Part 1A, Item 11]
26. Misdemeanor: For jurisdictions that do not differentiate between a felony and a misdemeanor,
a misdemeanor is an offense punishable by a sentence of less than one year imprisonment
and/or a fine of less than $1,000. The term also includes a special court martial. [Used in:
General Instructions; Part 1A, Item 11; DRPs; Part 2A, Item 9; Part 2B, Item 3]
27. Non-Resident: (a) an individual who resides in any place not subject to the jurisdiction of the
United States; (b) a corporation incorporated in or having its principal office and place of
business in any place not subject to the jurisdiction of the United States; and (c) a partnership
or other unincorporated organization or association that has its principal office and place of
business in any place not subject to the jurisdiction of the United States. [Used in: General
Instructions; Form ADV-NR]
28. Notice Filing: SEC-registered advisers may have to provide state securities authorities with
copies of documents that are filed with the SEC. These filings are referred to as “notice
filings.” [Used in: General Instructions; Part 1A, Item 2; Execution Page(s); Form ADV-W]
29. Order: A written directive issued pursuant to statutory authority and procedures, including an
order of denial, exemption, suspension, or revocation. Unless included in an order, this term

Form ADV: Glossary

Page 6

does not include special stipulations, undertakings, or agreements relating to payments,
limitations on activity or other restrictions. [Used in: Part 1A, Items 2 and 11; Schedule D;
DRPs; Part 2A, Item 9; Part 2B, Item 3]
30. Performance-Based Fee: An investment advisory fee based on a share of capital gains on, or
capital appreciation of, client assets. A fee that is based upon a percentage of assets that you
manage is not a performance-based fee. [Used in: Part 1A, Item 5]
31. Person: A natural person (an individual) or a company. A company includes any partnership,
corporation, trust, limited liability company (“LLC”), limited liability partnership (“LLP”), or
other organization. [Used throughout Form ADV and Form ADV-W]
32. Principal Place of Business or Principal Office and Place of Business: Your firm’s
executive office from which your firm’s officers, partners, or managers direct, control, and
coordinate the activities of your firm. [Used in: Part 1A, Instructions, Items 1 and 2; Schedule
D; Form ADV-W, Item 1]
33. Proceeding: This term includes a formal administrative or civil action initiated by a
governmental agency, self-regulatory organization or foreign financial regulatory authority;
a felony criminal indictment or information (or equivalent formal charge); or a misdemeanor
criminal information (or equivalent formal charge). This term does not include other civil
litigation, investigations, or arrests or similar charges effected in the absence of a formal
criminal indictment or information (or equivalent formal charge). [Used in: Part 1A, Item 11;
DRPs; Part 1B, Item 2; Part 2A, Item 9; Part 2B, Item 3]
34. Related Person: Any advisory affiliate and any person that is under common control with
your firm. [Used in: Part 1A, Items 7, 8, 9; Schedule D; Form ADV-W, Item 3; Part 2A,
Instructions, Items 5, 10, 11, 12, 14, 15]
35. Self-Regulatory Organization or SRO: Any national securities or commodities exchange,
registered securities association, or registered clearing agency. For example, the Chicago
Board of Trade (“CBOT”), FINRA and New York Stock Exchange (“NYSE”) are selfregulatory organizations. [Used in: Part 1A, Item 11; DRPs; Part 1B, Item 2; Part 2A, Item 9;
Part 2B, Item 3]
36. Sponsor: A sponsor of a wrap fee program sponsors, organizes, or administers the program or
selects, or provides advice to clients regarding the selection of, other investment advisers in the
program. [Used in: Part 1A, Item 5; Schedule D; Part 2A, Instructions, Appendix 1
Instructions]

Form ADV: Glossary

Page 7

37. State Securities Authority: The securities commission (or any agency or office performing
like functions) of any state of the United States, the District of Columbia, Puerto Rico, the
Virgin Islands, or any other possession of the United States. [Used throughout Form ADV]
38. Supervised Person: Any of your officers, partners, directors (or other persons occupying a
similar status or performing similar functions), or employees, or any other person who provides
investment advice on your behalf and is subject to your supervision or control. [Used in:
Part 2, General Instructions; Part 2A, Item 6; Used throughout Part 2B]
39. Wrap Brochure or Wrap Fee Program Brochure: The written disclosure statement that
sponsors of wrap fee programs are required to provide to each of their wrap fee program
clients. [Used in: Part 2, General Instructions; Used throughout Part 2A, Appendix 1]
40. Wrap Fee Program: Any advisory program under which a specified fee or fees not based
directly upon transactions in a client’s account is charged for investment advisory services
(which may include portfolio management or advice concerning the selection of other
investment advisers) and the execution of client transactions. [Used in: Part 1, Item 5;
Schedule D; Part 2A, Instructions, Item 4, used throughout Appendix 1; Part 2B, Instructions]

Appendix C

FORM ADV (Paper Version)
UNIFORM APPLICATION FOR INVESTMENT ADVISER REGISTRATION
PART 2: Uniform Requirements for Investment Adviser Brochure and Brochure Supplements
General Instructions for Part 2 of Form ADV
Under SEC and similar state rules, you are required to deliver to clients and prospective clients a brochure
disclosing information about your firm. You also may be required to deliver a brochure supplement disclosing
information about one or more of your supervised persons. Part 2 of Form ADV sets out the minimum required
disclosure that your brochure (Part 2A for a firm brochure, or Appendix 1 for a wrap fee program brochure) and
brochure supplements (Part 2B) must contain.
1.

N
arrative Format. Part 2 of Form ADV consists of a series of items that contain disclosure requirements for
preparing your firm’s brochure and any required supplements. The items require narrative responses. You may
omit responses to the items that do not apply to your business. You do not have to provide responses in the
same order as the items appear, and you should not repeat the items themselves in the brochure or the
supplements. A brochure would not need to repeat information simply because the information is responsive to
more than one item.

2. Plain English. The items in Part 2 of Form ADV are designed to promote effective communication between
you and your clients. Write your brochure and supplements in plain English, taking into consideration your
clients’ level of financial sophistication. Your brochure should be concise and direct. In drafting your
brochure and brochure supplements, you should: (i) use short sentences; (ii) use definite, concrete, everyday
words; (iii) use active voice; (iv) use tables or bullet lists for complex material, whenever possible; (v) avoid
legal jargon or highly technical business terms unless you explain them or you believe that your clients will
understand them; and (vi) avoid multiple negatives. Consider providing examples to illustrate a description of
your practices or policies.
Note: The SEC’s Office of Investor Education and Advocacy has published A Plain English Handbook. You
may find the handbook helpful in writing your brochure and supplements. For a copy of this handbook, visit
the SEC’s web site at or call 1-800-SEC-0330.
3. Full Disclosure of All Conflicts of Interest. Under federal and state law, you are a fiduciary required to make
full disclosure to your clients of all material facts, including conflicts of interest between you and your client
and any other material information that could affect the advisory relationship. You therefore may have to
disclose to clients information not specifically required by Part 2 of Form ADV. You may disclose this
additional information to clients in your brochure or by some other means.
4. Full and Truthful Disclosure. All information in your brochure and brochure supplements must be true and
may not omit any material facts.
5. Filing. You must file your brochure(s) (and amendments) through the IARD system. See SEC rules 203-1 and
204-1 and similar state rules. If you are registered or are registering with the SEC, you are not required to file
your brochure supplements through the IARD or otherwise. You must, however, preserve a copy of the
supplements and make them available to SEC staff upon request. See SEC rule 204-2(a)(14). If you are
registered or are registering with one or more of the state securities authorities, you must file a copy of the
brochure supplement for each supervised person and each investment adviser representative doing business in
that state. You should contact the appropriate state securities authorities to determine if this filing should be
made electronically through the IARD or by a paper filing with the state.

Instructions for Part 2A of Form ADV: Preparing Your Firm Brochure
1. To whom must we deliver a firm brochure? You must give a firm brochure to each client. You must deliver
the brochure even if your advisory agreement with the client is oral. See SEC rule 204-3(b)(1) and similar state
rules.
For SEC-registered advisers: You are not required to deliver your brochure to either (i) clients who receive
only impersonal investment advice from you and who will pay you less than $500 per year or (ii) clients that are
SEC-registered investment companies or business development companies (the client must be registered under
the Investment Company Act of 1940 or be a business development company as defined in that Act, and the
advisory contract must meet requirements of section 15(c) of that Act). See SEC rule 204-3(c).
Note: Even if you are not required to give a brochure to a client, as a fiduciary you may still be required to
provide your clients with similar information, particularly material information about your conflicts of interest
and about your disciplinary information. If you are not required to give a client a brochure, you may make any
required disclosures to that client by delivery of your brochure or through some other means.
2. When must we deliver a brochure to clients?
• You must give a firm brochure to each client before or at the time you enter into an advisory agreement with
that client. See SEC rule 204-3(b)(1) and similar state rules.
• Each year you must deliver to each client a free updated brochure within 120 days of the end of your fiscal
year. See SEC rule 204-3(b)(1) and similar state rules.
• You do not have to deliver an interim amendment to clients unless the amendment includes information in
response to Item 9 of Part 2A (disciplinary information). An interim amendment can be in the form of a
“sticker” that identifies the information that has become inaccurate and provides the new information and the
date of the sticker. See SEC rules 204-1 and 204-3(e) and similar state rules.
Note: As a fiduciary, you have an ongoing obligation to inform your clients of any material information that
could affect the advisory relationship. As a result, between annual updating amendments you must disclose
material changes to clients even if those changes do not trigger delivery of an interim amendment. See General
Instructions for Part 2 of Form ADV, Instruction 3.
3. May we deliver our brochure electronically? Yes. The SEC has published interpretive guidance on delivering
documents electronically, which you can find at .
4. When must we update our brochure? You must update your brochure: (i) each year at the time you file your
annual updating amendment; and (ii) promptly whenever any information in the brochure becomes materially
inaccurate. You are not generally required to update your brochure between annual amendments solely because
the amount of client assets you manage has changed or because your fee schedule has changed. However, if
you are updating your brochure for a separate reason in between annual amendments, and the amount of client
assets you manage listed in response to Item 4.E or your fee schedule listed in response to Item 5.A has become
materially inaccurate, you should update that item(s) as part of the interim amendment. All updates to your
brochure must be filed through the IARD system and maintained in your files. See SEC rules 204-1 and 204
2(a)(14) and similar state rules.
5. We have determined that we have no clients to whom we must deliver a brochure. Must we prepare one? No.
6. We offer several advisory services. May we prepare multiple firm brochures? Yes. If you offer substantially
different types of advisory services, you may opt to prepare separate brochures so long as each client receives
all applicable information about services and fees. Each brochure may omit information that does not apply to
the advisory services and fees it describes. For example, your firm brochure that describes one advisory service
can omit the fee schedule for a different advisory service that is not discussed in the brochure. See SEC rule

Form ADV: Instructions for Part 2A

Page 2

204-3(f) and similar state rules. If you prepare separate brochures you must file each brochure (and any
amendments) through the IARD system as required in SEC rules 203-1 and 204-1 and similar state rules.
7. We sponsor a wrap fee program. Is there a different brochure that we need to deliver to our wrap fee clients?
Yes. If you sponsor a wrap fee program, you must deliver a wrap fee program brochure to your wrap fee
clients. The disclosure requirements for preparing a wrap fee program brochure (also called a wrap brochure)
appear in Part 2A Appendix 1 of Form ADV. If your entire advisory business is sponsoring wrap fee programs,
you do not need to prepare a firm brochure separate from your wrap brochure(s). See SEC rule 204-3(d).
8. We provide portfolio management services to clients in wrap fee programs that we do not sponsor. Which
brochure must we deliver to these clients? You must deliver your firm brochure to your wrap fee clients. You
also must deliver to these clients any brochure supplements required by Part 2B of Form ADV.
9. May we include information not required by an item in our brochure? Yes. If you include information not
required by an item, however, you may not include so much additional information that the required
information is obscured.
10. Item 18 requires us to give our clients an audited balance sheet. May any public accountant perform the audit?
Your auditor must be independent. Article 2 of SEC Regulation S-X sets out the general rules for auditor
independence. Please note that these requirements may be different from the rules of professional
organizations.
11. We are a new firm. Do we need a brochure? Yes. Respond to items in Part 2A of Form ADV based on the
advisory services you propose to provide and the practices, policies and procedures you propose to adopt.
12. We are a “separately identifiable department or division” (SID) of a bank. Must our brochure discuss our
bank’s general business practices? No. Information you include in your firm brochure (or in brochure
supplements) should be information about you, the SID, and your business practices, rather than general
information about your bank.

Part 2A of Form ADV: Firm Brochure
Item 1

Cover Page

A. The cover page of your brochure must state your name, business address, telephone number, Web site
address (if you have one), and the date of the brochure.
Note: If you primarily conduct advisory business under a name different from your full legal name, and
you have disclosed your business name in Item 1.B of Part 1A of Form ADV, then you may use your
business name throughout your brochure.
B. Display on the cover page of your brochure the following (or other clear and concise language conveying
the same information):
This brochure provides information about the qualifications and business practices of [your name].
If you have any questions about the contents of this brochure, please contact [name and telephone
number of service center or name and/or title and telephone number of contact person]. The
information in this brochure has not been approved or verified by the United States Securities and
Exchange Commission or by any state securities authority.
Additional information about [your name] also is available on the Internet at www.adviserinfo.sec.gov.
C. If you refer to yourself as a “registered investment adviser” or describe yourself as being “registered,”
include a statement that registration does not imply a certain level of skill or training.
Item 2

Material Changes

If your brochure contains material changes from its last annual update, identify those changes on the cover page of
the brochure or on the page immediately following the cover page, or in a separate communication accompanying
the brochure. You must state clearly that you are discussing only material changes since the last annual update of
your brochure, and you must provide the date of the last annual update of your brochure.
Note: You do not have to provide this information to a client or prospective client who has not received a previous
version of your brochure.
Item 3

Table of Contents

Provide a table of contents to your brochure.
Note: Your table of contents must be detailed enough so that your clients can locate topics easily. However, your
brochure is not required to follow the same order as the items listed in Part 2.
Item 4

Advisory Business

A. Describe your advisory firm, including how long you have been in business. Identify your principal

owner(s).

Notes: (1) For purposes of this item, your principal owners include the persons you list as owning 25% or
more of your firm on Schedule A of Part 1A of Form ADV (Ownership Codes C, D or E). (2) If you are a
publicly held company without a 25% shareholder, simply disclose that you are publicly held. (3) If an
individual or company owns 25% or more of your firm through subsidiaries, you must identify the
individual or parent company and intermediate subsidiaries. If you are a state-registered adviser, you must

Form ADV: Part 2A

Page 2

identify all intermediate subsidiaries. If you are an SEC-registered adviser, you must identify intermediate
subsidiaries that are publicly held, but not other intermediate subsidiaries.
B. Describe the types of advisory services you offer. If you hold yourself out as specializing in a particular
type of advisory service, such as financial planning, quantitative analysis, or market timing, explain the
nature of that service in greater detail. If you provide investment advice only with respect to limited types
of investments, explain the type of investment advice you offer, and disclose that your advice is limited to
those types of investments.
C. Explain whether (and, if so, how) you tailor your advisory services to the individual needs of clients.
Explain whether clients may impose restrictions on investing in certain securities or types of securities.
D. If you participate in wrap fee programs by providing portfolio management services, (1) describe the
differences, if any, between how you manage wrap fee accounts and how you manage other accounts, and
(2) explain that you receive a portion of the wrap fee for your services.
E. If you manage client assets, disclose the amount of client assets you manage on a discretionary basis and
the amount of client assets you manage on a non-discretionary basis. Disclose the date “as of” which you
calculated the amounts.
Note: Your method for computing the amount of “client assets you manage” can be different from the method
for computing “assets under management” required for Item 5.F in Part 1A. However, if you choose to use a
different method to compute “client assets you manage,” you must keep documentation describing the method
you use. The amount you disclose may be rounded to the nearest $100,000. Your “as of” date must not be
more than three months before the date you last updated your brochure in response to this Item 4.E.
Item 5

Fees and Compensation

A. Describe how you are compensated for your advisory services. Provide your fee schedule. Disclose
whether the fees are negotiable.
B. Describe whether you deduct fees from clients’ assets or bill clients for fees incurred. If clients may select
either method, disclose this fact. Explain how often you bill clients or deduct your fees.
C. Describe any other types of fees or expenses clients may pay in connection with your advisory services,
such as custodian fees or mutual fund expenses. Disclose that clients will incur brokerage and other
transaction costs, and direct clients to the section(s) of your brochure that discuss brokerage.
D. If your clients either may or must pay your fees in advance, disclose this fact. Explain how a client may
obtain a refund of a pre-paid fee if the advisory contract is terminated before the end of the billing period.
Explain how you will determine the amount of the refund.
E. If you or any of your supervised persons accepts compensation for the sale of securities or other investment
products, including distribution or service (“trail”) fees from the sale of mutual funds, disclose this fact and
respond to Items 5.E.1, 5.E.2, 5.E.3 and 5.E.4.
1. Explain that this practice presents a conflict of interest and gives you or your supervised persons an
incentive to recommend investment products based on the compensation received, rather than on a
client’s needs. Describe generally how you address conflicts that arise, including your procedures for
disclosing the conflicts to clients. If you primarily recommend mutual funds, disclose whether you
will recommend “no-load” funds.

Form ADV: Part 2A

Page 3

2. Explain that clients have the option to purchase investment products that you recommend through
other brokers or agents that are not affiliated with you.
3. If more than 50% of your revenue from advisory clients results from commissions and other
compensation for the sale of investment products you recommend to your clients, including trail fees
from the sale of mutual funds, disclose that commissions provide your primary or, if applicable, your
exclusive compensation.
4. If you charge advisory fees in addition to commissions, disclose whether you reduce your advisory
fees to offset the commissions you accept.
Note: If you receive compensation in connection with the purchase or sale of securities, you should
carefully consider the applicability of the broker-dealer registration requirements of the Securities
Exchange Act of 1934 and any applicable state securities statutes.
Item 6

Performance Fees and Side-By-Side Management

If you or any of your supervised persons accepts “performance fees” – that is, fees based on a share of capital gains
on or capital appreciation of the assets of a client (such as a client that is a hedge fund or other pooled investment
vehicle) – disclose this fact. If you or any of your supervised persons manage both accounts that are charged a
performance fee and accounts that are charged another type of fee, such as an hourly or flat fee, or an asset-based
fee, disclose this fact. Explain the conflicts of interest that you or your supervised persons face by managing these
accounts at the same time, including that you or your supervised persons have an incentive to favor accounts for
which you or your supervised persons receive a performance fee, and describe generally how you address these
conflicts.
Item 7

Types of Clients

Describe the types of clients to whom you generally provide investment advice, such as individuals, trusts,
investment companies, or pension plans. If you have any requirements for opening or maintaining an account, such
as a minimum account size, disclose the requirements.
Item 8

Methods of Analysis, Investment Strategies and Risk of Loss

A. Describe the methods of analysis and investment strategies you use in formulating investment advice or
managing assets. Explain that investing in securities involves risk of loss that clients should be prepared to
bear.
B. If you primarily use a particular method of analysis or strategy, explain the specific risks involved. If the
method of analysis or strategy involves significant or unusual risks, discuss these risks in detail. If your
primary strategy involves frequent trading of securities, explain how frequent trading can affect investment
performance, particularly through increased brokerage and other transaction costs and taxes.
C. If you recommend primarily a particular type of security, explain the specific risks involved. If the type of
security involves significant or unusual risks, discuss these risks in detail.
D. Discuss your practices regarding cash balances in client accounts, including whether you invest cash
balances for temporary purposes and, if so, how.

Form ADV: Part 2A

Item 9

Page 4

Disciplinary Information

If there are legal or disciplinary events that are material to a client’s or prospective client’s evaluation of your
advisory business or the integrity of your management, disclose all material facts regarding those events.
Items 9.A, 9.B, and 9.C list specific legal and disciplinary events that you must presume are material for this
Item. If your advisory firm or a management person has been involved in one of these events, you must
disclose it under this Item for ten years following the date of the event, unless (1) the event was resolved in your
or the management person’s favor, or was reversed, suspended or vacated, or (2) the event is not material (see
Note below). For purposes of calculating this ten-year period, the “date” of an event is the date that the final
order, judgment, or decree was entered, or the date that any rights of appeal from preliminary orders, judgments
or decrees lapsed.
Items 9.A, 9.B, and 9.C do not contain an exclusive list of material disciplinary events. If your advisory firm or
a management person has been involved in a legal or disciplinary event that is not listed in Items 9.A, 9.B, or
9.C, but nonetheless is material to a client's or prospective client's evaluation of your advisory business or the
integrity of its management, you must disclose the event. Similarly, even if more than ten years have passed
since the date of the event, you must disclose the event if it is so serious that it remains currently material to a
client’s or prospective client’s evaluation.
A. A criminal or civil action in a domestic, foreign or military court of competent jurisdiction in which your
firm or a management person
1. was convicted of, or pled guilty or nolo contendere (“no contest”) to (a) any felony; (b) a misdemeanor
that involved investments or an investment-related business, fraud, false statements or omissions,
wrongful taking of property, bribery, perjury, forgery, counterfeiting, or extortion; or (c) a conspiracy
to commit any of these offenses;
2. is the named subject of a pending criminal proceeding that involves an investment-related business,
fraud, false statements or omissions, wrongful taking of property, bribery, forgery, counterfeiting,
extortion, or a conspiracy to commit any of these offenses;
3. was found to have been involved in a violation of an investment-related statute or regulation; or
4. was the subject of any order, judgment, or decree permanently or temporarily enjoining, or otherwise
limiting, your firm or a management person from engaging in any investment-related activity, or from
violating any investment-related statute, rule, or order.
B. An administrative proceeding before the SEC, any other federal regulatory agency, any state regulatory
agency, or any foreign financial regulatory authority in which your firm or a management person
1. was found to have caused an investment-related business to lose its authorization to do business; or
2. was found to have been involved in a violation of an investment-related statute or regulation and was
the subject of an order by the agency or authority
(a) denying, suspending, or revoking the authorization of your firm or a management person to act in
an investment-related business;
(b) barring or suspending your firm’s or a management person's association with an investmentrelated business;
(c) otherwise significantly limiting your firm’s or a management person's investment-related
activities; or

Form ADV: Part 2A

Page 5

(d) imposing a civil money penalty of more than $2,500 on your firm or a management person.
C. A self-regulatory organization (SRO) proceeding in which your firm or a management person
1.

was found to have caused an investment-related business to lose its authorization to do business; or

2.

was found to have been involved in a violation of the SRO’s rules and was: (i) barred or suspended
from membership or from association with other members, or was expelled from membership;
(ii) otherwise significantly limited from investment-related activities; or (iii) fined more than $2,500.

Note: Special circumstances may make an event immaterial (overcoming the materiality presumption). If an
event is immaterial, you are not required to disclose it. When you review a legal or disciplinary event involving
your firm or a management person for materiality, you should consider all of the following factors: (1) the
proximity of the person involved in the disciplinary event to the advisory function; (2) the nature of the
infraction that led to the disciplinary event; (3) the severity of the disciplinary sanction; and (4) the time elapsed
since the date of the disciplinary event. If you conclude that the materiality presumption is overcome, you must
prepare and maintain a file memorandum of your determination in your records. See SEC rule 204-2(a)(14)(iii).
Item 10

Other Financial Industry Activities and Affiliations

A. If you or any of your management persons are registered, or have an application pending to register, as a
broker-dealer or a registered representative of a broker-dealer, disclose this fact.
B. If you or any of your management persons are registered, or have an application pending to register, as a
futures commission merchant, commodity pool operator, a commodity trading advisor, or an associated
person of the foregoing entities, disclose this fact.
C. Describe any relationship or arrangement that is material to your advisory business or to your clients, that
you or any of your management persons have with any related person listed below. Identify the related
person and if the relationship or arrangement creates a material conflict of interest with clients, describe the
nature of the conflict and how you address it.
1. broker-dealer, municipal securities dealer, or government securities dealer or broker
2. investment company or other pooled investment vehicle (including a mutual fund, closed-end
investment company, unit investment trust, private investment company or “hedge fund,” and offshore
fund)
3. other investment adviser or financial planner
4. futures commission merchant, commodity pool operator, or commodity trading advisor
5. banking or thrift institution
6. accountant or accounting firm
7. lawyer or law firm
8. insurance company or agency
9. pension consultant
10. real estate broker or dealer
11. sponsor or syndicator of limited partnerships.
D. If you recommend or select other investment advisers for your clients and you receive compensation
directly or indirectly from those advisers, or you have other business relationships with those advisers,
describe these practices and discuss the conflicts of interest these practices create and how you address
them.

Form ADV: Part 2A

Item 11

Page 6

Code of Ethics, Participation or Interest in Client Transactions and Personal Trading

A. If you are an SEC-registered adviser, briefly describe your code of ethics adopted pursuant to SEC rule
204A-1. Explain that you will provide a copy of your code of ethics to any client or prospective client
upon request.
B. If you or a related person recommends to clients, or buys or sells for client accounts, securities in which
you or a related person has a material financial interest (excluding an interest as a shareholder of an SECregistered, open-end investment company), describe your practice and discuss the conflicts of interest it
presents. Describe generally how you address conflicts that arise, including your procedures for disclosing
the conflicts to clients. You do not need to repeat any information you provided in response to Item 5 of
Part 2A.
Examples: (1) You or a related person, as principal, buys securities from (or sells securities to) your
clients; (2) you or a related person acts as general partner in a partnership in which you solicit client
investments; or (3) you or a related person acts as investment adviser to an investment company that you
recommend to clients.
C. If you or a related person invests in the same securities (or related securities, e.g., warrants, options or
futures) that you or a related person recommends to clients, describe your practice and discuss the conflicts
of interest this presents and generally how you address the conflicts that arise in connection with personal
trading.
D. If you or a related person recommends securities to clients, or buys or sells securities for client accounts, at
or about the same time that you or a related person buys or sells the same securities for your own (or the
related person's own) account, describe your practice and discuss the conflicts of interest it presents.
Describe generally how you address conflicts that arise.
Note: The description required by Item 11.A may include information responsive to Item 11.B, C or D. If so, it is
not necessary to make repeated disclosures of the same information.
Item 12

Brokerage Practices

A. Describe the factors that you consider in selecting or recommending broker-dealers for client transactions
and determining the reasonableness of their compensation (e.g., commissions).
1. Research and Other Soft Dollar Benefits. If you receive research or other products or services other
than execution from a broker-dealer or a third party in connection with client securities transactions
(“soft dollar benefits”), disclose your practices and discuss the conflicts of interest they create.
Note: Your disclosure and discussion must include all soft dollar benefits you receive, including, in
the case of research, both proprietary research (created or developed by the broker-dealer) and research
created or developed by a third party.
a. Explain that when you use client brokerage commissions (or markups or markdowns) to obtain
research or other products or services, you receive a benefit because you do not have to produce or
pay for the research, products or services.
b. Disclose that you may have an incentive to select or recommend a broker-dealer based on your
interest in receiving the research or other products or services, rather than on your clients’ interest
in receiving best execution.

Form ADV: Part 2A

Page 7

c. If you may cause clients to pay commissions (or markups or markdowns) higher than those
charged by other broker-dealers in return for soft dollar benefits (known as paying-up), disclose
this fact.
d. Disclose whether you use soft dollar benefits to service all of your clients’ accounts or only those
that paid for the benefits. Disclose whether you seek to allocate soft dollar benefits to client
accounts proportionately to the soft dollar credits the accounts generate.
e. Describe the types of products and services you or any of your related persons acquired with
client brokerage commissions (or markups or markdowns) within your last fiscal year.
Note: This description must be specific enough for your clients to understand the types of
products or services that you are acquiring and to permit them to evaluate possible conflicts of
interest. Your description must be more detailed for products or services that do not qualify for
the safe harbor in section 28(e) of the Securities Exchange Act of 1934, such as those services that
do not aid in investment decision-making or trade execution. Merely disclosing that you obtain
various research reports and products is not specific enough.
f. Explain the procedures you used during your last fiscal year to direct client transactions to a
particular broker-dealer in return for soft dollar benefits you received.
2.

Brokerage

for Client Referrals. If you consider, in selecting or recommending broker-dealers, whether
you or a related person receives client referrals from a broker-dealer or third party, disclose this
practice and discuss the conflicts of interest it creates.
a. Disclose that you may have an incentive to select or recommend a broker-dealer based on your
interest in receiving client referrals, rather than on your clients’ interest in receiving best
execution.
b. Explain the procedures you used during your last fiscal year to direct client transactions to a
particular broker-dealer in return for client referrals.

3. Directed Brokerage.
a. If you routinely recommend, request or require that a client direct you to execute transactions
through a specified broker-dealer, describe your practice or policy. Explain that not all advisers
require their clients to direct brokerage. If you and the broker-dealer are affiliates or have another
economic relationship that creates a material conflict of interest, describe the relationship and
discuss the conflicts of interest it presents. Explain that by directing brokerage you may be unable
to achieve best execution of client transactions, and that this practice may cost clients more
money.
b. If you permit a client to direct brokerage, describe your practice. If applicable, explain that you
may be unable to achieve best execution of client transactions. Explain that directing brokerage
may cost clients more money. For example, in a directed brokerage account, the client may pay
higher brokerage commissions because you may not be able to aggregate orders to reduce
transaction costs, or the client may receive less favorable prices.
Note: If you only permit clients to direct brokerage subject to best execution, you do not need to
respond to Item 12.A.3.b.
B. Discuss whether and under what conditions you aggregate the purchase or sale of securities for various
client accounts in quantities sufficient to obtain reduced transaction costs (known as bunching). If you do

Form ADV: Part 2A

Page 8

not bunch orders when you have the opportunity to do so, explain your practice and describe the costs to
clients of not bunching.
Item 13

Review of Accounts

A. Indicate whether you periodically review client accounts or financial plans. If you do, describe the
frequency and nature of the review, and the titles of the employees who conduct the review.
B. If you review client accounts on other than a periodic basis, describe the factors that trigger a review.
C. Describe the content and indicate the frequency of regular reports you provide to clients regarding their
accounts. State whether these reports are written.
Item 14

Payment for Client Referrals

A. If someone who is not a client provides an economic benefit to you for providing investment advice or
other advisory services to your clients, generally describe the arrangement. For purposes of this Item,
economic benefits include any sales awards or other prizes. You do not need to repeat any information you
provided in response to Item 5 of Part 2A.
B. If you or a related person directly or indirectly compensates any person who is not your employee for client
referrals, describe the arrangement and the compensation.
Note: If you compensate any person for client referrals, you should consider whether SEC rule 206(4)-3 or
similar state rules regarding solicitation arrangements and/or state rules requiring registration of investment
adviser representatives apply.
Item 15

Custody

A. If you have custody of client funds or securities and a qualified custodian as defined in SEC rule 206(4)-2
or similar state rules (for example, a broker-dealer or bank) does not send account statements with respect
to those funds or securities directly to your clients, state that you have custody and explain the risks that
clients will face because of this.
B. If you have custody of client funds or securities and a qualified custodian sends quarterly, or more frequent,
account statements directly to your clients, explain that clients will receive account statements from the
broker-dealer, bank or other qualified custodian and that clients should carefully review those statements.
Item 16

Investment Discretion

If you accept discretionary authority to manage securities accounts on behalf of clients, disclose this fact and
describe any limitations clients may (or customarily do) place on this authority. Describe the procedures you follow
before you assume this authority (e.g., execution of a power of attorney).
Item 17

Voting Client Securities

A. If you have, or will accept, authority to vote client securities, briefly describe your voting policies and
procedures, including those adopted pursuant to SEC rule 206(4)-6. Describe whether (and, if so, how)
your clients can direct your vote in a particular solicitation. Describe how you address conflicts of interest
between you and your clients with respect to voting their securities. Describe how clients may obtain
information from you about how you voted their securities. Explain to clients that they may obtain a copy
of your proxy voting policies and procedures upon request.

Form ADV: Part 2A

Page 9

B. If you routinely rely on one or more third-party proxy voting services to advise you in connection with
voting client securities, list the proxy voting services that you use, describe how you select the proxy voting
services, and explain whether you permit clients to direct the use of a particular proxy voting service with
respect to the securities held in their accounts. (You do not need to identify a proxy voting service that a
client directs you to use unless you also use the service for the purpose of voting the securities of other
clients). Describe whether you pay for proxy voting services with soft dollars or pass the cost on to your
clients through a supplement to your advisory fee.
C. If you do not have authority to vote client securities, disclose this fact. Explain whether clients will receive
their proxies or other solicitations directly from their custodian or a transfer agent or from you, and discuss
whether (and, if so, how) clients can contact you with questions about a particular solicitation.
Item 18

Financial Information

A. If you require or solicit prepayment of more than $1,200 in fees per client, six months or more in advance,
include a balance sheet for your most recent fiscal year.
1. The balance sheet must be prepared in accordance with generally accepted accounting principles,
audited by an independent public accountant, and accompanied by a note stating the principles used to
prepare it, the basis of securities included, and any other explanations required for clarity.
2. Show parenthetically the market or fair value of securities included at cost.
3. Qualifications and any accompanying independent accountant’s report must conform to Article 2 of
SEC Regulation S-X.
Note: If you are a sole proprietor, show investment advisory business assets and liabilities separate from
other business and personal assets and liabilities. You may aggregate other business and personal assets
unless advisory business liabilities exceed advisory business assets.
Note: If you have not completed your first fiscal year, include a balance sheet dated not more than 90 days
prior to the date of your brochure.
Exception: You are not required to respond to Item 18.A of Part 2A if you also are: (i) a qualified
custodian as defined in SEC rule 206(4)-2 or similar state rules; or (ii) an insurance company.
B. If you are an SEC-registered adviser and you have discretionary authority or custody of client funds or
securities, or you require or solicit prepayment of more than $1,200 in fees per client, six months or more
in advance, disclose any financial condition that is reasonably likely to impair your ability to meet
contractual commitments to clients.
Note: With respect to Items 18.A and 18.B, if you are registered or are registering only with one or more of the
state securities authorities, the dollar amount reporting threshold for including the required balance sheet and
for making the required financial condition disclosures is more than $500 in fees per client, six months or more
in advance.
C. If you have been the subject of a bankruptcy petition at any time during the past ten years, disclose this
fact, the date the petition was first brought, and the current status.
Item 19

Index

The brochure you file with the SEC or state securities authorities must contain an index of the items required by
this Part 2A, indicating where in the brochure you address each item (e.g., Item 9 or “Disciplinary Information” on

Form ADV: Part 2A

Page 10

page 12). If you do not include an item in the brochure, note that fact and the reason it is not included in the index
(e.g., Item 10 or “Other Financial Industry Activities and Affiliations” does not apply so it is not included). The
brochure you provide to your clients does not need to include this index.
If you are registering or are registered with one or more state securities authorities, you must respond to the
following additional Item.
Item 20

Requirements for State-Registered Advisers

A. Identify each of your principal executive officers and management persons, and describe their formal
education and business background. If you have supplied this information elsewhere in your Form ADV,
you do not need to repeat it in response to this Item.
B. Describe any business in which you are actively engaged (other than giving investment advice) and the
approximate amount of time spent on that business. If you have supplied this information elsewhere in
your Form ADV, you do not need to repeat it in response to this Item.
C. In addition to the description of your fees in response to Item 5 of Part 2A, if you or a supervised person
are compensated for advisory services with performance-based fees, explain how these fees will be
calculated. Disclose specifically that performance-based compensation may create an incentive for the
adviser to recommend an investment that may carry a higher degree of risk to the client.
D. If you or a management person has been involved in one of the events listed below, disclose all material
facts regarding the event.
1. An award or otherwise being found liable in an arbitration claim alleging damages in excess of $2,500,
involving any of the following:
(a)
(b)
(c)
(d)
(e)

an investment or an investment-related business or activity;
fraud, false statement(s), or omissions;
theft, embezzlement, or other wrongful taking of property;
bribery, forgery, counterfeiting, or extortion; or
dishonest, unfair, or unethical practices.

2. An award or otherwise being found liable in a civil, self-regulatory organization, or administrative
proceeding involving any of the following:
(a)
(b)
(c)
(d)
(e)

an investment or an investment-related business or activity;
fraud, false statement(s), or omissions;
theft, embezzlement, or other wrongful taking of property;
bribery, forgery, counterfeiting, or extortion; or
dishonest, unfair, or unethical practices.

E. In addition to any relationship or arrangement described in response to Item 10.C. of Part 2A, describe any
relationship or arrangement that you or any of your management persons have with any issuer of securities
that is not listed in Item 10.C. of Part 2A.

Instructions for Part 2A Appendix 1 of Form ADV:
Preparing Your Wrap Fee Program Brochure
1. Who must deliver a wrap fee program brochure? If you sponsor a wrap fee program, you must give a wrap
brochure to each client of the wrap fee program.

However, if a wrap fee program that you sponsor has multiple sponsors and another sponsor creates and

delivers to your wrap fee program clients a wrap brochure that includes all the information required in your

wrap brochure, you do not have to create or deliver a separate wrap brochure.

A wrap brochure takes the place of your advisory firm brochure required by Part 2A of Form ADV, but only
for clients of wrap fee programs that you sponsor. See SEC rule 204-3(b)(1) and (f).
2. When must a wrap fee program brochure be delivered?
• You must give a wrap brochure to each client of the wrap fee program before or at the time the client enters
into a wrap fee program contract.
• Each year you must deliver to each client an updated wrap brochure within 120 days of the end of your
fiscal year.
• You do not have to deliver an interim amendment to clients unless the amendment includes information in
response to Item 9 of Part 2A (disciplinary information). An interim amendment can be in the form of a
“sticker” that identifies the information that has become inaccurate and provides the new information and the
date of the sticker. See SEC rule 204-3(b)(1), (f)(1), and (g).
Note: As a fiduciary, you have a continuing obligation to inform your clients of any material information
that could affect the advisory relationship. As a result, between annual updating amendments you must
disclose to clients changes that are material to them even if those changes do not trigger delivery of an
interim amendment.
3. When must we update our wrap brochure? You must update your wrap brochure: (i) each year at the time you
file your annual updating amendment, and (ii) promptly whenever any information in the wrap brochure (other
than information in response to Item 4.A of this Appendix (service fees/schedule)) becomes materially
inaccurate. See SEC rules 204-1 and 204-2(a)(14)(i).
4. May we deliver our wrap fee program brochure electronically? Yes. You may deliver your wrap brochure
using electronic media. The SEC has published interpretive guidance on delivering documents electronically,
which you can find at .
5. Must we also deliver brochure supplements to wrap fee program clients? Yes. A wrap brochure does not take
the place of any supplements required by Part 2B of Form ADV.
6. What if we sponsor more than one wrap fee program? You may prepare a single wrap brochure describing all
the wrap fee programs you sponsor, or you may prepare separate wrap brochures that describe one or more of
your wrap fee programs. If you prepare separate brochures, each brochure must state that you sponsor other
wrap fee programs and must explain how the client can obtain brochures for the other programs.
7. We provide portfolio management services under a wrap fee program that we sponsor. Must we deliver both
our wrap brochure and our firm brochure to our wrap fee program clients? No, just the wrap brochure. If you
or your employees provide portfolio management services under a wrap fee program that you also sponsor,
your wrap brochure must describe the investments and investment strategies you (or your employees) will use
as portfolio managers. This requirement appears in Item 6.B of this Appendix.
8.

We provide other advisory services outside of our wrap fee programs. May we combine our wrap brochure
into our firm brochure for clients receiving these other services? No. Your wrap brochure must address only
the wrap fee programs you sponsor. See SEC rule 204-3(d)(1).

Part 2A Appendix 1 of Form ADV: Wrap Fee Program Brochure
Item 1

Cover Page

A. The cover page of your wrap fee program brochure must state your name, business address, telephone
number, Web site address (if you have one), and the date of the wrap brochure.
Note: If you primarily conduct advisory business under a name different from your full legal name, and
you have disclosed your business name in Item 1.B of Part 1A of Form ADV, then you may use your
business name throughout your wrap brochure.
B. Display on the cover page of your wrap brochure the following (or other clear and concise language
conveying the same information):
This brochure provides information about the qualifications and business practices of [your name].
If you have any questions about the contents of this brochure, please contact [name and telephone
number of service center or name and/or title and telephone number of contact person]. The
information in this brochure has not been approved or verified by the United States Securities and
Exchange Commission or by any state securities authority.
Additional information about [your name] also is available on the Internet at www.adviserinfo.sec.gov.
C. If you refer to yourself as a “registered investment adviser” or describe yourself as being “registered,”
include a statement that registration does not imply a certain level of skill or training.
Item 2

Material Changes

If your wrap brochure contains material changes from its last annual update, identify those changes on the page
immediately following the cover page of the wrap brochure or in a separate letter accompanying the wrap brochure.
You must clearly state that you are discussing only material changes since the last annual update of the wrap
brochure, and must provide the date of the last annual update to the wrap brochure.
Note: You do not have to provide this information to a client or prospective client who has not received a previous
version of your wrap brochure.
Item 3

Table of Contents

Provide a table of contents to your wrap brochure.
Note: Your table of contents must be detailed enough so that your clients can locate topics easily.
Item 4

Services, Fees and Compensation

A. Describe the services, including the types of portfolio management services, provided under each program.
Indicate the wrap fee charged for each program or, if fees vary according to a schedule, provide your fee
schedule. Indicate whether fees are negotiable and identify the portion of the total fee, or the range of fees,
paid to portfolio managers.
B. Explain that the program may cost the client more or less than purchasing such services separately and
describe the factors that bear upon the relative cost of the program, such as the cost of the services if
provided separately and the trading activity in the client's account.

Form ADV: Part 2A Appendix 1

Page 2

C. Describe any fees that the client may pay in addition to the wrap fee, and describe the circumstances under
which clients may pay these fees, including, if applicable, mutual fund expenses and mark-ups, mark
downs, or spreads paid to market makers.
D. If the person recommending the wrap fee program to the client receives compensation as a result of the
client's participation in the program, disclose this fact. Explain, if applicable, that the amount of this
compensation may be more than what the person would receive if the client participated in your other
programs or paid separately for investment advice, brokerage, and other services. Explain that the person,
therefore, may have a financial incentive to recommend the wrap fee program over other programs or
services.
Item 5

Account Requirements and Types of Clients

If a wrap fee program imposes any requirements to open or maintain an account, such as a minimum account size,
disclose these requirements. If there is a minimum amount for assets placed with each portfolio manager as well as
a minimum account size for participation in the wrap fee program, disclose and explain these requirements. To the
extent applicable to your wrap fee program clients, describe the types of clients to whom you generally provide
investment advice, such as individuals, trusts, investment companies, or pension plans.
Item 6

Portfolio Manager Selection and Evaluation

A. Describe how you select and review portfolio managers, your basis for recommending or selecting portfolio
managers for particular clients, and your criteria for replacing or recommending the replacement of
portfolio managers for the program and for particular clients.
1. Describe any standards you use to calculate portfolio manager performance, such as industry standards
or standards used solely by you.
2. Indicate whether you review, or whether any third-party reviews, performance information to
determine or verify its accuracy or its compliance with presentation standards. If so, briefly describe
the nature of the review and the name of any third party conducting the review.
3. If applicable, explain that neither you nor a third-party reviews portfolio manager performance
information, and/or that performance information may not be calculated on a uniform and consistent
basis.
B. Disclose whether any of your related persons act as a portfolio manager for a wrap fee program described
in the wrap fee program brochure. Explain the conflicts of interest that you face because of this
arrangement and describe how you address these conflicts of interest. Disclose whether related person
portfolio managers are subject to the same selection and review as the other portfolio managers that
participate in the wrap fee program. If they are not, describe how you select and review related person
portfolio managers.
C. If you, or any of your employees covered under your investment adviser registration, act as portfolio
manager for a wrap fee program described in the wrap brochure, respond to Items 4.B, 4.C, 4.D (Advisory
Business), 6 (Performance Fees and Side-By-Side Management), 8.A (Methods of Analysis, Investment
Strategies and Risk of Loss) and 17 (Voting Client Securities) of Part 2A of Form ADV.
Item 7

Client Information Provided to Portfolio Managers

Describe the information about clients that you communicate to the clients’ portfolio managers, and how often or
under what circumstances you provide updated information.

Form ADV: Part 2A Appendix 1

Item 8

Page 3

Client Contact with Portfolio Managers

Explain any restrictions placed on clients’ ability to contact and consult with their portfolio managers.
Item 9

Additional Information

A. Respond to Item 9 (Disciplinary Information) and Item 10 (Other Financial Industry Activities and

Affiliations) of Part 2A of Form ADV.

B. Respond to Items 11 (Code of Ethics, Participation or Interest in Client Transactions and Personal Trading),
13 (Review of Accounts), 14 (Payment for Client Referrals), and 18 (Financial Information) of Part 2A of
Form ADV, as applicable to your wrap fee clients.
Item 10

Index

The wrap brochure you file with the SEC or state securities authorities must contain (or be accompanied by) an
index of the items required by this Appendix, indicating where in the wrap brochure you address each item. The
wrap brochure you provide to your clients does not need to include this index.
If you are registering or are registered with one or more state securities authorities, you must respond to the
following additional Item.
Item 11

Requirements for State-Registered Advisers

Respond to Item 20.E of Part 2A of Form ADV.

Instructions for Part 2B of Form ADV: Preparing a Brochure Supplement
1. For which supervised persons must we prepare a brochure supplement? As an initial matter, if you have no
clients to whom you must deliver a brochure supplement (see Instruction 2 below), then you need not prepare
any brochure supplements. Otherwise, you must prepare a brochure supplement for the following supervised
persons:
(i)

Any supervised person who formulates investment advice for a client and has direct client contact;
and

(ii)

Any supervised person who has discretionary authority over a client’s assets, even if the
supervised person has no direct client contact. See SEC rule 204-3(b)(2) and similar state rules.

Note: No supplement is required for a supervised person who has no direct client contact and has
discretionary authority over a client’s assets only as part of a team.
2. To whom must we deliver brochure supplements? Are there any exceptions?
You must deliver to a client the brochure supplements for each supervised person who provides advisory
services to that client. However, there are four categories of clients to whom you are not required to deliver
supplements. See SEC rule 204-3(c) and similar state rules.
First, you are not required to deliver supplements to clients to whom you are not required to deliver a firm
brochure (or a wrap fee program brochure).
Second, you are not required to deliver supplements to clients who receive only impersonal investment advice,
even if they receive a firm brochure.
Third, you are not required to deliver supplements to clients who are “qualified purchasers” – a term defined in
section 2(a)(51)(A) of the Investment Company Act of 1940. A “qualified purchaser” generally includes:
(i)

Any individual who owns not less than $5 million in investments;

(ii)

Any company that owns not less than $5 million in investments and that is owned by or for 2 or
more natural persons who are related (i.e., siblings or spouses, direct lineal descendants by birth or
adoption, spouses of such persons, the estates of such persons, or foundations, charitable
organizations, or trusts established by or for the benefit of such persons); and

(iii)

Any person who owns or invests on a discretionary basis (for his own account or for the accounts
of other qualified purchasers) not less than $25,000,000 in investments.

Fourth, you are not required to deliver supplements to clients who are individuals who would be “qualified
clients” of your firm under SEC rule 205-3(d)(1)(iii). Those persons are:
(i)

Any executive officers, directors, trustees, general partners, or persons serving in a similar
capacity, of your firm; and

(ii)

Any employees of your firm (other than employees performing solely clerical, secretarial or
administrative functions) who, in connection with their regular functions or duties, participate in
the investment activities of your firm and have been performing such functions or duties for at
least 12 months.

3. When must we deliver a supplement to a client?
•

You must deliver the supplement for a supervised person before or at the time that supervised person begins to
provide advisory services to a client.

Form ADV: Instructions for Part 2B

•

Page 2

You also must deliver to clients any update to the supplement that amends information in response to Item 3 of
Part 2B (disciplinary information). Such an amendment can be in the form of a “sticker” that identifies the
information that has become inaccurate and provides the new information and the date of the sticker.
Note: As a fiduciary, you have a continuing obligation to inform your clients of any material information that
could affect the advisory relationship. As a result, between annual updating amendments you must disclose
material changes to clients even if those changes do not trigger delivery of an updated supplement.
You may have a supervised person deliver supplements (including his own) on your behalf. Furthermore, you
are not required to file brochure supplements or updates, but you must maintain copies of them. See Instruction
5 of SEC General Instructions for Part 2 of Form ADV.

4. When must we update brochure supplements? You must update brochure supplements promptly whenever any
information in them becomes materially inaccurate.
5. May we deliver brochure supplements electronically? Yes. You may deliver supplements using electronic
media. The SEC has published interpretive guidance on delivering documents electronically, which you can
find at .
6. Must brochure supplements be separate documents? No. If your firm brochure includes all the information
required in a brochure supplement, you do not need a separate supplement. Smaller firms with just a few
supervised persons may find it easier to include all supplement information in their firm brochure, while larger
firms may prefer to use a firm brochure and separate supplements.
If your firm brochure includes some (but not all) supplement information about a supervised person, the
supplement can refer the reader to the appropriate section(s) of your firm brochure and describe the type of
information being referred to instead of repeating that information in the supplement.
You may prepare supplements for groups of supervised persons. A group supplement, or a firm brochure
presenting supplement information about supervised persons, must present information in a separate section for
each supervised person.
7. Must an adviser who is a sole proprietor provide his own brochure supplement to clients? No, if that
information is included in the firm brochure.
8. May we include information not required by an item in a brochure supplement? Yes. If you include
information not required by an item, however, you may not include so much additional information that the
required information is obscured.

Part 2B of Form ADV: Brochure Supplement
Item 1

Cover Page

A. Include the following on the cover page of the supplement:
1. The supervised person’s name, business address and telephone number (if different from yours).
2. Your firm’s name, business address and telephone number. If your firm brochure uses a business
name for your firm, use the same business name for the firm in the supplement.
3. The date of the supplement.
B. Display on the cover page statements containing the following or other clear and concise language

conveying the same information:

This supplement provides information about [name of supervised person] that supplements the [name
of advisory firm] brochure. You should have received a copy of that brochure. Please contact
[service center or name and/or title of your contact person] if you did not receive [name of advisory
firm]’s brochure or if you have any questions about the contents of this supplement.
Additional information about [name of supervised person] is available on the Internet at
www.adviserinfo.sec.gov.
Note: You do not have to include this statement directing clients to the public website until such time that
information about investment adviser representatives is available through the Investment Adviser Public
Disclosure System. In addition, you do not have to include this statement directing clients to the public
website unless the supervised person is an investment adviser representative required to register with state
securities authorities.
Item 2

Educational Background and Business Experience

Disclose the supervised person’s name, age (or year of birth), formal education after high school, and business
background for the preceding five years. If the supervised person either has no formal education after high school
or has no business background, disclose this fact.
Item 3

Disciplinary Information

If there are legal or disciplinary events material to a client's or prospective client's evaluation of the supervised
person, disclose all material facts regarding those events.
Items 3.A, 3.B, 3.C, and 3.D below list specific legal and disciplinary events that you must presume are material
for this Item. If the supervised person has been involved in one of these events, you must disclose it under this
Item for ten years following the date of the event, unless (1) the event was resolved in the supervised person’s
favor, or was reversed, suspended or vacated, or (2) the event is not material (see Note below). For purposes of
calculating this ten-year period, the “date” of an event is the date the final order, judgment, or decree was
entered, or the date any rights of appeal from preliminary orders, judgments or decrees lapsed.
Items 3.A, 3.B, 3.C, and 3.D do not contain an exclusive list of material disciplinary events. If the supervised
person has been involved in a legal or disciplinary event that is not listed in Items 3.A, 3.B, 3.C, or 3.D but is
material to a client's or prospective client's evaluation of the supervised person's integrity, you must disclose the
event. Similarly, even if more than ten years have passed since the date of the event, you must disclose the
event if it is so serious that it remains currently material to a client’s or prospective client’s evaluation.

Form ADV: Part 2B

Page 2

A. A criminal or civil action in a domestic, foreign or military court of competent jurisdiction in which the
supervised person
1. was convicted of, or pled guilty or nolo contendere (“no contest”) to (a) any felony; (b) a misdemeanor
that involved investments or an investment-related business, fraud, false statements or omissions,
wrongful taking of property, bribery, perjury, forgery, counterfeiting, or extortion; or (c) a conspiracy
to commit any of these offenses;
2. is the named subject of a pending criminal proceeding that involves an investment-related business,
fraud, false statements or omissions, wrongful taking of property, bribery, forgery, counterfeiting,
extortion, or a conspiracy to commit any of these offenses;
3. was found to have been involved in a violation of an investment-related statute or regulation; or
4. was the subject of any order, judgment, or decree permanently or temporarily enjoining, or otherwise
limiting, the supervised person from engaging in any investment-related activity, or from violating any
investment-related statute, rule, or order.
B. A
n administrative proceeding before the SEC, any other federal regulatory agency, any state regulatory
agency, or any foreign financial regulatory authority in which the supervised person
1. was found to have caused an investment-related business to lose its authorization to do business; or
2. was found to have been involved in a violation of an investment-related statute or regulation and was
the subject of an order by the agency or authority
(a) denying, suspending, or revoking the authorization of the supervised person to act in an
investment-related business;
(b) barring or suspending the supervised person's association with an investment-related business;
(c) otherwise significantly limiting the supervised person's investment-related activities; or
(d) imposing a civil money penalty of more than $2,500 on the supervised person.
C. A self-regulatory organization (SRO) proceeding in which the supervised person
1.

was found to have caused an investment-related business to lose its authorization to do business; or

2.

was found to have been involved in a violation of the SRO’s rules and was: (i) barred or suspended
from membership or from association with other members, or was expelled from membership;
(ii) otherwise significantly limited from investment-related activities; or (iii) fined more than $2,500.

D. Any other proceeding in which a professional attainment, designation, or license of the supervised person
was revoked or suspended because of a violation of rules relating to professional conduct. If the supervised
person resigned (or otherwise relinquished his attainment, designation, or license) in anticipation of such a
proceeding, disclose the event.
Note: Special circumstances may make an event immaterial (overcoming the materiality presumption). If an
event is immaterial, you are not required to disclose it. When you review a legal or disciplinary event involving
the supervised person for materiality, you should consider all of the following factors: (1) the proximity of the
supervised person to the advisory function; (2) the nature of the infraction that led to the disciplinary event; (3)
the severity of the disciplinary sanction; and (4) the time elapsed since the date of the disciplinary event. If you

Form ADV: Part 2B

Page 3

conclude that the materiality presumption is overcome, you must prepare and maintain a file memorandum of
your determination in your records.
Item 4

Other Business Activities

A. If the supervised person is actively engaged in any investment-related business or occupation, including if
the supervised person is registered, or has an application pending to register, as a broker-dealer, registered
representative of a broker-dealer, futures commission merchant (“FCM”), commodity pool operator
(“CPO”), commodity trading advisor (“CTA”), or an associated person of an FCM, CPO, or CTA, disclose
this fact and describe the business relationship, if any, between the advisory business and the other
business.
1. If a relationship between the advisory business and the supervised person’s other financial industry
activities creates a material conflict of interest with clients, describe the nature of the conflict and
generally how you address it.
2. If the supervised person receives commissions, bonuses or other compensation based on the sale of
securities or other investment products, including as a broker-dealer or registered representative, and
including distribution or service (“trail”) fees from the sale of mutual funds, disclose this fact. If this
compensation is not cash, explain what type of compensation the supervised person receives. Explain
that this practice gives the supervised person an incentive to recommend investment products based on
the compensation received, rather than on the client's needs.
B. If the supervised person is actively engaged in any business or occupation for compensation not discussed
in response to Item 4.A, above, and the other business activity or activities provide a substantial source of
the supervised person’s income or involve a substantial amount of the supervised person’s time, disclose
this fact and describe the nature of that business.
Item 5

Additional Compensation

If someone who is not a client provides an economic benefit to the supervised person for providing advisory
services, generally describe the arrangement. For purposes of this Item, economic benefits include sales awards and
other prizes, but do not include the supervised person’s regular salary. Any bonus that is based, at least in part, on
the number or amount of sales, client referrals, or new accounts should be considered an economic benefit, but other
regular bonuses should not.
Item 6

Supervision

Explain how you supervise the supervised person, including how you monitor the advice the supervised person
provides to clients. Provide the name, title and telephone number of the person responsible for supervising the
supervised person’s advisory activities on behalf of your firm.
If you are registering or are registered with one or more state securities authorities, you must respond to the
following additional Item.
Item 7

Requirements for State-Registered Advisers

A. In addition to the events listed in Item 3 of Part 2B, if the supervised person has been involved in one of the
events listed below, disclose all material facts regarding the event.
1. An award or otherwise being found liable in an arbitration claim alleging damages in excess of $2,500,
involving any of the following:

Form ADV: Part 2B

(a)
(b)
(c)
(d)
(e)

Page 4

an investment or an investment-related business or activity;
fraud, false statement(s), or omissions;
theft, embezzlement, or other wrongful taking of property;
bribery, forgery, counterfeiting, or extortion; or
dishonest, unfair, or unethical practices.

2. An award or otherwise being found liable in a civil, self-regulatory organization, or administrative
proceeding involving any of the following:
(a)
(b)
(c)
(d)
(e)

an investment or an investment-related business or activity;
fraud, false statement(s), or omissions;
theft, embezzlement, or other wrongful taking of property;
bribery, forgery, counterfeiting, or extortion; or
dishonest, unfair, or unethical practices.

B. If the supervised person has been the subject of a bankruptcy petition, disclose that fact, the date the
petition was first brought, and the current status.