J M Brown & Associates Inc

Item 5 – Fees and Compensation

JMB offers to meet with prospective clients on a complimentary basis to identify and assess the client’s
financial situation and determine his/her needs, goals, and objectives while at the same time describing
the firm's advisory services and how JMB can help address their needs (Please see Item 4 – Advisory
Business). After this initial phase is completed, the client being fully informed can then elect whether or
not to engage the Advisor and agree to the most effective form of compensation.

Compensation is based on the services provided and the complexity of the circumstances. JM Brown
Financial Partners provides both financial planning advisory and investment management of assets
services. Investment management of assets is among the most frequently provided services.
Securities recommended to be bought or sold can be implemented through JMB on a discretionary or non-
discretionary basis.

Discretionary transactions are directed by JMB for accounts that have a limited discretionary authority
agreement. Clients who choose to provide JMB with discretion have authorized JMB to buy and sell
securities without the client’s prior knowledge or consent. Clients may, by contract, place restrictions on
JMB’s discretionary authority. For accounts managed on a non-discretionary basis, JMB makes
recommendations as to buy or sell securities based on the needs of the client but will only execute trades
upon the client’s knowledge and consent.

JMB’s determination of investment management fees is based on one or more of the following factors:

    •   The number of accounts, investment strategies, positions, account objectives, risk tolerances and
        restrictions requested by the client. Fees are charged in arrears for investment management
        services provided and payable on a quarterly basis or as agreed upon by the client and the Advisor.

While fees are negotiable and may vary from client to client, JMB fees for investment management of
assets are paid as a percentage of assets under management or a fixed annual fee. Fees are calculated
based on the account value as of the last business day of the quarter. If a client joins or terminates in the
middle of a quarter then they are billed in arrears on a pro-rated basis.

J M Brown Financial Partners has no direct relationship with any specific custodian or brokerage firm and
receives no commission compensation from any custodian. JMB’s primary custodians are Charles Schwab
& Co., Inc (“Schwab”), American Funds fee-based platform, Nationwide’s fee-based annuity and
Community National Bank (“CNB”). By using Schwab as a primary custodian, JMB has access to a wide

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range of products and services that help serve our clients, including a full range of investment products
and trading services and technology and service support. Nationwide offers a flat fee annuity contract,
which is competitively priced versus other annuity carriers.

For Assets on the American Funds Fee Based platform, the Advisory Fees are set at 0.75% per year. Fees
are calculated and debited based on the Average Daily Net Asset Value quarterly in arrears by American
Funds for Investment Management of Assets held directly on American Funds fee-based platform. The
average daily net asset value used to calculate the fee is available on the Client’s Fee Notification.

The last custodian utilized by JMB is Community National Bank and is employed when CNB’s expenses
are lower than the expenses of holding assets at Schwab.

Advisor may also make recommendations of investment selections within other accounts not held by
Advisor’s broker/dealer or by a National Custodian, if Client so requests. Accounts held at a custodian
that are not directly accessible by the Advisor are referred to as (“Held Away Accounts”). JMB may, but is
not required to, manage these Held Away Accounts using the Pontera Order Management System
(“Pontera”) that allows Advisor to view and manage these assets. Client will have total responsibility for
implementing investment recommendations within those accounts that cannot be managed utilizing
Pontera and are not held by Advisor’s broker/dealer or a National Custodian.

The Client will select to have the asset management fee payable for any Held Away Account to be
deducted directly from another Client account or to be invoiced for such fee. In addition, if there are
insufficient funds available in another Client account or if the Advisor believes that deducting the asset
management fee from another Client account would be prohibited by applicable law, JMB will invoice
the Client.

Annual fees for investment management of assets shall be no greater than 2.75%, per year, of the average
daily balance or ending market value of the managed account. Clients may find comparable services to be
available at other investment advisors for a lesser cost. JMB’s management programs are not considered
a “wrap fee program” in that clients are responsible for paying any and all transaction costs, including, but
not limited to customary ticket charges, postage, service fees and annual maintenance fees that may be
issued by the custodians. Furthermore, please see Item 12 – Brokerage Practices of this Disclosure
Brochure.

In addition to investment management of assets JMB advises clients on general financial planning topics.
This may include cash flow management, understanding their assets and liabilities, addressing insurance
needs as well as tax planning, and estate planning. (Please see Item 4 – Advisory Business). These financial
planning advisory services are provided on an hourly, fixed fee, annual retainer fee or complementary
basis depending on other advisory services being provided and must be mutually agreed upon by both
parties after completion of the initial consulting work. Moreover, the advisory fee also takes into
...

Item 7 – Types of Clients

J M Brown Financial Partners takes an active approach to managing the types of clients accepted by the
firm. The clients that J M Brown Financial Partners currently chooses to work with are often “main street”
everyday people. There are some clients who have high net worth and would be considered “accredited”
investors ((individual net worth of any natural person, or joint net worth with the spouse of that person,
at the time of purchase, is more than $1,000,000 or income of $200,000 ($300,000 for couples) with an
expectation of the income continuing at that level)), qualified clients, and qualified purchasers (individuals
with higher net worth requirements than accredited investors)

J M Brown Financial Partners requires a minimum investment amount of $50,000 to establish and maintain
an asset management account. Exceptions to the minimum investment amount may be granted at
Advisor’s discretion. The firm requires clients to disclose current financial status and investment objectives
to the Advisor at the time of opening an investment account. These documents are updated as needed.
Clients are requested to inform the Advisor whenever the client has experienced a significant change in
financial status or condition or wish to change the investment objectives on the account. (Example: Client
wishes to change investment objective from Aggressive Growth to Moderate. The client would need to
complete a new Schedule B of the Asset Management Agreement that evidences this request).

JMB’s clientele could be categorized as individuals, high net worth individuals, pension and profit-sharing
plans, and charitable organizations. The services offered to each may vary and is largely dependent upon
the client’s unique circumstances. J M Brown Financial Partners has each client execute an independent
agreement and each agreement offers services separately to each individual client.

THIRD PARTY INVESTMENT ADVISORY PROGRAM

 Under JMB’s Third Party Investment advisory business, Roserock works with other unaffiliated
sponsoring RIAs and their clients as sub-Advisor. Roserock requires a minimum investment amount of
$100,000 to establish and maintain an account under Roserock’s Third Party Investment Advisory
Program. Exceptions to the minimum investment amount may be granted at Roserock’s discretion.

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