Martin D Parlato & Associates Inc

FEES & COMPENSATION
    Investment Management Fees
    Our typical fee for Investment Management Services is based upon a percentage of assets under
    management and are fixed at a rate that will vary by client up to 2.00% of assets under
    management, subject to a $250/quarter minimum fee. For the avoidance of doubt, the fixed rate
    is an absolute, agreed-upon amount and will not fluctuate up or down pursuant to a prescribed
    “break-point” schedule. The exact fee for each client is set forth in the client’s Agreement and
    is based on factors such as: client’s total assets under management; client’s financial complexity;
    and anticipated or requested frequency of client interaction.
    Generally, pursuant to client instructions and consent, we will directly debit the client’s
    custodial accounts for fees related to Investment Management Services. Unless otherwise agreed
    upon as part of the client Agreement, management fees are billed in advance, at the beginning
    of each quarter, based upon the market value of assets under management within client’s
    custodial account (including cash and cash equivalents) based upon a 365-day count (i.e., for
    quarterly billing we divide by the number of days in the upcoming calendar quarter).
    The fee structure outlined above will be used for all assets under management including assets
    managed at Nationwide (otherwise known as Jefferson National). However, for accounts held
    through Nationwide and/or Goldman Sachs (formerly FOLIOfn), we will not automatically debit
    the client’s account. Rather, Nationwide will conduct the billing in the client’s account, and
    remit to the firm our relevant fees.
    Minimum Fee
    If a client maintains less than $500,000 of assets under management, and fees are otherwise less
    than $1,000 annually, the Firm will typically assess an annual minimum fee of $1,000. This means
    combined accounts with a small balance may pay a higher fee on a percentage basis than they
    would otherwise according to the standard fee schedule above. The firm has the discretion to
    waive the minimum fee.
    New Accounts
    The initial fee for Investment Management Services shall be based on the client’s accounts’
    market value (including cash and cash equivalents) at the inception of our management (i.e., the
    date the account(s) is funded at the custodian) and shall be prorated for the number of days in
    the quarter that the account is under our management. Subsequent quarterly fees shall be
    assessed in accordance with the terms above.
    New Money on Existing Accounts
    Assets deposited into managed accounts between billing cycles will be subject to pro-rated
    partial billing procedures as outlined above. While we do not want to discourage clients from
    investing additional capital for their future; such deposits require modifications and adjustments
    to the client’s investment allocation and are considered managed assets as soon as they are
    funded at the custodian. Conversely, for assets clients may withdraw during the quarter, we do
Form ADV: Part 2A                                                                           Martin D. Parlato & Associates, Inc.

                                                                                        DISCLOSURE BROCHURE

    not make partial refunds of their fees. Just as with deposits, withdrawals from your portfolio will
    require modifications and adjustments to be made to correct the allocation of assets in the
    accounts.
    At times, we will utilize margin in client accounts (please refer to Item 8 below for detailed
    information regarding the risks surrounding margin). When utilizing margin strategies as part of
    a client’s portfolio account, we use the “gross value” of the client’s margin account assets for
    determining fees. Thus, fees are charged on the amount of assets in the underlying client
    account, as well as the margin portion of the account. For example, in an account holding $100K
    in equities, but $25K is attributable to margin loan, the entire $100K will be included when
    determining fees. This creates a conflict of interest in that we have an incentive to utilize margin
    accounts to receive additional fees. We mitigate this conflict of interest by disclosing it to clients
    as part of this Brochure and verbally prior to opening any margin accounts. Further, as part of
    our fiduciary duty to clients, we always endeavor to act in the client’s best interest, and
    recommendations will only be made to the extent that they are reasonably believed to be in the
    best interests of the client.
    Advisory fees will typically be deducted first from any money market funds or cash balances. If
    such assets are insufficient to satisfy payment of such fees, a portion of the account assets will
    be liquidated to cover the fees. Typically, unless instructed otherwise, each client account will
    be billed individually for its respective share of fees.           However, we will at times
    disproportionately bill accounts for fees should such actions be necessary due to insufficient
    funds in any respective account, or if doing so is deemed to be in the best interest of a client.
    Fees are negotiable and arrangements with any client can differ from those described above.
    Negotiated fees will be captured in and agreed upon by the client as part of the client’s
    Agreement. In addition, for family and friends of the Company, we will at times, in our sole
    discretion, reduce or waive management fees in their entirety.
    We may amend our fee schedule at any time by giving thirty (30) days advanced written notice
    to clients. Although we believe our Investment Management Fees are competitive, clients should
    be aware that lower fees for comparable services may be available from other sources.
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TYPES OF CLIENTS

        Description
    We provide discretionary and non-discretionary investment supervisory and management services
    on a continuous basis to individuals, high net worth individuals, charitable organization,
    foundation or endowment, and corporations and/or small business.

        Conditions for Managing Accounts
    The Firm generally requires a minimum initial investment of $100,000 to open an account, which
    could be negotiable by the Company in its sole discretion. Additionally, for clients who fail to
    maintain at least $500,000 in assets under management and incur fees of less than $1,000
    annually, the Firm requires a minimum annual fee of $1,000, which is assessed quarterly.
    However, we reserve the right to accept or decline a potential client for any reason, or
    reduce/waive our minimum fee, in our sole discretion. Prior to engaging us to provide any of
    the investment advisory services described in this Brochure, the client will be required to enter
    into one or more written Agreements with us setting forth the terms and conditions under which

Form ADV: Part 2A                                                                   Martin D. Parlato & Associates, Inc.

                                                                                       DISCLOSURE BROCHURE

    we shall render our services.

    There are times when certain restrictions are placed by a client, which prevents us from
    accepting or continuing to manage the account. We reserve the right to not accept and/or
    terminate management of a client’s account if we feel that the client-imposed restrictions which
    would limit or prevent us from meeting and/or maintaining our overall investment strategy.