Regulatory Disclosures

BAKER & CO., INC. PRIVACY STATEMENT:

Respect for our client's privacy has been and will continue to be a hallmark of our service at Baker & Co., Incorporated. Not only is it what our customers expect, it is the proper way to conduct our business. The trust and confidence of our clientele is our most valuable asset. This trust is built, in part, upon the proper handling of information. The information we collect and the extent to which we use it will vary depending on the product or service involved. 

Our privacy pledge derives from basic principles of ETHICS, INTEGRITY and TRUST: 

(1) We collect only the customer information necessary to consistently deliver products and services. 

As a Baker & Co. customer, you may share personal information with us. We use that information to improve our services to you. Because the security of your personal information is very important, we restrict access to your non-public personal information to those associates on an as needed basis, in order to provide you with the highest level of products and services. 

We obtain non-public information from the following sources.
  • Information received as part of the account opening process (such as name, address and social security number), or as a result of other requested services.
  • Information about client's transactions affected through Baker & Co. This information may include securities transactions, account positions, balances and debit card usage for those clients utilizing these services. This information allows Baker & Co. through our clearance and settlement arrangement to generate confirmations, statements and other required reports on behalf of our customers.
(2) We maintain safeguards to ensure information security. 

Baker & Co. has implemented security standards and processes including physical, procedural and through our clearance relationship, electronic safeguards that comply with federal regulations to protect your non-public personal information. 

Because security of your personal information is very important, we restrict access to customer information to employees, registered representatives and agents who may need it to do their jobs. They are required to respect the confidentiality of all customer information. 

(3) We limit how and with whom we share customer information. 

First and foremost, we do not sell lists of our customers, nor do we disclose customer information to marketing companies, with the exception of those companies we hire to provide specific services to Baker & Co. These agreements will continue to be honored. 

Baker & Co. will share customer information only for the following reasons:
  • When it is necessary to disclose information to third parties to effect, administer, or enforce a transaction that you request or authorize – for example, when we provide information to a mutual fund company from which you wish to purchase shares.
  • We may be required by law or regulation to disclose information to third parties – for example, in response to a subpoena and to comply with rules of, or inquires from, industry regulators.

If we change this PRIVACY POLICY, you will be notified in advance, and provided the opportunity to prevent use of your non-public information. We will reaffirm this policy annually in writing, as long as you maintain an ongoing relationship with Baker & Co., Incorporated.

BUSINESS CONTINUITY PLANNING STATEMENT

Baker & Co., Incorporated has developed a Business Continuity Plan on how we will respond to events that significantly disrupt our business. Since the timing and impact of disasters and disruptions is unpredictable, we will have to be flexible in responding to actual events as they occur. With that in mind, we are providing you with this information on our business continuity plan. 

Contacting Us – If after a significant business disruption you cannot contact us at 1-216-696-0167 or 1-800-321-1640, (phone numbers are internet protocol numbers) our emergency numbers are 1-440-829-8450 and 1-440-829-8509. If when calling our office the auto attendant answers during business hours dial 1-216-377-1235. 

Our Business Continuity Plan – We plan to quickly recover and resume business operations after a significant business disruption and respond by safeguarding our employees and property, making a financial and operational assessment, protecting the firm's books and records, and allowing our customers to transact business. In short, our business continuity plan is designed to permit our firm to resume operations as quickly as possible, given the scope and severity of the significant business disruption. 

Our business continuity plan addresses: data back up and recovery; all mission critical systems; financial and operational assessments; alternative communications with customers, employees, and regulators; alternate physical location of employees; critical supplier, contractor, bank and counter-party impact; regulatory reporting; and assuring our customers prompt access to their funds and securities if we are unable to continue our business. 

Our clearing firm, RBC Correspondent Services, backs up our important records in a geographically separate area. While every emergency situation poses unique problems based on external factors, such as time of day and the severity of the disruption, we have been advised by our clearing firm that its objective is to restore its own operations and be able to complete existing transactions and accept new transactions and payments within 24 hours. Your orders and requests for funds and securities could be delayed during this period. 

Varying Disruptions – Significant business disruptions can vary in their scope, such as only our firm, a single building housing our firm, the business district where our firm is located, the city where we are located, or the whole region. Within each of these areas, the severity of the disruption can also vary from minimal to severe. In a disruption to only our firm or a building housing our firm, we will transfer our operations to a local site when needed and expect to recover and resume business within 24 hours. In a disruption affecting our business district, city, or region, we will transfer our operations to a site outside of the affected area, and recover and resume business within 24 hours. In either situation, we plan to continue in business, transfer operations to an offsite if necessary, and notify you through our web sitewww.bakerinvestments.net or our customer emergency numbers, 1-440-829-8450, 1-440-829-8509 how to contact us. If the significant business disruption is so severe that it prevents us from remaining in business, we will assure our customer's prompt access to their funds and securities. 

For more information – If you have questions about our business continuity planning, you can contact us at 1-800-321-1640 or thenahan@ bakerinvestments.net 
 

MARGIN DISCLOSURE STATEMENT:

The following is a disclosure statement concerning margin accounts mandated for distribution to all retail customers by the Financial Industry Regulatory Authority (FINRA). The sample language is reprinted in its entirety. If you have questions concerning this disclosure or your account in general, please contact your broker directly.

Your brokerage firm is furnishing this document to you to provide some basic facts about purchasing securities on margin, and to alert you to the risks involved with trading securities in a margin account. Before trading stocks in a margin account, you should carefully review the margin agreement provided by your firm. Consult your firm regarding any questions or concerns you may have with your margin accounts.

When you purchase securities, you may pay for the securities in full or you may borrow part of the purchase price from your brokerage firm. If you choose to borrow funds from your firm, you will open a margin account with the firm. The securities purchased are the firm's collateral for the loan to you. If the securities in your account decline in value, so does the value of the collateral supporting your loan, and, as a result, the firm can take action, such as issue a margin call and/or sell securities or other assets in any of your accounts held with the member, in order to maintain the required equity in the account.

It is important that you fully understand the risks involved in trading securities on margin. These risks include the following:
  • You can lose more funds than you deposit in the margin account. A decline in the value of securities that are purchased on margin may require you to provide additional funds to the firm that has made the loan to avoid a forced sale of those securities or other securities or assets in your account(s). 
     
  • The firm can force the sale of securities or other assets in your account(s). If the equity in your account falls below the maintenance margin requirements or the firm's higher "house" requirements, the firm can sell the securities or other assets in any of your accounts held at the firm to cover the margin deficiency. You also will be responsible for any short fall in the account after such a sale.
     
  • The firm can sell your securities or other assets without contacting you. Some investors mistakenly believe that a firm must contact them for a margin call to be valid, and that the firm cannot liquidate securities or other assets in their accounts to meet the call unless the firm has contacted them first. This is not the case. Most firms will attempt to notify their customers of margin calls, but they are not required to do so. However, even if a firm has contacted a customer and provided a specific date by which the customer can meet a margin call, the firm can still take necessary steps to protect its financial interests, including immediately selling the securities without notice to the customer.
     
  • You are not entitled to choose which securities or other assets in your account(s) are liquidated or sold to meet a margin call. Because the securities are collateral for the margin loan, the firm has the right to decide which security to sell in order to protect its interest.
     
  • The firm can increase its "house" maintenance margin requirements at any time and is not required to provide you advance written notice. These changes in firm policy often take effect immediately and may result in the issuance of a maintenance margin call. Your failure to satisfy the call may cause the member to liquidate or sell securities in your account(s).
     
  • You are not entitled to an extension of time on a margin call. While an extension of time to meet margin requirements may be available to customers under certain conditions, a customer does not have a right to the extension.

ORDER DISCLOSURE

Order Disclosure

SEC Order Handling Disclosure 

SEC-Required Disclosure: Report on Routing of Customer Orders 

RBC Correspondent Services (RBC CS) (our clearing firm) has provided information pursuant to a U.S. Securities and Exchange Commission rule 606 that requires firms to make publicly available, quarterly reports on the firm's order routing practices. The report provides information on the routing of "non-directed orders" which is generally defined as any order that the client has not specifically instructed to be routed to a particular venue for execution. 

For these non-directed orders, RBC CS has selected the execution venue on behalf of its clients. 

The report is divided into four sections: one for securities listed on the New York Stock Exchange, one for securities listed on The Nasdaq Stock Market, one for securities listed on the American Stock Exchange or regional exchanges, and one for exchange-listed options. 

For each section, this report identifies the venues most often selected by RBC CS, sets forth the percentage of various types of orders routed to the venues, and discusses the material aspects of RBC CS's relationship with the venues. 

Transaction Auditing Group (TAG) has been selected to disseminate on their public Web site the Order Handling Disclosure Report for RBC CS. When you select this link you will be leaving this website. 


http://external.s3.com/rule606/rbcwm/correspondentsvcs/ 
 
SEC RULE 10B-10

SEC Rule 10b-10 

Baker & Co., Incorporated may receive compensation for directing order flow in equity securities. The source and nature of the compensation, if any, received in connection with equity transactions will be furnished upon written request.

PARTIAL REDEMPTION OF CALLABLE SECURITIES

Partial Redemption of Callable Securities

Securities with call features may be called in whole or in part. The following provides information related to the partial redemption procedures established at RBC Capital Markets, LLC (which includes the divisions of RBC Wealth Management, RBC Correspondent Services and RBC Advisor Services, collectively the “Firm” or “RBC CM”).

A written description of the Firm’s lottery system is provided to you at the time you open an account. Further, it is available on the Firm’s website and notice of availability is provided annually. A printed copy of this may also be obtained from your Financial Advisor. 

Partial Redemptions 
In a partial redemption, the issuer elects to exercise or call only a portion of the outstanding par value of the security outstanding. In such a case, some investors may have all or a portion of their position redeemed, while others may not have any portion of their position redeemed. It should also be noted that the issuer, not the investor, has the right to exercise a call or redemption. 

Description of Partial Redemptions Allocation Process 
The redemption process begins when an issuer notifies the Depository Trust Corporation (“DTC”) that it will exercise a partial call of the shares outstanding for a specific issue. DTC provides depository services to approximately 3.5 million security issues located in the United States and other countries. The issuer provides the specific security and the amount to be redeemed. After receiving a redemption notice from the issuer, DTC, using an impartial, random lottery system, allocates security positions to broker-dealers that hold securities in “street name.” In a partial call, participants may not receive an allocation from DTC because of the random lottery process. 

Upon notification of a partial call by an issuer, a third-party vendor of RBC CM conducts a lottery to allocate the calls in a fair and impartial manner among customers holding the specific security. 

Partial Redemption Lottery System 
FINRA Rule 4340 requires, among other things, that RBC CM have procedures that are fair and impartial to allocate securities to be redeemed or selected in the event of a partial redemption or call. When a partial call is offered on terms favorable to owners of the security, the member firm must take measures to prohibit the allocation of the call to its “proprietary accounts or those of an affiliate or certain associated persons, before all of its customers’security positions have been redeemed. Likewise, if a redemption or call is made on unfavorable terms, a firm may not exclude its position from those that may be called or put itself ‘last in line.’” 

RBC CM engages a third-party vendor to administer its lottery system for partial calls. The lottery system is designed to allocate calls for redeemed securities in a fair and impartial manner, and is consistent with regulatory guidance, including, among others, FINRA’s Regulatory Notices 14-05 and 08-21, FINRA Rule 4340, and MSRB Rule G-17. Specifically and as described in the rule, RBC CM uses a type of lottery system that ensures that the probability of any unit held by a customer included in a partial call is proportional to the holdings of all customers for the specific security. It should be noted that the lottery system used by RBC CM’s third-party vendor does not allocate the securities to customers on a pro-rata basis. 

The lottery performed by RBC CM’s third-party vendor begins with the identification of the number of units in each customer’s account for the specific security called. Each unit is entered in the lottery process. Units per customer are determined by dividing the total par value of the customer’s position by the unit of trade for the redemption. As an example, a customer with a $40,000 position in the security when the unit of trade for the partial call is $20,000 would have two units entered in the lottery. Similarly, a customer who owns $200,000 would have 10 units in the lottery. Although each unit has the same probability in the lottery, the chance of a customer receiving a partial redemption is based on the number of units each customer has entered in the lottery. 

Client Rights 
If a security is eligible for registration in a client’s name, the client reserves the right to withdraw uncalled, fully paid securities or excess margin securities (provided the account is not subject to a Regulation T restriction or such withdrawals will not cause a Rule 4210 under-margined condition) from the account at any time prior to the issuer making notification of redemption.

INVESTOR EDUCATION AND PROTECTION

Investor Education and Protection

We are required by the Financial Industry Regulatory Authority (FINRA) Conduct Rule 2280 to provide you with information about the availability of information through the FINRA's Public Disclosure Program. Consequently, please be advised that the FINRA offers an investor brochure describing the Public Disclosure Program. The investor brochure may be obtained via the FINRA Web Site (www.finra.org) or through FINRA Public Disclosure Program Hotline Number at (800) 289-9999.