EVERMAY WEALTH MANAGEMENT, LLC

Part 2A of Form ADV Firm Brochure 3901 Fairfax Drive, Suite 400 Arlington, VA 22203 Phone: 7038225696 www.evermaywealth.com August 1, 2025 This Firm Brochure provides information about the qualifications and business practices of Evermay Wealth Management, LLC. If you have any questions about the contents of this Firm Brochure, please contact us at 7038225696 or info@evermaywealth.com . The information in this Firm Brochure has not been approved or verified by the United States Securities and Exchange Commission or by any state securities authority. Registration as an investment adviser does not imply any certain level of skill or training. Additional information about Evermay Wealth Management, LLC is also available on the SECʼs website at: www.adviserinfo.sec.gov .  Item 2 Material Changes Annual Update The “Material Changesˮ section of this Disclosure Brochure (“Firm Brochureˮ or “Brochureˮ) is updated annually or when material changes occur since the previous release of the Brochure. Material Changes Since the Last Update There have been no material changes to Evermay Wealth Management, LLCʼs Firm Brochure since the previous version of this Brochure dated May 27, 2025. We encourage all clients to review the entire Firm Brochure. Please call us if you have any questions about this Brochure. 2  Item 3 Table of Contents Item 2 Material Changes ................................................................................................................. 2 Item 3 Table of Contents ................................................................................................................. 3 Item 4 Advisory Business ............................................................................................................... 4 Item 5 Fees and Compensation ........................................................................................................ 8 Item 6 Performance Based Fees and Side-by-Side Management ....................................................... 10 Item 7 Types of Clients .................................................................................................................. 10 Item 8 Methods of Analysis, Investment Strategies and Risk of Loss ................................................. 10 Item 9 Disciplinary Information ...................................................................................................... 15 Item 10 Other Financial Industry Activities and Affiliations and Other Conflicts of Interest ................... 15 Item 11 Code of Ethics, Participation or Interest in Client Transactions and Personal Trading ............... 16 Item 12 Brokerage Practices ........................................................................................................... 16 Item 13 Review of Accounts ........................................................................................................... 17 Item 14 Client Referrals and Other Compensation ............................................................................ 18 Item 15 Custody ............................................................................................................................ 18 Item 16 Investment Discretion ........................................................................................................ 19 Item 17 Voting Client Securities ...................................................................................................... 19 Item 18 Financial Information ......................................................................................................... 19 3  Item 4 Advisory Business Overview of this Brochure, the term “Retirement Accountˮ is used to cover certain retirement plans under Title I of ERISA, which includes Individual Retirement Accounts (“IRAsˮ). in December 2008. Evermay services. Conflicts Investment Management Services,on and non-discretionary basis both to corporations or business entities As a fiduciary, Evermayʼs responsibility is to make sure the clientʼs best interests come first and provide full disclosure of all material facts relating to our advisory relationships with clients. Evermay is obligated to disclose conflicts of interest as clients evaluate the Firmʼs of interest or potential conflicts of interest commonly refer to activities or relationships whereby Evermayʼs and/or its Advisorsʼ interest compete with the interest of our clients. A conflict of interest arises when the conflict could incline Evermay or its Advisors to provide advice to clients that is influenced by considerations of firm or personal advantages. Adviser Investment “Wealth Advisorsˮ, “Associate Firm will provide Services Team or Advisory process by our experienced The clients with objective our investment advice. Portfolio investments and asset allocation decisions are subject to a due diligence review investment professionals. strategies, suitable and plan. Additionally, Wealth Advisors plans. Evermay offers a Evermay Wealth Management, LLC (“Evermayˮ, “weˮ, “usˮ, “ourˮ, or “the Firmˮ) is an investment adviser registered (“adviserˮ or “RIAˮ) with the Securities and Exchange Commission (“SECˮ). The Firm became an adviser provides investment advisory services, sometimes referred to a as its discretionary clients, which may include individuals, high net worth individuals and associated trusts, estates, charitable organizations, pension and profit-sharing plans, and other (together “clientsˮ or “youˮ). Clients and prospective clients Representatives meet with (“Advisorsˮ, Wealth Advisorsˮ, “IARsˮ, or “Wealth Managers,ˮ together Teamˮ) to “Advisory determine if an advisory program is in their best interest, uncover investment goals and objectives, establish review investment work with clients to discuss any portfolios, changes to the clientʼs financial goals and objectives. Advisors can also meet with clients to create a financial are available to provide consulting services to certain retirement team-centric approach to helping clients with their financial needs whereby our clients work with different members of the Advisory Team. Evermay investment strategy recommendations are provided to clients only after we thoroughly review each clientʼs investment goals, financial situation, liquidity needs, tax sensitivity, investment horizon and risk tolerance (together “Investor Profileˮ). We will provide ongoing investment advice to our clients and if their goals change, we will work with them to keep their investment strategy in-line with those changes. Evermay will provide ongoing monitoring of their portfolios and make changes to the portfolio holdings and asset allocations as necessary. of advisory relationship Evermay invests in equities, mutual funds, bonds, cash-equivalents, private funds, private equity funds, and other instruments and/or third-party investment managers. In certain circumstances, clients have the ability to place reasonable restrictions on the types of investments that may be recommended by Evermay. the Advisory Agreementˮ) Evermayʼs principal place of business is located in Arlington, Virginia. the right to terminate the The Firm is a limited liability company whose shares are majority owned by President and Co-Founder, William Pitt, IV. Prior to Evermay providing clients with objective investment advice, clients are required to enter into a written agreement with us setting forth the terms and conditions (the “Investment sometimes referred to as the “Advisory Agreement.ˮ The Advisory Agreement will continue in effect until terminated by either party by written notice to the other. Evermay reserves Advisory Agreement at any time by providing 30-day advance written notice to the client. Evermay is a Fiduciary to Clients is a fiduciary when providing Advisers Act of 1940, as Evermay advisory services to its clients. We are registered under the amended Investment (“Advisers Actˮ), which places a fiduciary obligation on us. While this brochure generally describes the business of Evermay, certain sections also discuss the activities of the Firmʼs officers, Wealth Advisors, or other employees (together “Supervised Personsˮ or “Access Personsˮ) who provide investment advice or support services on Evermayʼs behalf and are subject to the Firmʼs supervision and control. Evermay works with a third-party clients are Form ADV provided Part with 2A, the which In addition, Evermay provides services as a “fiduciaryˮ (as the term is defined in Section 321A of the Employee Retirement Income Security Act of 1974, as amended (“ERISAˮ) and/or Section 4975 of the Internal Revenue Code of 1986, as amended (“the Codeˮ)), with respect to Retirement Accounts. For the purposes If investment manager to manage a portion of a clientʼs portfolio, third-party these describes managerʼs investment information about the third-party 4  strategies, advisory of investment interest, and advisory such as bridge loans. fees, managerʼs conflicts services. Third-party investment managers do not split their fees with us and therefore there is no conflict of interest associated with recommending clients invest with a third-party manager. Investment Management Services interest or fees in connection with use margin have the ability to borrow money to buy securities and/or for other non-investment borrowing The short-term purposes custodian charges the investor interest for the right to borrow money and uses the securities in the account as collateral. Evermay does not recommend the use of margin for investment purposes and does not receive margin any balances. The Deposits can in cash any transferred assets similar different to account the usual and securities. Clients to notice on customary or methodologies, and about the options and implications we offer Investment Evermay and its Wealth Advisors provide ongoing Management discretionary Investment portfolio Services and advice to portfolio clients. are based on the clientʼs individual management financial needs. Wealth Advisors work closely with clients to establish financial goals and objectives based on their specific financial circumstances and needs. Evermayʼs investment portfolios have flexibility asset to allocations, use rebalancing security holdings within the same investment strategy. There is no guarantee that clients with the same asset allocations or investment strategy will have the same investment holdings or performance. In a limited number of client engagements, Management Services on a non-discretionary basis. Evermay tailors its advisory services to meet the needs of its clients and works on a continuous basis to manage client portfolios in a manner Clients can make deposits to and withdrawals from their accounts at any time, subject to Evermayʼs right to terminate the Advisory Agreement for a client account. or securities be provided that the Firm reserves the right to liquidate or decline can Evermay, withdraw subject securities settlement procedures. However, the Firm designs its portfolios for long-term investing, and withdrawals of assets may impair the achievement of a clientʼs investment objectives. Evermay may consult with its clients of transferring securities. Clients are advised that when securities transferred to the account are liquidated, the securities may be subject to transaction fees, short-term redemption fees, fees assessed at the mutual fund level (e.g., contingent deferred sales charges), and the sale of securities could have tax implications. under the circumstance, to consistent with those needs and objectives. After building a clientʼs investment portfolio, we attempt to meet with clients at least annually, or as reasonably necessary discuss changes to the clientʼs financial situation, investment goals and objectives, and aspects of his or her Investor Profile. During investment portfolio reviews or throughout the course of the year, Wealth Advisors are available to review various components of the clientʼs investment portfolios including but not limited to, account performance, securities holdings, asset allocation, and the rebalancing strategy. Clients must notify us as soon as practical when there are changes to their financial situation. Evermay will new or increase Clients can engage Evermay to manage and/or advise on certain investment products or accounts that are not maintained at our primary custodian, such as employer sponsored retirement plans and qualified tuition plans (i.e., 529 plans). In these situations, Evermay recommends the allocation of client assets among various investment choices available within the account and works with the client to access the account and implement portfolio investment changes. as applicable, are laws additional degrees investment risk Retirement Account Rollovers. A client or prospective client who has changed employers over the years may have retirement plan accounts such as 401ks or 403bs remaining at their former employers. Clients who find themselves in these situations have four options regarding their prior qualified retirement plans which include the following: (i) leave the money in the former employerʼs plan, if permitted, (ii) roll over the assets to the new employerʼs plan, if one is available and rollovers are permitted, (iii) roll over the assets to an IRA, or (iv) cash out the account value, which could, depending on the clientʼs age, result in adverse tax consequences. If Evermay or its Wealth Advisors recommends clients roll over their retirement plan assets into an account to be managed by Evermay, such recommendations create a conflict of interest since its earn compensation as a result of the rollover. If Evermay provides a recommendation as to whether a client should engage in a rollover or not, Evermay is acting as a fiduciary within the meaning of ERISA and/or the Code, governing which retirement accounts. No client is under any obligation to roll over retirement plan assets to an account managed by Evermay. Some investments available for client portfolios take and/or of on liquidity risk. These investments are only included in a client portfolio when consistent with the clientʼs goals, objectives, liquidity needs, and risk tolerance. and conflicts interest can Additional information regarding potential conflicts of interest found be of throughout different sections of this Brochure. Client accounts that are approved by the custodian to 5  Financial Planning performance of the planʼs report plans (“Plansˮ), which include 401ks, profit sharing plans, and pensions. Evermay will analyze the Planʼs current investment platform, and, if applicable, review and analyze the Planʼs investment policy statement. Evermay will also recommend the investment options to offer in the Plan, provide participant education, and monitor available the investment vehicles. and detailed consultative steps and sessions review recommendations We offer financial planning services that focus on determining our clientʼs unique long-term financial goals and objectives and establishing a road map to help them achieve those goals. Clients who would like to obtain a financial plan are provided with a financial to plan discuss to implement the plan. The Firm will work with the Plans on an ongoing basis to include regular considerations of the goals and objectives of the Plan and provide plan participation education. Miscellaneous 12, when to recommend Financial planning is the evaluation of a clientʼs current and hypothetical future financial state that utilizes known variables to help model or forecast future cash flows, asset values, and portfolio withdrawals. During the financial planning process, we ask an extensive number of questions in order for clients to provide us with the necessary information to assist us with building their financial plan. Custodian Charges-Additional Fees . As discussed in a requested Item broker-dealer/custodian for client accounts, Evermay generally recommends that Charles Schwab & Co. Inc. (“Schwabˮ) serve as the broker-dealer/custodian for client investment management assets. Evermay believes that having an estate planning strategy is an important element to financial planning. The firm has two distinct avenues for offering estate planning services. planning service fees for mutual funds, planning consulting does not Estate planning consulting is included as part of our offering. The firm has financial leveraged the resources of a law firm to advise Evermay on client specific estate planning strategies. Estate include the preparation of estate documents. upon preparation services. We use transactions ETFs), others estate plan documents. end-to-end estate planning Broker-dealers such as Schwab charge brokerage commissions, transaction, and/or other type fees for certain types of securities transactions (i.e., including and certain transaction mark-ups and mark-downs charged for fixed income transactions, etc.). The types of securities for which transaction fees, commissions, and/or other type fees differ (as well as the amount of those fees) shall depending the broker-dealer/custodian. While certain custodians, including Schwab, generally (with exceptions) do not currently charge fees on individual do. (including equity Please Note : there can be no assurance that Schwab will not change its transaction fee pricing in the future. Schwab may also assess fees to clients who elect to receive trade confirmations and account statements by regular mail rather than electronically. require that cash proceeds from Evermay also offers personalized estate and trust document a comprehensive estate management platform to create The platform is detailed administered by an independent third-party firm that uses technology and human expertise to maintain a tech-led service Our Evermay specifically built for wealth advisors. team will assist you through this estate document creation process. This service, including document preparation, is available for an additional fee. thereafter) platform, Evermay for the account. Planning Limitations . Evermay believes that it is important for the client to address financial planning issues on an ongoing basis. Evermayʼs advisory fee, as set forth at Item 5 below, will remain the same regardless of whether or not the client determines to address financial planning issues with Evermay. It remains each clientʼs responsibility to promptly notify Evermay if there is ever any change in his or her financial situation or investment objectives for the purpose of reviewing, evaluating, revising our previous recommendations and/or services. Evermay does not serve as an insurance agent, attorney, or accountant, and no portion of our services should be inferred as such. Retirement Plan Consulting Services We provide consulting services to qualified retirement Cash Sweep Accounts. Certain account custodians can account transactions or new deposits be swept to and/or initially maintained in a specific custodian designated sweep account. The yield on the sweep account will generally be lower than those available for other money market accounts. When this occurs, to help mitigate the corresponding yield dispersion, Evermay shall (usually within 30 days generally (with exceptions) purchase a higher yielding money market fund (or other type security) available on the reasonably unless custodianʼs anticipates that it will utilize the cash proceeds during the subsequent 30-day period to purchase additional investments Exceptions clientʼs and/or modifications can and will occur with respect to all or a portion of the cash balances for various reasons, including, but not limited to the amount of dispersion between the sweep account and a money cash balance, an of market fund, the size the 6  significant risk. Clients who authorize does not within apply an the to Evermay cash actively Such investments are considered speculative and carry the purchase of a cryptocurrency investment must be prepared for the potential for liquidity constraints, extreme price volatility, regulatory risk, technological risk, security and custody risk, and complete loss of principal. exclusively responsible for securities Clients wishing to gain reasonable exposure to this asset class can discuss adding a position to their portfolios with their Wealth Advisor. Evermay will advise the client to consider a potential investment in corresponding that exchange-traded provide cryptocurrency exposure. indication from the client of an imminent need for such cash, or the client has a demonstrated history of writing checks from the account. Please Note: The component above maintained managed investment strategy (the cash balances for which shall generally remain in the custodian designated cash sweep account), an indication from the client of a need for access to such cash, assets allocated to an unaffiliated investment manager, and cash balances maintained for fee billing purposes. The client shall yield remain dispersion/cash balance decisions and corresponding transactions for cash balances maintained in any Evermay unmanaged accounts. controls, are designed various cybersecurity which incidents stemming basis to determine if limited to, investment performance, or non-public personal to regulatory obligations, other Clients 5 Item subject periods to of Portfolio Activity. Evermay has a fiduciary duty to provide services consistent with the clientʼs best interest. Evermay will review client portfolios on an ongoing any changes are necessary based upon various factors, including, but not market conditions, fund manager tenure, style drift, account additions/withdrawals, and/or a change in the clientʼs investment objective. Based upon these factors, there may be extended periods of time when Evermay determines that changes to a clientʼs portfolio are the fees remain unnecessary. portfolio during in described inactivity. Of course, as indicated below, there can be no assurance that investment decisions made by Evermay will be profitable or equal any specific performance level(s). Investments and Digital purposes, service Clients including and adverse Most applications, digital assets use incidents consequences that more could resulting directly and other custodians, regulatory Cybersecurity. The information technology systems and networks that Evermay and its third-party service providers use to provide services to Evermayʼs clients employ to prevent from intentional or unintentional actions that could cause significant interruptions in Evermayʼs operations and result in the unauthorized acquisition or use of clientsʼ confidential information. Clients and Evermay are nonetheless subject to the risk of cybersecurity incidents that could ultimately cause them to incur losses, including for example: financial losses, cost and reputational damage to respond costs associated with corrective measures, and loss from damage or interruption to systems. Although Evermay has established processes to reduce the risk of cybersecurity incidents, there is no guarantee that these efforts will always be successful, especially considering that Evermay does not directly control the cybersecurity measures and policies employed by incur third-party providers. from similar cybersecurity affect issuers of securities in which those clients invest, broker-dealers, qualified governmental authorities, exchange and other financial market operators, or other financial institutions. to portfolios. advisory addition described below, Cryptocurrency Assets . Cryptocurrencies are digital assets that can be used transactions, for various speculative decentralized investments. blockchain technology, an advanced cryptographic digital ledger to secure transactions and validate asset ownership. Unlike conventional currencies issued and regulated by monetary authorities, cryptocurrencies generally operate without centralized control, and their value is determined by market supply and demand. While regulatory oversight of digital assets has evolved significantly since their inception, they remain subject to variable regulatory treatment globally, which may impact their risk profile and liquidity. subject to extreme price volatility, cryptocurrency investments for authorized by the client. of, or in, Use of Mutual and Exchange Traded Funds . Evermay utilizes mutual funds and exchange traded funds for Evermayʼs In its client investment and fee transaction and/or custodial fees discussed above, clients will also incur, relative to all mutual fund and exchange traded fund purchases, charges imposed at the fund level (e.g., management fees and other fund expenses). The mutual funds and exchange traded funds utilized by Evermay are generally available directly to the public. Thus, a client can generally obtain the funds recommended and/or utilized by Evermay independent of engaging Evermay as an investment advisor. However, if a prospective client does so, then they will not receive Evermay's initial Given that cryptocurrency investments are speculative liquidity and constraints, and the potential for total loss of principal, Evermay does not exercise discretionary authority to purchase client accounts. Any investment in cryptocurrencies must be expressly Furthermore, Evermay does not recommend or advocate for the purchase cryptocurrencies, investment including Bitcoin, or other digital assets to clients. 7  and ongoing investment advisory services. Item 5 Fees and Compensation our Investment Management Services Obligations. not shall In be performing required to verify pay other professionals and is Management Services. The our previous recommendations services, Client any Evermay information received from the client or from the clientʼs expressly authorized to rely thereon. Moreover, it remains each clientʼs responsibility to promptly notify Evermay if there is ever any change in his or her financial situation or investment objectives for the purpose of evaluating and/or services. Evermay (including cash, securities, facilitates in minimum client investment estate, private equity, generally for requires an Investment and illiquid private or are lockups and liquidity to types of investments. For example, related accounts, Investment Liquidity and Difficult to Value Assets. participation Evermay several opportunities, such as market private private real private credit. infrastructure, private These semi-liquid and entail investments investment exit. gates Additionally, there are additional costs associated with these these investment strategies charge a management fee and, in some instances, charge an incentive fee based on performance. the quarterly is prorated and Clients an asset based annual fee (“Annual Advisory Feeˮ or “Investment Management Feeˮ) for Investment Annual Advisory Fee is based on an annual percentage of the market value of the assets in account(s) managed by Evermay. The Firmʼs Investment Management Fee shall be prorated and paid quarterly, in advance, based upon the market value of the assets managed by pending trades, and accrued interest) on the last day of the previous quarter. Evermay determines the billing cycle and of account Management Services. $1,000,000 However, Evermay, in its sole discretion, may require a lesser account minimum based upon certain criteria (i.e., anticipated future earning capacity, anticipated future additional assets, dollar amount of assets to be managed, account composition, negotiations with clients, etc.). If an account is fully removed from Evermayʼs management during a billing the fee quarter, difference between the assessed fee and the prorated fee is refunded back to the client. Standard Tiered Investment Management Fee Schedule Account Market Value Annual Advisory Fee To invest in private markets, clients must meet certain criteria based on the terms of each offering. The valuation of a private investment, sometimes referred to as an alternative investment, may be complex, as there is generally no established market for these assets. Evermay does not independently value any private securities held in client accounts or in the hedge funds it recommends. The quarterly financial information provided by the private funds themselves will be used as the basis for client reporting and fee billing (where a client pays an asset-based fee). This valuation is determined independent of Evermay. $0 - $5,000,000 $5,000,001 - $10,000,000 $10,000,001 - $25,000,000 $25,000,001 - $50,000,000 $50,000,001 + 1.00% 0.60% 0.50% 0.40% 0.30% Risk . Different types of or (including within each tiered investment and/or strategy investment Investment investments involve varying degrees of risk, and it should not be assumed that future performance of any specific investment the strategies investments recommended or undertaken by Evermay) will be profitable or equal any specific performance level(s). As the market value of the account reaches a higher tier breakpoint, as shown in the table above, the level are charged the assets corresponding Annual Advisory Fee. This type of fee schedule is sometimes referred to as a “blended fee schedule.ˮ and Form (“Client with, the execution of Disclosure Brochure. A copy of Evermayʼs written Brochure Relationship CRS Summaryˮ) shall be provided to each client prior to, or contemporaneously an agreement between the client and Evermay. Assets Under Management of December 31, accounts, 2024, $1,180,000,000 Evermay in assets managed As approximately under management, with $1,139,000,000 on a discretionary basis and $41,500,000 on a non-discretionary basis. Fee Dispersion. Evermay, in its discretion, may charge a lesser or higher investment advisory fee, charge a flat fee, waive applicable minimum asset or minimum fee levels, waive its fee entirely, or charge a fee on a different interval, based upon certain criteria (i.e. anticipated future earning capacity, anticipated future assets, dollar amount of assets to be additional managed, account composition, related complexity of the engagement, anticipated services to be rendered, grandfathered fee schedules, employees and family members, courtesy accounts, competition, negotiations with client, etc.). Please Note: As a result of the above, similarly situated clients could pay 8  set financial planning fee schedule. or lower fees. Evermayʼs As mentioned in the previous section, there are no additional fees or cost associated with Evermayʼs estate planning strategies. Plan Consulting Services Fees. it shall generally fall within under administration within the plan to the directly or Sponsors. Evermay The from annual fee fee program, Retirement The annual fee for Evermayʼs Retirement Plan Consulting Services is charged either on a quarterly basis in advance or in arrears and is based on a percentage of assets and typically ranges from .50 to 1.00% per year. The annual fee is based upon several factors including the size of the plan, the number of participants, the number of office locations as well as the method of employee education and the services required. Fees plan paid are administrators for Retirement Plan Consulting Services will not be higher than Evermayʼs standard fee schedule for Investment Management. quarter. Any contributions different fees. In addition, similar advisory services may be available from other investment advisers for Investment similar Management Fee generally falls within the range from 0.3% to 1.0%. Although Evermay has established the standard tiered management fee schedule, we retain the discretion to negotiate alternative fee schedules on a client-by-client basis. While the annual fee is negotiable, the above-listed range but may be higher or lower than this range based on the nature of the account. Factors affecting fee percentages include the size of the account, complexity of asset structures, and other factors. Evermay, in its sole discretion, may consider a fixed annual advisory fee in lieu of an asset-based management fee. Investment Advisory services begin on the effective date of the Investment Advisory Agreement unless otherwise stated in writing by Evermay. The Firm offers a discretionary householding sometimes referred to as advisory “accounts related for fee billing purposes,ˮ whereby the firm can aggregate assets of multiple related accounts and apply the aggregated Account Market Value for purposes of calculating the Annual Advisory Fee for each account. In certain circumstances, the aggregated Account Market Values allow clients to reach a higher breakpoint on the tiered Standard Fee Schedule and pay a lower Annual Advisory Fee. Fee Payment. Fees will be debited directly from each clientʼs account. The advisory fee is billed in advance at the beginning of each calendar quarter, and the value used for the fee calculation will be determined using the account value as of the last day of the previous and/or withdrawals made during a calendar quarter may cause an adjustment to the advisory fee. Generally, any contributions and/or withdrawals intra-quarter, which result in a prorated quarterly fee adjustment of over one hundred dollars, is charged or credited to the client. in resulting higher advisory Evermay fee earning for Clients whose fees are directly debited will provide written authorization to debit advisory fees from their accounts held by a qualified custodian. Each quarter, clients may receive a bill from Evermay itemizing the fees to be debited and the time period covered by the fee. The invoice may additionally state that the fee was not independently calculated by the custodian. The client should also receive a statement from their account custodian showing all transactions in their account, including the advisory fee. Evermay will include the entire market value of margin assets when computing its advisory fee. Accordingly, Evermayʼs advisory fee for clients that hold a margin balance shall be based upon the higher margined a value, account correspondingly these accounts. As a result, a potential conflict of interest arises since Evermay may have economic disincentive to recommend that the client terminate the use of margin. Evermay clients who sign up for margin will get a preferred margin rate at the custodian, which is lower compared to their standard retail margin rate. Wealth Advisors discuss the clientʼs use of margin during their portfolio reviews. Please Note: Evermay does not recommend the use of margin for investment purposes and does not receive any interest or fees in connection with the use of margin. fee has been billˮ will not be included in assets whether the At Clients should be aware of their responsibility to verify the accuracy of the fee calculation submitted to the custodian by Evermay, as the custodian will not the determine properly calculated. clientʼs request, Evermay may provide the client with a separate copy of each invoice, setting forth the basis for the calculation. Any security(ies) excluded from billing or labeled as “no under management to determine the annual advisory fee. Therefore, there may be differences in the values we use for reporting, trading, and billing calculations. ETFs, private have own funds, managers including which investment funds, their advisory basis and negotiate a each fund's prospectus or in Financial Planning Fees. Evermayʼs Financial Planning Services are provided at no additional charge to Investment Management clients. Based on individual facts and circumstances, Wealth Advisors have the ability to provide Financial Planning Services on a stand-alone payment arrangement with the client. Evermay does not have a Other Fees. The Advisory Fee charged by Evermay is separate and distinct from fees and expenses charged and/or mutual by investment fee structures, fees. Descriptions of these fees and expenses are available in management agreements. Evermayʼs fees are for advisory services 9  the Firm to liquidate these types third including calculating its advisory fee. If or when the client directs of investments, Evermay will reinvest the proceeds of the sale in different securities. There is no guarantee that the future performance of the new investments will perform in a profitable manner or equal to any specific performance level. third-party investments, private Item 6 Performance Based Fees and Side-by-Side Management taxes in side-by-side account fee while at the same fee). This valuation is Evermay does not charge performance-based fees or engage management. Performance-based fees are typically based on a share of capital gains or capital appreciation of a clientʼs account. Side-by-side management is the practice of managing accounts that are charged a performance-based time managing accounts that are charged another type of fee, such as an asset-based fee, whereby a potential conflict could arise that could cause an advisor to favor one account over another account. only and do not include other costs that the client may incur such as, but not limited to; transaction fees, commissions, or other management fees charged by non-affiliated investment parties managers that are recommended to clients. Clients may incur certain charges imposed by custodians, brokers, funds, private equity funds, and other third parties such as fees charged by managers, custodial fees, deferred sales charges, odd-lot differentials, transfer taxes, wire transfer and electronic fund fees, private fund management, performance, and carry and other fees and on brokerage accounts and securities transactions. Evermay does not independently value any private securities held in client accounts or in the hedge funds it recommends. As noted above in Item 4, the quarterly financial information provided by the private funds themselves will be used as the basis for client reporting and fee billing (where a client pays an determined asset-based independent of Evermay. For marketable securities, the prices provided by custodians are used for client reporting and fee billing. Item 7 Types of Clients accounts for unless the intra-quarter of amount deposits the Evermay primarily provides customized investment management services to individuals, high net worth individuals and associated trusts, estates, charitable organizations, pension and profit-sharing plans, and other corporations or business entities. minimum of of assets Either the client A under $1,000,000 management is required for investment management services. However, Evermay, in its sole discretion, may require a lesser account minimum or charge a lesser management fee based upon certain criteria (i.e., anticipated future earning capacity, anticipated future assets, dollar amount of assets to be additional managed, account composition, accounts, related negotiations with clients, etc.). Pro-rata Fees . When clients engage Evermay at any time other than the beginning of a quarter, clients will pay a management fee for the number of days left in that quarter. Evermay does not reimburse or charge or client withdrawals pre-paid quarterly advisory fee increases or decreases by more than one hundred dollars. If a client terminates our relationship at any time other than the beginning of the quarter, they will be refunded the portion of the prepaid management fee for the remainder of the quarter (or the credit can be applied to another Investment Management Account). Evermay may terminate the Agreement for any or reason upon 30-days written notice. Once a client receives the notice of termination, we will refund the unearned fees via check or wire. relationships vary in scope and length of Client service. Evermay reserves the right to decline any new account or resign as adviser to any account after initiation of an investment advisory relationship for any reason at its sole discretion. Cash Positions. As discussed in Item 4, Evermay continues to treat cash as an asset class. As such, unless determined to the contrary by Evermay, all cash positions (money markets, etc.) shall continue to be included as part of assets under management for purposes of calculating Evermayʼs advisory fee. Item 8 Methods of Analysis, Investment Strategies and Risk of Loss these securities under It is important to keep in mind that all investments carry risks. Investing in securities involves risk of loss that clients should be prepared to bear. Investment Allocations Each portfolio will be invested according to that clientʼs investment objectives. We determine these Other Assets. Investment Management portfolios hold securities that were purchased at the request of the client or acquired prior to the clientʼs engagement with Evermay. Typically, Evermay would not recommend or track regular and would circumstances prefer to liquidate such securities. Upon the request or direction of a client, Evermay shall remain available to discuss these securities, generally consider these securities as part of the clientʼs overall asset allocation strategy and include the market value of these securities for purposes of 10  Once we in a company, develop allocation constructing client portfolios. Our asset guidelines are in equity return potential ability to pass asset allocation of 5060% in fixed analyses. we invest continuously monitor As in-house portfolio managers, we employ both top-down and bottom-up techniques in top-down approach includes the analysis of macroeconomic, geopolitical, and capital market conditions, business regulations and industry developments. With this data in mind, we select equities based on their long-term total our and fundamental and technical analyses. Once we invest in a company, we continuously monitor its business fundamentals and stock valuation. objectives by interviewing the client and/or asking the client to put these objectives in writing. Once we ascertain the clientʼs objectives for each account, we guidelines. will Asset allocation percentage-based allocations to different investment types, or types of managers or funds. For example, an asset allocation strategy may call for 4060% of the portfolio to be invested with the remaining securities, balance in fixed income. Another program may have an income securities, 20% in equities, and the remainder in cash or a personal business. Yet another program may have an asset allocation of 100% in equities. We primarily choose Evermay selects fixed income investments based on their investment grade, liquidity, duration, and yield to maturity. investment-grade securities issued by financially sound corporations, and by the U.S. government or its agencies. If a client is subject to high income tax rates, as many of our clients are, we can utilize high grade, tax-exempt state, and local bonds. The investment strategy that we recommend is based on the needs of the client, current market conditions, the clientʼs current financial situation (including assets that may be managed by another advisor), financial goals, and the timeline to meet those goals. Because we develop an investment strategy based on the clientʼs personal situation and financial goals, the clientʼs asset allocation guidelines may be similar to or different from another client. to meet the guidelines of the conditions can vary greatly, the If requested by the client, Wealth Advisors can review taxable accounts for tax-loss harvesting opportunities. Tax-loss harvesting is a tax-savings strategy that involves selling investments at a loss with the goal of offsetting future gains, such as those from the sale of investments or capital gains distributions from mutual funds and ETFs. The primary benefit of tax-loss harvesting is lowering capital gains tax liability and increasing after-tax returns. Tax loss harvesting trades are made on a best-efforts basis and there is no guarantee that Evermay will be able to recognize all available losses under this strategy. it buys and sells for direct with knowledge managers a in particular investment We may periodically recommend changes to the client portfolios asset allocation. It is important to remember that because market asset allocation guidelines are not necessarily strict rules. Rather, we review accounts individually and may deviate from the guidelines as we believe necessary. Evermay reserves the right to add or delete any security holdings and otherwise change the list of securities client accounts. Subsequent changes to the list of securities Evermay buys or sells does not mean a particular client holding will change. Evermay does not offer proprietary ETFs or mutual funds and it does not manage or sub-advise mutual funds or ETFs. The Firm is not a publicly traded company, and it does not issue publicly traded equity or debt securities, therefore portfolios do not hold securities issued by or affiliated with Evermay. Evermay makes placement memorandum and these changes changes may Rather, some to not accounts may Third-Party Managers. At times we may recommend that significant portions of a client's portfolio be managed by independent third-party managers or independent investment recommend third-party managers or in private funds, typically if those and demonstrate expertise strategy. Investments in private funds, including private equity funds, are governed by and fully described in the private related subscription materials. Fees charged by independent third-party managers are in addition to the advisory fee charged by Evermay. traded earlier, inadvertently having investment When made be strategies, be simultaneously. modified before others. This may result in accounts being an advantage or disadvantage over accounts traded later. Methods of Analysis and Strategies conditions. monitor the part of overall periodic The experience, expertise, investment philosophies, and past performance of independent third-party investment managers are examined in an attempt to determine if that manager has demonstrated an ability to invest over a period of time and in different economic managerʼs We underlying holdings, strategies, concentration, and leverage risk our as assessment. Based on a clientʼs individual circumstances and needs, we will determine which money manager's As in-house portfolio managers, we employ both top-down and bottom-up techniques in constructing client portfolios. Our top-down approach includes the analysis of macroeconomic, geopolitical, and capital market conditions, business regulations and industry developments. With this data in mind, we select equities based on their long-term total return potential and ability to pass our fundamental and technical 11  account tolerance, and or environmental disasters, war, acts size, philosophy risk of selected We the clients to review portfolio management strategy is appropriate for that client. Factors considered in making this determination the include money investment manager. the encourage third-party managerʼs disclosure documents. regularly and continuously monitor recover any lost value. In addition, significant market disruptions, such as those caused by pandemics, of natural terrorism, or other events, can adversely affect local and global markets and normal market operations. Market disruptions may exacerbate political, social, and economic risks. Adding additional securities does not help to minimize this risk since all securities may be affected by market fluctuations. consistent with the client's Currency Risk. When investing in another country using another currency or in a company that conducts business in other countries, the changes in the value of the countryʼs currency can change the value of the securities in the portfolio. the We performance of the selected money managers. If we determine that a particular selected money manager is not providing sufficient management services to the client or is not managing the client's portfolio in a manner investment objectives, we may remove the client's assets from that selected money manager and place the client's assets with another money manager at our discretion and without prior consent from the client. are more susceptible to Regulatory Risk. Changes in laws and regulations from any government can change the value of a given company and its accompanying securities. Certain industries government regulation. Changes in zoning, tax structure, or laws impact the return on these investments. Evermay may obtain appropriate due diligence on independent third-party managers, making reasonable inquiries into their performance calculations, policies and procedures, code of ethics policies, and other operational and compliance matters to account for performance and risk management. Qualitative analysis is necessary as well, to determine: If there were true factors leading to out-performance, as opposed to just “luckˮ; and, if the factors leading to previous out-performance are identifiable and repeatable. Tax Risks Related to Short Term Trading. Clients should note that Evermay may engage in short-term trading transactions. These transactions may result in short-term gains or losses for federal and state tax purposes, which may be taxed at a higher rate than long-term strategies. Evermay endeavors to invest client assets in a tax efficient manner, but all clients are advised to consult with their tax professionals regarding the transactions in client accounts. the investment team and research record, among characteristics. Qualitative screening includes a review of each firmʼs organizational history and stability, depth/experience of group, investment process and strategy, and legitimacy of track Other other qualitative or quantitative screens include a fundʼs or managerʼs expense ratio, assets under management, manager tenure, length of track record, and minimum initial investment. while still allowing clients to are IRS rules and restrictions Our due diligence does not stop once we select a manager. We meet or speak with managers on a periodic, ongoing basis, and factors we analyzed before recommending managers are reviewed and scrutinized. Risk of Loss Tax Harvesting Risk. Tax-loss harvesting is a strategy whereby specific portfolio holdings are sold at a taxable loss, and those positions are replaced by investment holdings with similar historical returns and expected future performance. Since the replacement securities are similar, the expectation is that there will little impact on the overall strategic portfolio be allocation capture potential tax losses. Since past performance is not an indication of future results, there is potential for the future performance of the replacement positions to deviate from that of the initial holdings. Additionally, there on tax-loss harvesting, including purchasing investments the IRS considers “substantially identicalˮ within a specific period of time. There are always risks to investing. It is impossible to name all possible types of risks. Among the risks are the following: Risks. Most investments have a in the world may have Political global component, even domestic stocks. Political events anywhere unforeseen consequences to markets around the world. Purchasing Power Risk. Purchasing power risk is the risk that an investmentʼs value will decline as the price of goods rises (inflation). The investmentʼs value itself does not decline, but its relative value does, which is the same thing. Inflation can happen for a variety of complex reasons, including a growing economy and a rising money supply. down on various releases or for Business Risk. This can be thought of as certainty or uncertainty of income. Management comes under business risk. Cyclical companies (like automobile companies) have more business risk because of the General Market Risks. Markets can, as a whole, go up or no news understandable reason at all. This sometimes means that the price of specific securities could go up or down without real reason and may take some time to 12  the funds may leverage and less steady income stream. On the other hand, fast food chains tend to have steadier income streams and therefore, less business risk. that assume use contingent liabilities of the portfolio company when acquiring portfolio companies. Risk. The amount of debt or leverage Financial determines the financial risk of a company. Although the of many of to rating services help to identify against strategies principal (i.e., risk, straddles, Default Risk. This risk pertains to the ability of a company to service their debt. Ratings provided by several those companies with more risk. Obligations of the U.S. government are said to have low default risk. risks, should the strategy and its risks prior Options. The use of options transactions as an investment strategy involves a high level of inherent risk. the intent options-related transactions implemented by Evermay certain is hedge options-related short positions, etc.), may in and of themselves, produce principal volatility and/or risk. Thus, a client must be willing to accept the enhanced volatility and principal risks associated with such strategies. In light of these enhanced a client may direct Evermay, in writing, not to employ any or all such strategies for his or her accounts. Clients participating in the Options carefully consider all information Strategy regarding to participating. account should Risks specific to sub-advisors and other managers. If we invest some of the clientʼs assets with another advisor, including a private placement, there are additional risks. These include risks that the other manager is not as qualified as we believe them to be, that the investments they use are not as liquid as we would normally use in our portfolios, or that their risk management guidelines are more liberal than we would normally employ. The other manager may have had historical success, but such success does not guarantee any future success. In addition, as we do not select the underlying investments that may be used by such other manager, one or more other managers used by the firm to manage the clientʼs assets may purchase the same security, increasing the risk to the client if that security were to fall in review the other managersʼ value. Clients disclosure documents for the investment risks for those managers and the underlying investments. Margin Risk. “Marginˮ is a tool used to maximize returns on a given investment by using securities in a client as collateral for a loan from the custodian to the client. The proceeds of that loan are then used to buy more securities. In a positive result, the additional securities provide additional return on the same initial investment. In a negative result, the additional securities provide additional losses. Margin therefore carries a higher degree of risk than investing without margin. Evermay utilizes margin on a very limited basis for clients with higher risk tolerances. in order to draw conclusions the described and in related private subscription The reliance on portfolio Information Risk. All investment professionals rely on about research investment options. This research is always a mix of both internal (proprietary) and external (provided by third-parties) data and analyses. Even an advisor who says they rely solely on proprietary research must still collect data from third-parties. This data, or outside research, is chosen for its perceived reliability, but there is no guarantee that the data or research will be accurate. Failure in data accuracy or completely research will translate to a compromised ability by the advisor to reach satisfactory investment conclusions. marketplace involve smaller issuers. diversification resulting in the fund While these companies sometimes a companyʼs management may time-period. of opportunities since availability there is a Private Equity. If we invest some of the clientʼs assets with a fund that invests in private equity, including private placements, there are additional risks that will placement be fully memorandum materials which shall govern. These risks include, but are not limited to, the realization of gains, which require finding a buyer willing to pay the fair market value without discount. That there is no assurance of investment returns. The reliance on fund personnelʼs ability to identify and properly analyze companies for investment. company management teams. There can be no assurance that the existing management team, or any successor, will be able to operate the portfolio company successfully or implement any operational improvements. The lack of being substantially adversely affected by the unfavorable performance of any single portfolio company. The holding of minority investments, limited rights, or abilities to exert significant influence over the portfolio company. The investment in illiquid and long-term investments with no assurance that the fund will be able to monetize investments in a timely manner, or at all, and dispositions of such investments may require a limited lengthy The investment highly competitive market for investment opportunities. And Small Companies. Some investment opportunities in These the companies may be starting up, or are historically small. have potential for outsized returns, they also have the potential for losses because the reasons the company is small are also risks to the companyʼs future. For example, lack experience, or the companyʼs capital for growth may be restricted. These small companies also tend to trade less frequently than larger companies, which can add to the risks associated with their securities because the ability to sell them at an appropriate price may be limited as compared to the markets as a whole. Not only do these companies have investment 13  immediate or short-term risk, if a client is invested in such small companies and requests liquidity, these securities may require a significant discount to value in order to be sold in a shorter time frame. on an individualized assessment of market liquidity. Although many ETFs in as an (among types of shares are listed on a securities exchange. Shares can be bought and sold throughout the trading day like shares of other publicly traded companies and the market price for a share of an ETF may fluctuate from the value of its underlying securities. Consequently, ETF shares may trade at a discount or premium to their net asset value. In addition, there is a price difference between the bid price and the ask price that is often referred to as the “spreadˮ, which generally varies based on the ETFʼs trading volume and are investment company under the registered Investment Company Act of 1940, some ETFs, in particular those that invest in commodities, are not registered as an investment company. Concentration Risk . While Evermay selects individual securities, including mutual funds, for client portfolios each based security, this evaluation comes without an overlay of general economic or sector specific issue analysis. This means that a clientʼs equity portfolio may be a specific sector, geography, or concentrated sub-sector potential other concentrations), so that if an unexpected event occurs that affects that specific sector or geography, for example, the clientʼs equity portfolio may be affected negatively, including significant losses. and Inverse ETFs, ETNs and prior to reposition the portfolio into the Transition Risk. As assets are transitioned from a clientʼs advisors to Evermay there may be securities and other investments that do not fit within the asset allocation strategy selected for the client. Accordingly, these investments will need to be sold in order asset allocation strategy selected by Evermay. However, this transition process may take some time to accomplish. Some investments may not be unwound for a lengthy period of time for a variety of reasons that may include unwarranted low share prices, restrictions on trading, tax consequences, contractual restrictions on liquidity, or market-related liquidity concerns. In some cases, there may be securities or investments that are never able to be sold. The inability to transition a client's holdings into recommendations of Evermay may adversely affect the client's account values, as Evermayʼs recommendations may not be able to be fully implemented. products Risk. Clients may, at all times, place Restriction reasonable restrictions on the management of their accounts. However, placing these restrictions may make managing the accounts more difficult, thus lowering the potential for returns. Related to Term & swaps, futures contracts, and Mutual Leveraged Funds Risk: Leveraged ETFs, ETNs and mutual funds, sometimes labeled “ultraˮ or “2xˮ for example, are designed to provide a multiple of the underlying indexʼs return, typically on a daily basis. Inverse products are designed to provide the opposite of the return of the underlying index, typically on a daily basis. These products are different from and can be riskier than traditional ETFs, ETNs and mutual funds. Although these products are designed to provide returns that generally correspond to the underlying index, they may not be able to exactly replicate the performance of the index because of fund expenses and other factors. This is referred to as tracking error. Continual resetting of returns within the product may add to the underlying costs and increase the tracking error. As a result, this may prevent these products from achieving their investment objective. In addition, compounding of the returns can produce a divergence from the underlying index over time, in particular for leveraged products. In highly volatile markets with large positive and negative swings, return distortions are magnified over time. Because of these distortions, these should be actively monitored, as frequently as daily, and may not be appropriate as an intermediate or long-term holding. To accomplish their objectives, these products use a range of strategies, including other derivatives. These products may not be diversified and can be based on commodities or currencies. These products may have higher expense ratios and be less tax efficient than more traditional ETFs, ETNs and mutual funds. Evermay may recommend that Risks Liquidity. Investment Securities do not follow a straight line up in value. All securities will have periods of time when the current price of the security is not an accurate measure of its value. If a client requires us to liquidate his or her portfolio during one of these periods, the client will not realize as much value as he or she would have, had the investment had the opportunity to regain its value. Further, some investments are made with the intention of the investment appreciating over an extended period of time. Liquidating these investments prior to their intended time horizon may result in losses. Exchange Traded Funds ETFs ETFs are typically investment companies that are legally classified as open-end mutual funds or UITs. However, they differ from traditional mutual funds, in particular, in that ETF significant REITs: portions of client portfolios be allocated to liquid and illiquid real estate investment trusts, otherwise known as “REITsˮ. A REIT is an entity, typically a trust or corporation, that accepts investments from a number of investors, pools the money, and then uses that money to invest in real estate through either actual property purchases or mortgage loans. While there are some benefits to owning REITs, which include potential tax benefits, income and the relatively low 14  real estate, REITs also in risks as location. Such investment focus can the underlying estate, resources, are which means the rules under which the entity is run. The investors are the limited partners of the MLP, with affiliate of the manager typically the general an partner. This means the manager has all the control in running the entity, as opposed to an equity investment where shareholders vote on such matters as board composition. There is also a significant amount of risk or real with commodities investments. Clients should ask Evermay any questions regarding the role of MLPs in their portfolio. the also properties employ for principal REITs the if may purpose of purchasing Item 9 Disciplinary Information its manager. should ensure Evermay has had no legal or disciplinary events that would be material to a client or prospective clientʼs evaluation of Evermayʼs business or firm management. barrier to invest in real estate as compared to directly investing some have to more traditional compared increased investments such as stocks, bonds, and mutual funds. First, real estate investing can be highly volatile. Second, the specific REIT chosen may have a focus such as commercial real estate or real estate in a be given beneficial if the properties are successful but lose significant not significant successful. more leverage investments with fewer investment dollars, which can enhance returns but also enhances the risk of loss. The success of a REIT investment is highly dependent they Clients upon understand the role of REITs in their portfolio. Evermay may recommend that Item 10 Other Financial Industry Activities and Affiliations and Other Conflicts of Interest does not have other financial industry all, of its income from real estate, Evermay activities or affiliations. as well receive a dividend at management of the firm and Minority-owner client portfolios special trades treatment or access with to A limited number of clients have a minority interest in Evermay as certain Evermay Supervised Persons (together “Minority Ownersˮ). These Minority certain floating Owners frequencies (e.g., quarterly) from the Firm. Minority Owner clients do not provide input into the direction or day-to-day pay a negotiated advisory fee for Investment Management Services. are managed the same as all clients and they do not respect any receive to investment of allocation opportunities. the underlying estate, resources, by clients. relationships do or MLPs: significant portions of client portfolios be allocated to master limited partnerships, otherwise known as “MLPsˮ. An MLP is a publicly traded entity that is designed to provide tax benefits for the investor. In order to preserve these benefits, the MLP must derive most, if natural not resources and commodities. While MLPs may add diversification and tax favored treatment to a clientʼs portfolio, they also carry significant risks beyond more traditional investments such as stocks, bonds, and mutual funds. One such risk is management risk-the success of the MLP is dependent upon the managerʼs experience and judgment in selecting investments for the MLP. Another risk is the governance structure, which means the rules under which the entity is run. The investors are the limited partners of the MLP, with an affiliate of the manager typically the general partner. This means the manager has all the control in running the entity, as opposed to an equity investment where shareholders vote on such matters as board composition. There is also a significant amount of risk with or real commodities investments. Clients should ask Evermay any questions regarding the role of MLPs in their portfolio. In a limited number of circumstances, Evermay uses the professional services of the businesses owned or not These managed change impact the advisory fees charged or services provided to these clients. Evermay may recommend that all, of its income from real estate, and potential conflicts of interest These arrangements could cause a conflict of interest whereby the goals of the Firm compete with Evermay clientsʼ interest. These conflicts and potential conflicts of interest are mitigated by the Firm and Wealth Advisorʼs fiduciary duty to its clients, the Firmʼs policies and procedures and Code of Ethics, and the duty of Evermayʼs Chief Compliance Officer to review conflicts with Officers of the Firm. MLPs: significant portions of client portfolios be allocated to master limited partnerships, otherwise known as “MLPsˮ. An MLP is a publicly traded entity that is designed to provide tax benefits for the investor. In order to preserve these benefits, the MLP must derive most, if not natural resources and commodities. While MLPs may add diversification and tax favored treatment to a clientʼs portfolio, they also carry significant risks beyond more traditional investments such as stocks, bonds, and mutual funds. One such risk is management risk-the success of the MLP is dependent upon the managerʼs experience and judgment in selecting investments for the MLP. Another risk is the governance structure, 15  selling, alternative investment strategies, or the use of various options strategies. Item 11 Code of Ethics, Participation or Interest in Client Transactions and Personal Trading Code of Ethics If there is a violation of the Code of Ethics or conflict of interest, Evermayʼs Chief Compliance Officer will review the facts and circumstances and, if necessary, take appropriate steps to resolve the issue, keeping in mind the Firm and its Wealth Advisors must always put the clientʼs interest first to resolve conflicts. Item 12 Brokerage Practices Evermay has adopted a Code of Ethics, as mandated by the Adviser Act rules. The Code of Ethics sets forth high ethical standards of business conduct that we require of our employees, including compliance with applicable federal securities laws and reporting any violations of the Code of Ethics. Recommendation of Broker-Dealer The Code of Ethics includes the following provisions: generally recommends that ● These services include custody Standards of business conduct required of Access Persons, which standards reflect fiduciary duty obligations and those of Supervised Persons to advisory clients; It is expected that most, if not ● Terms requiring Supervised Persons to comply with applicable federal securities laws; ● Evermay investment accounts be held in custody by Schwab. Schwab offers enhanced services to independent investment advisors. of securities, trade execution platforms, and access to research. all transactions in a given client account may be cleared through the custodian of that account in its capacity as a broker-dealer. In the future, Evermay could expand the number of custodians available for client accounts. which is Terms and procedures relating to the review and approval of certain securities transactions and holdings by Supervised Persons with access to client information; the particular circumstances. ● Requirements prohibiting the use of material non-public information for personal or professional gain; ● Schwab has can be Procedures for reporting violations of the Code of Ethics; and ● Procedures for the receipt and acknowledgment of the Code of Ethics by Supervised Persons. Evermay will provide a copy of the Code of Ethics to any client or prospective client upon request. Participation or Interest in Client Transactions and Personal Trading for Evermay seeks to obtain best execution for client transactions not necessarily the lowest commission but the best overall qualitative execution Evermay under recommends broker-dealers or custodians such as Schwab to its clients based on a variety of factors. These include, but are not limited to, commission costs. considered what discounted commission rates. However, in choosing a broker-dealer or custodian to recommend, we are most concerned with the value the client receives for the cost paid, not just the cost. Other factors that may be considered in determining overall value include speed and accuracy of execution, financial strength, knowledge and experience of staff, and research and service. Schwab also has arrangements with many mutual funds that enable us to purchase these mutual funds client accounts at reduced transaction charges. Evermay re-evaluates the use of Schwab periodically to determine if they are still the best value for our clients. not a material consideration Evermayʼs Supervised Persons often have their own brokerage accounts as well as different investment objectives, risk tolerance, and financial goals for those accounts. Evermayʼs Supervised Persons also have the ability to enroll in one or several of the Firmʼs advisory accounts and engage in different investment strategies. access research and to, support investment materials. These associated Evermayʼs be in the form research Although Evermayʼs advisory accounts are designed for long-term investing, the investment strategies for accounts Supervised with Persons can differ substantially from those of its clients. As such, Supervised Persons can buy, sell, or sell short securities that could also be held in client portfolios. Evermayʼs investment portfolios can also include mutual funds or ETFs that engage in short Although when determining whether to recommend that a client utilize the services of a particular broker-dealer/custodian such as Schwab, we may receive from that firm, or other have practice items may be available to us as a result of executing client securities transactions through that firm or clients utilizing that company to provide custodial services. These items may reports, other of securities analysis products, investment seminars, education seminars, various written publications on topics related to firm practice, discount programs, 16  access to technology solutions, and support and other products or services. execution. If an aggregate trade is not fully executed, the securities may be allocated to client accounts on a pro rata basis, except where doing so would create an unintended adverse consequence (for example, ¼ of a share, or a position in the account of less than 1%. The aforementioned services are used by our Firm to manage accounts for which we have investment discretion, and not solely for particular clients. Without this arrangement, our firm might be compelled to purchase the same or similar services at our own expense. a result of receiving these services for use or expand use of services. a Our to enter into relationships with believe these along with Trade Error. From time to time, Evermay or the custodian may make an error in placing a trade on a clientʼs behalf. Evermay generally considers a “trade errorˮ to be the execution of a transaction on behalf of a client on terms other than those intended. Evermay faces an inherent conflict in addressing trade errors, as trade errors are often detected by firm personnel who may have an inherent incentive to mitigate such trade errors in Evermayʼs favor, which could be to the detriment of the clients. To address this risk, Evermay logs, and firm management reviews, all trade errors. We periodic controls, employee engagement on trade errors, mitigate these inherent risks. by the same investment advisor. As no additional cost, we may have an incentive to continue particular the to broker-dealer/custodianʼs Firm considered this potential conflict of interest when we chose the the broker-dealer/custodian and we have determined that the relationships are in the best interest of our firmʼs clients and satisfies our client obligations, including our duty to seek best execution. In addition, this potential conflict of interest is addressed because our clients may not pay more for investment transactions effected and/or assets maintained at a particular broker-dealer/custodian as result of our receipt of such aforementioned benefit(s). We do not consider whether Schwab or any other broker-dealer/custodian refers clients to Evermay as part of our evaluation of these broker-dealers. Cross Transactions and Principal Trades . A cross transaction is a transaction between two accounts managed We recognize that significant conflicts of interest could arise when performing internal cross transactions in client accounts. Evermay does not perform internal cross transactions. Additionally, Evermay does not act as principal in any transaction (“principal tradesˮ) nor does the firm sell securities held in inventory to clients. at other broker-dealers. Evermay does Item 13 Review of Accounts Reviews. For Investment basis Evermay's team by Management Services accounts execution services or prices from more frequently with Wealth or other transaction allocation and reviews, harvesting, investment objectives and/or Some clients may come to Evermay with accounts held not require that clients hold their assets at Schwab. A clientʼs direction of brokerage to other broker-dealers to negotiate can limit or eliminate Evermayʼs ability commissions (which could esult in higher commission costs) and otherwise obtain most favorable execution of client transactions. In addition, Evermay may be unable to aggregate orders to reduce transaction costs. If the client directs brokerage, the client will negotiate terms and arrangements for the account with that broker-dealer, and Evermay will not seek better other broker-dealers. As a result, the client may pay higher commissions costs or incur greater spreads, or receive less favorable net prices, on transactions for the account than would otherwise be the case. In other words, directing brokerage may cost a client more money. Further, because Evermayʼs access to information may differ from access to information for clients whose assets are held at Schwab, there may be delays in meeting client needs. Account Management Services clients, account reviews are conducted on an members. ongoing are Investment reviewed with clients on different frequencies (i.e., monthly, quarterly, or semi-annually, annually, or as needed) based on factors such as the complexity of the clientʼs objectives and changes to the clientʼs Investor Profile. When needed, clients can review their accounts Advisors. Account reviews, which vary in focus, can include rebalancing, updates asset security tax performance holdings reviews, cash flow monitoring, and more. It remains the clientʼs responsibility to advise Evermay (in person, virtually or via telephone) of any changes financial their in situation. transaction account directly from report from Evermay that contains certain account Account Statements and Reports Clients are provided confirmation notices and regular with their statements summary custodian. On a quarterly basis, clients also receive a or its service performance provider related information such as account holdings, asset allocation Aggregating Trades . Commission costs per client may be lower on a particular trade if all clientsʼ accounts in which the trades are to be made are executed at the same time. This is called aggregating trades. Instead of placing a number of trades for the same security for each account, we may, when appropriate, execute one trade for all accounts and after then allocate the trades to each account 17  not receive any compensation or commissions related to these types of referrals. breakdown, or account performance. Clients should compare the account statements they receive from their custodian with any documents or reports they receive from Evermay. Item 14 Client Referrals and Other Compensation or referral fees related to Evermay related the advisory will be detailed and executable estate identified by Evermay. Clients may to Clients may be introduced to Evermay via other third parties. In the event that the Firm compensates any party for the referral of a client to Evermay, any such compensation will be paid by Evermay, and not the client. The referral arrangement will not result in higher costs to clients. If the client is introduced to Evermay by an unaffiliated third party, the referral disclosed, arrangement with Evermay including the compensation for the referral. The client will be provided with a copy of Evermayʼs ADV Parts 2A (“Firm Brochureˮ), 2B (“Brochure Supplementˮ), and 3 (“Form CRSˮ or “Client Relationship Summaryˮ) prior at the time the investment advisory or agreement is executed. Estate planning strategies are created by an attorney who is also an Evermay client. The law firm who employs the attorney is not affiliated with Evermay. Clients are under no obligation to engage with the estate planning services through Evermay or this law firm. The Firm pays the cost of these estate strategy services and Evermay does not receive any additional compensation this engagement. The attorney who is a client does not receive any advisory fee discounts or other benefits from services to provided to the attorney. In most cases, clients will need to obtain a different estate planning attorney to planning create documents in conjunction with the estate planning strategies in certain circumstances engage the law firm assisting Evermay. Estate planning consulting is included as part of our financial planning service offering. Estate planning does not include the preparation of estate documents. Professional Services Referrals Item 15 Custody Evermay a for refers of clients services to such any products recommended by or professional, and a unaffiliated licensed professionals, and other Occasionally, professionals as variety accounting, tax, legal, or insurance brokerage. Clients, however, are under no obligation to purchase any products or services through these professionals or to purchase these professionals. The client retains absolute discretion over all such implementation decisions and is free to accept or reject any professional recommendations from the Advisor. If the client engages any such recommended dispute arises thereafter relative to such engagement, the client agrees to seek recourse exclusively from and against the engaged professional. The engaged professionals and not Evermay, shall be responsible for the quality and competency of the services provided. service referral Client assets are held by unaffiliated broker-dealers or banks (“qualified custodiansˮ). Evermay is also considered to have custody of client assets due to the following services and activities: ability to deduct advisory fees directly from client accounts; being able to access client accounts using client credentials on retirement plan websites; forwarding custodial checks to custodians on behalf of our clients; having limited power of attorney of certain accounts on behalf of our clients; and facilitating withdrawals, payments and/or other disbursements to third parties (including wire transfers and ACHs) whereby clients maintain a standard letter of authorization (“SLOAˮ) on file with the firm and the custodian. Additionally, on a case-by-case basis and at the request of clients, Evermayʼs Wealth Advisors may serve in the capacity of trustee, co-trustee, or successor trustee. Given these services and activities that deem Evermay to have custody of client assets, Evermay engaged an outside accounting firm to perform an annual surprise audit of the related accounts. This audit is required by the Advisers Act. custodians send statements by Evermay has a conflict of interest in making these professional recommendations because it could receive referrals from professionals it has recommended to clients. In instances where the referred professional is also a client of Evermay, it may appear that Evermay has an economic incentive for the referral. Evermay will refer other professionals to its clients only when we believe the services provided by the professional best suit the clientʼs needs. mail or Account electronically to the account owners on at least a quarterly basis. Clients should carefully review these statements and should compare these statements to any account information provided by Evermay. review to help clientsʼ their if Therefore, on an annual basis, for these clients, Evermay is required to undergo a surprise examination of client funds and securities, by an independent public accountant. More specifically, Evermay works with a small number of insurance firms whereby insurance agents offer a insurance our of complimentary coverage insurance determine coverage is adequate and meets their needs. Clients are under no obligation to engage with these firms or purchase insurance from their agents. Evermay does 18  Item 16 Investment Discretion Item 18 Financial Information Evermay is not required to disclose any financial information due to the following: investment managers. When ● Evermay does not require payment of more than $1,200 in fees per client, six months or more in advance; for the clientʼs account(s), the amount is unaware of any ● client securities transactions. The Evermay financial commitment that is reasonably likely to impair its ability to meet its contractual commitments to clients; and When a client agrees to discretionary management, Evermay may be responsible for asset allocation and selecting given discretionary management authority, Evermay will be authorized to determine the securities to be bought or of sold securities to be bought or sold, the timing of securities transactions, and the broker or dealer to be used to execute only limitations on the investment authority may be those limitations imposed in writing by the client. has not been the subject ● the discretion hire and fire Evermay of bankruptcy proceedings at any time during the past ten years. QUESTIONS Chief a client or client may information on policy ANY Compliance Evermayʼs Officer remains available to address any questions that have prospective regarding the above disclosures and arrangements. If we retain an investment manager for the client, we reserve money to managers on our clientʼs behalf. The only limitations on the investment authority may be those limitations imposed in writing by the client. For the investment managers that we select to manage client assets, clients should review their disclosure document(s) for more with regard to their investment or brokerage discretion. Item 17 Voting Client Securities of certain legacy and exception notwithstanding Evermayʼs will exercise proxy Evermay over and trust accounts, Evermay may all elections relative to any trust With the accounts, discretionary authority to make investment decisions on behalf of clients, voting not authority securities held in client accounts. Clients should instruct each custodian of the assets to forward to the clients copies of all proxies and shareholder communications relating to the clientʼs holdings. The obligation to vote client proxies shall at all times rest with the client. Evermay shall not be deemed to have proxy voting authority solely as a result of providing advice or information about a particular proxy vote to a client. With regard to the legacy have discretion and may vote all, vote some, or not vote proxies for those clients. In the event we vote, we will vote those proxies in the best interest of the client. These clients may direct the votes, as well as obtain information on voting and voting policies by request. Evermay does not vote proxies on behalf of itself and therefore does not expect to have any conflict with voting clientsʼ proxies or clientsʼ proxy voting. In addition, clients maintain exclusive responsibility for making mergers, acquisitions, tender offers, bankruptcy proceedings, class or mass actions, legal proceedings or other events pertaining to the securities held in client accounts. 19