PASSIVE CAPITAL MANAGEMENT, LLC

Form ADV Part 2 A Brochure Passive Capital Management, LLC Salina Place 205 S. Salina Street – Suite 403 Syracuse, NY 13202 Main Telephone No. (315) 478-3130 www.passivecapital.com This brochure provides information about the qualifications and business practices of Passive Capital Management, LLC. If you have any questions about the contents of this brochure, please contact us at (315) 478-3130 and/ or info@passivecapital.com. The information in this brochure has not been approved or verified by the United States Securities and Exchange Commission or any state securities authority. Additional information about Passive Capital Management, LLC also is available on the SEC’s website at www.adviserinfo.sec.gov. Passive Capital Management, LLC is a registered investment adviser. The use of the term registered investment adviser does not imply a certain level of skill or training. January 26, 2026 1  Item 2 – Material Changes Form ADV Part 2A requires registered investment advisers to amend their brochure when information becomes materially inaccurate. If there are any material changes to an adviser’s disclosure brochure, the adviser is required to notify you and provide you with a description of material changes. The following material changes to this Brochure occurred since the last annual amendment was submitted. Item 4 – Added Retirement Plan Advisory Services Items 12, 14, and 15 – Added additional information on our relationship with our Custodian, Charles Schwab, and some of the services they provide as part of this relationship. 2  Item 3 – Table of Contents Item 1- Cover Page Item 2 – Material Changes ................................................................................................................... 2 Item 3 – Table of Contents .................................................................................................................. 3 Item 4 – Advisory Business .................................................................................................................. 4 Item 5 – Fees and Compensation ......................................................................................................... 5 Item 6 – Performance-Based Fees and Side-By-Side Management.......................................................... 6 Item 7 – Types of Clients ..................................................................................................................... 6 Item 8 – Methods of Analysis, Investment Strategies and Risk of Loss ................................................... 7 Item 8.A – Frequent Trading of Securities ......................................................................................... 7 Item 8.B – Material Risks of Particular Securities ............................................................................... 7 Item 9 – Disciplinary Information ....................................................................................................... 10 Item 9.B – Administrative Proceedings ............................................................................................ 10 Item 9.C – Self-Regulatory Organization (“SRO”) Proceedings .......................................................... 10 Item 10 – Other Financial Industry Activities and Affiliations ................................................................ 10 Item 10.A – Broker-Dealer Registration ........................................................................................... 10 Item 10.B – Futures Commission Merchant/Commodities ................................................................. 10 Item 10.C – Relationships with Related Persons .............................................................................. 10 Item 10.D – Relationships with Other Advisers ................................................................................ 11 Item 11 – Code of Ethics, Participation or Interest in Client Transactions and Personal Trading .............. 11 Item 11.A – Code of Ethics ............................................................................................................ 11 Item 11.B – Participation or Interest in Client Transactions .............................................................. 11 Item 11.C – Personal Trading by Associated Persons ....................................................................... 11 Item 11.D – Conflicts of Interest with Personal Trading by Associated Persons .................................. 11 Item 12 – Brokerage Practices ........................................................................................................... 11 Item 12.A – Factors in Selecting or Recommending Broker-Dealers .................................................. 12 Item 12.A1 – Research and Other Soft Dollar Benefits ................................................................. 13 Item 12.A2 – Brokerage for Client Referrals ................................................................................. 14 Item 12.A3 – Directed Brokerage ................................................................................................ 14 Item 12.B – Trade Aggregation ...................................................................................................... 14 Item 13 – Review of Accounts ........................................................................................................... 14 Item 14 – Client Referrals and Other Compensation ............................................................................ 14 Item 15 – Custody ............................................................................................................................ 15 Item 16 – Investment Discretion ........................................................................................................ 15 Item 17 – Voting Client Securities ...................................................................................................... 15 Item 18 – Financial Information ......................................................................................................... 15 3  Item 4 – Advisory Business Passive Capital Management, LLC (“PCM” or “the Adviser”) has been in business since 2007. PCM is an investment advisory firm registered with the United States Securities and Exchange Commission (“SEC”). The principal owners are Scott D. Reinhardt and Jonathan E. Farber. Assets Under Management As of December 31, 2025, the Adviser managed $996,942,091 in client assets broken down as follows: Discretionary $986,986,632,500 Non-Discretionary $10,309,591 Investment Management Services The Adviser provides investment management services to its clients on a discretionary and non- discretionary basis. All investment advice provided is customized to each client’s investment objectives and financial needs. The information provided by the client, together with any other information relating to the client’s overall financial circumstances, will be used by PCM to determine the appropriate portfolio asset allocation and investment strategy for the client. Discretionary Services Discretionary services consist of constructing portfolios to achieve established risk objectives. Portfolios include various funds, primarily passively managed index and asset class funds, designed to achieve competitive returns while attempting to minimize costs and capture the returns provided by the capital markets. The portfolio would generally be rebalanced quarterly to reflect previous commitments to each market/asset class. When the Adviser manages client assets on a discretionary basis, the Adviser executes securities transactions for clients without having to obtain specific client consent prior to each transaction. Discretionary authority is limited to investments within clients’ managed accounts. Non-discretionary Services Non-discretionary services consist of establishing long-term investment policies, making recommendations regarding portfolio construction and security selection, implementation as directed by the client, and measuring and monitoring results. When the Adviser manages client assets on a non-discretionary basis, the Adviser notifies the client and obtains permission prior to the sale or purchase of each security within the client’s managed account. Clients may decide not to invest in certain securities or types of securities and refuse to approve securities transactions. Retirement Accounts PCM provides investment advice to Clients regarding retirement accounts or individual retirement accounts (“IRAs”), PCM is a fiduciary within the meaning of Title I of the Employee Retirement 4  Income security Act (“ERISA”) and/or the Internal Revenue Code, as applicable, which are laws governing retirement accounts. The way PCM makes money creates some conflicts with your interests, so PCM operates under a special rule that requires PCM to act in your best interest and not put PCM’s interest ahead of yours. Retirement Plan Advisory Services PCM provides 3(21) retirement plan advisory services on behalf of the retirement plans (each a “Plan”) and the company (the “Plan Sponsor”). PCM’s retirement plan advisory services are designed to assist the Plan Sponsor in meeting its fiduciary obligations to the Plan and its Plan Participants. Each engagement is customized to the needs of the Plan and Plan Sponsor. Services generally include: Investment Oversight (ERISA 3(21))  Vendor Analysis   Performance Reporting  Ongoing Investment Recommendation and Assistance  Benchmarking Services These services are provided by PCM serving in the capacity as a fiduciary under ERISA. In accordance with ERISA Section 408(b)(2), the Plan Sponsor is provided with a written description of PCM’s fiduciary status, the specific services to be rendered and all direct and indirect compensation PCM reasonably expects under the engagement. Note Regarding Tax or Legal Advice: In providing services, PCM does not offer or otherwise provide tax or legal advice. PCM will, at a client’s direction and approval, work with a client’s existing tax or legal professionals to assist in the provision of the services. Fees charged by any tax, legal or other third-party professionals are the responsibility of the client. PCM may refer professionals; however, there is no compensation to PCM for these referrals, and clients are under no obligation to use the referred service providers. Financial Planning Services PCM offers personal financial planning services for clients as part of their overall management of accounts. PCM does not charge any additional fees in connection with this service. Item 5 – Fees and Compensation The Adviser is compensated for investment management services based on clients’ assets under management. Fees are based on the market value of assets on the last business day of the preceding quarter, are payable quarterly in arrears and are prorated for accounts opened during the quarter. Fees are directly deducted from client accounts. Fees are negotiable when an Investment Adviser Representative had a relationship with a client through a previous employer. If a client was subject to lower fee breakpoints, a fee schedule similar to the fee schedule that was in effect with the previous employer may be negotiated. The Adviser may also negotiate fees based upon additional business opportunities, family relationships and other factors.  0.80% of the initial $1,000,000 5   0.60% of the next $4,000,000  0.40% on the next $5,000,000  0.20% on amounts over $10,000,000 The account custodian may charge fees, which are in addition to and separate from advisory fees. Custodians may charge accounts for transaction, retirement plan and administration fees. Mutual funds and ETFs have annual expenses and may assess other fees, which are in addition to and separate from advisory fees, these are described in each fund’s prospectus. Advisory clients should note that fees for comparable services vary and lower or higher fees for comparable services may be available from other sources. Termination Clients will have a period of five (5) business days from the date of signing an advisory agreement to unconditionally rescind the agreement and receive a full refund of all fees. Thereafter, either party may terminate the advisory agreement at any time. Since fees are payable after services are provided, there are no unearned fees and the client is not due a refund upon early termination of an investment advisory contract. However, the Adviser’s fees are prorated to the date of termination. Item 6 – Performance-Based Fees and Side-By-Side Management The Adviser does not charge or receive, directly or indirectly, any performance-based fees. Item 7 – Types of Clients The Adviser provides advisory services to:  Individuals, including their trusts, estates, 401(k) plans and IRAs and those of their family members  High net worth individuals – Individuals who are “qualified clients” under rule 205-3 of the Advisers Act of 1940 or are “qualified purchasers”.  Business entities including corporations  Pension and profit-sharing plans (other than plan participants)  Charitable or nonprofit organizations – This may include social welfare organizations, agricultural/horticultural organizations, labor organizations, business leagues or trade associations and entities that operate for purposes that are religious, artistic, literary, charitable, scientific, educational or in the interest of public safety. Account Minimums The Adviser does not impose a minimum account requirement on clients. 6  Item 8 – Methods of Analysis, Investment Strategies and Risk of Loss The Adviser believes:  Capital markets and asset classes generate returns  Asset allocation is the primary determinant of the variability in performance  Markets are generally efficient  Expected returns are a function of systematic risk  Diversification is critical The Adviser doesn’t try to outsmart the collective wisdom of the markets or predict the future as the Adviser believes that these are oftentimes futile endeavors. The Adviser constructs portfolios with passively-managed investment products. The strategy is to gain exposure to asset classes in a cost-effective manner by attempting to minimize trading commissions, taxes and market-timing penalties. The primary method of analysis consists of the review of past results from various portfolios compared to what was available in domestic and international capital markets as represented in published indices and various asset classes. The analysis includes the measurement and integration of investment goals and objectives with what can be expected from well-functioning capital markets. The Adviser uses passive investment vehicles to capture the risk/return from various asset classes; the allocation is determined by the individual client’s goals, objectives, and risk tolerance. The primary source of information consists of published data on returns from various indices and asset classes that represent components of domestic and international capital markets. Other sources of information include specific results of active investment managers and data from proprietary databases. The investment strategy consists of allocating funds among several diversified financial asset portfolios designed to replicate specific markets/asset classes to meet specific risk objectives. Important to this strategy is the periodic measurement of results to ensure these objectives are being achieved. In sum, the Adviser adheres to a disciplined asset allocation philosophy. Item 8.A – Frequent Trading of Securities The Adviser is not involved in the frequent trading of securities. Item 8.B – Material Risks Involved Investing in securities involves a risk of loss which clients should be prepared to bear. PCM’s investment recommendations are subject to various market, currency, economic, political and business risks, and such investment decisions will not always be profitable. Clients should be aware that there may be a loss or depreciation to the value of the client’s account. There can be no assurance that the client’s investment objectives will be obtained and no inference to the contrary should be made. 7  Generally, the market value of equity stocks will fluctuate with market conditions, and small-stock prices generally will fluctuate more than large-stock prices. The market value of fixed income securities will generally fluctuate inversely with interest rates and other market conditions prior to maturity. Fixed income securities are obligations of the issuer to make payments of principal and/or interest on future dates, and include, among other securities: bonds, notes and debentures issued by corporations; debt securities issued or guaranteed by the U.S. government or one of its agencies or instrumentalities, or by a non-U.S. government or one of its agencies or instrumentalities; municipal securities; and mortgage-backed and asset-backed securities. These securities may pay fixed, variable, or floating rates of interest, and may include zero coupon obligations and inflation-linked fixed income securities. The value of longer duration fixed income securities will generally fluctuate more than shorter duration fixed income securities. Investments in overseas markets also pose special risks, including currency fluctuation and political risks, and it may be more volatile than that of a U.S. only investment. Such risks are generally intensified for investments in emerging markets. In addition, there is no assurance that a mutual fund or ETF will achieve its investment objective. Past performance of investments is no guarantee of future results. Additional risks involved in the securities recommended by PCM include, among others: • Stock market risk, which is the chance that stock prices overall will decline. The market value of equity securities will generally fluctuate with market conditions. Stock markets tend to move in cycles, with periods of rising prices and periods of falling prices. Prices of equity securities tend to fluctuate over the short term as a result of factors affecting the individual companies, industries or the securities market as a whole. Equity securities generally have greater price volatility than fixed income securities. • Sector risk, which is the chance that significant problems will affect a particular sector, or that returns from that sector will trail returns from the overall stock market. Daily fluctuations in specific market sectors are often more extreme than fluctuations in the overall market. • Issuer risk, which is the risk that the value of a security will decline for reasons directly related to the issuer, such as management performance, financial leverage, and reduced demand for the issuer's goods or services. • Smaller company risk, which is the risk that the value of securities issued by a smaller company will go up or down, sometimes rapidly and unpredictably as compared to more widely held securities. Investments in smaller companies are subject to greater levels of credit, market and issuer risk. • Foreign (non-U.S.) investment risk, which is the risk that investing in foreign securities result in the portfolio experiencing more rapid and extreme changes in value than a portfolio that invests exclusively in securities of U.S. companies. Risks associated with investing in foreign securities include fluctuations in the exchange rates of foreign currencies that may affect the U.S. dollar value of a security, the possibility of substantial price volatility as a result of political and economic instability in the foreign country, less public information about issuers of securities, different securities regulation, different accounting, auditing and financial reporting standards and less liquidity than in the U.S. markets. • Interest rate risk, which is the chance that prices of fixed income securities decline because of rising interest rates. Similarly, the income from fixed income securities may decline because of falling interest rates. 8  • Credit risk, which is the chance that an issuer of a fixed income security will fail to pay interest and principal in a timely manner, or that negative perceptions of the issuer’s ability to make such payments will cause the price of that fixed income security to decline. • Exchange Traded Fund (ETF) risk, which is the risk of an investment in an ETF, including the possible loss of principal. ETFs typically trade on a securities exchange and the prices of their shares fluctuate throughout the day based on supply and demand, which may not correlate to their net asset values. Although ETF shares will be listed on an exchange, there can be no guarantee that an active trading market will develop or continue. Owning an ETF generally reflects the risks of owning the underlying securities it is designed to track. ETFs are also subject to secondary market trading risks. In addition, an ETF may not replicate exactly the performance of the index it seeks to track for a number of reasons, including transaction costs incurred by the ETF, the temporary unavailability of certain securities in the secondary market, or discrepancies between the ETF and the index with respect to weighting of securities or number of securities held. • Management risk, which is the risk that the investment techniques and risk analyses applied by PCM may not produce the desired results and that legislative, regulatory, or tax developments, affect the investment techniques available to PCM. There is no guarantee that a client’s investment objectives will be achieved. • Investment Companies (“Mutual Funds”) risk, when an investor invests in mutual funds, the investor will bear additional expenses based on his/her pro rata share of the mutual fund’s operating expenses, including the management fees. The risk of owning a mutual fund generally reflects the risks of owning the underlying investments the mutual fund holds. Cybersecurity risk, which is the risk related to unauthorized access to the systems and networks of PCM and its service providers. The computer systems, networks and devices used by PCM and service providers to us and our clients to carry out routine business operations employ a variety of protections designed to prevent damage or interruption from computer viruses, network failures, computer and telecommunication failures, infiltration by unauthorized persons and security breaches. Despite the various protections utilized, systems, networks or devices potentially can be breached. A client could be negatively impacted as a result of a cybersecurity breach. Cybersecurity breaches can include unauthorized access to systems, networks or devices; infection from computer viruses or other malicious software code; and attacks that shut down, disable, slow or otherwise disrupt operations, business processes or website access or functionality. Cybersecurity breaches cause disruptions and impact business operations, potentially resulting in financial losses to a client; impediments to trading; the inability by us and other service providers to transact business; violations of applicable privacy and other laws; regulatory fines, penalties, reputational damage, reimbursement or other compensation costs, or other compliance costs; as well as the inadvertent release of confidential information. Similar adverse consequences could result from cybersecurity breaches affecting issues of securities in which a client invests; governmental and other regulatory authorities; exchange and other financial market operators, banks, brokers, dealers and other financial institutions; and other parties. In addition, substantial costs 9  may be incurred by those entities in order to prevent any cybersecurity breaches in the future. Item 9 – Disciplinary Information Registered investment advisers are required to disclose all material facts regarding any legal or disciplinary events that would be material to a client’s evaluation of the adviser and the integrity of the adviser’s management. The Adviser does not have any disciplinary information to disclose. Item 9.A – Criminal or Civil Actions Neither the Adviser nor any management person has been found guilty of or has any criminal or civil actions pending in a domestic, foreign or military court. Item 9.B – Administrative Proceedings Neither the Adviser nor any management person has any administrative proceedings pending before the SEC, any other federal regulatory agency, any state regulatory agency, or any foreign financial regulatory authority. Item 9.C – Self-Regulatory Organization (“SRO”) Proceedings Neither the Adviser nor any management person have been found by any SRO to have caused an investment-related business to lose its authorization to do business, or to have been involved in a violation of the SRO’s rules, or were barred or suspended from membership or from association with other members, or were expelled from membership, otherwise significantly limited from investment-related activities, or fined more than $2,500. Item 10 – Other Financial Industry Activities and Affiliations Item 10.A – Broker-Dealer Registration Neither the Adviser nor its management persons is or owns a securities broker-dealer or has an application for registration pending. No associated person of the Adviser is a registered representative of a broker-dealer. Item 10.B – Futures Commission Merchant/Commodities Neither the Adviser nor any of its management persons is a commodity broker/futures commission merchant, a commodity pool operator, commodity trading advisor or an associated person for the foregoing entities or has an application for registration pending. Item 10.C – Relationships with Related Persons Neither the Adviser nor any of its management persons have any material relationships with related persons that create a material conflict of interest with clients. 10  Item 10.D – Relationships with Other Advisers Neither the Adviser nor any of its management persons have any other material relationships or conflicts of interest with any related financial industry participants other than those discussed above. Item 11 – Code of Ethics, Participation or Interest in Client Transactions and Personal Trading Item 11.A – Code of Ethics The Adviser has adopted a Code of Ethics that sets forth standards of conduct expected of advisory personnel and to address conflicts that arise from personal trading by advisory personnel. Advisory personnel are obligated to adhere to the Code of Ethics, and applicable securities and other laws. The Code covers a range of topics that may include: general ethical principles, conflicts of interest, insider trading, reporting personal securities trading, exceptions to reporting securities trading, reportable securities, pre-clearance of initial public offerings and private placements, reporting ethical violations, distribution of the Code, and review and enforcement processes. The Adviser will provide a copy of the Code to any client or prospective client upon request. Item 11.B – Participation or Interest in Client Transactions Neither the Adviser nor any associated person recommends to clients, or buys or sells for client accounts, securities in which adviser or an associated person has a material financial interest. Neither the Adviser nor any associated person acting as a principal, buys securities from (or sells securities to) clients; acts as general partner in a partnership in which Adviser solicits client investments; or acts as an investment adviser to an investment company that Adviser recommends to clients. Item 11.C – Personal Trading by Associated Persons The Adviser primarily recommends and invests client assets in open-end mutual funds and exchange-traded funds. The Adviser and its related persons may invest in the same open-end mutual funds and exchange-traded funds. Item 11.D – Conflicts of Interest with Personal Trading by Associated Persons Neither the Adviser nor any related person recommends individual securities to clients, but may facilitate a purchase upon request and may sell securities for client accounts to implement the Adviser’s investment management strategy. The Adviser or related persons are not likely to buy or sell the same securities for their own accounts. Item 12 – Brokerage Practices The Custodian and Brokers We Use 11  PCM does not maintain custody of your assets, although we may be deemed to have custody of your assets if you give us authority to withdraw assets from your account (see Item 15- Custody, below). Your assets must be maintained in an account as a “qualified custodian,” generally a broker-dealer (“BD”) or bank. We recommend that our clients use Charles Schwab & Co., Inc. (“Schwab”), a registered BD, member SIPC, as the qualified custodian. We are independently owned and operated and are not affiliated with Schwab. Schwab will hold your assets in a brokerage account and buy and sell securities when we instruct them to. While we recommend that you use Schwab as custodian/broker, you will decide whether to do so and will open your account with Schwab by entering into an account Agreement directly with them. We do not open the account for you, although we may assist you in doing so. Not all advisors require their clients to use a particular BD or other custodian recommended by the advisor. Conflicts of interest associated with this arrangement are described below as well as in Item 14. You should consider these conflicts of interest when selecting a custodian. Item 12.A – Factors in Selecting or Recommending Broker-Dealers In making BD/Custodian recommendations, PCM will consider a number of judgmental factors, including, without limitation: combination of transaction execution services and asset custody services, capability to execute, clear and settle trades, capability to facilitate transfers and payments to and from accounts, breadth of available investment products (stocks, bonds, mutual funds, no-transaction fee exchange traded funds (ETFs), quality of confirmations and account statements, online access to computerized data regarding client accounts, availability of investment research and tools that assist us in making investment decisions, services delivered or paid for by Schwab, the financial standing, reputation, and integrity of the BD/Custodian, past experience with the BD/Custodian, past experience with similar trades, availability of other products and services that benefit us, as discussed below. For our clients’ accounts that Schwab maintains, Schwab generally does not charge you separately for custody services but is compensated by charging you commissions or other fees on trades that it executes or that settle into your Schwab account. Certain trades (for example, mutual funds and ETFs) do not incur Schwab commissions or transaction fees. Schwab is also compensated by earning interest on uninvested cash in your account. We are not required to select the broker or dealer that charges the lowest transaction cost, even if that broker provides execution quality comparable to other brokers or dealers. Although we are not required to execute all trades through Schwab, we have determined that having Scwab execute most or all trades is consistent with our duty to seek “best execution”. Best execution means the most favorable terms for a transaction based on all relevant factors, including those listed above. By using another broker or dealer you may pay lower transaction costs. Schwab Advisor Services is Schwab’s business serving independent investment advisory firms like us. They provide our clients and us with access to their institutional brokerage services, many of which are not available to Schwab retail customers. However, certain retail investors may be able to get institutional brokerage services from Schwab without going through us. Schwab also makes available various support services. Some of those services help us manage or administer our clients’ accounts, while others help us manage and grow our business. Schwab’s support services 12  are generally available on an unsolicited basis and at no charge to us. Following is a more detailed description of Schwab’s support services: Services that benefit you. Schwab’s institutional brokerage services include access to a broad range of investment products, execution of securities transactions, and custody of client assets. The investment products available through Schwab include some of which we might not otherwise have access or that would require a significantly higher minimum investment by our clients. Schwab’s services described in this paragraph generally benefit you and your account. Services that do not benefit you. Schwab also makes available to us other products and services that benefit us but do not directly benefit you or your account. These products and services assist us in managing or administering our clients’ accounts and operating our firm. They include investment research, both Schwab’s own and that of third parties. We use this research to service all or a substantial number of our clients’ accounts, including accounts not maintained at Schwab. In addition to investment research, Schwab also makes available software and other technology that provides access to client account data, facilitates trade execution, provides pricing and other market data, facilitates payment of our fees from our clients’ accounts and assists with back-office functions, recordkeeping, and client reporting. Services that generally only benefit us. Schwab also offers other services intended to help us manage and further develop our business. These include educational conferences, consulting on technology and business needs, consulting on legal or compliance needs. Schwab provides some of these services itself. In other cases, it will arrange for third-party vendors to provide the services to us. Schwab also discounts or waives its fees for some of these services or pays all or a part of a third party’s fee. If you did not maintain you account with Schwab, we would be required to pay for those services from our own resources. PCM may use some or all of the services previously mentioned, which causes a conflict of interest when recommending Schwab. This conflict is mitigated by the careful consideration of the factor listed above when selecting or recommending a custodian/BD. Our interest in Schwab’s services. The availability of these services from Schwab benefits us because we do not have to produce or purchase them. We don’t have to pay for Schwab’s services. Schwab has agreed to pay for certain services on our behalf. The fact that we receive these benefits from Schwab is an incentive for us to recommend the use of Schwab rather than making such a decision based exclusively on your interest in receiving the best value in custody services and most favorable execution of your transactions. This is a conflict of interest. We believe, however, that taken in the aggregate our recommendation of Schwab as custodian and broker is in the best interest of our clients. Our selection is primarily supported by the scope, quality, and price of Schwab’s services and not Schwab’s services that benefit only us. Item 12.A1 – Research and Other Soft Dollar Benefits The term "soft dollars" refers to funds which are generated by client trades being used to pay for products and services such as research and enhanced brokerage services that that the Adviser receives from or through the broker-dealers whom it engages to perform securities transactions. The Adviser does not receive soft dollars generated by securities transactions of its clients. 13  Item 12.A2 – Brokerage for Client Referrals The Adviser does not refer clients to particular broker-dealers in exchange for client referrals from those broker-dealers. Item 12.A3 – Directed Brokerage The Adviser doesn’t allow clients to direct their brokerage business to specific broker-dealers. Item 12.B – Trade Aggregation The Adviser primarily recommends and invests client assets in open-end mutual funds and exchange traded funds. The Adviser’s investment strategies do not present an opportunity to aggregate trades. Item 13 – Review of Accounts Accounts are reviewed at least quarterly by an investment advisory representative at the company. Upon review accounts are rebalanced if actual allocations deviate substantially from target allocations. Accounts are rebalanced to reflect previously established long-term commitments to various asset classes. Written brokerage statements are generated by the qualified custodian generally on a monthly basis, but at least quarterly, and valuation reports are generated quarterly by the Adviser. These reports include asset allocation, market value, a summary of market conditions and performance information. Clients are also sent confirmations following each brokerage account transaction unless confirmations have been waived. Item 14 – Client Referrals and Other Compensation We receive an economic benefit from Schwab in the form of the support products and services it makes available to us and other independent investment advisors who maintain their accounts at Schwab. In addition, Schwab has also agreed to pay for certain products or services for which we would otherwise have to pay once the value of our clients’ assets in accounts at Schwab reach a certain size. You do not pay more for assets maintained at Schwab as a result of these arrangements. However, we benefit from the arrangement because the cost of these services would otherwise be borne directly by us. You should consider these conflicts of interest when selecting a custodian. The products and services provided by Schwab, how they benefit us, and the related conflicts of interest are described above in Item 12. 14  Item 15 – Custody Under government regulations, we are deemed to have custody of your assets if, for example, you authorize us to instruct Schwab to deduct our advisory fees directly from your account, if you grant us authority to move your money to another person’s account, or direct payments to third parties. You will receive account statements directly from Schwab at least quarterly. They will be sent to the email or postal mailing address you provided to Schwab. You should carefully review those statements promptly when you receive them. We also urge you to compare Schwab’s account statements with the periodic statements you receive from us. The Adviser doesn’t receive any economic benefit for providing advisory services to clients from a person who is not a client. This includes sales awards or prizes. Item 16 – Investment Discretion In most cases, the Adviser will have discretion over the selection and amount of securities to be bought or sold without obtaining specific client consent. The Adviser will also have discretion over the selection of the broker-dealer to be used but not the commission rates to be paid to the broker-dealer. Item 17 – Voting Client Securities The Adviser does not accept authority to vote proxies on behalf of clients as a matter of policy. Clients will receive their proxy information directly from their custodian. Clients may contact the Adviser with questions about a particular solicitation by telephone at (315) 478-3130 or e-mail sreinhardt@passivecapital.com or jfountain@passivecapital.com. Item 18 – Financial Information PCM is not required to disclose any financial information pursuant to this item due to the following:  PCM does not require or solicit the prepayment of more than $1,200 in fees six months or more in advance of rendering services;  PCM is unaware of any financial condition that is reasonably likely to impair its ability to meet its contractual commitments relating to its discretionary authority over certain client accounts; and  PCM has never been the subject of a bankruptcy petition. 15