CURVATURE SECURITIES, LLC 

CUSTOMER DISCLOSURE DOCUMENT CUSTOMER IDENTIFICATION PROGRAM NOTICE TO CUSTOMERS

Important Information You Need to Know about Opening an Account with Curvature Securities LLC.

To help the government fight the funding of terrorism and money laundering activities, federal law requires financial institutions to obtain, verify and record information that identifies each person opening an account.

When you open an account with Curvature Securities, LLC, we are required to collect information such as the following from you:

  • Your Name
  • Your Address
  • Your taxpayer identification number or other government-issued identification number

We may also obtain or request that you provide us with the following documents and information and/or conduct a database check to verify your identity:

  • Certified Articles of Incorporation/Partnership Agreement
  • Trading Authorization
  • Investment Advisor Letter, if applicable
  • Other identifying documents, as applicable, to help us identify you.

Treasury, SEC, NASD and/or NYSE rules already require you to provide most of this information.

If you do not provide the information requested or your identity cannot be verified, Curvature may not be able to open an account or carry out transactions for you. If Curvature has already opened an account for you we may have to close it.

We thank you for your support and patience and hope that you will support Curvature’s efforts to deny terrorists and money launderers access to America’s financial system.

You may obtain information about SIPC, including the SIPC brochure, by contacting SIPC via web www.sipc.org or by phone (202) 371-8300.

 

Re: Order Handling Practices, Terms of Dealing, and Regulatory Disclosures

Dear Customer:

At Curvature Securities, LLC. (“the “Firm,” “we,” “our,” “us”), our top priority is to provide our customers and their representatives (“you,” “your”) with transparency on our business practices.  This letter contains information regarding our order handling practices and terms of dealing as well as certain important disclosures related to Curvature Securities, LLC and the services we provide to our customers.

  1. Disclosures Applicable to All Curvature Securities, LLC Customers

Compliance with Applicable Law

We are committed to conducting business in compliance with all applicable laws, rules and regulations and with the policies and practices of securities and futures exchanges and clearing houses, alternative trading facilities, and self-regulatory organizations.

We expect that all orders you send to us comply with and fulfill all obligations under applicable laws, rules, and regulations.

Order Handling in Non-Normal Market Conditions

When non-normal market conditions exist, we reserve the right, in our sole discretion, to reduce, modify, suspend, or cancel any of our order handling protocols without notice.

Best Execution (FINRA Rule 5310)

We seek to execute our customers’ orders at the most favorable terms reasonably available under prevailing market conditions.  In seeking best execution for your orders, we take a number of factors into consideration in determining how to execute and where to route orders, including, among other things, the size and type of order, the terms and conditions of the order, the trading characteristics of the security, the character of the market for the security, the accessibility of quotations, transaction costs, the opportunity for price or size improvement, the speed of execution, the availability of efficient and reliable order handling systems, the level of service provided by the market venue, and your overall investment objectives.

Access and Use of Customer Information

Access to customer order information is limited to account coverage, personnel handling customer orders, and supervisors, as well as certain legal, compliance, risk management, senior management and other support personnel in the performance of their responsibilities.  Other customers, traders, and sales traders do not have access to this information.  Depending on respective personnel responsibilities, there are different levels of permissioned access, pursuant to our internal policies.

Protecting the confidentiality and security of order, execution, position, revenue, and related information is an important part of how we conduct our business, and we have implemented controls that are reasonably designed to protect such information.  We may use such information for a variety of purposes, including customer coverage, supervision, risk management, liquidity provision, and business strategy, and may disclose such information in connection with our regulatory obligations, customer instructions, and normal course brokerage functions.

 

Disclosure of Financial Condition (FINRA Rule 2261)

Upon request, we are required to make available to inspection by any bona fide regular customer the information relative to our financial condition as disclosed in our most recent balance sheet prepared either in accordance with our usual practice or as required by any state or federal securities laws, or any rule or regulation thereunder.

SIPC Information (FINRA Rule 2266)

Curvature Securities, LLC is a member of the Securities Investor Protection Corporation (“SIPC”). Customers may obtain information about SIPC, including the SIPC brochure, by contacting SIPC at www.sipc.org or (202) 371-8300.

Investor Education and Protection Information (FINRA Rule 2267)

BrokerCheck provides investors with the ability to research the professional backgrounds, business practices, and conduct of FINRA-registered brokerage firms and brokers.  In connection with this program, investors may call the BrokerCheck Hotline at (800)289-9999 and/or visit the FINRA website at http://brokercheck.finra.org/Search/Search.  An investor brochure that includes information describing the FINRA BrokerCheck Program is available from either of these sources.

Business Continuity Plan (FINRA Rule 4370)

We maintain a business continuity plan with established procedures in the event of an emergency or significant business disruption.  Information regarding Curvature Securities, LLC Business Continuity Plan may be provided upon request.

Customer Complaints (FINRA Rule 4530)

We endeavor to investigate any customer complaint promptly.  We are required to promptly report to FINRA no later than 30 calendar days after we know or should have known of the existence of a written customer complaint involving allegations of theft or misappropriation of funds or securities or of forgery.  Customer complaints or inquiries related to any Curvature Securities, LLC matter may be directed to the following address:

 

Todd Pigott

Chief Compliance Officer

Curvature Securities, LLC

376 Main Street, Suite 100

Bedminster, NJ 97921

toddpigott@curvaturesecurities.net

(646) 671-2723

 

Margin Disclosure Statement

I acknowledge that I have read the terms and conditions which concerns with the account and agree to be bound by the terms and conditions which could be in effect and may be amended in any future date or time. This account is governed by a Pre-Dispute Arbitration Clause which is attached in this agreement. I acknowledge receipt of the Pre-Dispute Arbitration Clause, the Disclosure of Credit Terms on transactions, and in this Margin Disclosure Statement.

Important Information about the use of Margin

This document is being furnished to you to provide some basic information about purchasing securities on margin and to alert you the risks associated with trading securities in a margin account. Before trading securities in a margin account, you should carefully review the margin terms in your account application and agreement. Not all securities are marginable and Curvature Securities LLC “Curvature” reserves the right and its sole discretion to determine whether to extend margin on any of the securities. Contact your broker dealer regarding any questions or concerns you may have with your margin accounts.

 

When you purchase securities, you may pay for the securities in full or you may borrow all or part of the purchase price from your brokerage firm. If you choose to borrow funds from your firm you will open a margin account with Curvature. The securities in your accounts are Curvature‘s collateral for the loan to you. The actual amount you can borrow and Curvature‘s margin maintenance requirements may vary depending on Curvature‘s internal margin policies which may exceed the margin requirements of FINRA and NYSE. Curvature‘s margin policies are subject to review and revision at any time to comply with the changes in Curvature‘s policies. If the securities in your account decline in value, so does the value of the collateral supporting your loan and as a result Curvature and your broker dealer may take action to sell securities or other assets in your accounts held at with Curvature.

 

Risks of Borrowing on Margin

 

It is important that you fully understand the risks involving trading securities on margin these risks include the following: You may lose more funds than you deposit in the margin account. Curvature uses internal mythologies to determine whether there is insufficient equity in your account. This validation may differ from the valuation and may differ from the valuation that Curvature is able to obtain if it sells assets to meet margin deficiency in your account. A decline in margin value of securities you purchased on margin may require you to provide additional funds or margin eligible Securities to Curvature to avoid forced sale of any securities or assets in your account.

 

Curvature and/or your broker dealer can force the sale securities and other assets in your account without contacting you.

 

There are occasions when some investors mistakenly believe a firm must contact them for a margin call to be valid, and that the firm cannot liquidate securities or other assets in their accounts to meet the call unless the firm has contacted them first. This is NOT the case. Most firms will attempt to notify their customers of margin calls, but they are not required to do so. In addition, even if the firm has contacted a customer and provide the specific date by which the customer can meet a margin call, the firm can still take necessary steps to protect its financial interest prior to that date, including immediately selling securities without notice to the customer. The customer is not entitled to choose which securities or other assets in your account are liquidated or sold to meet a margin call because the securities and any other assets in your account or collateral for the margin loan. Curvature or your broker dealer has the right to decide which assets to sell in order protect its interests.

 

Curvature can increase its “house” maintenance margin requirements at any time and is not required to provide you in advance notice. These changes in firm policy can affect immediately and may result in the issuance of a maintenance call your failure to satisfy the call may cause Curvature or your broker dealer to liquidate or sell securities and add any other assets in your accounts.

 

Curvature may set Account or security specific margin requirements on any individual basis and takes in consideration the following factors and determining margin maintenance requirements (a) market volatility which may include general market issue or industry and country conditions (b) the quality and composition of the securities in your account including the issue or capitalization and issue or industry and liquidity and ownership concentrations (c) the quality and composition of your portfolio including domestic and foreign exchange exposure fixed income exposure frequency of activity in your account and liquidity you have your account (d) Curvature‘s ability generally to obtain financing and its margin loans (e) regulatory requirements and applicable law.

 

Curvature may place different weight on each of these factors which may result in Curvature‘s determining and their own sole discretion to immediately increase your margin maintenance requirement which will require you to provide additional funds or securities to avoid the forced sale of assets in your account. Curvature‘s review of any of the following factors described above may require you to provide additional funds or securities in an amount determined by Curvature‘s and soul discretion to avoid the for sale of securities or other securities in your account.

 

You are not entitled to an extension of time on a margin call

While an extension of time to meet margin requirements may be available to customers under certain conditions a customer does not have a right to the extension. Short selling is a margin account transaction and entails the same risks as described above. Curvature or your broker dealer can buy in your account securities to cover a short position without contacting you and may use all or any portion of the assets in your account to make such a purchase if the assets in your account or not sufficient to cover the cost of such purchase you will be responsible for any shortfall possibly including Curvature‘s and or your broker dealers costs in collecting the shortfall.

 

Curvature can loan securities held in your margin account with collateralized your margin borrowing

 

In connection with the extension or maintenance of margin credit. Curvature may loan securities in your margin account to itself or to others. As a result of these loans, you may not be entitled to receive certain benefits of a security owner such as the ability exercise voting rights, and or receive interest, dividends and or other distributions with respect to the securities lent. While a security in your account is lent, you may only be allocated to receive the substitute payments in lieu of such interest dividends and/ or other distributions. Substitute payments may not be given the same tax treatment as actual interest, dividends or other distributions that you may receive. Curvature may allocate substitute payments in any manner permitted by law, rule, or regulation, including but not limited to by means of a lottery allocation method. You are not entitled to compensation in connection with securities line from your account for additional taxes you may be required to pay as a result of any tax treatment differential between substitute payments and actual interest dividends or other distributions.

 

In addition to market volatility the use of check writing, wiring out of funds, the transferring of securities, and similar features with your margin account may increase the risk of a margin call. Curvature may use certain securities in your account in connection with short sales and may receive compensation and connection therewith. Please contact your broker dealer to request additional information concerning Curvature margin policies or concern questions you may have with your margin account.

 

BUSINESS CONTINUITY PLAN DISCLOSURE DOCUMENT

 

The purpose of this disclosure is to describe the manner in which Curvature Securities, LLC (“Curvature” or the “Firm”) Business Continuity Plan (the “Plan”) addresses the possibility of a prospective significant business disruption and how Curvature would respond to business interruptions of varying severity and scope including Firm-only, single building, business district, city-wide, and regional disruptions. This disclosure is being provided to you pursuant to FINRA Rule 4370(e).

 

Curvature has compiled a Plan that identifies procedures relating to an emergency or significant business interruption that are reasonably designed to enable Curvature to meet its existing obligations to customers.

 

Under the terms of the Plan in the event of (i) a Firm-only business interruption, (ii) a disruption involving our office building, (iii) a business district disruption, or (iv) a city-wide disruption, Curvature has the ability and intention to relocate its core operation, including, Sales, Trading, Research, Origination and back office support functions, to another facility. In the case of a region-wide business interruption Curvature has made arrangements with its and will seek to service its clients from alternate business locations. In each of the foregoing scenarios, it is Curvature’s plan to continue business; however, the lengths of delay in service will vary depending on the degree of severity of the interruption and are outlined with respect to various scenarios in the Plan. The Plan is designed to enable Curvature to resume its business activities as soon as practicable given the severity of a particular interruption.

 

Except in the event of a regional disruption or an unforeseen event, the Plan contemplates and is designed to enable customers to reach their account representatives at their current telephone number, e-mail address or through Bloomberg. In the event of a regional disruption or an unforeseen development, Curvature staff can be reached at the following email address: SBD@curvaturesecurities.net.

 

The major features of the Plan are as follows:

 

  1. The back-up facility is available for utilization 24 hours a day seven days a week and contains the systems and equipment necessary for Curvature to conduct its customary business activities.

 

  1. All employees have been advised of the location of the back-up facility and have been provided with detailed procedures and instructions for proceeding to the backup facility.

 

  1. Curvature tests the Plan periodically in accordance with Plan testing procedures, and key personnel visit the site periodically to ensure that readiness is maintained.

 

Curvature’s Plan is subject to modification as circumstances dictate. If you have any questions concerning this disclosure document or would like to obtain a copy of the most current Plan, please contact your account representative or request a written copy of the Plan by mail.

 

Notice regarding charges for failures to deliver US Treasuries,

Agency Debt and Agency MBS

 

We are writing to inform you of an important change that we are making with respect to our transactions involving U.S. Treasury securities (Treasuries), debentures issued by Fannie Mae, Freddie Mac, and the Federal Home Loan Banks and agency mortgage- backed securities (“MBS”) issued or guaranteed by Fannie Mae, Freddie Mac or Ginnie Mae (“U.S. Treasury”, “Agency Debt” and “Agency MBS”, respectively.   The Treasury

Markets Practice Group (TPMG) and the Securities Industry and Financial Markets

Association (SIFMA) have published a “U.S. Treasury Securities Fails Charge Trading Practice”  and the “Agency Debt and Agency Mortgage-Backed Securities Fail Charge

Trading Practice” (as modified and in effect from time to time and published by the TMPG which can be viewed at www.sifma.org/TMPG.

 

The “U.S. Treasury Securities/Agency Debt and Agency Mortgage Backed Securities Fails Charge Practice” provides a standardized procedure that we expect all market participants to follow in order to assess and pay Fails Charges in connection with delivery failures involving these securities.  The process is being introduced to reduce the overall incidence of fails in the marketplace, which prevent efficient market clearing and undermine overall market liquidity, and to compensate a non-failing counterparty.

 

We have decided to adopt this Fails Charge Trading Practice for purposes of our transactions with all our counterparties, and accordingly, are notifying you that any delivery-versus-payment or delivery-versus-transfer transaction in these securities entered into between you and us shall be deemed to be subject to the Fails Charge Trading Practice, unless otherwise agreed in respect of a particular transaction.   In line with TPMG guidance we will not submit claims to less than $500.

 

By entering into any transaction with us for the delivery of these securities (US

Treasuries, Agency Debt and Agency Mortgage Backed) against the payment of funds or the transfer of securities (including any cash purchase or sale, forward purchase or sale, Treasury option, repurchase “repo” or reverse repo transaction, or bonds borrow or loan transaction), you will be deemed to have agreed that such transaction will be subject to the Fails Charge Trading Practice, unless explicitly agreed otherwise with respect to a specific transaction.   Similarly, by entering into any such transaction, we shall be deemed to have agreed that such transaction will be subject to the Fails Charge Trading Practice, unless explicitly agreed otherwise with respect to a specific transaction.  Both of us also shall be deemed to have agreed for any such transactions that the failure to enforce such a Fails Charge in any one transaction or in multiple transactions shall not constitute a waiver of the foregoing rights with regard to any other transactions subject to a Fails Charge.  The claim of a Fails Charge shall be without prejudice to any other rights or remedies under the applicable agreement governing the transaction or applicable law, and shall not constitute a waiver of the non-failing party’s right to exercise any other remedy.

 

We will follow TMPG guidance when calculating any Fail Charge and will aim to submit any claims by the 10th business day of the following month. Payment or notice of claim rejection must be submitted to us by the last business day of that month.

 

We appreciate your anticipated cooperation and understanding and thank you for your continued business and support.   Should you have any questions regarding the foregoing, please contact our Compliance Department at 646-671-2723.