Form ADV Part 2A

April 15th, 2019

Item 1: Introduction

​This page provides information about the qualifications and business practices of Middleton & Company, “M&C”. If you have any questions about the contents below, please contact us at (360) 524-3517. This information has not been approved or verified by the United States Securities and Exchange Commission or by any state securities authority.

The Form ADV Part 2A is referred to as ‘brochure’ below. A PDF version of the brochure is available upon request.

Middleton & Company is registered as an Investment Adviser with the State of Washington. Registration of an Investment Adviser does not imply any level of skill or training.

Additional information about M&C is available on the SEC’s website at www.adviserinfo.sec.gov which can be found using the firm’s identification number 284996.

Item 2: Material Changes

​This is an annual update to the ADV Part 2. We have made the following material changes since our last annual ADV update:

Item 4 – Description of Advisory Firm:

  • Assets under management were 65.3 Million, as of December 31, 2018.
  • Taylor Anderson and Kailie Abascal have been added as minority owners.

Item 4 – Types of Services:

  • Investment Management has been renamed to Investment Advisory Service.
  • Comprehensive Financial Planning has been renamed to Foundation Financial Planning.
  • Hourly and Project Based Engagements has been renamed solely to Project-Based Engagements.

Item 5 – Fees & Compensation:

  • The monthly fee for Foundational Financial Planning has been updated from a range of $100-$300/month to a flat $200/month.
  • A $25,000 asset minimum applies for Foundational Financial Planning clients who would also like to engage Middleton & Company for Investment Advisory Services.
  • Monthly/quarterly fees for Foundational Financial Planning are now paid in arrears.
  • The hourly rate for Project-Based Engagements has been increased from $200/hour to $250/hour.

Item 7 – Types of Clients:

  • The minim account size requirement for the Investment Advisory Service has been increased from $100,000 to $250,000.
  • A minimum account size of $25,000 applies to Foundational Financial Planning clients who would also like M&C Investment Advisory services.

Item 8 – Methods of Analysis, Investment Strategies and Risk of Loss:

  • Fundamental Analysis has been removed as an investment strategy. Middleton & Company does not monitor individual company financials. Middleton & Company continues to rely on academic research, mutual fund and exchange traded fund (ETF) selection, and passive and active investing as part of its investment philosophy.

Item 19 – Requirements for State-Registered Advisers:

  • Financial Advisor has been added to George Middleton’s current job title under Business Experience.
  • CERTIFIED FINANCIAL PLANNER™ education was added to Taylor Anderson’s Educational Background.
  • CFP® professional designation has been added under Professional Designations, Licensing & Exams for Taylor Anderson.

Future Changes

From time to time, we may amend this Disclosure Brochure to reflect changes in our business practices, changes in regulations and routine annual updates as required by the securities regulators. This complete Disclosure Brochure or a Summary of Material Changes shall be provided to each Client annually and if a material change occurs in the business practices of Middleton & Company.

At any time, you may view the current Disclosure Brochure online at the SEC’s Investment Adviser Public Disclosure website at http://www.adviserinfo.sec.gov by searching for our firm name or by our CRD number 284996.

You may also request a copy of this Disclosure Brochure at any time, by contacting us at (360) 524-3517.

Item 4: Advisory Business

Description of Advisory Firm

Middleton & Company is registered as an Investment Adviser with the State of Washington. We were founded in 2016 and are a fee-only firm. George Middleton is the President and majority owner of M&C. Taylor Anderson and Kailie Abascal are minority owners. Assets under management are $65.3 Million, as of December 31, 2018.

Types of Advisory Services

Investment Advisory Services

We are in the business of managing individually tailored investment portfolios. Our firm provides continuous advice to a client regarding the investment of client funds based on the individual needs of the client. Through personal discussions, in which goals and objectives based on a client’s particular circumstances are established, we develop a client’s personal Investment Policy Statement or investment plan with an asset allocation target. We then create and manage a portfolio based on that policy and allocation target. During our data gathering process, we determine the client’s individual objectives, time horizons, risk tolerance, tax considerations, and liquidity needs. We may also review and discuss a client’s prior investment history, as well as family composition and background.

Account supervision is guided by the stated objectives of the client (i.e., aggressive growth, capital appreciation (growth), capital appreciation (growth) and income, income, or capital preservation), as well as tax considerations. Clients may impose reasonable restrictions on investing in certain securities, types of securities, or industry sectors.

Since the primary objective of investing is to ensure long term financial security for clients, this service may also include the following financial planning services with no additional fee:

  • Financial plan to include:
    • Savings strategy to reach financial goals
    • Retirement income plan
    • Social Security benefit analysis
  • Tax planning and tax efficient investment strategies
  • Basic review of employer benefit plan investments and options to ensure proper overall asset allocation and diversification
  • Basic advice on related financial decisions, including major purchases, types of insurance coverage needed, charitable giving and estate planning considerations
  • Referrals to other unaffiliated specialists, including CPAs, business attorneys, estate planning attorneys, or insurance agents

Fees pertaining to this service are outlined in Item 5 of this brochure.

Foundational Financial Planning

Foundational Financial Planning involves the client working with a planner over an extended period of time. By paying a monthly/quarterly fee, clients get continuous access to a planner who will help them design and build their financial plan. The planner will help the client develop action steps for recommendations, monitor the plan, adapt the plan to changing life circumstances, recommend changes when necessary, and ensure the plan is up to date based on information provided by the client.

As part of the financial planning process, the client will be taken through a process to establish their financial goals and values around money. We will then evaluate the client’s current financial situation. This can include the following areas of analysis: net worth, cash flow, employee benefits, retirement savings, other investments, insurance coverage, college savings, estate planning, etc.

The client is expected to provide necessary documents and data for the areas listed. Based on this information and the client’s goals, we will build a financial plan with recommendations for key action steps. The plan will be reviewed with the client and the client will receive a written or electronic report to guide their next steps.

The client’s financial plan will be monitored throughout the year and follow up meetings, phone calls, and emails will be used to confirm that any agreed upon action steps have been completed. The plan will be reviewed on an annual basis to ensure that it is accurate and up to date. Any updates will be made at that time.

In general, the financial plan will address any or all of the following areas of concern. The client and advisor will work together to select the specific areas to cover. These areas may include, but are not limited to, the following:

  • Comprehensive financial goal setting
  • Savings strategy
  • Cash flow & debt management planning
  • Tax planning
  • Estate planning needs
  • Employee benefits selection
  • College savings planning
  • Investment strategy & allocation
  • Retirement planning
  • Insurance coverage needs assessment
  • Short and long-term charitable giving planning
  • Referrals to other unaffiliated specialists, including CPAs, estate planning attorneys, or insurance agents

Project-Based Engagements

Clients who are not in need of, or who do not want, Investment Advisory Service or Foundational Financial Planning services may engage us for a Project-Based Engagement. We will meet with the client to learn about their financial goals and objectives for the engagement. These services will be defined clearly in the Client Agreement and will address a specific part of a client’s financial picture, as defined by the client.

Project-based engagements can cover topics such as:

  • One-time financial plan creation and analysis
  • Analysis of employer retirement plan asset allocation and investment selection
  • Social Security benefits analysis

All deliverables from project-based engagements will be presented and delivered to the client upon completion.

Educational Seminars

We may provide educational seminars on an “as announced” basis for groups seeking general advice on investments and other areas of personal finance. The content of these seminars will vary depending on the needs of the attendees. These seminars are purely educational in nature and do not involve the sale of any investment products or services. Information presented will not be based on any individual’s needs, nor does M&C provide individualized investment advice to attendees during these seminars.

Client Tailored Services and Client Imposed Restrictions

The same suite of services is available to all of our clients. However, individual client financial plans and their implementation will differ based on 1) which services the client chooses to engage us for, and 2) the information they have provided to us regarding goals, income, tax levels, and risk tolerance levels.

For clients of the Investment Advisory Service, information provided to us is documented in an Investment Policy Statement or investment plan and is used to construct a client-specific plan to aid in the selection of a portfolio that matches restrictions, needs, and targets.

Wrap Fee Programs

We do not participate in wrap fee programs.

Item 5: Fees & Compensation

Please note, the Investment Advisory Agreement and/or the Client Agreement may be terminated by the client within five (5) business days of signing the contract without incurring any advisory fees and without penalty. How we are paid depends on the type of advisory service we perform. Please see fee and compensation information below.

Investment Advisory Service

Our standard advisory fee is based on the market value of the assets under management (AUM) as of the end of the previous quarter, and is calculated as follows:

Account Value Annual Advisory Fee (Divided Quarterly by 4)
$0 – $100,000 1.50%
$100,001 – $500,000 1.25%
$500,001 – $1,000,000 1.00%
$1,000,001 – $3,000,000 0.85%
$3,000,001 and Above Negotiable
 

The advisory fee is calculated at the end of each quarter by:

  1. Determining the percentage rate, using the levels of assets shown in the above chart. The percentage rate applies to the full account value; it is not tiered.
  2. Multiplying current assets under management by the corresponding percentage, and
  3. Dividing by four.

The annual fees are negotiable. They are prorated on a daily basis for deposits and withdrawals and are paid in advance on a quarterly basis.

Assets under management of family members (lineal descendants, including siblings) are aggregated at the end of each quarter to determine the applicable percentage.

In computing the market value of any investment contained in a client account, securities listed on any national securities exchange shall be valued at the last quoted sale price on the valuation date on the principal exchange on which such security is traded. Any other security or asset shall be valued in a manner determined in good faith by M&C to reflect its fair market value. Any disagreement in valuation of investments may be brought to M&C’s attention in writing. M&C’s assigned valuations will be consistent with its fiduciary duty to act in the best interest of the client.

No increase in the annual fee shall be effective without agreement from the client by signing a new agreement or amendment to their current advisory agreement.

Advisory fees are directly debited from client accounts, with client permission. Clients may also pay by personal check or ACH. Accounts initiated or terminated during a calendar quarter will be charged a prorated fee based on the amount of time remaining in the billing period. An account may be terminated with written notice at least 1 calendar day in advance. Upon termination of the account, any unearned fee will be refunded to the client.

Foundational Financial Planning

Foundational Financial Planning consists of an upfront charge of $1,500.00 with no asset minimum, and an ongoing fee that is paid monthly or quarterly, in arrears, once the baseline financial plan is in place. The fees, both upfront and ongoing, may be negotiable in certain cases.

The upfront charge is a prepayment of fees for services to be rendered. Any unearned fees from the upfront payment will be applied to future months of service.

The rate for this service is $200 per month (or $600 quarterly). Please note: The monthly (or quarterly) fee for providing Foundational Financial Planning will be based upon M&C’s standard $250/hour rate.

Written billing information will be sent to the client on a monthly (or quarterly) basis. It will contain a description of the fee and the time period covered by the fee.

Monthly rates will be reviewed annually and may be adjusted based on updated hourly rates. No increase in fee will occur without client notification and written agreement by the client.

Foundational Financial Planning is provided separately from the Investment Advisory Service. The client has the option to purchase recommended investment products through other brokers or agents that are not affiliated with M&C. A client may engage M&C for the Investment Advisory Service in addition to Foundational Financial Planning with a $25,000 asset minimum. Standard AUM fees will apply and will be billed separately (see previous section).

This service may be terminated with 30 days’ written notice. Upon termination, the fee will be prorated to the end of the current month and any unearned fees for remaining months will be refunded. Any completed work for earned fees, for example completed sections of a financial plan, will be delivered to the client upon termination.

Project-Based Engagements

Project-based engagements will be offered on a fixed fee basis. Our standard hourly rate is $250 per hour.

Project quotes will be based on the $250 hourly rate and an estimated number of hours. The Client Agreement may include a do-not-exceed amount agreed upon by the client and the advisor before the project begins. Project-based engagements will be billed on a prorated basis for hours worked, if less than
the do-not-exceed amount. If a project is highly complex, we may request a deposit prior to beginning work.

The fixed fee is negotiable and will be agreed upon in the Client Agreement. If a fixed fee program is chosen, the client will be billed monthly for services rendered or at time of completion. Written billing information will be sent to the client for fee payment requests. It will contain the fees, the formula used to calculate the fees, and the time period covered by the fees.

The client has the option to purchase recommended investment products through other brokers or agents that are not affiliated with M&C.

Since fees are paid after services are delivered, no refund will be necessary in the event of early termination. In the case that a deposit was paid, an invoice for work completed at time of termination, including early termination, will be sent to the client and any remaining balance for unearned hours will be fully refunded. Any completed work for earned fees will be delivered to the client upon termination.

Educational Seminars

Educational seminars will range in price between $100-$500, depending on length, location, and enrollment. Fees may be negotiated. The client and M&C will agree on a fee associated with a specific workshop prior to the seminar. Since fees are paid after services are delivered, no refund will be necessary in the event of early termination.

Alternate Fees

Middleton & Company may negotiate alternate fees. The company may:

  • Offer a flat fee based on a reduced hourly rate for a minimum number of hours.
  • Negotiate a reduced hourly fee.
  • Waive fees under special circumstances.
  • Offer special promotional fees for services to both prospective and current clients.
  • Offer educational workshops for a fee.
  • Teach classes at a public or private college or university for a negotiated fee.
  • Offer employer-sponsored retirement plan education and advisory services for businesses for a negotiated fee.
  • Offer pro-bono (free) services to individuals, nonprofit organizations or family members of M&C, at the discretion of the advisor.

The client and M&C will agree on the fee prior to any of the above activities. Since fees are paid after
services are delivered, no refund will be necessary in the event of early termination.

Other Types of Fees and Expenses

Our fees are exclusive of third-party commissions, transaction fees, and other related costs and expenses which may be incurred by the client. Clients may incur certain charges imposed by custodians, brokers, and other third parties such as custodial fees, deferred sales charges, odd-lot differentials, transfer taxes, wire transfer and electronic fund fees, and other fees and taxes on brokerage accounts and securities transactions. Our recommended custodian does not impose annual account maintenance fees; however, termination fees may apply to account closures.

The custodian may also charge reporting fees for non-traded, unregistered, or non-priced securities held in the client’s account. In addition, mutual funds and exchange traded funds charge internal management fees, which are disclosed in a fund’s prospectus. Such charges, fees and commissions are exclusive of and in addition to our fee, and we shall not receive any portion of these commissions, fees, and costs.

Item 12 further describes the factors that we consider in selecting or recommending broker-dealers for client transactions and determining the reasonableness of their compensation (e.g., commissions).

We do not accept compensation for the sale of securities or other investment products, including asset based sales charges or service fees from the sale of mutual funds.

Item 6: Performance-Based Fees and Side-By-Side Management

We do not offer performance-based fees.

Item 7: Types of Clients

We provide financial planning and portfolio management services to individuals, high net-worth individuals, employer benefit programs, trusts, foundations, charitable organizations, corporations or other businesses.

We have a minimum account size requirement of $250,000 for the Investment Advisory Service, unless waived by the advisor.

We have a minimum account size requirement of $25,000 for our Foundational Financial Planning services or project-based engagements.

Accepting new clients is at the discretion of M&C or the investment adviser representative.

Item 8: Methods of Analysis, Investment Strategies and Risk of Loss

Our primary investment strategies consist of fundamental analysis, academic research, mutual fund and exchange traded fund (ETF) selection, selection of other investment vehicles, and passive and active investing.

Academic Research

Our academic research includes regularly reviewing industry news, publications focused on the economy, and other online resources. We do not employ proprietary analysis methods, nor do we attempt to time the market in any way through identifying trends or cyclical investing. The risk of academic research is that information available is based on past performance and may not be repeated in the future. Additionally, any conclusions or judgements we make based on academic research may not perform as expected due to macroeconomic events, market volatility, or changing factors related to a specific investment.

Mutual Fund and Exchange Traded Fund (ETF) Selection

​We employ the use of mutual funds and exchange traded funds (ETFs), which are managed by “outside managers”. Our analysis of outside managers involves the examination of the experience, expertise, investment philosophies, and past performance of the outside managers in an attempt to determine if that manager(s) has demonstrated an ability to invest over a period of time and in different economic conditions. We monitor the manager’s underlying holdings, strategies, concentrations and leverage as part of our overall periodic risk assessment. We may also call mutual funds directly for additional information.

A risk of investing with an outside manager who has been successful in the past is that he/she may not be able to replicate that success in the future. In addition, we do not control the underlying investments in an outside manager’s portfolio. There is also a risk that a manager may deviate from the stated investment mandate or strategy of the portfolio, making it a less suitable investment for our clients. Moreover, as we do not control the manager’s daily business and compliance operations, we may be unaware of the lack of internal controls necessary to prevent business, regulatory or reputational deficiencies.

Selection of Other Investment Vehicles

​Investments used to manage risk and provide diversification may include vehicles such as FDIC-guaranteed Certificates of Deposit, Real Estate Investment Trusts (REITs), and bonds issued by corporations and U.S. and foreign governments. These vehicles present risk in the forms of market volatility, change in interest rates, and factors of solvency specific to the issuing entity.

We typically do not employ Alternative investments (e.g. shorting stocks, long-short funds, and options), which are techniques to hedge portfolios against potential loss, however we are not prevented from doing this.

Passive Investment Management

​We employ passive investment management where appropriate. Funds that passively capture the returns of the desired asset classes are placed in the portfolio. The funds that are used to build passive portfolios are typically index mutual funds or exchange traded funds.

Passive investment management is characterized by low portfolio expenses (i.e. the funds inside the portfolio have low internal costs), minimal trading costs (due to infrequent trading activity), and relative tax efficiency (because the funds inside the portfolio are tax efficient and turnover inside the portfolio is minimal).

Active Investment Management

Mutual funds or exchange traded funds with active management involve a manager or managers who employ some method, strategy or technique to construct a portfolio that is intended to generate returns that are greater than the broader market or a designated benchmark, or to offer lower risk.

In general, we employ a combination of active and passive investments in our asset allocation strategy to balance our clients’ risk tolerance with potential investment gains.

Material Risks Involved

All investing strategies we offer involve risk and may result in a loss of your original investment, which you should be prepared to bear. Many of these risks apply equally to stocks, bonds, commodities and any other investment or security. Material risks associated with our investment strategies are listed below.

Market Risk: Market risk involves the possibility that an investment’s current market value will fall because of a general market decline, reducing the value of the investment regardless of the operational success of the issuer’s operations or its financial condition.

Strategy Risk: The advisor’s investment strategies and/or investment techniques may not work as intended.

Small and Medium Cap Company Risk: Securities of companies with small and medium market capitalizations are often more volatile and less liquid than investments in larger companies. Small and medium cap companies may face a greater risk of business failure, which could increase the volatility of the client’s portfolio.

Turnover Risk: At times, a manager’s strategy may have a portfolio turnover rate that is higher than other strategies. A high portfolio turnover would result in correspondingly greater brokerage commission expenses and may result in the distribution of additional capital gains for tax purposes. These factors may negatively affect the account’s performance.

Limited Markets: Certain securities may be less liquid (harder to sell or buy) and their prices may at times be more volatile than at other times. Under certain market conditions we may be unable to sell or liquidate investments at prices we consider reasonable or favorable, or find buyers at any price.

Concentration Risk: Certain investment strategies focus on particular asset classes, industries, sectors or types of investment. From time to time these strategies may be subject to greater risks of adverse developments than a strategy that is more broadly diversified across a wider variety of investments.

Interest Rate Risk: Bond (fixed income) prices generally fall when interest rates rise, and the value may fall below par value or the principal investment. The opposite is also generally true; bond prices generally rise when interest rates fall. In general, fixed income securities with longer maturities are more sensitive to these price changes. Most other investments are also sensitive to the level and direction of interest rates.

Legal or Legislative Risk: Legislative changes or Court rulings may impact the value of investments, or the securities’ claim on the issuer’s assets and finances.

Inflation: Inflation may erode the buying power of your investment portfolio, even if the dollar value of your investments remains the same.

Taxable Account Risk: Portfolios may include investments subject to taxable gains; gains are subject to applicable tax rates.

Risks Associated with Securities

Apart from the general risks outlined above which apply to all types of investments, specific securities may have other risks.

Commercial Paper is, in most cases, an unsecured promissory note that is issued with a maturity of 270 days or less. Being unsecured, the risk to the investor is that the issuer may default.

Common Stocks may go up and down in price quite dramatically, and in the event of an issuer’s bankruptcy or restructuring, could lose all value. A slower-growth or recessionary economic environment could have an adverse effect on the price of all stocks.

Corporate Bonds are debt securities to borrow money. Generally, issuers pay investors periodic interest and repay the amount borrowed either periodically during the life of the security and/or at maturity. Alternatively, investors can purchase other debt securities, such as zero coupon bonds, which do not pay current interest, but rather are priced at a discount from their face values and their values accrete over time to face value at maturity. The market prices of debt securities fluctuate depending on such factors as interest rates, credit quality, and maturity. In general, market prices of debt securities decline when interest rates rise and increase when interest rates fall. The longer the time to a bond’s maturity, the greater its interest rate risk.

Bank Obligations, including bonds and certificates of deposit (CDs), may be vulnerable to setbacks or panics in the banking industry. Banks and other financial institutions are greatly affected by interest rates and may be adversely affected by downturns in the U.S. and foreign economies or changes in banking regulations.

Municipal Bonds are debt obligations generally issued to obtain funds for various public purposes, including the construction of public facilities. Municipal bonds pay a lower rate of return than most other types of bonds. However, because of a municipal bond’s tax-favored status, investors should compare the relative after-tax return to the after-tax return of other bonds, depending on the investor’s tax bracket. Investing in municipal bonds carries the same risks as investing in bonds in general. Those risks include interest rate risk, reinvestment risk, inflation risk, market risk, call or redemption risk, credit risk, liquidity and valuation risk.

Options and Other Derivatives carry many unique risks, including time-sensitivity, and can result in the complete loss of principal. While covered call writing does provide a partial hedge to the stock against which the call is written, the hedge is limited to the amount of cash flow received when writing the option. When selling covered calls, there is a risk the underlying position may be called away at a price lower than the current market price.

Exchange Traded Fund (ETF) prices may vary significantly from the Net Asset Value (NAV) due to market conditions. Certain Exchange Traded Funds may not track underlying benchmarks as expected.

Investment Companies Risk When a client invests in open-end mutual funds or ETFs, the client indirectly bears its proportionate share of any fees and expenses payable directly by those funds. Therefore, the client will incur higher expenses, many of which may be duplicative. In addition, the client’s overall portfolio may be affected by losses of an underlying fund and the level of risk arising from the investment practices of an underlying fund (such as the use of derivatives). ETFs are also subject to the following risks:

  • An ETF’s shares may trade at a market price that is above or below their net asset value;
  • The ETF may employ an investment strategy that utilizes high leverage ratios; or
  • Trading of an ETF’s shares may be halted if the listing exchange’s officials deem such action appropriate, if the shares are de-listed from the exchange, or if the activation of market-wide “circuit breakers” (which are tied to large decreases in stock prices) halts stock trading generally.

The Adviser has no control over the risks taken by the underlying funds in which clients invest.

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 your evaluation of M&C or the integrity of our management. We have no information applicable to this Item.

Item 10: Other Financial Industry Activities and Affiliations

Our firm currently does not participate in financial industry activities other than financial planning and investment advisory services.

As of April 1, 2017, Middleton & Company discontinued its affiliation with Limoges Investment Management PC. This affiliation continued during a transitionary period when Middleton & Company investment adviser representatives spent approximately 20 hours a week providing financial planning and investment management services to Limoges Investment Management PC clients as they transitioned their accounts to Middleton & Company. Any conflicts of interest regarding Limoges Investment Management PC’s materials, procedures and ownership of client accounts are addressed in a signed Confidentiality & Non-Solicitation Agreement.

Accounting-related services, such as personal balance sheet preparation and tax planning, may be incorporated into Middleton & Company investment management and financial planning services for clients. These services are provided as an added benefit for existing clients, on an as needed basis. They may take up to 10 hours per month. No additional compensation is requested, therefore there are no perceived conflicts of interest related to these activities. These activities are typically done after trading hours.

We will also gladly refer our clients to specialized service providers as appropriate, including CPAs, business attorneys, estate planning attorneys, and insurance experts. We do not provide or receive any compensation for any referrals. Clients may choose to use these services or not.

Item 11: Code of Ethics, Participation or Interest in Client Transactions and Personal Trading

As a fiduciary, our firm and its associates have a duty of utmost good faith to act solely in the best interest of each client. Our clients entrust us with their funds and personal information, which in turn places a high standard on our conduct and integrity. Our fiduciary duty is a core aspect of our Code of Ethics and our business in general. The firm also adheres to the Code of Ethics and Professional Responsibility adopted by the CFP® Board of Standards Inc. and accepts the obligation not only to comply with the mandates and requirements of all applicable laws and regulations, but also to take responsibility to act in an ethical and responsible manner in all professional services and activities.

This code does not attempt to identify all possible conflicts of interest, and literal compliance with each of its specific provisions will not shield associated persons from liability for personal trading or other conduct that violates a fiduciary duty to advisory clients. A summary of the Code of Ethics’ Principles is outlined below. Associated persons shall act with the following:

  • Integrity and Honesty – offer and provide professional services with integrity and honesty.
  • Objectivity – be objective in providing professional services to clients.
  • Competence – provide services to clients competently and maintain the necessary knowledge and skill to continue to do so in those areas in which they are engaged.
  • Suitability and Fairness – perform professional services in a manner that is suitable, fair and reasonable to clients, principals, partners, and employers.
  • Confidentiality – never disclose confidential client information without the specific consent of the client unless in response to proper legal process, or as required by law.
  • Professionalism – conduct in all matter shall reflect credit of the profession.
  • Diligence, Regulatory Compliance and Full Disclosure – act diligently in providing professional services, comply with all regulatory requirements, and disclose conflict(s) of interest in providing such services.

We will, upon request, promptly provide a complete Code of Ethics.

Our firm and its “related persons” (associates, their immediate family members, etc.) may buy or sell securities the same as, similar to, or different from, those we recommend to clients for their accounts. A recommendation made to one client may be different in nature or in timing from a recommendation made to a different client. Clients often have different objectives and risk tolerances. At no time, however, will our firm or any related party receive preferential treatment over our clients.

In an effort to reduce or eliminate certain conflicts of interest involving the firm or personal trading, our policy may require that we restrict or prohibit associates’ transactions in specific securities transactions. Any exceptions or trading pre‐clearance must be approved by our Chief Compliance Officer (CCO) in advance of the transaction, and we maintain the required personal securities transaction records per regulation.

Item 12: Brokerage Practices

Factors Used to Select Custodians and/or Broker-Dealers

M&C does not have any affiliation with broker-dealers. Specific custodian recommendations are made to clients based on their need for such services. We recommend custodians based on the reputation and services provided by the firm, including investment options, knowledge of the staff, technology used, and discounted commission structure.

1. Research and Other Soft-Dollar Benefits
We currently do not receive any soft-dollar benefits.

2. Brokerage for Client Referrals
We receive no referrals from a broker-dealer or third party in exchange for using that broker-dealer or third party.

3. Clients Directing Which Broker/Dealer/Custodian to Use

We do recommend a specific custodian for clients to use, however clients may custody their assets at a custodian of their choice. By allowing clients to choose a specific custodian, the client may be unable to achieve the most favorable execution of a transaction and this may cost them more money versus using our recommended custodian.

Aggregating (Block) Trading for Multiple Client Accounts

Generally, we combine multiple orders for shares of the same stock or ETF purchased for advisory accounts we manage (this practice is commonly referred to as “block trading”). We will then distribute a portion of the shares to participating accounts in a fair and equitable manner. The distribution of the shares purchased is typically proportionate to the size of the account, but it is not based on account performance or the amount or structure of management fees.

Subject to our discretion, regarding particular circumstances and market conditions, when we combine orders, each participating account pays an average price per share for all transactions and pays a proportionate share of all transaction costs. Accounts owned by our firm or persons associated with our firm may participate in block trading with your accounts; however, they will not be given preferential treatment.

Item 13: Review of Accounts

Client accounts with the Investment Advisory Service will be reviewed on a quarterly basis. During the regular review, the holdings are evaluated to ensure suitability with client objectives and desired asset allocation. The account’s performance is also compared against like-managed accounts to identify any unacceptable performance deviation. Additionally, reasonable client-imposed restrictions will be reviewed to confirm that they are being enforced. Events that may trigger a special review would be unusual performance, changes in client-imposed restrictions, excessive draw-down, performance volatility, or buy and sell decisions by the firm or per the client’s needs.

Clients will receive trade confirmations from the broker(s) for each transaction in their accounts, as well as monthly or quarterly statements and annual tax reporting statements from their custodian showing all activity in the accounts, such as receipt of dividends and interest.

M&C will provide written performance reports to Investment Advisory clients on an annual basis. We urge clients to compare these reports against the account statements they receive from their custodian.

Item 14: Client Referrals and Other Compensation

We do not receive any economic benefit, directly or indirectly from any third party for advice rendered to our clients. Nor do we directly or indirectly compensate any person for client referrals.

Item 15: Custody

M&C does not accept custody of client funds, except for withdrawal of client fees and in cases where a client has established a standing letter of authorization (SLOA) to transfer funds or securities to a thirdparty account he or she authorizes.

The amount and number of clients in Custody figures are included solely because of the SLOA put in place by the client. M&C complies with each of the specific requirements and conditions enumerated in Washington State Securities Act Policy Statement 23.

All accounts will be opened and maintained under the client’s name. Clients should receive at least quarterly statements from the broker dealer, bank or other qualified custodian that holds and maintains the client’s investment assets. We urge you to carefully review such statements and compare such official custodial records to the account statements or reports that we may provide to you. Our statements or reports may vary from custodial statements based on accounting procedures, reporting dates, or valuation methodologies of certain securities.

For client accounts in which M&C directly debits their advisory fee:

M&C will send a copy of its invoice to the custodian at the same time it sends the client a copy.
The client will provide written authorization to M&C, permitting them to be paid directly for their accounts held by the custodian.

The client will receive a billing statement detailing the quarterly fee and how it was calculated.

The custodian will send at least quarterly statements to the client showing all disbursements for the account, including the amount of the advisory fee.

Item 16: Investment Discretion

For those client accounts to whom we provide Investment Advisory, with the client’s permission we maintain discretion with respect to the securities to be bought and sold, as well as the amount of securities to be bought and sold. We are also authorized, with permission of the client, to transfer and distribute funds to accounts in that client’s name or to recipients the client has authorized in writing.

Investment discretion is explained to clients when an advisory relationship has commenced. At the start of the advisory relationship, the client will indicate in the Investment Advisory Agreement that they agree to allow discretion and will execute a Limited Power of Attorney which will grant our firm discretion over the account. Additionally, the discretionary relationship will be outlined in the Investment Advisory Agreement and signed by the client. While most Investment Advisory clients agree to allow discretion over their investment account(s), it is optional. If discretion is not authorized, we will contact the client prior to any trade and will await an affirmative response before taking any action.

Project-based engagements typically do not entail discretion over investment accounts.

Item 17: Voting Client Securities

We do not vote client proxies. Therefore, clients maintain exclusive responsibility for:

  1. Voting proxies, and
  2. Acting on corporate actions pertaining to the client’s investment assets.

The client shall instruct his/her qualified custodian to forward to the client copies of all proxies and shareholder communications relating to the client’s investment assets. If the client would like our opinion on a particular proxy vote, they may contact us at (360) 524-3517. In the event we were to receive any written or electronic proxy materials, we would forward them directly to the client by mail, unless the client has authorized our firm to contact him/her by electronic mail, in which case, we would forward any electronic solicitation to vote proxies.

Item 18: Financial Information

Registered investment advisers are required to provide you with certain financial information or disclosures about their financial condition. We have no financial commitment that impairs our ability to meet contractual and fiduciary commitments to clients, and we have not been the subject of a bankruptcy proceeding. See Item 15 for information on Custody of funds and securities. We do not require or solicit prepayment of more than $500 in fees per client six months or more in advance.

Item 19: Requirements for State-Registered Advisers

George Middleton, CRD # 3090714

  • Born: 1951

Education Background

  • 1977 – Master of Business Administration, University of Washington
  • 1975 – Bachelor of Science, Mathematics, Rochester Institute of Technology

Business Experience

  • 07/2016 – Present, Middleton & Company, Financial Advisor, President and CCO
  • 04/1998 – 03/2017, Limoges Investment Management, Financial Advisor
  • 04/1998 – 12/2016, Middleton Investments, Financial Advisor

Professional Designations, Licensing & Exams

Chartered Financial Analyst (CFA®): The CFA® Program is a graduate-level self-study program that combines a broad-based curriculum of investment principles with professional conduct requirements. It is designed to prepare charter holders for a wide range of investment specialties that apply in every market all over the world. To earn a CFA® charter, applicants study for three exams (Levels I, II, III) using an assigned curriculum. Upon passing all three exams and meeting the professional and ethical requirements, they are awarded a charter.

Certified Public Accountant (CPA): CPAs are licensed and regulated by state boards of accountancy. The education, experience and testing requirements for licensure as a CPA generally include minimum college education (typically 150 credit hours with at least a baccalaureate degree), minimum experience levels (most states require at least one year of experience under the supervision of or verification by a CPA), and successful passage of the Uniform CPA Examination. To maintain a CPA license, states generally require 40 hours of continuing professional education (CPE) each year (or 80 hours over a two-year period or 120 hours over a three-year period). Additionally, all American Institute of Certified Public Accountants (AICPA) members are required to follow a rigorous Code of Professional Conduct.

Personal Financial Specialist (PFS): This designation is issued by the American Institute of Certified Public Accountants (AICPA) and is granted to individuals who must meet all of the following prerequisites: be a member of the AICPA; hold an unrevoked CPA certificate issued by a state authority; earn at least 100 points under the PFS point system; and have substantial business experience in personal financial planning related services. The candidate is required to obtain personal financial planning specific education in addition to holding a valid CPA. The candidate must take a final certification examination (proctored by the AICPA) and once issued, the individual must undergo Continuing Education in the form of 60 PFS points in personal financial planning experience as well as qualified ‘life-long learning’ activities every three years.

Other Business Activities

As of April 1, 2017, George Middleton discontinued his affiliation with Limoges Investment Management PC. His affiliation continued between January 1, 2017 and March 31, 2017, when he spent approximately 20 hours a week providing financial planning and investment management services to Limoges Investment Management PC clients as they transitioned their accounts to Middleton & Company. Any conflicts of interest regarding Limoges Investment Management PC’s materials, procedures and ownership of client accounts are addressed in a signed Confidentiality & Non-Solicitation Agreement.

George Middleton teaches personal finance classes for the Continuing Education Program at Clark College from time to time. George may receive a stipend for this service, per Washington State law.

Performance Based Fees

Please refer to Item 6 of this brochure.

Material Disciplinary Disclosures

No management person at Middleton & Company has ever been involved in an arbitration claim of any kind or been found liable in a civil, self-regulatory organization, or administrative proceeding.

Material Relationships That Management Persons Have with Issuers of Securities

Neither Middleton & Company, nor George Middleton, have any relationship or arrangement with issuers of securities.

Taylor Anderson, CRD # 6812068

  • Born: 1984

Educational Background

  • 2018 – CFP® Certification Professional Education, University of California Los Angeles Extension
  • 2006 – Bachelor of Arts, Business Administration, University of Washington
  • 2006 – Bachelor of Arts, French Language & Literature, University of Washington

Business Experience

  • 06/2017 – Present, Middleton & Company, Financial Planner
  • 01/2017 – 06/2017, Middleton & Company, Business Development
  • 12/2015 – 12/2016, TCM Consulting, Independent Consultant
  • 04/2014 – 12/2015, Peace Corps, Health Education Volunteer
  • 04/2011 – 03/2014, Starbucks Coffee Company, Project Manager
  • 08/2006 – 03/2011, Hitachi Consulting, Consultant

Professional Designations, Licensing & Exams

CERTIFIED FINANCIAL PLANNER™ Certificate: A Certified Financial Planner (CFP®) refers to the certification owned and awarded by the Certified Financial Planner Board of Standards, Inc. The CFP® designation is awarded to individuals who successfully complete the CFP Board’s initial and ongoing certification requirements. Individuals desiring to become a CFP professional must take extensive exams in the areas of financial planning, taxes, insurance, estate planning and retirement. They must also complete minimum experience requirements and agree to abide by a code of ethics that includes principles of integrity, objectivity, competence, fairness, confidentiality, professionalism, and diligence in their interactions with clients.

Series 65 Exam: The Series 65 is the North American Securities Administrators Association (NASAA) Investment Advisers Law Examination. It is administered by the Financial Industry Regulatory Authority (FINRA) on behalf of NASAA. Completion of the Series 65 Exam will qualify an investment professional to operate as an Investment Adviser Representative. The exam focuses on topic areas that are important for an investment adviser to know when providing investment advice. These areas include topics such as retirement planning, portfolio management strategies, and fiduciary obligations.

Other Business Activities

Taylor Anderson teaches personal finance classes for the Continuing Education Program at Clark College from time to time. Taylor may receive a stipend for this service, per Washington State law.

Performance Based Fees

Please refer to Item 6 of this brochure.

Material Disciplinary Disclosures

No person at Middleton & Company has ever been involved in an arbitration claim of any kind or been found liable in a civil, self-regulatory organization, or administrative proceeding.

Material Relationships That Management Persons Have with Issuers of Securities

Neither Middleton & Company, nor Taylor Anderson, have any relationship or arrangement with issuers of securities.

Kailie Abascal, CRD # 6758430

  • Born: 1987

Educational Background

  • 2016 – CFP® Certification Professional Education, College for Financial Planning
  • 2013 – Master of Arts, Latin American and Caribbean Studies, New York University
  • 2009 – SIT Teacher of English to Speakers of Other Languages (TESOL) Certification, School of International Training
  • 2009 – Bachelor of Arts, International Studies: Latin America, University of Washington
  • 2009 – Bachelor of Arts, Spanish Language and Literature, University of Washington

Business Experience

  • 01/2018 – Present, Middleton & Company, Financial Planner
  • 01/2016 – 12/2017, APCM Wealth Management for Individuals, Associate Financial Planner
  • 10/2014 – 01/2016, Alaska Trust Company, Investment Analyst
  • 02/2014 – 10/2014, Limoges Investment Management, Assistant
  • 01/2014 – 02/2014, Lucky Luna, Hostess
  • 01/2013 – 02/2014, Council of the Americas, Intern/Associate
  • 08/2012 – 12/2013, Center for Latin American and Caribbean Studies, NYU, Student Worker
  • 06/2013 – 09/2013, Student Affairs, GSAS, New York University, Student Worker
  • 01/2012 – 08/2012, CTS Language Link, Project Manager
  • 09/2010 – 12/2011, Berlitz Language Center, English Language Instructor, Supervisor/Instructor
  • 12/2009 – 06/2010, Universidad Regional del Sureste, English Instructor
  • 01/2007 – 06/2009, University of Washington, Barista, Student Worker

Professional Designations, Licensing & Exams

CERTIFIED FINANCIAL PLANNER™ Certificate: A Certified Financial Planner (CFP®) refers to the certification owned and awarded by the Certified Financial Planner Board of Standards, Inc. The CFP® designation is awarded to individuals who successfully complete the CFP Board’s initial and ongoing certification requirements. Individuals desiring to become a CFP professional must take extensive exams in the areas of financial planning, taxes, insurance, estate planning and retirement. They must also complete minimum experience requirements and agree to abide by a code of ethics that includes principles of integrity, objectivity, competence, fairness, confidentiality, professionalism, and diligence in their interactions with clients.

Other Business Activities

Kailie Abascal teaches personal finance classes for the Continuing Education Program at Clark College from time to time. Kailie may receive a stipend for this service, per Washington State law.

Performance Based Fees

Please refer to Item 6 of this brochure.

Material Disciplinary Disclosures

No person at Middleton & Company has ever been involved in an arbitration claim of any kind or been found liable in a civil, self-regulatory organization, or administrative proceeding.

Material Relationships That Management Persons Have with Issuers of Securities

Neither Middleton & Company, nor Kailie Abascal, have any relationship or arrangement with issuers of securities.

Form ADV Part 2B – Brochure Supplement

George Middleton

Financial Advisor, President, and Chief Compliance Officer

Dated March 11, 2019

This brochure supplement provides information about George Middleton that supplements the Middleton & Company (“M&C”) brochure. A copy of that brochure precedes this supplement. Please contact George Middleton if the M&C brochure is not included with this supplement or if you have any questions about the contents of this supplement.

Additional information about George Middleton is available on the SEC’s website at www.adviserinfo.sec.gov.

Item 2: Educational Background and Business Experience

Please refer to Item 19 of the Form ADV Part 2A.

Item 3: Disciplinary Information

Please refer to Item 19 of the Form ADV Part 2A.

Item 4: Other Business Activities

As of April 1, 2017, George Middleton discontinued his affiliation with Limoges Investment Management PC, CRD# 117328, as a Financial Advisor. His affiliation continued between January 1, 2017 and March 31, 2017, when he spent approximately 20 hours a week providing financial planning and investment management services to Limoges Investment Management PC clients as they transitioned their accounts to Middleton & Company.

George Middleton teaches personal finance classes for the Continuing Education Program at Clark College from time to time. George may receive a stipend for this service, per Washington State law.

Item 5: Additional Compensation

George Middleton does not receive any economic benefit from any person, company, or organization, in exchange for providing clients advisory services through M&C.

Item 6: Supervision

George Middleton, as President and Chief Compliance Officer of M&C, is responsible for supervision. He may be contacted at (360) 524-3517.

Item 7: Requirements for State Registered Advisers

  1. George Middleton has NOT been involved in any of the events listed below.
    1. An award or otherwise being found liable in an arbitration claim alleging damages in excess of $2,500, involving any of the following:
      1. An investment or an investment-related business or activity;
      2. Fraud, false statements, or omissions;
      3. Theft, embezzlement, or other wrongful taking of property;
      4. Bribery, forgery, counterfeiting, or extortion; or
      5. Dishonest, unfair, or unethical practices.
    2. An award or otherwise being found liable in a civil, self-regulatory organization, or administrative proceeding involving any of the following:
      1. An investment or an investment-related business or activity;
      2. Fraud, false statements, or omissions;
      3. Theft, embezzlement, or other wrongful taking of property;
      4. Bribery, forgery, counterfeiting, or extortion; or
      5. Dishonest, unfair, or unethical practices.
  2. George Middleton has NOT been the subject of a bankruptcy petition at any time.

Taylor Anderson

Financial Planner

Dated March 11, 2019

This brochure supplement provides information about Taylor Anderson that supplements the Middleton & Company (“M&C”) brochure. A copy of that brochure precedes this supplement. Please contact George Middleton if the M&C brochure is not included with this supplement or if you have any questions about the contents of this supplement.

Additional information about Taylor Anderson is available on the SEC’s website at www.adviserinfo.sec.gov.

Item 2: Educational Background and Business Experience

Please refer to Item 19 of the Form ADV Part 2A.

Item 3: Disciplinary Information

Please refer to Item 19 of the Form ADV Part 2A.

Item 4: Other Business Activities

Taylor Anderson teaches personal finance classes for the Continuing Education Program at Clark College from time to time. Taylor may receive a stipend for this service, per Washington State law.

Item 5: Additional Compensation

Taylor Anderson does not receive any economic benefit from any person, company, or organization, in exchange for providing clients advisory services through M&C.

Item 6: Supervision

George Middleton, as President and Chief Compliance Officer of M&C, is responsible for supervision. He may be contacted at (360) 524-3517.

Item 7: Requirements for State Registered Advisers

  1. Taylor Anderson has NOT been involved in any of the events listed below.
    1. An award or otherwise being found liable in an arbitration claim alleging damages in excess of $2,500, involving any of the following:
      1. An investment or an investment-related business or activity;
      2. Fraud, false statements, or omissions;
      3. Theft, embezzlement, or other wrongful taking of property;
      4. Bribery, forgery, counterfeiting, or extortion; or
      5. Dishonest, unfair, or unethical practices.
    2. An award or otherwise being found liable in a civil, self-regulatory organization, or administrative proceeding involving any of the following:
      1. An investment or an investment-related business or activity;
      2. Fraud, false statements, or omissions;
      3. Theft, embezzlement, or other wrongful taking of property;
      4. Bribery, forgery, counterfeiting, or extortion; or
      5. Dishonest, unfair, or unethical practices.
  2. Taylor Anderson has NOT been the subject of a bankruptcy petition at any time.

Kailie Abascal

Financial Planner

Dated March 11, 2019

This brochure supplement provides information about Kailie Abascal that supplements the Middleton & Company (“M&C”) brochure. A copy of that brochure precedes this supplement. Please contact George Middleton if the M&C brochure is not included with this supplement or if you have any questions about the contents of this supplement.

Additional information about Kailie Abascal is available on the SEC’s website at www.adviserinfo.sec.gov.

Item 2: Educational Background and Business Experience

Please refer to Item 19 of the Form ADV Part 2A.

Item 3: Disciplinary Information

Please refer to Item 19 of the Form ADV Part 2A.

Item 4: Other Business Activities

Kailie Abascal teaches personal finance classes for the Continuing Education Program at Clark College from time to time. Kailie may receive a stipend for this service, per Washington State law.

Item 5: Additional Compensation

Kailie Abascal does not receive any economic benefit from any person, company, or organization, in exchange for providing clients advisory services through M&C.

Item 6: Supervision

George Middleton, as President and Chief Compliance Officer of M&C, is responsible for supervision. He may be contacted at (360) 524-3517.

Item 7: Requirements for State Registered Advisers

  1. Kailie Abascal has NOT been involved in any of the events listed below.
    1. An award or otherwise being found liable in an arbitration claim alleging damages in excess of $2,500, involving any of the following:
      1. An investment or an investment-related business or activity;
      2. Fraud, false statements, or omissions;
      3. Theft, embezzlement, or other wrongful taking of property;
      4. Bribery, forgery, counterfeiting, or extortion; or
      5. Dishonest, unfair, or unethical practices.
    2. An award or otherwise being found liable in a civil, self-regulatory organization, or administrative proceeding involving any of the following:
      1. An investment or an investment-related business or activity;
      2. Fraud, false statements, or omissions;
      3. Theft, embezzlement, or other wrongful taking of property;
      4. Bribery, forgery, counterfeiting, or extortion; or
      5. Dishonest, unfair, or unethical practices.
  2. Kailie Abascal has NOT been the subject of a bankruptcy petition at any time.