Cash Management Program Disclosure Statement
DriveWealth offers a Cash Management Program to automatically invest, or “sweep,” the “Free Credit Balance” in your eligible DriveWealth brokerage account(s) (“Accounts”), into a liquid investment which may earn a return while you decide how those funds should be invested longer term. This document explains the features of DriveWealth’s Cash Management Program and provides important disclosures about each feature.
Please make sure to read this document carefully and keep a copy for your records. You should also read the prospectuses for any money market funds that are available through DriveWealth’s Cash Management Program.
The Cash Management Programs currently available through DriveWealth are as follows:
(1) The “Money Market Sweep” feature which automatically invests in and redeems shares of a Dreyfus Treasury Securities Cash Management Fund. By establishing an Account at DriveWealth, you agree to opt-in to our Cash Management Program.
Your Responsibility to Monitor Eligibility
DriveWealth currently offers a single Cash Management Program. In the future, we may make additional programs available. DriveWealth will notify you in writing if new Cash Management Programs are made available or there are changes to the offered Cash Management Programs. It is your responsibility to monitor your eligibility for DriveWealth’s Cash Management Programs.
Returns and Yields
DriveWealth’s Cash Management Programs are not intended to be long-term investments. You should also consider higher-return options for your funds that are not immediately needed for investments purposes, as yields on any of our Cash Management Program options may be lower than those of similar investments or deposit accounts offered outside of DriveWealth.
In general, eligibility for DriveWealth’s Cash Management Programs are based on the ownership of the Account and applicable laws and regulations. Eligibility requirements for any Cash Management Program may change; DriveWealth will notify you in advance if any change in eligibility affects your Account.
All Accounts established at DriveWealth are currently eligible for the Money Market Sweep. You understand that by establishing a DriveWealth Account you are automatically opting in to the Money Market Sweep and do not have the ability to alter this election.
Changes to the Cash Management Program
You understand and agree that DriveWealth may: (i) make changes to the terms and conditions of our Cash Management Program; (ii) make changes to the terms and conditions of any Cash Management Program; (iii) change, add, or discontinue any Cash Management Program; (iv) change your investment from one Cash Management Program to another program if your Account becomes ineligible for your current Cash Management Program or your Cash Management Program is discontinued; and (v) make any other changes to the Cash Management Program as allowed by applicable laws and regulations. DriveWealth will notify you in writing of changes to the terms of our Cash Management Program including changes to the available program prior to the effective date of the proposed change.
In the event that you are notified that your Cash Management Program will be changed to another available program, you agree to respond to us in the manner and within the time period set forth in the notice. If you do not respond in the manner and within the specified time period, you agree that we may treat your non-response as your acceptance of the new program. Your authorization will remain in effect until you give us notice to the contrary.
Money Market Sweep Program
The Money Market Sweep automatically invests in and redeems shares of the Dreyfus Treasury Securities Cash Management Fund (Symbol: DARXX). Under the Money Market Sweep feature a Free Credit Balance of one dollar ($1.00 USD) or more in your Account on any Business Day will be swept into the money market fund after the close of business on that Business Day and generally will not begin earning dividends until the following Business Day. DriveWealth has sole discretion to change when and how often sweeps occur, and whether to share interest earned under the Money Market Sweep feature with you.
DriveWealth automatically redeems shares of your money market fund to satisfy debits in your Account as needed or, if applicable, to provide the necessary collateral to your margin account at any time. There is no specific time period during which a money market fund must make payments when it is liquidating. DriveWealth will not credit your Account in advance of payments received from the money market fund. Until proceeds from redemption requests are received for your Account, your funds invested in the money market fund will not be available for withdrawals or the funding of securities transactions in your Account.
A money market fund is a type of mutual fund that has relatively low risks compared to other mutual funds and most other investments and historically has had lower returns. Money market funds invest in high quality, short-term debt securities and pay dividends that generally reflect short-term interest rates. Your investments in the money market fund are subject to the restrictions described in the applicable prospectus. For more complete information regarding the Dreyfus Money Market Fund including charges and expenses, please read the fund’s prospectus carefully – although a money market funds generally seek to preserve the value of your investment at one dollar ($1.00 USD) per share, it is possible to lose money by investing in a money market fund. You acknowledge that you have read and understand the current prospectus for the fund.
All money market sweep transactions will appear on your periodic Account statements in lieu of separate confirmations. Minimum investment requirements may exist for the sweep vehicle and money market fund, and also for the various classes within a money market fund. DriveWealth will provide notice to you as part of your quarterly statement that the balance in the sweep program can be liquidated at your order and returned to you.
There can be no assurance that the money market fund will maintain a stable net asset value of $1.00 USD per share. In the event that DriveWealth determines that the money market fund is no longer able to maintain the net asset value of its shares at $1.00, you authorize and instruct us, without further notice to you, to redeem all of your swept funds as soon as commercially practicable and deposit the proceeds in your Account.
DriveWealth, in its discretion, may elect to share interest earned on funds invested in the Money Market Sweep Program with you. If, on any given day, the accrued daily dividend for your money market fund as calculated for your Account is less than one-half of one cent ($0.005 USD), your Account will not earn a dividend for that day. In addition, if you do not accrue at least one daily dividend of one cent ($0.01 USD) during a pay period, you will not receive a money market dividend for that period. If you elect to liquidate your Account with DriveWealth during the month, you will not be entitled to any interest earned for such month.
Under money fund reform regulations, money market funds have the option of imposing liquidity fees (fees charged upon the redemption of shares) of up to 2% and/or redemption gates (which prevent redemption of shares) for up to ten (10) Business Days in any 90-day period if a fund's liquidity percentage falls below certain regulatory thresholds. Money funds that invest at least 99.5% of their assets in cash and U.S. government securities are defined as "government money funds" and are permitted to continue to use a stable net asset value ("NAV"). Money market funds that limit shareholders to natural persons are defined as "retail money funds" and are also permitted to continue to use a stable NAV. Under the new regulations, money market funds other than those defined as "government" or "retail" will be required to operate with a floating NAV. Further details about any particular money fund can be found in the fund's prospectus and other disclosure documents.
An investment in a money market fund is not a deposit or other obligation of, nor is it guaranteed by, any bank, and it is not insured by the FDIC. DriveWealth LLC is a member of SIPC. SIPC provides member institutions up to $500,000 USD (including $250,000 USD for claims of cash) of coverage per brokerage client in each recognized insurable capacity when aggregated with other securities and cash held by the same brokerage client in the same insurable capacity at the same member institution. Money market funds are considered securities for SIPC purposes. SIPC provides protection to clients of securities brokerage firms in the event such brokerage firms become insolvent. SIPC does not insure against the failure of the issuer of a security. In other words, it would not protect you against losses in a money market fund or the insolvency of a money market fund.
 The term "Free Credit Balance" means the uninvested cash in your Account, minus (i) funds necessary to pay for purchase transactions due to settle within the two Business Days after funds are eligible to be swept to a Cash Feature; (ii) charges to your Account; (iii) credit balances that are designated as collateral for your obligations. "Business Day" is any day that the New York Stock Exchange and the Federal Reserve Bank of New York are open. (Although our offices may be open on certain bank holidays, these days are not considered Business Days for purposes relating to the transfer of funds.)
 “Business Day” is any day that the New York Stock Exchange and the Federal Reserve Bank of New York are open for business. Although DriveWealth’s offices may be open on certain bank holidays, these days are not considered a Business Day for purposes relating to the transfer or funds in the Cash Management Program.