* Federally Covered Investment Advisor *

To separate the SEC registered IA's from the State registered IAs based on the amount of assets under management.

* Federally Covered Security *

Broker Dealers are required to register with both the SEC & State.
Investment Advisors are only required to register with the SEC.

1. Securities listed or authorized to be listed on the exchanges or Tier 1 Exchanges (NYSE, AMEX, Nasdaq, Chicago Board).
2. Securities issued by a SEC registered investment company
3. Sales to qualified purchasers.
4. Securities transaction that is exempt from state registration but not prohibit a state from imposing notice filing rqmts.