8 Issues to Address in Your Advisory Contracts

Notices
This clause contains the contact information of the parties, and spells out how each party is to make formal notifications should they need to (e.g. notifications of termination, assignment, fee changes, etc.).

A notices clause is important because it sets communication expectations and degrees of formality (e.g. whether email is permitted or certified return-receipt snail mail is required). 

Severability
If one section or provision of the agreement is determined to be invalid or unenforceable, a severability clause saves the rest of the contract. It essentially ensures that an isolated screw-up in one area of the contract doesn't moot the contract overall and provide one party with an automatic "out".
Trim the contaminate and carry on.

Successors and Assigns
Should one party die or some sort of succession event occur (i.e. a merger, acquisition or assignment), a successors and assigns clause entitles the substituted party to the benefits of the contract and binds him to its obligations.
Given the restrictions on assignment by the advisor under Section 205, successors and assigns must be "permitted" to be valid. 

Force Majeure
If a catastrophic flood sweeps away a client's house on the day he's supposed to pay his advisor's quarterly fee… maybe give him a break. If an advisor gets stuck overseas in a country whose government is in the process of being overthrown… maybe give her a few extra days to rebalance the account.
The point is that there are certain things beyond a party's control that may prevent performance under the contract, and a force majeure clause allows for that. 

Governing Law
The parties can generally pick which state's laws govern their contract. Typically this would be the state in which the advisor is located, but could also conceivably be where the client is located or the state of incorporation if the advisor has an incorporated entity. The governing law clause should be closely integrated with the dispute resolution or venue/forum clause, which spells out how and where dispute resolution would occur (e.g. arbitration in Chicago, the Superior Court in Los Angeles, Bob's E-Z Mediation in Kissimmee… whatever).
It is possible to draft the contract such that a Kentucky court would be tasked with interpreting Nevada law should a dispute arise between a Washington advisor and a Vermont client, but query the sensibility and enforceability of this approach. 

Naturally, a prudent investment advisory contract would include more than mere boilerplate and should describe the services to be provided, responsibilities assumed, fees to be paid, risks of investing, limitations of liability, authorizations granted, and an acknowledgement of receipt of applicable disclosure documents (like the ADV, e.g.). And don't forget about Section 205 – or for state registered advisors – your particular state's specific regulations. 

The above boilerplate and advisor-specific provisions are far from an exhaustive list of what could potentially be in a contract, but avoid the temptation to throw in everything but the kitchen sink. No contract is an impenetrable prophylactic to disputes.