Arc Advisory LLC

Item 5​ Fees and Compensation
General
Wrap Fee
Arc Advisory offers investment advice to Clients and manages assets through the Arc Advisory
wrap fee program (the “Wrap Program”). A wrap fee program has a fee structure that provides
Clients with advisory and brokerage services for a bundled fee with no additional account activity
charges for execution of trades. As such, Arc Advisory charges Clients a single bundled fee (the
“Wrap Fee”) that covers the investment advisory services it provides, access to Arc’s proprietary
platform, as well as the custodial services and brokerage services associated with trading securities
provided by the third-party broker-dealer and custodian.

The Wrap Program offers individualized portfolio management, asset allocation, and consolidated
reporting. Arc Advisory does not provide account monitoring or review as a service due to the
non-discretionary nature of our services. Arc Advisory currently provides reports to Clients only
through its Platform. Portfolios are not limited to any specific product offered by a broker/dealer
and will generally include selected government-backed securities, money market funds, and
mutual funds.
Arc Advisory typically charges the Wrap Fee based on the total net assets in Client accounts,
represented as an annualized percentage of total net assets.
Client accounts may hold cash sweep balances for liquidity or pending investment. Advisory fees
are generally calculated based on the total net assets in a Client account, which may include cash
sweep balances. To help protect Clients from negative net returns on cash sweep balances, Arc
Advisory may apply a cap to the advisory fee attributable to such balances so that the fee charged
does not exceed the interest earned on the cash sweep balance during the applicable billing period.
The Wrap Fee shall be prorated and charged monthly, in arrears, based upon the average daily
market value of the assets in the month prior, and are deducted directly from Client accounts. If a
Client account is terminated prior to the end of a month, the Wrap Fee will be prorated for the
portion of the month during which the Client account was active, and debited from the Client
account or invoiced to the Client as appropriate.
The Wrap Fee is generally between 0.05% and 0.60%, but Arc Advisory reserves the right to
negotiate the Wrap Fee, and any other management fees, with a Client or prospective Client.

The Wrap Fee includes brokerage trade commission charges applicable to an account. No
transaction fees are assessed for trades in the Wrap Program account, except for nominal
transaction charges that are not controlled by Arc Advisory or the custodian/broker-dealer, such as
those that may be imposed by the SEC.

The Wrap Fee does not include some other related costs and expenses. Clients may incur certain
other fees imposed by third-party financial institutions. (e.g., transfer fees, administrative fees,
other expenses). The Wrap Fee may not cover certain charges imposed by our third-party broker
and custodian. These types of charges include, but are not limited to, wire transfer fees, paper
statement fees, bounced check fees, transfer taxes, wire transfer and electronic fund fees.
From time-to-time Arc Advisory may adjust its Wrap Program, Wrap Fee, and associated policies.
In the event of such adjustments this brochure will be modified as needed and an updated copy
will be made available to Clients.

The Wrap Program may cost you more or less than purchasing these services separately would
have cost from a different provider, depending on the amount of trading activity in your account,
the value of services that are provided to you under this program, and other factors.

We do not charge our Clients higher advisory fees based on their trading activity, but you should
be aware that we may have an incentive to limit our trading activities in your account(s) because
we are charged for executed trades. Generally, wrap programs may result in higher overall costs to
you in accounts that experience little trading activity.

Our fees may be higher or lower than the fees charged by other advisers for similar services.

In addition to our fee, certain additional charges may be assessed, as described above. These fees
are not assessed by or paid to Arc Advisory, and may include miscellaneous transaction fees and
taxes on brokerage accounts and securities transactions.

Fees paid to us for investment advisory services are separate and distinct from the fees and
expenses charged by mutual funds and/or ETFs to their shareholders. These fees and expenses are
described in each fund’s prospectus. These fees will generally include a management fee, other
fund expenses, and a possible distribution fee. Arc Advisory will not participate in the sharing of
fees charged by the mutual fund.
Payment of Fees
Arc Advisory will calculate and debit the prorated amounts of the fees from the assets in a Client's
account on a monthly basis in arrears, unless Arc Advisory has agreed to be paid fees via invoice
from outside of the managed account. Prior to deducting fees from their accounts, Arc Advisory
may, when necessary, instruct our broker to sell securities, in accordance with the Client’s prior
instructions and as agreed upon within the Investment Advisory Agreement, in an amount that will
generate cash proceeds to satisfy a Client's fee obligation.

Additional Fees and Expenses Payable by Clients
Investment activity may also involve other transaction fees payable by Clients, such as sales
charges, odd-lot differentials, transfer taxes, returned transaction fees, wire transfer and electronic
fund fees, and other fees and taxes on brokerage accounts and securities transactions. In addition,

Clients will incur certain charges imposed by outside custodians, broker-dealers, and other third
parties, such as custodial fees, administrative fees, and transfer agency fees. Such fees are separate
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Item 7​ Types of Clients
Arc Advisory provides advice to corporate entity accounts. Investment minimums are not required at this
time.

Item 8​ Method of Analysis, Investment
Strategies, And Risk of Loss
 Investment Strategies and Methods of Analysis
 Arc Advisory provides access to government-backed securities, money market funds, and mutual
 funds through its digital investment platform, subject to Client’s investment amount, time horizon,
 and stated investment and risk preferences. Arc Advisory collects information from each Client at
 time of onboarding and at least annually, including specific information about a Client’s overall
 investment objectives. Arc Advisory will provide initial investment recommendations and at least
 annual updated recommendations which are based on the information provided. Arc Advisory does
 not accept discretion over Client assets and Clients retain the ultimate decision of whether or not to
 follow such recommendations.

 We use the following methods of analysis in formulating our investment advice and/or managing
 Client assets:

 Money Market Fund, Mutual Fund, and/or ETF Analysis: We look at the experience and track
 record of the manager of the money market fund, mutual fund, or ETF in an attempt to determine if
 that manager has demonstrated an ability to invest over a period of time and in different economic
 conditions. We also look at the underlying assets in a money market fund, mutual fund, or ETF in
 an attempt to determine if there is significant overlap in the underlying investments held in another
 fund(s) in the Client’s portfolio.

A risk of fund and/or ETF analysis is that, as in all securities investments, past performance does
not guarantee future results. A manager who has been successful may not be able to replicate that
success in the future. In addition, as we do not control the underlying investments in a fund or ETF,
managers of different funds held by the Client may purchase the same security, increasing the risk
to the Client if that security were to fall in value. There is also a risk that a manager may deviate
from the stated investment mandate or strategy of the fund or ETF, which could make the holding(s)
less suitable for the Client’s portfolio.

Risks for all forms of analysis: Our securities analysis methods rely on the assumption that the
companies whose securities we purchase and sell, the rating agencies that review these securities,
and other publicly-available sources of information about these securities, are providing accurate
and unbiased data. While we are alert to indications that data may be incorrect, there is always a
risk that our analysis may be compromised by inaccurate or misleading information.

The Platform provides access to funds available through the Firm’s brokerage, clearing, and
custodial arrangements, subject to applicable minimums and other restrictions imposed by the
broker-dealer or custodian. Available investment options and recommendations may vary based on
the Client’s investment amount, time horizon, and stated investment and risk preferences.

Clients select investments through the Platform, and there can be no guarantee of investment
performance.General economic conditions, current interest rates, the performance of a particular
industry or a particular company, and any number of other factors can affect investment
performance.

You should be prepared to bear the risk of loss. All investments are subject to loss, including
(among other things) loss of principal, a reduction in earnings (including interest, dividends and
other distributions), and the loss of future earnings.

Risk of Loss
All investing and trading activities risk the loss of capital, including loss of principal. Arc
Advisory cannot guarantee any level of performance or that Clients will not incur a loss of capital.
The following risks are not meant to be all inclusive, but should be considered prior to engaging
Arc Advisory for its advisory services.

Advisory Risk
There is no guarantee that Arc Advisory’s analysis or recommendations pertaining to particular
securities or strategies will produce the intended results. Our judgment may not be correct, and
Clients may not achieve their investment objectives. In addition, there is a risk that Arc Advisory
or its Clients may experience computer issues, including equipment or Platform failure, loss of
internet access, viruses, or other events that may impair our ability to provide or Clients’ ability to
receive advisory services.

General Market Risk
The price of any security or the value of an entire asset class can decline for a variety of reasons
that Arc Advisory cannot control, including, but not limited to, changes in the macroeconomic
environment, unpredictable market sentiment, forecasted or unforeseen economic developments,
interest rates, regulatory changes, and domestic or foreign political, demographic, or social events.

Money Market Fund Risks
Interest Rate Risk: Money market funds invest in short-term, low-risk debt securities with
maturities typically ranging from a few days to a year. Changes in interest rates can impact the
yield of these securities and, consequently, the return on the money market fund. Rising interest
rates may lead to lower returns, while falling rates could result in reinvestment risk.

Credit Risk: Although money market funds focus on high-quality, short-term debt instruments,
there is still a risk of default by issuers. Funds holding securities of lower credit quality or those
subject to downgrades may be more likely to experience losses.

Liquidity Risk: Money market funds aim to maintain a stable net asset value (NAV) of $1 per
share, but they may face liquidity challenges in certain market conditions. If the fund needs to sell
assets quickly to meet redemptions, it may face difficulty obtaining fair prices for those assets,
potentially impacting the NAV.
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