Balefire LLC

Item 5: Fees and Compensation

          Description

Fees for Discretionary Asset Management, Financial Planning Services, and Corporate Solutions are
subject to negotiation based on the scope and complexity of the services provided to the client or Plan.
The specific fee rate and the manner and timing of fee collection are described in each client or Plan
advisory Agreement, Engagement Contract, or account application. Advisory fees for services provided
by Balefire may be more or less than those for comparable services offered elsewhere. Clients have the
option to invest in opportunities recommended by Balefire through other brokers or agents that are not
affiliated with Balefire. Advisory fees vary depending on the types of engagement and the selected
services provided.

          Comprehensive Asset Management Services

Fees for Comprehensive Asset Management Services are generally calculated as a percentage of assets
under management based on the market value of the assets in each account, including cash and similar
equivalents, on the close of the last business day of each calendar quarter and are collected in advance.
A typical fee calculation for these services is (ending account value) x (annual fee %/4 quarters) =
(quarterly fee). As an example, a client with a $200,000 account balance on the close of the last day of a
quarter and paying a 1.25% annual fee would be charged a fee of $625.00 for that quarter.

                                Example: ($200,000.00) x (.0125/4) = ($625.00)

Fees for the initial quarter for which services are provided are prorated based upon the number of days
remaining in the quarter. Any fee rate changes become effective with the next fee billing cycle.

Financial Planning Services

The fees for Financial Planning Services are generally contracted on an hourly, project, or flat-fee basis
depending upon the scope, complexity, and duration of the services provided. Fees will vary significantly
depending upon the scope and duration of the services provided. A written estimate of the negotiated
fees for services will be provided to the client in their engagement agreement prior to the initiation of any
services. Balefire may require an advance deposit equal up to 100% of the estimated fee, however we will
not collect any fee in excess of $1,200 for Services to be performed six (6) months or more in the future.
Any unearned portion of any previously paid fees for Financial Planning Services will be refunded to the
client if services are terminated prior to the completion of the contracted project.

          Corporate Solutions

Fees for advisory services provided to ERISA and Internal Revenue Code (“IRC”) Qualified Plans, Pensions,
and Profit-sharing Plans (each a “Plan”) are charged as a percentage of Plan assets or a flat fee and are
negotiated regardless of Plan size. Fees for established Plans range from .05% to .50% depending upon
the services selected and the discretionary nature of the relationship. Annual fees for start-up Plans range
from $5,000 to $7,500 depending upon the selection of services provided. Fees for Corporate Solutions
services are paid in arrears.

Balefire is subject to specific duties and obligations under ERISA and the IRC that include, among other

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things, restrictions concerning certain forms of compensation. To avoid engaging in prohibited
transactions, Balefire may only charge fees for investment advice about products for which Balefire and/or
its affiliates do not receive any commission, 12b-1 fees or other compensation or alternatively, if Balefire
and/or its affiliates receive such commissions, 12b-1 fees or other compensation, it will offset such
amounts on a dollar-for-dollar basis against the advisory fee.

          Platform Fee

A portion of the fee Balefire collects is used to offset the costs of providing portfolio accounting, modeling
and rebalancing services, technology platforms, compliance, back office operational support, and
reporting services, commonly referred to as a “platform fee”. The platform fee is an additional 25bps
(0.25%) cost assessed to the Client.

Platform fees are not paid by Plans receiving services from the Corporate Solutions team and are often
waived for Institutional and Ultra-High Net Worth Clients.

          Asset Selection

While Balefire mainly utilizes Separately Managed Accounts (“SMA’s”), mutual funds, ETF’s, cash
equivalents, stocks, alternatives, and both public and private debt and equity, in Client accounts, it does
not limit the types of investments it might consider managing for a client. Balefire believes that all asset
classes - equities, fixed income, alternatives, and cash – are valuable tools in implementing Client
investment strategies. As such, Fees for services are based on each account’s total value including cash
and cash equivalents.

          Fee Debiting

Balefire collects advisory fees, in advance, on a quarterly basis for its Comprehensive Asset Management
clients. In the application to establish an advisory account, and through their advisory agreement the
client authorizes Balefire and their account custodian to deduct one-fourth of the annual management
fee directly from the client’s account(s) at the beginning of each quarter and send the fees to Balefire.
Clients will not receive advance billing invoices prior to the debiting of fees. However, each client will
receive a quarterly account statement directly from their Qualified Custodian detailing the fee deducted
from each account during the prior period. The client’s authorization to deduct fees directly from the
client’s account is intended as an accommodation for the benefit of the client. Clients authorize Balefire
and their custodians to sell money market shares and then securities, in that order of preference, if
...

Item 7: Types of Clients

Balefire provides investment advice and financial planning services to individuals, including high-net-
worth individuals2, pension and profit-sharing plans, trusts, estates, charitable organizations,
corporations, and other business entities. In providing these services, Balefire relies on each Client to
furnish Balefire with current and accurate information regarding their current Plan, investment portfolio
and financial situation, investment objectives, risk tolerance level, investment time frame, liquidity needs,
and tax status, as well as the related documents which Balefire requests. Upon completion of its review
and analysis, Balefire will suggest a strategy for the client or Plan. Each recommendation and investment
decision will be made in reliance on the information provided by the client or Plan Trustees.

Balefire will contact each Plan and Client household at least annually to see if there have been any changes
in financial condition, investment objectives, risk tolerance level, investment time frame, liquidity needs,
tax status, or similar meaningful information. Each client may impose reasonable restrictions on the
management of their Account or modify existing restrictions at any time.

Balefire does not impose a minimum account or relationship size. Certain Sub-Advisors or investment
models may have a minimum asset requirement, and thus may not be available for smaller accounts.