Birchbrook

TYPES OF CLIENTS

Birchbrook generally provides investment advisory and financial planning services to individuals,
corporations, trusts, estates, charitable organizations, and self-directed retirement plans.

                  METHODS OF ANALYSIS, INVESTM ENT STRATEGIES
                               AND RISK OF LOSS

We utilize fundamental analysis in the selection of securities, placing great emphasis on measures of
intrinsic value, earnings growth, and strong financial statements. We receive information used in the
analysis and selection of securities from a variety of sources such as: purchased research, corporate filings
with the Securities and Exchange Commission, quarterly and annual reports, prospectuses, company press
releases, corporate rating services, financial newspapers and magazines, and research materials provided
by brokerage and other investment advisory firms.

Strategies are designed to meet client requirements, including risk tolerance and time horizon. The
specific investment strategies used to implement our investment advice vary greatly from long-term
purchases to trading. “Trading” is generally defined as selling a security within 30 days of its purchase.
Frequent trading can affect performance, particularly through increased brokerage and other transaction
costs and taxes. In most cases, we recommend holding securities until company fundamentals change
(such as narrowing margins or negative industry expectations). Portfolios are diversified, and it is
generally true that any one security will not account for more than 10% of the total portfolio value unless
so directed by the client. Exceptions may apply due to specific client objectives, tax considerations, or
investments in exchange-traded funds (ETFs) or mutual funds. Margin investing is not recommended but
may be employed for short-term borrowing needs.

Types of Investments
We utilize individual equities, mutual funds, ETFs, warrants, corporate debt obligations, commercial
paper, certificates of deposit, municipal securities, investment company securities (with the exception of
variable life insurance), U.S. Government and U.S. Government-sponsored entity securities, and options.
While Birchbrook does not typically invest in initial public offerings (IPOs), futures contracts, hedge
funds, private equity funds, closely held or non-publicly traded securities, the firm does utilize mutual
funds and ETFs that may contain some of these types of investments.

Risk of Loss
There is material risk involved in any investment strategy. Some of the risks include the following: the
risk that the general level of asset prices will decline; the financial condition of the issuers of individual
securities may decline; various and unpredictable factors such as inflation, interest rates, economic
expansion or contraction, global, regional, economic, political or banking crises; lack of liquidity or active
trading or other market disruptions; clearing and settlement of transactions may be delayed or disrupted;
fees and commissions for trading may change without notice.

Individual stocks or bonds generally have more company specific risk than investments in a pool of
securities such as an ETF or mutual fund. Securities invested in a narrow asset category such as gold or a
single country or economic sector generally have more risk individually than a combination of
investments in a more diversified portfolio. We try to mitigate the volatility of all the above risk factors
by diversifying investments among issuers and by asset class, but positive performance is not guaranteed,
and past performance is not indicative of future results.