Breakwater Financial LLC

Item 5 Fees and Compensation
The following paragraphs detail the fee structure and compensation methodology for services provided
by the Advisor. Each Client shall sign one or more agreements that detail the responsibilities of
Breakwater and the Client.

A. Fees for Advisory Services

Investment Advisory Services

Investment advisory fees are paid quarterly, in advance of each calendar quarter, pursuant to the
terms of the investment advisory agreement. Investment advisory fees are charged at an annual rate
of 0.50% to 1.5%, based on the market value of assets under management at the end of the prior
quarter. Investment advisory fees in the first quarter of service are prorated from the inception date of
the Client's account[s] to the end of the first quarter. Fees may be negotiable at the discretion of the
Advisor. The Client's fees will take into consideration the aggregate assets under management with
Advisor. All securities held in accounts managed by Breakwater will be independently valued by the
Custodian. Breakwater will not have the authority or responsibility to value portfolio securities. The
investment advisory fee may include securities transaction fees for normal trading pursuant to the
Advisor's strategies. Please see Item 5.C. below.

Breakwater will adjust the current quarter’s billing amount to reflect any individual material deposits or
withdrawals made during the previous quarter. Breakwater uses a $10,000 threshold to determine if a

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specific deposit or withdrawal qualifies as material. Additional fees charged or rebated for material
deposits or withdrawals will be determined by the dollar amount of the transaction, the fee rate, and the
number of days Breakwater held the deposit or withdrawal – this is the same method used to calculate
our normal quarterly fees. Breakwater does not aggregate individual deposits or withdrawals that are
below the threshold amount for these billing cash-flow adjustments.

At our discretion, we may combine the account values of family members living in the same household
to determine the applicable advisory fee. For example, we may combine account values for you and
your minor children, joint accounts with your spouse, and other types of related accounts.

Breakwater will deduct our fee directly from your account through the qualified custodian holding your
funds and securities. Breakwater will deduct our advisory fee only when the following requirements are
met:

    • You provide our firm with written authorization permitting the fees to be paid directly from your
      account held by the qualified custodian;
    • Breakwater sends you an invoice showing the amount of the fee, the value of the assets on
      which the fee is based, the time period covered by the fee, and the specific manner in which the
      fee was calculated; and
    • The qualified custodian agrees to send you a statement, at least quarterly, indicating all
      amounts disbursed from your account including the amount of the advisory fee paid directly to
      our firm.

Breakwater encourages you to reconcile our invoices with the statement(s) you receive from the
qualified custodian. If you find any inconsistent information between our invoice and the statement(s)
you receive from the qualified custodian call our main office number located on the cover page of this
brochure. All client accounts are subject to a fee unless Breakwater, in its sole discretion, decides not
to charge a fee on a particular account.

You may terminate the portfolio management agreement upon 30 days' written notice. You will incur a
pro rata charge for services rendered prior to the termination of the portfolio management agreement,
which means you will incur advisory fees only in proportion to the number of days in the quarter for
which you are a client. If you have pre-paid advisory fees that we have not yet earned, you will receive
a prorated refund of those fees

B. Fee Billing

Investment Advisory Services

Investment advisory fees will be calculated by the Advisor and automatically deducted from the Client's
account[s] at the Custodian. The Advisor shall send an invoice to the Custodian indicating the amount
of the fees to be deducted from the Client's account[s] at the respective quarter-end date. The amount
due is calculated by applying the quarterly rate (annual rate divided by 4) to the total assets under
management with Breakwater at the end of each quarter. Clients will be provided with a statement, at
least quarterly, from the Custodian reflecting deduction of the investment advisory fee. Clients provide
written authorization permitting Breakwater to be paid directly from their accounts held by the
Custodian as part of the investment advisory agreement and separate account forms provided by the
Custodian. In addition, the Advisor will provide the Client a report itemizing the fee, including the

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calculation period covered by the fee, the account value and the methodology used to calculate the
fee.

Financial Planning Services

Breakwater offers financial planning as part of its investment advisory services, which typically involve
providing a variety of advisory services to clients regarding the management of their financial
resources based upon an analysis of their individual needs. These services can range from broad-
based financial planning to consultative or single subject planning. There are no additional fees for the
financial planning services requested by the Client when Breakwater is engaged to manage a Client's
portfolio valued at $250,000 or more.

Financial planning fees for hourly engagements are billed after the completion of the financial plan
engagement and due upon receipt of the invoice. Monthly fixed fee engagements are billed in advance
of each month or 30-day period. The Advisor may invoice the Client for financial planning fees or
arrange for the deduction of planning fees from the Client's account[s] at the Custodian.
...

Item 7 Types of Clients
Breakwater offers investment advisory services to individuals, high net worth individuals, families,
trusts, estates, pension and profit sharing plans (but not the plan participants) and businesses.

Breakwater does not impose a minimum account value to initiate our Firm’s advisory and money
management services, but as indicated above in Item 5 Fees & Compensation, the Firm will impose a
minimum advisory fee of $5,000 annually for its combined Portfolio Management and Financial
Planning Service (“Full-Service Financial Planning).