Equity Services Inc

Item 5 – Fees and Compensation
Fee-Based Accounts
When making the determination of whether one of EFA's advisory programs is appropriate for their
needs, clients should bear in mind that fee-based accounts, when compared with commission-based
accounts, often result in lower transaction costs during periods when trading activity is heavier, such as
the year an account is established. However, during periods when trading activity is lower, fee-based
accounts may result in a higher annual cost to the client than a traditional brokerage account. Thus,
depending on a number of factors, the difference in total cost of a fee-based account compared to a
commission-based account can vary significantly. Factors which affect the cost of a fee-based account
include the account size, as well as the investment advisory fee you have negotiated with your Advisor.
Factors which affect the cost of a commission-based account that charges transaction fees include the
number of transactions in the account, the types and quantities of securities purchased or sold and
commission rates. Clients should discuss any proposed program with their advisory representative and
read this Brochure carefully, as it explains the programs in detail.

The specific manner in which fees are charged by EFA is established in a client’s written agreement with
EFA. EFA will generally bill its fees on a quarterly basis. Clients are charged for advisory services either
in advance or arrears, each calendar quarter, depending on which advisory program they choose. Clients
authorize the appropriate custodian to directly debit fees from their accounts, which are then paid to EFA
for services provided. Advisory fees for each program are described below.

Program sponsors establish the minimum and maximum fee ranges associated with each of their
respective programs. These ranges vary between programs and create a conflict to representatives in
that there is an incentive to recommend programs with higher minimum investments and/or maximum
allowable fees to generate higher fees.

On a quarterly basis, a portion of the fee for service (typically between 50%-85% of the fee) is paid to the
IAR according to their compensation agreement with EFA. The total advisory fee is exclusive of
brokerage commissions, transaction fees, and other related costs and expenses which are incurred by
the client. Clients incur certain charges imposed by custodians, brokers, third-party investment managers,
and other third parties, such as: advisory fees, custodial fees, deferred sales charges, odd-lot differentials,
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transfer taxes, wire transfer and electronic fund fees, IRA fees, and other fees and taxes on brokerage
accounts and securities transactions. Such expenses may be avoided through the selection of mutual fund
share classes which do not include such fees, provided the funds make these share classes available.
Mutual funds and ETFs also charge internal management fees, which are disclosed in each fund’s
prospectus. Clients may incur deferred sales charges on previously purchased mutual funds.

Clients have the ability to purchase mutual fund shares directly from fund companies, without utilizing the
services of an adviser. Doing so could provide clients with similar market exposure without paying
advisory fees.

Fees and Expenses: No-Transaction Fee (“NTF”) Funds and Transaction Fee (“TF”) Funds
TPAMs have the ability to use certain funds that do not incur transaction fees when traded, commonly referred to as
no-transaction fee (NTF) funds. However, compared to other comparable funds, NTF funds typically have
higher internal expenses, charged as a percentage of the assets in the fund and deducted from its value.
Accordingly, these higher internal expenses reduce the returns of NTF funds. Third-party managers may
or may not include NTF funds in their portfolios, based on each individual manager’s discretion. If clients
are uncomfortable with the use of NTF funds in their portfolio, and would prefer to pay transaction fees,
they should work with their advisory representative to ensure their chosen program addresses their
concerns.

Sometimes, but not always, clients could save money by paying transaction fees instead of investing in
more expensive NTF funds. Clients should review the Form ADV Part 2A of any third-party manager being
considered, to learn about their use of NTF funds. Clients may or may not be able to restrict the third-party
manager’s use of NTF funds. Therefore, clients who are uncomfortable with the use of NTF funds in their
portfolio, and would prefer to pay transaction fees, but are unable to prevent their use, should talk to their
advisor regarding other advisory program options.

Other Revenue

Revenue Sharing Arrangements
The Firm has revenue sharing agreements with selected third-party asset managers (“TPAM”),
collectively referred to as Strategic Partners, which pay additional material compensation in the form of a
set amount or a percentage of assets under management. As a result, the Firm faces a conflict of interest
in that it has an incentive to promote certain programs that provide additional compensation over others
which do not, but which offer similar services. Certain other fund sponsors and/or TPAMs that do not
participate in the Strategic Partners program, but whose funds may be used in advisory accounts, make
marketing payments to ESI to sponsor certain meetings or events. These include American Funds,
AssetMark, BlackRock Funds, LiveWell, PIMCO, Symmetry, and Vanguard. As such, the Firm has an
incentive to promote use of these funds, over other available funds, in programs in which the IAR acts as
the portfolio manager, specifically Flagship Select, ESI Directions, and ESI Compass, as described in the
Firm’s Form ADV Part 2A-Appendix 1 brochure.

Compensation From Securities and Other Investments
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Item 7 – Types of Clients
EFA provides portfolio management services to individuals, corporations, trusts, estates, charitable
organizations, and retirement plans including pension and profit-sharing plans. Most asset management
programs offered by EFA have minimum account sizes to open/maintain an account ranging from
$10,000 to $750,000. Details on these minimums are explained by the various asset managers’ program
description materials.

The Firm reserves the right to prohibit anyone or any account type from investing in any of its advisory
programs if it believes the recommended program is not an appropriate investment strategy for the client.