Flagship Harbor Advisors LLC

Item 5. Fees and Compensation
            Flagship, depending upon the engagement, offers its services on a fee basis which may include hourly
            and/or fixed fees for financial planning or consulting as well as fees based upon assets under management
            for managed accounts. Alternatively, certain of Flagship’s Advisory Affiliates offer securities brokerage
            services under a commission arrangement, which may be used to offset Flagship’s fees (as discussed
            below).

            Non-Wrap Fee Basis

            The client can determine to engage Flagship to provide discretionary and/or non-discretionary investment
            advisory services on a fee basis. Flagship’s annual investment advisory fee shall be based upon a
            percentage (%) of the market value and type of assets placed under Flagship’s management, generally
            between 0.25% and 2.0% (See Fee Differential disclosure below).

            Wrap Fee Basis

Page | 11

Flagship Harbor Advisors, LLC Disclosure Brochure

            The current annual Program fee range is negotiable to a maximum annual management fee of 0.25% to
            2.0%, depending upon the amount and type of the Program assets. Certain costs, such as IRA and check
            writing fees may be charged separately. Flagship shall deduct fees and/or bill clients quarterly in advance,
            based upon the market value of the assets on the last business day of the previous quarter. Flagship, in its
            sole discretion, may charge a lesser advisory fee and/or reduce or waive its minimum fee based upon
            certain criteria (i.e. anticipated future earning capacity, anticipated future additional assets, dollar amount
            of assets to be managed, related accounts, account composition, negotiations with client, etc.). Because
            wrap program transaction fees and/or commissions are being paid by Flagship to the account
            custodian/broker-dealer, Flagship could have an economic incentive to maximize its compensation by
            seeking to minimize the number of trades in the client's account. See separate Wrap Fee Program
            Brochure.

            Fee Differentials: If the client determines to engage Flagship to provide investment advisory services,
            Flagship shall receive an investment advisory fee based upon a percentage (percentage) of the market
            value of the assets placed under management. The range shall generally be from 0.25% to 2.0%. Because
            we shall generally price our advisory services based upon various objective and subjective factors, our
            clients could pay diverse fees based upon a combination of factors , including but not limited to the
            representative assigned to the account, the market value of their assets to be invested , the complexity of
            the engagement, the level and scope of the overall investment advisory services to be rendered, related
            accounts and negotiations, similarly situated clients could pay diverse fees, and the services to be provided
            by Flagship to any particular client could be available from other advisers at lower fees (Also See Item 7
            below).

            Billing: Clients have the option of having fees automatically deducted from their accounts, billed to them
            directly, or a combination of the two options. Clients may change their method of payment at any time. Both
            Flagship's Investment Advisory Agreement and the custodial/clearing agreement may authorize the
            custodian to debit the account for the amount of Flagship's investment advisory fee and to directly remit
            that management fee to Flagship in compliance with regulatory procedures. In the limited event that
            Flagship bills the client directly, payment is due upon receipt of Flagship’s invoice.

            Cash Balances: At any specific point in time, depending upon perceived or anticipated market
            conditions/events (there being no guarantee that such anticipated market conditions/events will occur),
            Flagship may maintain cash positions for defensive purposes. All cash positions (money markets, etc.) shall
            be included as part of assets under management for purposes of calculating Flagship’s advisory fee. Should

Page | 12

Flagship Harbor Advisors, LLC Disclosure Brochure

            Client utilize LPL’s Insured Cash Account (“ICA”) or Deposit Cash Account (“DCA”) Programs they should
            be aware of the following:

                   •   The fees LPL Financial receives from the banks participating in the ICA program are based
                       upon the level of client assets in the ICA /DCA program;
                   •   The fees paid to LPL reduces the interest rate paid to clients in the ICA program;
                   •   That LPL retains a majority of the interest revenue;

                   •   Flagship Harbor Advisors does not share in the revenue;
                   •   That clients can experience negative investment returns with respect to cash balances in the
                   ICA program; rates are generally significantly lower than money market yields
                   •   LPL does not offer money market mutual funds as an option under its bank deposit sweep
                   program; and such investment must be purchased within the account
                   •   LPL has an incentive to leverage its brokerage/custodial platform to cross-sell its bank deposit
                       sweep product(s) and to make investment products available on its platform from product
                       sponsors and manufacturers with whom LPL has revenue sharing or similar third-party
                       arrangements.

            Expenses/Other Fees: Fees in Flagship’s Wrap Fee Program are inclusive of brokerage commissions,
...

Item 7. Types of Clients
            Flagship provides its services to individuals, pension and profit-sharing plans, trusts, estates, charitable
            organizations, corporations, and business entities. Flagship does not generally require an annual minimum
            fee or an aggregate minimum account value for its investment advisory services. Flagship, in its sole
            discretion, may charge a lesser investment management fee based upon certain criteria (i.e., anticipated

Page | 18

Flagship Harbor Advisors, LLC Disclosure Brochure

            future earning capacity, anticipated future additional assets, dollar amount of assets to be managed, related
            accounts, account composition, negotiations with client, etc.). As result of the above, similarly situated
            clients could pay different fees. In addition, similar advisory services may be available from other investment
            advisers for similar or lower fees. Flagship does not impose a minimum portfolio size or minimum annual
            fee.

            Minimums Imposed by Independent Managers

            Certain Independent Manager(s) may, however, impose more restrictive account requirements and varying
            billing practices than Flagship. In such instances, Flagship may alter its corresponding account
            requirements and/or billing practices to accommodate those of the Independent Manager(s).