Godfrey Financial Associates Inc

Item 5           Fees and Compensation

         The Registrant is generally compensated for its investment management services on a
         quarterly basis. The fee is determined quarterly, in arrears, based upon the market value of
         such assets on the last day of the previous quarter. The Registrant’s policy is to treat intra-
         quarter account additions and withdrawals equally unless indicated to the contrary on the
         Registrant’s Investment Advisory Agreement executed by the client.

         The advisory fee will be pro-rated, and paid quarterly, in arrears, based upon the market
         value of the assets on the last day of the previous quarter. Unless Registrant agrees
         otherwise, in writing, Registrant shall debit the account directly for its advisory fee. In the
         event of termination, Registrant shall refund any unearned portion of the advanced fee paid
         based upon the number of days remaining in the billing quarter.

   A. INVESTMENT ADVISORY SERVICES
      The client can engage the Registrant to provide discretionary investment advisory services
      on a fee basis. Registrant’s negotiable annual investment advisory fee shall generally be
      based upon a percentage (%) of the market value and type of assets placed under
      Registrant’s management as follows:

          Market Value of Portfolio                                       Annual Fee %
          First $500,000                                                  1.25%
          Next $500,000                                                   1.00%
          Next $4,000,000                                                 0.75%
          More than $5,000,000                                            0.50%

         Fee Dispersion: Registrant, in its discretion, may charge a lesser investment advisory fee,
         charge a flat fee, waive its fee entirely, or charge a fee on a different interval, 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, complexity
         of the engagement, anticipated services to be rendered, grandfathered fee schedules,

    employees and family members, courtesy accounts, competition, negotiations with client,
    status as a non-profit organization, status as an employee of the Registrant, etc.). Please
    Note: 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. ANY QUESTIONS: Registrant’s Chief Compliance Officer, Kathleen
    Godfrey, remains available to address any questions that a client or prospective client may
    have regarding advisory fees.

    The Registrant’s policy is to treat intra-quarter account additions and withdrawals equally
    and the advisory fee is adjusted pro-rata for the addition or withdrawal of client assets to
    or from an account based upon the number of days remaining in the billing period.

    The Registrant’s Chief Compliance Officer, Kathleen Godfrey, remains available to
    address any questions that a client or prospective client may have regarding the above
    fee determination.

    FINANCIAL PLANNING AND CONSULTING SERVICES (STAND-ALONE)
    To the extent specifically requested by a client, Registrant may determine to provide
    financial planning and/or consulting services (including investment and non-investment
    related matters, including estate planning, insurance planning, etc.) on a stand-alone fee
    basis. Registrant’s planning and consulting fees are negotiable, but generally the Registrant
    charges $2,500 on a fixed fee basis based upon the level and scope of the service(s) required
    and the professional(s) rendering the service(s).

B. Clients may elect to have the Registrant’s advisory fees deducted from their custodial
   account. Both Registrant’s Investment Advisory Agreement and the custodial/clearing
   agreement may authorize the custodian to debit the account for the amount of the
   Registrant’s investment advisory fee and to directly remit that management fee to the
   Registrant in compliance with regulatory procedures. In the limited event that the
   Registrant bills the client directly, payment is due upon receipt of the Registrant’s invoice.
   The Registrant shall deduct fees and/or bill clients quarterly in arrears, based upon the
   market value of the assets on the last business day of the previous quarter.

    As discussed below, unless the client directs otherwise or an individual client’s
    circumstances require, Registrant shall generally recommend that Fidelity, an SEC-
    registered and FINRA/SIPC member broker-dealer serve as the broker-dealer/custodian for
    client investment management assets. Broker-dealers such as Fidelity charge brokerage
    commissions and/or transaction fees for effecting certain securities transactions (i.e.,
    transaction fees are charged for certain no-load mutual funds, and fixed income securities
    transactions). In addition to Registrant’s investment management fee and brokerage
    transaction fees, clients will also incur, relative to all mutual fund and ETF purchases,
    charges imposed at the fund level (e.g., management fees and other fund expenses).

C. The Registrant’s quarterly investment advisory fee shall be prorated and paid quarterly in
   arrears, based upon the market value of the assets on the last business day of the previous
   quarter. The Registrant generally does not require a minimum annual investment advisory
   fee. The Registrant, in its sole discretion, may reduce or waive its investment advisory fee
   based upon certain criteria (i.e., anticipated future earning capacity, anticipated future
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Item 7           Types of Clients

         The Registrant’s clients shall generally include individuals, high net worth individuals,
         corporations and other business entities. The Registrant generally does not require a
         minimum annual investment advisory fee. The Registrant, in its sole discretion, may reduce
         or waive its investment advisory fee based upon certain criteria (i.e., anticipated future
         earning capacity, anticipated future additional assets, familial relationship, dollar amount
         of assets to be managed, related accounts, account composition, etc.).

         Please Note: Fee Dispersion: Registrant, in its discretion, may charge a lesser investment
         advisory fee, charge a flat fee, waive its fee entirely, or charge a fee on a different interval,
         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, complexity of the engagement, anticipated services to be rendered,
         grandfathered fee schedules, employees and family members, courtesy accounts,
         competition, negotiations with client, etc.). Please Note: 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. ANY QUESTIONS:
         Registrant’s Chief Compliance Officer, Kathleen Godfrey, remains available to address
         any questions that a client or prospective client may have regarding advisory fees.