Harbour Investments Inc

Item 5 – Fees and Compensation

The hourly fee for consultation services is negotiable but generally range from $50 to $300
per hour. Services can also be performed on a flat fee basis. Flat fees generally range
between $200 to $2,500 but vary depending on the scope of the plan. The rate and fee
payment schedule is typically determined by the complexity of the project and the amount
of time involved. Client charges for a plan or service are negotiable. Typically the fee is
paid in its entirety up front or an estimate of the total fee is given to client by Harbour or
the IAR and a deposit of 50% of the estimated hourly or flat fee is paid at the execution of
the agreement. The balance of any fees is due upon receipt of the final written report or
advisory service. Hourly or flat fees can be waived or refunded when repositioning of the
client's portfolio has generated trading concessions to Harbour and IAR. In the event of
contract termination by the Client or Harbour, prepaid fees received but not earned are
reimbursed to the client. Clients may purchase investment products that IAR’s recommend
through other brokers or agents unaffiliated with Harbour.

Harbour sponsors Wrap Fee Programs through Pershing Advisor Solutions (“PAS”),
American Funds Service Company and Charles Schwab Advisor Services division of Charles
Schwab & Co., Inc, and Life Insurance Companies. This program maintains assets at a
designated custodian or Life Insurance Company. The custodian generally executes trades
in the client’s account. The client, at all times, makes the decision where to custody assets
including accounts under ERISA or IRA rules and regulations. Harbour and its IARs offer
different compensation options. In most cases, when the client wishes an ongoing
investment advisory relationship, compensation is calculated as a percentage of AUM.
These fees have a maximum of 2.0%. Since the IAR receives fees as a result of the client’s
participation in the program, the IAR has a financial incentive to recommend a wrap fee
program over other services. This constitutes a conflict of interest for Harbour and the IAR
which must be disclosed to the client, along with a comparison of the cost of the wrap fee
program with other potential arrangements. The client is free after such disclosure to
choose the wrap fee program or any other program Harbour offers, including a brokerage
account charging transaction-based compensation.

The IAR negotiates the management fee with the client. All agreements are subject to
Harbour approval. Where the IAR uses commissioned products to implement an
investment strategy, fees on the AUM may be waived for agreed periods after the sale
which generated the commission. Any refund must be approved by Harbour. In most
cases, the value of AUM is determined at account commencement or at the end of the first
month or quarter after the account is established. Harbour and the IAR are compensated by
the client for advisory services on a monthly, quarterly or any other agreed upon schedule.
Fees are calculated by multiplying the percentage fee agreed upon in the advisory
agreement between Harbour and client against the AUM. The product of this calculation is
the fee paid by the client. The fee excludes transaction and custodian costs including
brokerage commissions and account maintenance fees depending on the agreement with
the client. Upon agreement between Harbour and the client, certain assets under
management are excluded from the computation of the AUM. Transaction costs are per
transaction or a percentage of AUM. When these costs are not included in the typical
service fees, they are separately charged to the account.

Accounts with account values under $25,000 may have greater service fees due to higher
costs of the IAR maintaining the account. Clients authorize the client's account
custodian(s) to deduct, upon Harbour's instruction, fees when due from assets held in the
account. Money market funds and other securities in the client's account in amounts
sufficient to cover Harbour's fees are liquidated to pay fees. In all other cases, Harbour and
IAR calculate and submit a fee invoice to the client which can be paid from the client’s
account with client permission. The service fees for American Funds F-2 Direct Program
are a maximum of 1.0%. Harbour and IAR do not take custody of any clients' funds or
securities.

The investment advisory contract between Harbour and each client can be terminated by
either party upon receipt of written notification. The client also has the right to rescind the

contract within five business days of the date the contract was signed. IAR and Harbour
are reimbursed for expenses incurred by request of the client.

Third party Manager fee programs generally range between 0.25% to 2.50% per annum.
These fees include both the advisor fees and the Third Party Manger fees. The maximum
advisor fee is 2.0% and is separate from the Third Party Manager fees. For example, an
advisor charging 2.0% utilizes a third party manager that charges a separate fee of 0.80%,
the cumulative fee charged to the client would be 2.80%. Each manager dictates their own
fee schedule which may vary. These may be higher or lower than those charged by other
management services. Harbour and its IAR will provide periodic assistance in evaluating
manager(s) performance and, if necessary, recommend replacing a manager. Under the
terms of Third Party Managers agreements, Harbour receives a fee for the referral of a
Harbour client, calculated as a percentage of AUM or as a percentage of the advisory fee
received by the investment manager from the client. Such fees continue to be paid as long
as the account remains under management. A conflict of interest exists when Harbour
recommends managers or a manager’s platform and receives compensation from the
manager for doing so. In all cases, the total management fees will be disclosed to the client
...

Item 7 – Types of Clients

Harbour offers its services and investment advice to entities, individuals, trusts, investment
companies, investment advisors, pension and 401(k) plans and other tax-deferred vehicles
like Individual Retirement Accounts, Single Employment Plans, high net worth individuals
and others needing investment services and advice.

Harbour does not stipulate account minimums, however, for an account value less than
$5,000 held at Pershing Advisor Solutions and/or Charles Schwab, Inc., Harbour will not
assess an advisory fee. An IAR may require account minimums in excess of these numbers.
Third party manager programs have different account minimums depending on the
manager. Harbour’s American Funds F-2 Direct Program minimums are set per individual
mutual fund prospectus which are considerably lower than Harbour general account
minimums. Harbour’s HTM program….