Howe and Rusling Inc

ITEM 5 - FEES AND COMPENSATION

A. We provide investment supervisory services according to the following basic fee
schedule. The minimum quarterly fee is $1500 (the fee for a $500,000 portfolio).

The standard fee schedule for equity and balanced accounts is as follows:

Portfolio Value                Quarterly Rate         Annualized Rate
First $500,000                 0.30%                  1.20%
Next $500,000                  0.25 %                 1.00 %
Above $ 1,000,000              0.20 %                 0.80 %

The following fee schedule is for fixed income-only accounts. The minimum
quarterly fee is $1250 (the fee for a $1,000,000 portfolio).

Portfolio Value                Quarterly Rate         Annualized Rate
Any                            0.1250 %               0.50 %

The following fee schedule is for ETF-only accounts.

Portfolio Value                Quarterly Rate         Annualized Rate
Any                            0.20%                  0.80%

Howe and Rusling may, in its discretion, reduce the standard fee. Under certain
circumstances, such as multiple relationships within a single family, our fees and
minimums may be negotiable. Lower fees for comparable services may be available from
other sources. Fixed fees, as opposed to fees based on a percentage of assets under
management, may also be negotiated on very rare occasions and on an individual basis
due to unusual circumstances.

B. At the start of a client’s relationship with us, the client may choose if he/she would
like us to send an invoice for our advisory services directly or if he/she would like us to
have the fee directly debited from the custodial account. Fees are collected quarterly in
advance.

C. Howe and Rusling’s schedule of fees does not include any brokerage fees, fund
expenses, or transaction costs that the client may incur through investing. Please see
“Brokerage Practices” for a discussion of custody and brokerage arrangements.

In a wrap fee arrangement, clients generally pay a single fee to the wrap program
sponsor for advisory, brokerage, and custodial services. Depending on the arrangement,
the client’s portfolio transactions may be executed without commission charge in a wrap
fee situation. In evaluating such an arrangement, the client should consider that
depending upon the level of the wrap fee, the amount of portfolio activity in the client’s

account, and other factors, the wrap fee may or may not exceed the aggregate cost of
such services if they were to be provided separately. Clients should discuss any
particulars of the wrap fee details directly with their contact at the wrap program sponsor
firm.

D. The management fee is billed quarterly in advance in an amount determined by
applying the quarterly rate to the portfolio market value on the last day of the calendar
quarter immediately preceding the billing date. In the event of termination of the
investment agreement by written notice from the client mid-quarter, a rebate for the pro-
rated amount of the fee not used is sent by check to the client or back to the brokerage
account where the fee was paid.

Cash and Margin Holdings:

Unless agreed otherwise, any and all account asset classes, including cash positions, are
included in the firm’s advisory fee calculation. At certain times our advisory fee may
exceed the money market yield for cash assets.

Depending on the agreement with a client, accounts with utilized margin may be billed
on the higher-margin value. This presents a potential conflict because we earn a higher
fee and have a disincentive to advise clients to reduce or eliminate the margin balance.

Typically, for clients with an account size of $150,000 or less, financial planning services
are provided for a fixed fee of $3, 000 for preparation of an initial financial plan due in
two payments. The first payment of $1,500 will be due upon execution of the financial
planning contract and the final payment will be due upon delivery of the financial plan.
Clients will have three months from the plan delivery to submit follow up questions or
requests. An additional fee of $300 will be charged each time the financial plan is
reviewed and updated after the three months expire.

If a client terminates the financial planning agreement within five (5) business days of its
signing, the client will receive a full refund of all financial planning fees. If a client
terminates the financial planning agreement after five (5) business days of its signing, the
initial agreed-upon payment will be considered earned and will not be refunded to the
client by Howe and Rusling.

Howe and Rusling’s supervised person completing the financial plan is compensated for
his or her financial planning services as a percentage of financial planning revenue
received by Howe and Rusling from a client.

Certain legacy clients and clients or children of clients with account sizes over $150,000
will typically receive financial planning services at no additional cost.

Consulting services provided to other financial professionals are typically based on a
discreetly negotiated fixed fee, typically payable quarterly in advance.

E. N/A

ITEM 7 - TYPES OF CLIENTS

We offer investment supervisory services and require a minimum market value to start an
account: $500,000 for basic accounts and $1,000,000 for fixed income-only accounts.
Howe and Rusling may, in its discretion, waive the minimum account size.

We primarily provide investment advice to:
  • individuals
  • high net worth individuals

However, we also provide investment advice to:
  • insurance companies
  • pension and profit sharing plans
  • trusts, estates, and charitable organizations
  • corporations and other businesses