Kingwood Investment Group LLC

Fees and Compensation

The following types of fees will be assessed:

Asset Management – Fees are charged either quarterly or monthly, in either advance or arrears,
as agreed upon between the client and KIG, and are based primarily on asset size and the level of
complexity of the services provided. In individual cases, KIG has the sole discretion to negotiate
fees that are lower than the standard fee shown or to waive fees. Fees are not based on the share
of capital gains or capital appreciation of the funds or any portion of the funds. Comparable
services for lower fees may be available from other sources. Fees for the initial billing period
will be prorated based upon the number of calendar days in the billing period that the advisory

agreement is in effect. Fees are based on the market value of the assets on either the last
business day of the billing period or the last day of the previous billing period. Annual fees
range from .80% - 1.50%, depending on the amount of assets under management (“AUM”) – See
chart below. Consulting services are included in these fees for asset management services with
the exception of unique circumstances that may require a separate agreement for financial
planning services (description and fees are discussed below). If the situation warrants separate
financial planning fees, it will be discussed upfront, and a separate agreement will be negotiated.

Fee Schedule for Asset Management:

  Total Account Value                                  Maximum Annual Advisory Fee
 First $500,000                                                    1.50%
 Next $250,000                                                     1.40%
 Next $250,000                                                     1.30%
 Next $1,000,000                                                   1.20%
 Next $3,000,000                                                   1.00%
 Above $5,000,000                                                  0.80%

The fee is calculated as follows: The market value of the assets under management on either the
last business day of the billing period or the last day of the previous billing period multiplied by
either 1/4 or 1/12 of the annual advisor fee.

For clients utilizing a Sub-Advisor for asset management services, the fee stated above will
include the Sub-Advisor’s fee. Clients will receive the Sub-Advisors’ Form ADV Part 2A
reflecting such fees. As authorized in the client agreement, the account custodian withdraws
KIG’s advisory fees directly from the clients’ accounts according to the custodian’s policies,
practices, and procedures. The custodian will send the client a statement at least quarterly which
includes the amount of any fees paid to KIG for advisory services. You should carefully review
the statement from your custodian/broker-dealer’s statement and verify the calculation of fees.
Your custodian/broker-dealer does not verify the accuracy of fee calculations. Clients are urged
to compare the account statements received from the custodian with any reports received from
KIG and notify the firm promptly of any discrepancies.

Fees are charged either quarterly or monthly, in either advance or arrears, meaning that advisory
fees for a quarter are charged on either the first day of the billing period or the first day of the
following billing period. Clients may terminate investment advisory services obtained from
KIG, without penalty, upon written notice within five (5) business days after entering into the
advisory agreement with KIG. The client is responsible for any fees and charges incurred by the
client from third parties as a result of maintaining the account such as transaction fees for any
securities transactions executed and account maintenance or custodial fees. Thereafter, the client
may terminate advisory services upon written notice delivered to and received by KIG. Clients
who terminate investment advisory services during a billing period are charged a prorated
advisory fee based on the date of KIG’s receipt of client’s written notice to terminate. Any
earned but unpaid fees are immediately due and payable, and any prepaid and unearned fees will
be immediately refunded. All funds under management shall be liquidated or transferred at
market value as of the date of liquidation or transfer.

Financial Planning – Financial planning services are charged in advance through a fixed fee or
in arrears through an hourly arrangement as agreed upon between the client and Kingwood
Investment Group, LLC. There will never be an instance where $1,200 or more in fees is
charged six or more months in advance. Hourly fees are generally charged when the scope of
services cannot be determined or if the services are limited to one meeting. Fixed fees are
generally quoted to the client for longer term consulting projects. Fees are negotiable and vary
depending upon the complexity of the client situation and services to be provided. Hourly fees
range from $300 - $500 per hour, depending on what is negotiated between KIG and the client
and based on the complexity and length of the services provided. Similar financial planning
services may be available elsewhere for a lower cost to the client. Fixed fees for longer-term
consulting projects range from $500 to $5,000 per project. An estimate for total hours and
charges is determined at the start of the advisory relationship.

Typically, hourly financial planning clients will be invoiced monthly for all time spent by KIG as
agreed upon by client or upon completion of the services if less than a month. Clients who wish
to terminate the planning process prior to completion may do so with written notice. The client
may obtain a refund of a pre-paid fee if the advisory contract is terminated before the end of the
billing period by contacting Christopher Alden at (281) 359-7900. Upon receipt of written
notification, any earned fee will immediately become due and payable, and any prepaid and
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Types of Clients

KIG offers investment advisory services to individuals and high net worth individuals. There is
no minimum account size to open and maintain an advisory account.

Form ADV, Part 2A, Item 8

     Methods of Analysis, Investment Strategies, and Risk of Loss

KIG’s methods of analysis and investment strategies incorporate the client’s needs and
investment objectives, time horizon, and risk tolerance. KIG is not bound to a specific
investment strategy for the management of investment portfolios, but rather consider the risk
tolerance levels pre-determined gathered at the account opening, as well as on an on-going basis.
Examples of methodologies that our investment strategies may incorporate include:

Asset Allocation – Asset Allocation is a broad term used to define the process of selecting a mix
of asset classes and the efficient allocation of capital to those assets by matching rates of return
to a specified and quantifiable tolerance for risk.

Dollar-Cost Averaging – Dollar-cost averaging is the technique of buying a fixed dollar amount
of securities at regularly scheduled intervals, regardless of the price per share. This will
gradually, over time, decrease the average share price of the security. Dollar-cost averaging
lessens the risk of investing a large amount in a single investment at the wrong time.

Technical Analysis – involves studying past price patterns and trends in the financial markets to
predict the direction of both the overall market and specific stocks.

Long-Term Purchases – securities purchased with the expectation that the value of those
securities will grow over a relatively long period of time, generally greater than one year.

Short-Term Purchases – securities purchased with the expectation that they will be sold within a
relatively short period of time, generally less than one year, to take advantage of the securities’
short term price fluctuations.

Our strategies and investments may have unique and significant tax implications. Regardless of
your account size or other factors, we strongly recommend that you continuously consult with a
tax professional prior to and throughout the investing of your assets.

Investing in securities involves risk of loss that clients should be prepared to bear. Although we
manage your portfolio with strategies and in a manner consistent with your risk tolerances, there
can be no guarantee that our efforts will be successful. You should be prepared to bear the risk
of loss.

All investments involve the risk of loss, including (among other things) loss of principal, a
reduction in earnings (including interest, dividends, and other distributions), and the loss of
future earnings. These risks include market risk, interest rate risk, issuer risk, and general
economic risk. Regardless of the methods of analysis or strategies suggested for your particular
investment goals, you should carefully consider these risks, as they all bear risks.

KIG’s primary goal for investing is to help the client maintain purchasing power over the long
term. This may result in short term variability and loss of principal. Time horizon and risk
tolerance are key determinates of the proper asset allocation. KIG’s approach focuses on taking
appropriate risks for which clients are compensated (i.e. market risk) and seeking to limit or
eliminate risks that do not provide compensation over the long term (i.e. individual stock risk or
lack of portfolio risk).

Below are some more specific risks of investing:

Market Risk. The prices of securities in which clients invest may decline in response to certain
events taking place around the world, including those directly involving the companies whose
securities are owned by the client or an underlying fund; conditions affecting the general
economy; overall market changes; local, regional or global political, social or economic
instability; and currency, interest rate and commodity price fluctuations. Investors should have a
long-term perspective and be able to tolerate potentially sharp declines in market value.

Management Risk. KIG’s investment approach may fail to produce the intended results. If our
perception of the performance of a specific asset class or underlying fund is not realized in the
expected time frame, the overall performance of client’s portfolio may suffer.

Equity Risk. Equity securities tend to be more volatile than other investment choices. The value
of an individual mutual fund or ETF can be more volatile than the market as a whole. This
volatility affects the value of the client’s overall portfolio. Small- and mid-cap companies are
subject to additional risks. Smaller companies may experience greater volatility, higher failure
rates, more limited markets, product lines, financial resources, and less management experience
than larger companies. Smaller companies may also have a lower trading volume, which may
disproportionately affect their market price, tending to make them fall more in response to
selling pressure than is the case with larger companies.

Fixed Income Risk. The issuer of a fixed income security may not be able to make interest and
principal payments when due. Generally, the lower the credit rating of a security, the greater the
risk that the issuer will default on its obligation. If a rating agency gives a debt security a lower
rating, the value of the debt security will decline because investors will demand a higher rate of
return. As nominal interest rates rise, the value of fixed income securities is likely to decrease. A
nominal interest rate is the sum of a real interest rate and an expected inflation rate.

Municipal Securities Risk. The value of municipal obligations can fluctuate over time, and may
be affected by adverse political, legislative and tax changes, as well as by financial developments
that affect the municipal issuers. Because many municipal obligations are issued to finance
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