Kinnamon & Associates Ltd II

Item 5      Fees and Compensation

                     PORTFOLIO MANAGEMENT SERVICES FEES
The annualized fee for Portfolio Management Services will be charged as a fixed fee,
negotiated on a case-by-case basis. Overall factors to be considered will include the
type and amount of assets to be managed and the complexity of the client's
circumstances. KINNAMON & ASSOCIATES, LTD. II's fixed fees range from 0.5% to
1.25% of Managed Assets.
Clients will be invoiced in arrears at the end of each calendar quarter based on the pre
agreed fixed fee.
Limited Negotiability of Advisory Fees: Although KINNAMON & ASSOCIATES, LTD.
II has established the aforementioned fee schedule(s), we retain the discretion to
negotiate alternative fees on a client-by-client basis. Client facts, circumstances and
needs will be considered in determining the fee schedule. These include the complexity
of the client, assets to be placed under management, anticipated future additional
assets; related accounts; portfolio style, account composition, reports, among other
factors.
We may group certain related client accounts for the purposes of achieving the
minimum account size requirements and determining the annualized fee.
Discounts, not generally available to our advisory clients, may be offered to family
members and friends of associated persons of our firm.

                             PENSION CONSULTING FEES
We charge an annual fee for Pension Consulting Services which ranges from 0.5% to
1.25% of plan assets depending on the services requested and the size of the plan.

                              FINANCIAL PLANNING FEES
KINNAMON & ASSOCIATES, LTD. II's Financial Planning fee will be determined based
on the nature of the services being provided and the complexity of each client's
circumstances. All fees are agreed upon prior to entering into a contract with any client.
Our Financial Planning fees are calculated and charged on an hourly basis, ranging
from $125 to $200 per hour. Although the length of time it will take to provide a Financial
Plan will depend on each client's personal situation, we will provide an estimate for the
total hours at the start of the advisory relationship.
Our Financial Planning fees are calculated and charged on a fixed fee basis, typically
ranging from $500 to $2,500 a quarter, depending on the specific arrangement reached
with the client.
We may request a retainer upon completion of our initial fact-finding session with the
client; however, advance payment will never exceed $500 for work that will not be
completed within six months. The balance is due upon completion of the plan.
Fees Offset By Commissions: If a Financial Planning client executes recommended
securities transactions through associated persons of our firm in their separate
capacities as registered representatives of a broker dealer, these individuals will earn
commissions which are separate and distinct from fees charged for advisory services. In
some instances, depending on the size of the transaction, advisory fees will be
discounted, at our discretion, for commissions earned. Commissions will not be credited
towards future advisory fees.
The client will be billed quarterly in arrears based on actual hours accrued.
Management personnel and other related persons of our firm are licensed as registered
representatives of a broker-dealer and/or licensed as insurance agents or brokers. In
their separate capacity(ies), these individuals are able to implement investment
recommendations for advisory clients for separate and typical compensation (i.e.,
commissions, 12b-1 fees or other sales-related forms of compensation). This presents a
conflict of interest to the extent that these individuals recommend that a client invest in a
security which results in a commission being paid to the individuals. Clients are not
under any obligation to engage these individuals when considering implementation of
advisory recommendations. The implementation of any or all recommendations is solely
at the discretion of the client. Our Stock trades commission schedule is as follows:

              Purchase Price(Amt)                                  Commission Formula

              0 - $15,000                                          (AMT*2%)+$50)*80%
              15,000 - $35,000                                     (AMT*1.5%)+$50)*80%
              >$35,000                                             (AMT*1.0%)*80%

Exceptions:If the stock purchase involves greater than 2000 shares, there is an
extra .02-cent per share charge; on Penny stock purchases, defined as less than $2.00
per share cost, the commission will be calculated using Cetera's commission schedule.

                                GENERAL INFORMATION
Termination of the Advisory Relationship: A client agreement may be canceled at
any time, by either party, for any reason upon receipt of 30 days written notice. As
disclosed above, certain fees are paid in advance of services provided. Upon
termination of any account, any prepaid, unearned fees will be promptly refunded. In
calculating a client's reimbursement of fees, we will pro rate the reimbursement
according to the number of days remaining in the billing period.
Mutual Fund Fees: All fees paid to KINNAMON & ASSOCIATES, LTD. II for
investment advisory services are separate and distinct from the fees and expenses
charged by mutual funds and/or EFTs to their shareholders. These fees and expenses
are described in each fund's prospectus. These fees will generally include a
management fee, other fund expenses, and a possible distribution fee. If the fund also
imposes sales charges, a client may pay an initial or deferred sales charge. A client
could invest in a mutual fund directly, without our services. In that case, the client would
not receive the services provided by our firm which are designed, among other things,
to assist the client in determining which mutual fund or funds are most appropriate to
...

Item 7      Types of Clients
KINNAMON & ASSOCIATES, LTD. II provides advisory services to the following types
of clients:
• Individuals (other than high net worth individuals)
• High net worth individuals
• Pension and profit sharing plans(other than plan participants)
• Corporations or other businesses not listed above