Madrona Financial Services LLC

Item 5       Fees and Compensation

Asset-based fees are charged quarterly, in arrears, based on the value of the account assets as
of the last business day of the quarter. Madrona relies on the prices or values provided by the
qualified custodian holding the accounts assets—Madrona does not independently price the
securities held in the accounts we advise.

In cases where the account holds unregistered securities (private placements), for which a
market value is not available, we value the holdings at original cost for billing purposes. Original
cost may be more or less than the actual market value of the security, and may be more or less
than the proceeds investors will receive upon liquidation or termination of the security.

A significant portion of our assets under management are invested in accordance with our
models, though we tailor our advice to our clients and a number of our clients have legacy or
other individual equity positions, or are otherwise not allocated to the models at all. Where we
recommend a private placement, that investment will not be included in the model but its value
will be included with other assets and assessed the same annual fee, unless the product was
subject to a brokerage commission and recommended by one of our representatives while the
representative was previously also registered with a broker-dealer. See below for the range of
our asset under management fees.

Also see Item 8 Methods of Analysis, Investment Strategies and Risk of Loss for further
information on private placements, including their costs and the impact on fees of Madrona’s
recommending private placements.

                    INVESTMENT SUPERVISORY SERVICES
      MODEL PORTFOLIO, DST MANAGEMENT, AND THIRD-PARTY ADVISER FEES

A minimum of $500,000 of investable assets is generally required for this service, though the
minimum is negotiable. Madrona may group certain related client accounts for the purposes of
achieving the minimum account size and determining the annualized fee. In our discretion, we
may accept clients with investable assets of between $250,000 and $500,000, but those clients
will be offered a separate service and will generally not have access to our Rooted Wealth
services without additional fees.

Our annual fees for Model Portfolio Management Services and managing client investments in
“standard” assets, such as stock market investments (equities and fixed income), structured
notes, and non-traded REITs, are based upon a percentage of assets under management and
are generally as follows:

                                  Standard Asset Fee Schedule

                           Assets Under Management            Annual Fee
                         0 to $1,000,000                        1.25%
                         $1,000,000 to $5,000,000               1.05%
                         $5,000,000 to $10,000,000              0.85%
                         $10,000,000 to $15,000,000             0.75%
                         $15,000,000 to $25,000,000             0.65%
                         Assets in excess of $25,000,000        0.50%

Where we select a sub-adviser to manage all or a portion of client assets, Madrona is charged
additional fees for the aggregate amount of our client assets managed through sub-advisers.
The additional fee charged to us ranges from 10 basis points (0.10%) to 65 basis points (0.65%)
depending on the investment strategy. In general, we will apply this additional charge to client
assets, thereby increasing the overall fee charged to the client.

For more complex strategies, which may involve options trading, we may select other sub-
advisers that have fee schedules ranging from 50 basis points (0.50%) to 75 basis points
(0.75%), depending on the strategy employed and the size of the account allocated to the sub-
adviser. We negotiate with clients as to whether we will apply the additional charge to client
assets, thereby increasing the overall fee charged to the client, or whether we will absorb the
sub-adviser’s fees, whether in full or in part. For example, we could pass along the entire third-
party fee and add that to our own annual fee, resulting in a maximum total fee of 2.00% for
assets of $1 million or below. Alternatively, we could choose to absorb the third-party fee entirely,
resulting in a maximum fee of 1.25%. Finally, we could choose to absorb some portion of the
third-party fee, in which case the maximum total fee would be somewhere between 1.25% and
2.00%.

If sub-adviser fees are in addition to Madrona’s advisory fees, that will be disclosed to the client
and prior consent obtained, if required by the advisory agreement. Clients are free to direct us
not to use sub-advisers. Please see Item 10 for additional information about our sub-adviser
arrangements, the fees involved, and the conflicts of interest the arrangements create.

DSTs are subject to a lower fee schedule. The products are available through many brokers for
an up-front commission, rather than an ongoing asset management fee, though clients may not
receive from brokers all the services provided through Madrona. The ongoing management fee
may cost you more or less over the life of the investment than an upfront commission.

                                       DST Fee Schedule

                                                                Annual
                              DSTs Under Management
                                                                  Fee
                           $100,000 to $1,000,000               1.00%
                           $1,000,000 to $5,000,000              .80%
                           Amount in excess of $5,000,000        .60%

Fees charged on DSTs are calculated and paid to us by the DST sponsor based on the original
amount invested, which includes a specified fee based on the above schedule and the value at
the time of investment. The fee charged applies on a per-DST basis and will not change based
...

Item 7       Types of Clients
Madrona provides advisory services to the following types of clients:

 ▪   Individuals (other than high net worth individuals)

 ▪   High net worth individuals

 ▪   Charitable organizations

 ▪   Corporations or other businesses not listed above

Clients must generally have minimum investable assets of $500,000, including securities,
insurance products, and DSTs or other non-standard assets we advise on. The minimum is
negotiable and if we accept clients with investable assets between $250,000 and $500,000, those
clients will generally not have access to our Rooted Wealth services without additional fees.