McDonough Capital Management Inc

ITEM 5 - FEES AND COMPENSATION

Description
MCM bases its asset management fee on a percentage of assets under management.

Asset Management Fees
Generally, the annualized fees for managed accounts are based on the following floating rate schedule:

             Assets Under ManagementMaximum Annualized Fee
             <$1,000,000                 1.50%
             $1,000,000 - $5,000,000     1.0%
             $5,000,000 - $10,000,000    0.9%
             $10,000,000+                Negotiable

Lesser fees may be available elsewhere. In its discretion, the Firm may allow related accounts, such as those of
members of the same household, to be aggregated for the purpose of determining the advisory fee or for meeting the
previously stated minimum. MCM also offers clients an annualized fixed fee for managed accounts. The annualized
fixed fee is applied to the total value of the client’s assets under management and ranges from 1.00% to 0.75% on the
value of assets under management. The final fee is negotiable based on the size, asset composition and complexity of
the client account. Older client relationships may be subject to a lower fee schedule. In any case, the fees, fee-paying
arrangements, and terms will be set forth in the executed Investment Advisory Agreement for services.

MCM, in its sole discretion, may waive its minimum fee and/or charge a lesser investment advisory fee based upon
certain criteria (e.g., historical relationship, type of assets, anticipated future earning capacity, anticipated future
additional assets, dollar amounts of assets to be managed, related accounts, account composition, negotiations with
clients, etc.).

Financial Planning Fees
Typically, the Firm does not charge separately or offer separate financial planning services apart from asset
management.

MCM does not represent, warrant, or imply that the services or methods of analysis employed by the Firm can or will
predict future results, successfully identify market tops or bottoms, or insulate clients from losses due to market
corrections or declines.

MCM reserves the right to advise clients on any other type of investment that it deems appropriate based on the client’s
stated goals and investment objectives. MCM may also provide advice on any type of investment held in a client’s
portfolio at the inception of the advisory relationship or on any investment for which the client requests advice.

MCM’s fees are exclusive of brokerage commissions, transaction fees, and other related costs and expenses which
shall be incurred by the client. Clients may incur certain charges imposed by custodians, brokers, and other third
parties such as fees charged by managers, custodial fees, deferred sales charges, odd-lot differentials, transfer taxes,
wire transfer and electronic fund fees, and other fees and taxes on brokerage accounts and securities transactions.
Mutual funds and exchange traded funds also charge internal management fees, which are disclosed in a fund’s
prospectus. Such charges, fees and commissions are exclusive of and in addition to MCM’s fee, and MCM shall not
receive any portion of these commissions, fees, and costs. The client should review all fees charged by mutual funds,
MCM, and others to fully understand the total amount of fees to be paid by the client.

Fee Billing
Asset management fees are billed quarterly, in advance, as outlined in the Investment Advisory Agreement. The asset-
based fee is calculated on the account asset value on the last business day of the preceding calendar quarter. Fees will
be assessed pro rata in the event the Investment Advisory Agreement is executed at any time other than the first day
of a calendar quarter.

Payment of the Firm’s asset management fees will be made by the qualified custodian holding the client’s funds and
securities provided the client supplies written authorization permitting the fees to be paid directly from the client's
account. MCM will not have access to client funds for payment of fees without written consent by the client. Further,
the qualified custodian agrees to deliver an account statement directly to the client, at least quarterly, showing all
amounts disbursed from client's account, including fees paid to MCM. The client is encouraged to review all account
statements for accuracy. MCM will receive a duplicate copy of the statement that was delivered to the client.

As stated above, financial planning fees will be due upon presentation of the written plan.

Other Fees
For non-IRA/ERISA managed accounts, the client’s IAR may elect to absorb all or a portion of the Processing Fee, if
any, but not less than 10% per trade. In addition to assessing management fees, certain open-end mutual funds may
internally assess a distribution fee pursuant to section 12(b)-1 of the Investment Company Act of 1940, or an
administrative or service fee (“trail”). Such fees are included in the calculation of operating expenses of a mutual fund
and are disclosed in the fund prospectus. If received by the Firm, these fees will be used to offset Advisory Fees
incurred by the client. However, if the IAR elects to absorb at least 10% of the Processing Fees in non-IRA/ERISA
accounts, they may also elect to receive trails paid by the fund company, if any, to defray the cost of the Processing
Fees they absorb. If such an election is made, there may be a conflict of interest where the IAR may have an incentive
to absorb a portion or all of the Processing Fees in consideration of the actual or anticipated trails they will receive.

Clients should understand that the annual advisory fees charged in the asset management program are in addition to
the management fees and operating expenses charged by open-end, closed-end and exchange-traded funds (“ETFs”).
To the extent that a client intends to hold fund shares for an extended period of time, it may be more economical for
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ITEM 7 - TYPES OF CLIENTS

Description
MCM generally provides investment advice to individuals including high net worth individuals, pension and profit-
sharing plans, trusts, estates, charitable organizations, corporations, and other business entities.

Client relationships vary in scope and length of service.

Account Minimums
MCM generally imposes a minimum of $1,000,000 to open and maintain an advisory account. However, this account
minimum may be waived at the discretion of MCM if, for example, the client appears to have significant potential for
increasing assets under management. In its discretion, the Firm may waive this minimum or may allow related
accounts, such as those of members of the same household, to be aggregated for purposes of determining the advisory
fee or for meeting the previously stated minimum.