Philip James Wealth Management LLC

Fees and Compensation

The following types of fees will be assessed:

Asset Management – Pension consulting services are included in the fees for asset management
services. Fees are charged quarterly in advance or arrears and are based primarily on asset size
and the level of complexity of the services provided. In individual cases, PGI has the sole
discretion to negotiate fees that are lower than the standard fee shown or to waive fees. Instances
where fees may be reduced or waived include for employees of the firm, friends or relatives of
employees of the firm, and the potential and/or expectation of assets increasing in the foreseeable
future. 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 quarter will be prorated based upon the number of calendar days in the
calendar quarter that the advisory agreement is in effect. Fees are based on the daily average
value of the assets of the previous quarter or the value of assets on the last day of the previous
quarter, or a fixed fee not to exceed 2%. Annual fees range up to 2.00% depending on the
amount of assets under management (“AUM”).

As authorized in the client agreement, the account custodian withdraws PGI Wealth
Management’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 PGI 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.

Fees are charged in advance or arrears on a quarterly basis, meaning that advisory fees for a
quarter are charged on the first day of the quarter. Clients may terminate investment advisory
services obtained from PGI, without fee or penalty, upon written notice within five (5) business
days after entering into the advisory agreement with PGI. Thereafter, the client may terminate
advisory services upon written notice delivered to and received by PGI. Clients who terminate
investment advisory services during a quarter are charged a prorated advisory fee based on the
date of PGI’s receipt of client’s written notice to terminate. Any unearned pre-paid fees will be
refunded to the client on a pro-rata basis based on the date of termination.

Additional Fees and Expenses

In addition to advisory fees paid to PGI as explained above, clients may pay custodial service,
account maintenance, transaction, and other fees associated with maintaining the account. These
fees vary by broker and/or custodian. Clients should ask PGI for details on transaction fees or
other custodial fees specific to their account, as these fees are not included in the annual advisory
fee. PGI does not share any portion of such fees. Additionally, for any mutual funds purchased,
the client may pay their proportionate share of the funds’ distribution, internal management,
investment advisory and administrative fees. Mutual fund companies impose internal fees and
expenses on clients. Mutual funds purchased or sold in custodian accounts may generate
transaction fees that would not exist if the purchase or sale were made directly with the mutual
fund company. Mutual funds held in custodian accounts also charge management fees. Such
fees are not shared with PGI and are compensation to the fund manager. Clients are urged to
read the mutual fund prospectus prior to investing.

Please refer to Item 12 “Brokerage Practices” of this brochure for additional information.

Representatives of PGI Wealth Management may also be licensed insurance agents. From time
to time, they may offer clients advice or products from those activities. Clients should be aware
that these services pay a commission and involve a conflict of interest, as the sale of
commissionable products conflicts with the fiduciary duties of a registered investment adviser.
PGI always acts in the best interest of the client; including the sale of commissionable products
to advisory clients. Clients always have the right to decide whether to implement any insurance
recommendations made by the firm. If the client does decide to implement those
recommendations, they always have the right to do so through the insurance agent of their
choice.

Form ADV, Part 2A, Item 6

          Performance-Based Fees and Side-By-Side Management

PGI Wealth Management does not charge performance-based fees or participate in side-by-side
management. Side-by-side management refers to the practice of managing accounts that are
charged performance-based fees while at the same time managing accounts that are not charged
performance-based fees. Performance-based fees are fees that are based on a share of capital
gains or appreciation of the assets of a client. Our fees are calculated as described in Fees and
Compensation section above and are not charged on the basis of performance of your advisory
account.

Form ADV, Part 2A, Item 7

Types of Clients

PGI offers investment advisory services to individuals, high net worth individuals, pension and
profit sharing plans, and non-profits and charitable organizations. There is no minimum account

size to open and maintain an advisory account, nor are there any conditions or restrictions in
maintaining an advisory account with PGI.

Form ADV, Part 2A, Item 8

       Methods of Analysis, Investment Strategies, and Risk of Loss

PGI’s methods of analysis and investment strategies incorporate the client’s needs, goals,
investment objectives, time horizon, and risk tolerance. PGI will often recommend long-term
strategies, such as dollar-cost averaging, reinvestment of dividends or other proceeds on
investments and asset allocation. Recommendations can also be made to help you realize capital
gains or losses on securities or investment products that you own and will consider the clients’
risk tolerance levels, goals, investment history and experiences, time horizon, and other relevant
factors as determined during the engagement process, as well as on an on-going basis. Generally,
PGI invests with a long-term outlook. Therefore, frequent trading would not be typical in our
portfolios. Frequent trading can negatively affect account performance because of an increase in
the client’s brokerage and transaction costs. Examples of methodologies 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 purchased 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. While PGI is not a market
timer or “technical” trader of securities, it is one component considered when implementing
allocations and rebalances for client accounts.

Fundamental Analysis – Fundamental analysis is a technique that attempts to determine a
security’s value by focusing on underlying factors that affect a company's actual business and its
future prospects. The analysis is performed on historical and present data. On a broader scope,
one can perform fundamental analysis on industries or the economy as a whole. The term refers
to the analysis of the economic well-being of a financial entity as opposed to only its price
movements. The risk associated with fundamental analysis is that despite that appearance that a
security is undervalued, it may not rise in value as predicted.

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.

All investments have certain risks that are borne by the investor. Our investment approach
attempts to mitigate investment risk through diversification among multiple security issuers,

sectors, asset classes, investment types, markets, and by using the above outlined strategies.
Nevertheless, investors face the following investment risks:

•      Interest-rate Risk: Fluctuations in interest rates may cause investment prices to fluctuate.
For example, when interest rates rise, yields on existing bonds become less attractive, causing
their market values to decline.

•       Market Risk: The price of a security, bond, or mutual fund may drop in reaction to
tangible and intangible events and conditions. This type of risk is caused by external factors
independent of a security’s particular underlying fundamental circumstances. For example,
political, economic and social conditions may trigger market events.

•       Inflation Risk: When any type of inflation is present, a dollar today will buy more than a
dollar next year, because purchasing power is eroding at the rate of inflation.

•        Currency Risk: Overseas investments are subject to fluctuations in the value of the dollar
against the currency of the investment’s originating country. This is also referred to as exchange
rate risk.

•       Reinvestment Risk: This is the risk that future proceeds from investments may have to
be reinvested at a potentially lower rate of return (i.e. interest rate). This primarily relates to
fixed income securities that mature at a future time, such as CD’s and bonds.

•      ETF and Mutual Fund Risk: When investing in an ETF or mutual fund, you will bear
additional expenses based on your pro rata share of the ETF’s or mutual fund’s operating
expenses, including the potential duplication of management fees. The risk of owning an ETF or
mutual fund generally reflects the risks of owning the underlying securities the ETF or mutual
fund holds. You will also incur brokerage transaction costs when purchasing or selling ETF’s
and/or mutual funds.

•      Unique Risks Investing in ETFs: An ETF is a security that trades on an exchange during
market hours and typically seeks to track and index, commodity, or a basket of assets like an
index fund. However, some ETFs are actively management and do not seek to track a certain
index or basket of assets. ETFs may trade at a premium or discount to their Net Asset Value
(“NAV”) and may also be affected by market fluctuations of their underlying investment
holdings. An ETF purchased with a premium may not yield a premium or may be priced at a
discount upon sale. They may also have unique risks depending on their structure and
underlying investments.

•       Equity (stock) Risk: Common stocks are susceptible to general stock market
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