Professional Financial Management Inc

Item 5 – Fees and Compensation
A.
Level I – Investment Management – Fees for the Investment Management service are broken into
two levels: managed accounts and outside accounts (Outside accounts generally include employer
retirement plans [e.g., 401k, 403b, 457, etc.]). All fees are negotiable.
          • Fees for the managed accounts are calculated as a percentage of the total value of
             investments under PFM's management as set forth in the following table.
          • Fees for the outside accounts are calculated as a percentage of the total value of
             investments under PFM's advisement as set forth in the following table. However, if
             the combined balances of the managed and outside accounts total $100,000 or more,
             the outside accounts’ annual fee percentage is 50% of the marginal rate.

         Value of Assets                                Annual Fee
         $0 - $100,000                                  1.20%
         $100,001 - $500,000                            1.00%
         $500,001 - $1,000,000                          0.90%
         $1,000,001 - $2,500,000                        0.80%
         $2,500,001 - $5,000,000                        0.70%
         Over $5,000,000                                0.60%

The initial fee is charged from the date the agreement is signed through the end of the first calendar
quarter on a prorated basis. Thereafter, fees are payable quarterly in advance based on the market
value of the assets at the end of the immediately preceding calendar quarter as specified in the
Investment Management Services Agreement. In most cases, PFM deducts fees directly from the
investment accounts. However, if a client chooses, PFM could send a bill for payment. Note:
Fees for outside accounts cannot be deducted directly from the account. Therefore, the client
must choose to either have the fees deducted from a taxable managed account or have a bill sent
for payment by the client.

Clients should be aware that mutual funds and exchange traded funds/notes (ETFs/ETNs) also
charge customary internal investment management fees and other internal expenses as described
in the prospectus of each fund. Thus, clients pay these internal fees to the mutual fund and/or ETF

managers and administrators in addition to fees to PFM. Fees relating to transactions may be
charged by the brokerage firm processing the transactions. Please refer to Item 12 Brokerage
Practices for additional information.

As noted above, fees are charged quarterly in advance. If the Investment Management Services
Agreement is terminated before the end of the billing period, the client may be granted a partial
refund at PFM’s discretion. If a refund is granted, the amount of the refund will be prorated from
the date of termination of the contract to the end of the billing period.

Level II – Financial Planning - Fees for the Financial Planning service are broken into three levels:
managed accounts, outside accounts (Outside accounts generally include employer retirement
plans [e.g., 401k, 403b, 457, etc.]) and financial planning fees. All fees are negotiable.
          • Fees for the managed accounts are calculated as a percentage of the total value of
              investments under PFM's management as set forth in the following table.
          • Fees for the outside accounts are calculated as a percentage of the total value of
              investments under PFM's advisement as set forth in the following table. However, if
              the combined balances of the managed and outside accounts total $100,000 or more,
              the outside accounts’ annual fee percentage is 50% of the marginal rate.
          • Financial planning fees - $50 per quarter.

         Value of Assets                                Annual Fee
         $0 - $100,000                                  1.20%
         $100,001 - $500,000                            1.00%
         $500,001 - $1,000,000                          0.90%
         $1,000,001 - $2,500,000                        0.80%
         $2,500,001 - $5,000,000                        0.70%
         Over $5,000,000                                0.60%

The initial fee is charged from the date the agreement is signed through the end of the first calendar
quarter on a prorated basis. Thereafter, fees are payable quarterly in advance based on the market
value of the assets at the end of the immediately preceding calendar quarter as specified in the
Investment Management Services Agreement. In most cases, PFM deducts fees directly from the
investment accounts. However, if a client chooses, PFM could send a bill for payment. Note:
Fees for outside accounts cannot be deducted directly from the account. Therefore, the client
must choose to either have the fees deducted from a taxable managed account or have a bill sent
for payment by the client.

Clients should be aware that mutual funds and exchange traded funds/notes (ETFs/ETNs) also pay
customary internal investment management fees and other internal expenses as described in the
prospectus of each fund. Thus, clients pay these internal fees to the mutual fund and/or ETF
managers and administrators in addition to fees to PFM. Fees relating to transactions may be
charged by the brokerage firm processing the transactions. Please refer to Item 12 Brokerage
Practices for additional information.

As noted above, fees are charged quarterly in advance. If the Investment Management Services
Agreement and/or the Financial Planning and Consulting Service Agreement is terminated before

the end of the billing period, the client may be granted a partial refund at PFM’s discretion. If a
refund is granted, the amount of the refund will be prorated from the date of termination of the
contract to the end of the billing period.

Level III – Wealth Advisory - Fees for the Wealth Advisory service are broken into three levels:
...

Item 7 – Types of Clients

PFM provides advice to a wide variety of clients, including individuals, entities, pension and profit
sharing plans, trusts, estates and charitable organizations, corporations and other business entities.