Red Oak Financial Group LLC

Item 5 – Fees and Compensation

The following paragraphs detail the fee structure and compensation methodology for services provided by the
Advisor. Each Client engaging the Advisor for services described herein shall be required to enter into one or
more written agreements with the Advisor.

A. Fees for Advisory Services
Wealth Management Services

                                                 Red Oak Financial Group
                                         403 Allegheny Avenue, Towson, MD 21204
                                        Phone: (410) 321-0168 * Fax: (410) 321-0169

                                                  http://redoak1978.com/

Clients engaged for comprehensive wealth management services will be charged a single combined fee for
investment management and financial planning services based on the market value of assets under
management.
Wealth management fees are paid quarterly, in advance of each calendar quarter, pursuant to the terms of the
investment advisory agreement. Wealth management fees are based on the market value of assets under
management at the end of the prior calendar quarter. Wealth management fees range up to 1.50% annually
based on several factors, including: the complexity of the services to be provided, the level of assets to be
managed, and the overall relationship with the Advisor. Relationships with multiple objectives, specific reporting
requirements, portfolio restrictions and other complexities may be charged a higher fee. Fees may vary from the
above fee depending on the nature and complexity of each Client’s circumstances, or with the inclusion of a
financial plan. An estimate for the total costs will be determined prior to establishing the advisory relationship.

The wealth management fee in the first quarter of service is prorated from the inception date of the account[s] to
the end of the first quarter. Fees are negotiable at the sole discretion of the Advisor. The Client’s fees will take
into consideration the aggregate assets under management with the Advisor. All securities held in accounts
managed by Red Oak Financial will be independently valued by the Custodian. The Advisor will conduct periodic
reviews of the Custodian’s valuation to ensure accurate billing.

The Client may make additions or withdrawals from the account[s] at any time, subject to the Advisor’s right to
terminate an account or the overall relationship. Additions may be in cash or securities provided that the Advisor
reserves the right to liquidate any transferred securities or decline to accept particular securities into a Client’s
account[s]. Clients may withdraw account assets on notice to Red Oak, subject to the usual and customary
securities settlement procedures. However, the Advisor typically designs its investment portfolios as long-term
investments and the withdrawal of assets may impair the achievement of a Client’s investment objectives. Red
Oak may consult the Client about certain implications of such transactions. Clients are advised that when such
securities are liquidated, they may be subject to securities transaction fees, short-term redemption fees, and/or
tax ramifications. If assets are deposited into or withdrawn from the Client’s account[s], the Advisor’s fee will be
adjusted in the next billing period to reflect the fee difference. The Advisor, at its sole discretion, will negotiate a
fee that differs from the schedule above for certain account[s] or holdings.

The Advisor’s fee is exclusive of, and in addition to any applicable brokerage fees, transaction fees, and other
related costs and expenses, which will be incurred by the Client. However, the Advisor shall not receive any
portion of these commissions, fees, and costs.

Financial Planning Services
Red Oak Financial may also be engaged for financial planning services as a separate engagement. Financial
planning services are offered on either an hourly basis or for a fixed fee per engagement. Hourly engagements
are at a rate of $150 to $500 per hour. Fixed fee engagements range from $1,500 to $15,000. Fees are
negotiable based on the nature and complexity of the services to be provided and the overall relationship with the
Advisor. An estimate for total hours and total costs will be provided to the Client prior to engaging for these
services.

Retirement Plan Advisory Services
Fees for retirement plan advisory services are charged an annual asset-based fee of up to 1.00%. Retirement
plan advisory fees are payable either monthly or quarterly, at the end of each month or calendar quarter.
Retirement plan advisory fees are negotiable with the plan sponsor.

Use of Independent Managers
As noted in Item 4, the Advisor will implement all or a portion of a Client’s investment portfolio utilizing one or
more Independent Managers. To eliminate any conflict of interest, the Advisor does not earn any compensation
from an Independent Manager. The Advisor will only earn its investment advisory fee as described above.
Independent Managers typically do not offer any fee discounts but may have a breakpoint schedule which will
reduce the fee with an increased level of assets placed under management with an Independent Manager. The
terms of such fee arrangements are included in the Independent Manager’s disclosure brochure and applicable

                                                  Red Oak Financial Group
                                          403 Allegheny Avenue, Towson, MD 21204
                                         Phone: (410) 321-0168 * Fax: (410) 321-0169

                                                   http://redoak1978.com/

contract[s] with the Independent Manager. The total blended fee, including the Advisor’s fee and the Independent
Manager’s fee, will not exceed 2.00% annually.

B. Fee Billing
Wealth Management Services
Wealth management fees are calculated and deducted from the Client’s account[s] by the Custodian. The Client
...

Item 7 – Types of Clients

Red Oak Financial offers wealth management services to individuals, high net worth individuals, trusts, estates,
charitable organizations, businesses and retirement plans. Red Oak Financial generally does not impose a
minimum size for establishing a relationship.