SMI Advisory Services LLC

Item 5 – Fees and Compensation
Advisory Fees
SMI is compensated for its advisory services by charging a fee based on the net market value of a Client’s
Account. SMI reserves the right, in its sole discretion, to negotiate, reduce, change or waive the advisory fee
for certain Client Accounts for any period of time determined by SMI. In addition, SMI may reduce, change
or waive its fees for the Accounts of some Clients without notice to, or fee adjustment for, other Clients.

The following are the annual management fees for the SMI Family of mutual funds:

    The Sound Mind Investing Fund (SMIFX) Management Fee

                   Fund Assets                             Management Fee
       Less than $250 million                                  1.00%
       Over $250 million to $500 million                       0.90%
       Over $500 million                                       0.80%

    SMI Multi-Strategy Fund (SMILX) Management Fee

                   Fund Assets                             Management Fee
       Less than $100 million                                  0.90%
       Over $100 million to $250 million                       0.80%
       Over $250 million to $500 million                       0.70%
       Over $500 million                                       0.60%

    The SMI Dynamic Allocation Fund (SMIDX) Management Fee

                   Fund Assets                             Management Fee
       Less than $250 million                                  1.00%
       Over $250 million to $500 million                       0.90%
       Over $500 million                                       0.80%

For PMAs, SMI charges the following annual management fees:

                                                                                   Transaction
                 Program                      Client Assets        Annual Fee         Costs

          SMI Private Client - Classic   $100,000 - $249,999       1.00%             Included*
          SMI Private Client - Select    $250,000 - $999,999       0.95%             Included*
          SMI Private Client - Premier   $1,000,000 and above      0.85%             Included*

    Clients will pay any transaction charges incurred by the Held Away Account(s).

SMI may have the ability, through arrangements between SMI and third parties, to advise or manage
Client’s 401(k), 403(b), 529, Donor Advised Fund and/or health savings account(s) held at financial
institutions other than Custodian where SMI cannot directly access such accounts (hereafter and
collectively, “Held Away Accounts”).

Fees will be calculated monthly, based on the average daily value of the Account(s) or Held Away Account(s)
assets (securities, cash and cash equivalents) under management as valued by the Custodian, when
available, or otherwise in good faith, and paid monthly. The monthly fee is determined by multiplying the
month's average daily value by the annual management fee divided by 12.
Since the advisory fee is applied to the Account(s) or Held Away Account(s) month’s average daily balance
under management, and since some of days in the first month may have no assets under management, the
Initial Advisory Fee is appropriately pro-rated, and it is due at the end of the month in which this
Agreement was executed. Subsequent Advisory Fees will be assessed at the end of each month and paid on
or around the first business day of the following month. Additional deposits of funds and/or securities will
be subject to the same billing procedures. This includes deposits of stocks, bonds, mutual funds, and any
other securities approved by SMI for investment in this type of account.
In the event of termination, the final Advisory Fee for the Account(s) or Held Away Account(s) will be
calculated, with appropriate proration, as of the day that SMI receives notification of the termination.

In limited circumstances, mutual funds sponsored and managed by SMI (the “SMI Funds”) will be invested
into the Account. SMI earns fees in connection with the services it provides to the SMI Funds (the “SMI
Funds’ Internal Expenses”), and such SMI Funds’ Internal Expenses will generally be higher than the Advisory
Fee. The SMI Mutual Funds will usually be implemented into the Account in the following limited
circumstances:
      A. The Account is comprised of less than an amount of assets sufficient to support the full
         implementation of the SMI Strategies, and the Account is subject to an Advisory Fee of 1% per
         annum; or
      B. Upon the specific direction of Client in writing (e.g., so as to avoid triggering an undue tax obligation
         or for reasons otherwise in furtherance of SMI’s fiduciary duty to Client).

With respect to the limited circumstance described in Paragraph A, above, SMI will offset any SMI Funds’
management fees it receives against the 1% PMA Advisory Fee shown above.

With respect to the limited circumstance described in Paragraph B, above, the PMA Advisory Fee will not be
charged on the assets that are invested in the SMI Funds.

In the event that an ETF, whose investment advisor is an affiliate of SMI, is purchased in the PMAs, the
Classic, Select, and Premier tiers’ PMA fee charged on the assets invested in the ETF will be reduced by
subtracting that ETF’s net revenue contribution to SMI from the normal PMA fee . Example: If a Client’s
Premier tier PMA account is normally charged 0.85% and the account has $100,000 in an ETF whose
investment advisor is an affiliate of SMI and SMI receives 0.30% in revenue from the ETF, then the $100,000
would be charged a PMA fee of (0.85% - 0.30%).

In the event that an ETF, whose investment advisor is an affiliate of SMI, is purchased in the SMI Funds, SMI
will reduce the management fee of the corresponding SMI Fund by an amount intended to offset the net
revenue SMI receives from managing the ETF.
...

Item 7 – Types of Clients
SMI generally provides investment advice to individuals and investment companies. For the SMI Family of
mutual funds, the minimum investment is $500. If an automatic investment plan is established, then the
initial minimum is $0.

In general, a Client should have a minimum of $100,000 to establish a PMA. This minimum may be waived
on an account-by-account basis at the sole discretion of our management.

Additional conditions for opening and maintaining a PMA:
The Client must acknowledge their ability and willingness to conduct their relationship with SMI on an
electronic basis. Under the terms of the Account Agreement, each Client agrees to receive all Account
information and Account documents (including this Brochure), and any updates or changes to same,
through their access to the Site and SMI’s electronic communications. Unless noted otherwise on the Site or
within this Brochure, SMI’s advisory service, the signature for the Account Agreement, and all
documentation related to the advisory services are managed electronically. SMI does make individual
representatives available to discuss servicing matters with Select and Premier Tier Clients.
Investors with specific restrictions are not permitted to become Clients.

SMI provides educational information related to the services provided and does not offer recommendations
regarding the decision to move accounts to SMI’s management. Clients with retirement Account(s) must
acknowledge SMI representatives did not provide any recommendations regarding whether Client should
roll over or transfer their retirement Account(s) to SMI for management.