HIGHSTONE GROUP

FIRM BROCHURE ADV PART 2A 4205 Dover Road Richmond, VA 23221 Phone: (804) 285-7010 Fax: (804) 285-7046 WWW.HIGHSTONEGROUP.COM March 25, 2026 This brochure provides information about the qualifications and business practices of Highstone Group which is a registered investment adviser. Registration does not imply a certain level of skill or training. If you have any questions about the contents of this brochure, please contact us at (804) 285-7010. The information in this brochure has not been approved or verified by the United States Securities and Exchange Commission or by any state securities authority. Additional information about Highstone Group also is available on the SEC’s website at www.adviserinfo.sec.gov. 1  MATERIAL CHANGES There are no material changes since our last annual update of this brochure, dated March 25, 2025. Full Brochure Available Whenever you would like to receive a complete copy of our Firm Brochure, please contact us by telephone at: (804) 285-7010 or by email at: contact@highstonegroup.com 2  TABLE OF CONTENTS Item 1 – Cover Page Page 1 Item 2 – Material Changes Page 2 Item 3 – Table of Contents Page 3 Item 4 - Advisory Business Page 4 Item 5 - Fees and Compensation Page 5 Item 6 - Performance Based Fees Page 9 Item 7 - Types of Clients Page 9 Item 8 - Methods of Analysis, Investment Strategies and Risk of Loss Page 9 Item 9 - Disciplinary Information Page 11 Item 10 - Other Financial Industry Activities and Affiliations Page 11 Item 11 - Code of Ethics, Participation or Interest in Client Transactions and Personal Trading Page 12 Item 12 - Brokerage Practices Page 13 Item 13 - Review of Accounts Page 15 Item 14 - Client Referrals and Other Compensation Page 15 Item 15 – Custody Page 15 Item 16 - Investment Discretion Page 16 Item 17 - Voting Client Securities Page 17 Item 18 - Financial Information Page 17 3  Advisory Business Comprehensive Financial Planning Corporation (CFPC) is registered under state securities laws and the Federal Investment Advisors Act of 1940. Registration does not imply a certain level of skill or training. Our firm primarily conducts advisory services under the name of Highstone Group (HSG) Comprehensive Financial Planning Corporation was formed in 1983 by Ronald J. Hochstein. Mr. Hochstein is 100% owner of the corporation and remains as the firm’s President. The other officers of the company are Amy Hochstein Clark and Justin P. Hochstein. Asset Management HSG offers a variety of investment advisory services to its clients. First and foremost, we offer individual portfolio management and investment supervisory services (“Asset Management”). The firm provides individualized investment advice to clients based upon the client's specific needs. Through personal consultations, we gather specific financial data to develop a client’s personalized profile, which includes their investment objectives, current financial position, risk profile, investment time horizon, tax situation and liquidity needs. We review the client's personalized profile and, based upon this review, we determine an appropriate asset allocation for the client. Such allocations consider the client's liquidity needs, portfolio goals, tax objectives and risk tolerance. We then recommend specific investments to implement the client's recommended asset allocation, incorporating a client’s existing holdings where appropriate. We may also recommend non-securities products as part of this service to provide a more comprehensive approach to meeting the client’s needs. HSG does not limit its investment recommendations to any specific type of product or security. A client’s individual needs and objectives are analyzed to determine appropriate investments and products for the client. Since different types of investments typically involve different types of risk, the firm conducts a risk analysis of the client and his/her overall portfolio before recommending a certain investment. We generally manage assets on a non-discretionary basis, which means the client is always free to place restrictions on the types of investments the firm recommends for the client’s portfolio. In general, the firm utilizes equity investments in individual stocks, mutual funds, and exchange traded funds. We also provide recommendations on fixed income investments, including individual bond positions, bond mutual funds, certificates of deposit, and fixed income exchange traded funds. In addition, we provide advice related to real estate limited partnerships and Real Estate Investment Trusts and may also provide advice on variable and fixed insurance products. In some cases, we may recommend the purchase or sale of derivative products, including options contracts. However, since associates of HSG are registered representatives of Silver Oak Securities, Inc., a registered broker/dealer, investment recommendations are limited to only those products offered through that firm. 4  Consulting Services In addition to individualized investment management, HSG offers investment consulting services on an hourly-fee basis. This hourly fee is negotiable depending on the complexity of the service. Such consultation is normally offered to assist a client in an isolated area of concern, such as a specific investment or a specific area of financial planning. Consulting services are also offered in the form of administrative assistance not involving investment advice, to provide cost-basis information, or facilitate the transfer of assets or accounts. These services may be provided by HSG officers, representatives, or administrative support staff. Assets Under Management As of December 31, 2025, HSG was providing regular and continuous Asset Management services for 174 clients, “Households”. The total value of assets under management was $263,885,687 held in 841 accounts. This is all currently held as non-discretionary. Assets under management are calculated using the available market prices of all investments held in client portfolios, as reported by the Investment Company or custodian holding such assets on the date of valuation. Fees and Compensation Our typical client engagement agreement provides Comprehensive Financial Investment Advisory services which consist of Financial Planning, Tax Planning, Consulting Services and Portfolio Management. All fees for incorporated services are based on a percentage of assets under management. For those clients that wish to receive Financial Planning, Tax Planning and Consulting Services on a stand-alone basis without entering into an investment advisory agreement, an hourly charge for these specific services cited above range from $150 to $350 an hour depending on the complexity of the services. The rate will be agreed upon by all parties involved prior to services rendered. All fees are negotiable and payable in arrears. Payment is due within 30 days of receipt of the invoice. Investment Advisory Fees for services provided by our firm remain negotiable depending on the complexity of the services provided. The fees are agreed upon in advance with the client and will be stated specifically in a written agreement between HSG and the client. Advisory Fees will be billed monthly, in arrears of the services provided, based upon the account value on the last business day of the preceding period being billed. For accounts opened or closed during a calendar month, the fee due and payable will be pro-rated for the period. Advisory 5  fees will be charged to and collected directly from the client's account and paid to Highstone Group. Client will be provided with an account statement from their custodian reflecting the deduction of the advisory fee. If the account does not contain a sufficient cash or cash equivalent balance to pay advisory fees, HSG has limited authority to redeem securities in sufficient amounts to pay advisory fees. Clients may reimburse the account for advisory fees paid, except IRA or other tax qualified accounts. Clients may make additions to the account or withdrawals from the account provided the account continues to meet minimum account size requirements. HSG’s recommended minimum investment amount for establishing a fee-based account is $50,000. Exception may be granted to the minimum at HSG’s discretion. No fee adjustments will be made for partial withdrawals from or additional deposits to the account or for account appreciation or depreciation. The client shall be responsible for paying the following expenses: (i) all expenses of the transfer, receipt, safekeeping, servicing, and accounting for the client's cash, securities, and other property, including all charges of depositories, custodians, trustees, and other agents, if any, (ii) all broker's commissions and other charges incident to the purchase, sale, or lending of the client's securities; (iii) all tax or governmental fees payable by or with respect of the client to federal, state or other governmental agencies, domestic or foreign, including stamp or other transfer taxes. Fees paid to HSG for Portfolio Management Services are separate and distinct from the fees and expenses charged by mutual funds to their shareholders. These fees and expenses are described in each fund's prospectus. These fees will generally include a management fee, other fund expenses and a possible fund distribution fee. If the fund imposes sales charges, a client may pay an initial or deferred sales charge. Advisor representatives will be advised to recommend mutual funds that are load-waived or no-load to the maximum extent feasible for Portfolio Management Accounts, Silver Oak Securities, Inc., our broker-dealer, may receive payments from certain mutual funds distributed pursuant to a Rule 12(b)1 distribution plan or other such plan as compensation for administrative services, representing a separate financial interest to Advisor (Except Rule 12(b)1 fees paid to Advisor.) Additional information regarding brokerage practices is found on page 12 under Brokerage Practices. Subject to charges for work completed, the client or HSG may terminate the engagement by written notice to the other party at any time. The client will receive a refund of any fees paid if the agreement is terminated within five (5) business days of signing the engagement agreement. After the first five (5) business days, the client would receive a pro-rated refund for investment advice for the contract period. Fees are generally not negotiated once agreed to and upon 6  signing the engagement agreement, nor are refunds generally available once services are provided. Reasonable expenses are billed at an approximate of the actual cost. The client agrees to compensate HSG for any collection costs, expenses, and reasonable attorney's fees required to enforce any agreement. With respect to all services, our basic tiered fee schedule for new and prospective clients is: $0 to $1,000,000.00 1.50% Percent annually of the portfolio value between $1,000,000.01 to $2,500,000.00 1.25% Percent annually of the portfolio value between $2,500,000.01 1.00% Percent annually of the portfolio value between to $5,000,000.00 $5,000,000.01 0.75% Percent annually of the portfolio value And above *For example; a $3,000,000.00 portfolio end of month value would have a fee calculated as: $1,000,000.00 1.50% $1,250.00 $1,500,000.00 1.25% $1,562.50 $500,000.00 1.00% $416.67 $3,000,000.00 $3,229.17 Monthly Fee Due All work and terms of payment are negotiable based on factors in each individual case. Such factors may include the nature of the work, other work the firm is engaged in for the client, and competitive factors. However, the range within which fees for investment supervisory and/or portfolio management services generally fall is between 0.50% and 2.0% annually. This fee is charged based on a percentage of assets under management or subject to advice, as prorated monthly. Certain advisor representatives may also be separately licensed through various states to sell traditional and variable life insurance products for which they may receive usual and customary commission compensation. Traditional insurance product transactions such as term, universal and whole life insurance and fixed or index annuities may take place through HSG's affiliated insurance agency or through insurance companies with which an Advisor Representative maintains an appointment as an independent agent. HSG and advisor representatives may recommend that clients purchase fixed or variable insurance contracts when the client's tax or legal situation make such purchases suitable, or if client determines that certain living or death benefit guarantees available through insurance contracts are desirable in helping client meet their investment, tax or income objectives. Client is advised that variable and fixed insurance contracts carry fees and expenses relating to providing insurance guarantees that are in addition to the expenses associated with investment features. These insurance related expenses usually include mortality and expense risk fees, premium 7  taxes (in certain states), an annual contract administration fee and, in the case of life insurance, the cost of the life insurance risk to the insurance company. Client is advised that the additional fees charged by insurance companies within these contracts are separate and distinct from advisory fees charged by HSG. In addition, these contracts may have significant withdrawal or surrender penalties if a minimum contract holding period is not met. All fees and expenses associated with contract features & benefits are explained in detail in the prospectus for the product being recommended. Client is advised to review the prospectus provided carefully prior to purchase of a variable or fixed insurance product. A conflict of interest exists between the interests of HSG and/or its advisory representatives and the interests of the client in that HSG and advisory representatives offer financial planning and investment advisory services for a fee and offer various securities products in their concurrent capacities as registered representatives of a broker-dealer on which they may also be paid a commission. This practice gives advisory representatives an incentive to recommend investment products based on compensation received rather than solely on a client's needs. Advisory representatives are required to inform and seek prior approval from clients on any recommended securities transactions on which a separate commission will be earned so that client can make an informed decision prior to deciding on the recommended action. In recognition of the fact that fixed and variable insurance products pay commissions to advisory representatives of HSG who are also licensed insurance agents and/or broker-dealer registered representatives, no investment advisory fees will be incurred and charged on insurance products including annuity contracts where a commission has been earned for one full year (twelve months) from the date of the purchase transaction. Such amounts will be subject to investment advisory fee charges in subsequent years. Any amounts invested in insurance products that for any reason do not pay a commission to anyone who is affiliated as an employee or registered representative of HSG will be subject to normal investment advisory fees like other client investments. The value billed on will be the accumulated contract values excluding any applicable surrender charges. This value will be sent via the qualified custodian to a third-party billing software system. The actual terminology for the value varies between custodians and products. Clients are not obligated to place securities transactions through HSG and may use any Broker/Dealer they desire. Commissions or other fees for securities transactions may be higher or lower if placed through Silver Oak Securities, Inc. than if placed through another Broker/Dealer. Clients may purchase shares of mutual funds directly from the mutual fund issuer, its principal underwriter, or a distributor, or through other agents and brokers not affiliated with HSG, without purchasing the services of HSG or paying the advisory fees on such shares (but subject to any applicable sales charges). Certain mutual funds are offered to the public without sales charge. In the case of mutual funds offered with a sales charge, the prevailing sales charge (as described in the mutual fund prospectus) may be more or less than the applicable advisory fee. However, clients would not receive the advisory representative’s 8  assistance in developing an investment strategy, selection of securities, monitoring performance of the account, and making changes as necessary. Performance-Based Fees HSG does not use a performance-based fee structure because of the potential conflict of interest. Performance-based compensation may create an incentive for the adviser to recommend an investment that may carry a higher degree of risk to the client. However, the nature of asset-based fees allows HSG to participate in the growth of the client’s wealth. This also means that our fees can decline when the client’s portfolio declines in value. Types of Clients HSG can provide continuous discretionary and non-discretionary investment advisory and account supervisory services for individuals, businesses, individual retirement accounts, trusts and other entities. Methods of Analysis, Investment Strategies and Risk of Loss Product recommendations may include, but are not limited to, equities, corporate debt securities, municipal bonds, mutual funds, government securities, and options. HSG directly manages and diversifies clients’ portfolios based upon the client’s risk profile, investment horizon, financial goals, income (current and potential), tax bracket, portfolio size, net worth and other various suitability factors. Restrictions and guidelines imposed by clients effect the composition and performance of portfolios. For this reason, performance of portfolios within the same investment objective may differ. Our investment strategies may include long-term and short-term purchases. We select the specific investments using fundamental analysis. Fundamental analysis is an attempt to determine the fair market value of an investment using a combination of related economic, financial and other qualitative and quantitative factors. Fundamental analysts attempt to study everything that can affect the security's value, including macroeconomic factors (like the overall economy and industry conditions) and company- specific factors (like financial condition and management). Using fundamental analysis, an investor faces many types of risk both Financial (Liquidity Risk, Credit Risk, Interest Risk, Exchange Rate, Commodity Price, Equity Prices) and Non-Financial (Operation Risk, Model Risk, Settlement Risk, Accounting, Taxes, Legal, Regulation). With thorough due diligence and monitoring we hope to create a well-diversified portfolio that minimizes these risks while 9  maximizing returns. Risk of Loss: There is not a security that HSG offers where performance is guaranteed. Types of Risk include but are not limited to: Market Risk – Market risk, also known as systematic risk, is the possibility for an investor to experience losses due to factors that affect the overall performance of financial markets in which the investor is involved. GDP growth rates, interest rates, currency volatility, central bank and government actions, market conditions and liquidity, natural disasters, and man-made disasters (e.g. war and negligence) are examples of factors that affect the overall stock market. Interest-rate Risk – Fluctuations in interest rates may cause investment prices to fluctuate. For example, when interest rates rise, yields on existing bonds or dividend paying stocks become less attractive, causing their market values to decline. Stocks that do not pay dividends may also decline as the value of anticipated cash flows becomes relatively less attractive. Interest rates affect the value of all investments, but especially the value of fixed income securities. For example, a bond sold prior to maturity after interest rates have risen substantially would likely result in loss. Inflation Risk – Inflation risk, also known as purchasing power risk, is the chance that cash flows from an investment will not be worth as much in the future because of changes in purchasing power due to inflation. Reinvestment Risk – Reinvestment risk is the risk that proceeds from a payment of principal and interest, which must be reinvested at a lower rate than the original investment. Call features affect an investor’s reinvestment risk because corporations typically call their bonds in a declining interest rate environment. Default Risk – Default risk is the chance that a company will be unable to make the required payments on its debt obligations. Interest and principal payments may be altered if an insured bond defaults or the bank issuing the CD is closed. Equity holders may be wiped out. Company Specific Business Risks - Increased competition, technological change, higher material costs, lower sales prices, foreign currency exposure, corporate debt levels, regulations and litigation, are examples of company specific risks to consider. These types of risks are often listed under Risk Factors in each company’s Form 10-K filed with the SEC. Mutual Funds and ETFs An investment in a mutual fund or ETF involves risk, including the loss of principal. Mutual funds and ETFs are subject to secondary market trading risks. Shares of mutual funds and ETFs will be listed for trading on an exchange, however, there can be no guarantee that an active trading market for such shares will develop or continue. There can be no guarantee that a mutual funds’ and ETFs’ exchange listing or ability to trade its shares will continue or remain unchanged. 10  Volatility Risks The prices and values of investments can be highly volatile, and are influenced by, among other things, interest rates, general economic conditions, the condition of the financial markets, the financial condition of the issuers of such assets, changing supply and demand relationships, and programs and policies of governments. Cash Management Risks The Firm may invest some of a client’s assets temporarily in money market funds or other similar types of investments, during which time an advisory account may be prevented from achieving its investment objective. Fixed Income Securities Fixed income securities are subject to the risk of the issuer’s or a guarantor’s inability to meet principal and interest payments on its obligations and to price volatility. Disciplinary Information HSG and any of its employees have not or are not currently involved in any legal or disciplinary events. Other Financial Industry Activities and Affiliations Ronald J. Hochstein, Amy L. Clark, and Justin P. Hochstein are also independently licensed to sell insurance products through Comprehensive Financial Insurance Services, Inc. (CFIS), an affiliated company, for which Ronald J. Hochstein is the President and owner. CFIS is licensed with various insurance companies to sell their products. When acting in this capacity, they will receive commissions for selling these products. Clients are not obligated to implement insurance advice through the IARs in this capacity. Ronald J. Hochstein is the managing tax partner of Comprehensive Financial Group, LLC (CFG), a limited-liability company providing accounting and tax preparation services to clients. This relationship presents a potential conflict of interest, as clients may feel obligated to use CFG's services. Clients are not required to use CFG. At times, some of our clients may desire Comprehensive Financial Group, LLC (CFG) or affiliated persons acting in other capacities to assist in developing business arrangements for estate planning or investment purposes. These arrangements may involve organizing closely held businesses or coordinating contractual matters. In some cases, CFG and/or affiliated persons may charge fees for these services or may participate in the earnings, profits, management, and/or ownership of some of these ventures by agreement with the client and with full applicable disclosures. 11  Clients are not obligated to utilize the services of CFG or CFIS. Ronald J. Hochstein, Amy L. Clark, and Justin P. Hochstein are all Registered Representatives of broker dealer, Silver Oak Securities, Inc., Member FINRA / SIPC. As agents of our Broker Dealer we are allowed to only purchase and sell investment products that are approved by Silver Oak Securities, Inc. This may result in clients having a limited number of investment options. Code of Ethics Ethical conduct is the hallmark of any profession. This is especially true in the financial services industry. Since investment advisors’ function in an arena of primary importance, they are subject to extensive regulation. However, these laws, rules and regulations provide only the base or foundation for proper conduct. Professional conduct is defined not by reference to regulatory dictates, but rather by moral and ethical standards. HSG fully supports the spirit as well as the letter of the law. Clients do business when they trust the advisor. They trust the advisor when they believe he/she is listening to their needs and has those needs at heart when making recommendations. Each employee of the advisor must be convinced that his/her self-interest is best served by placing the customer's interests before his own. This is in the highest and best tradition of fiduciary conduct, a tradition which HSG expects its employees to uphold. We recognize and respect the privacy and confidentiality of employment records. Your personnel records, as well as your medical file, are treated with the same confidentiality given to client records. We collect, use, and disclose IAR information only on a business need-to- know basis or as required by law. This policy also extends to our former IARs. We owe much to the Company's reputation for honesty and fairness. It is an essential part of HSG's culture and a major reason for our success through the years. We are confident that today's HSG personnel are determined to maintain and build on that reputation. Rule 204A-1 mandates that each supervised person “IAR” will be provided a copy of the code of ethics and any amendments. Each supervised person “IAR” is also required to acknowledge receipt of the copies by certifying in writing that “supervised person/IAR” has read and understands this Manual and the Code of Ethics; and are following the requirements and responsibilities it outlines. An annual recertification is required. This process should remind us of the company's commitment to ethical issues and fairness in business. It should also prompt us to examine and affirm our personal commitment to the company's philosophy and policies regarding ethics. 12  As a provider of a broad range of quality financial services and products, an employer, and a responsible corporate citizen, HSG performs a variety of important social and economic functions. We want to meet our obligations in all these areas in a manner that earns the respect of our clients, our business associates, our fellow IARs, and the public. Three basic principles apply: · We will conduct every aspect of our business in a fair, lawful, and ethical manner. · We will offer our customers only products and services that are appropriate to their needs and provide fair value. · We will maintain a climate that encourages every IAR to be honest and fair in the conduct of his or her duties. Since a company operates entirely through the people it employs, the responsibility for ethical conduct rests with those individuals. HSG expects all IARs and other employees to comply with the law, both when acting on behalf of HSG and in their personal conduct. Beyond that, in gray areas not covered by laws or regulations, we expect every IAR to conduct his/her self in an ethical and fair manner. HSG employees and related persons generally invest in equity securities that we recommend to clients. Not all firm clients have the same objectives compared to HSG employees and related persons. HSG employees and related persons may not have the same objectives compared to one another. This can create conflicts of interest. Without exception, HSG employees are forbidden to front-run (a practice generally understood to be employees personally trading ahead of proposed client transactions), short any securities held in client portfolios, or engage in short- term trades of mutual fund shares. Trades in the accounts of employees, spouses, and other accounts over which the employee, directs trading and/or has direct or indirect beneficial interest, are monitored on a quarterly basis to make sure that there have been no violations of personal trading policies and procedures. Brokerage Practices Highstone Group recommends but does not require the brokerage and custodial services of Charles Schwab, Corp., (“Schwab”) a securities broker/dealer and a member of the Financial Industry Regulatory Authority and the Securities Investor Protection Corporation. While we recommend that you use Charles Schwab, Corp. as the custodian/broker, you will decide whether to do so and will open your account with the custodian/broker you choose by entering into an account agreement directly with them. 13  We believe that Schwab provides quality execution services for you at competitive prices. Price is not the sole factor we consider in evaluating best execution. We also consider the quality of the brokerage services provided by Schwab, including the value of the firm's reputation, execution capabilities, commission rates, and responsiveness to our clients and our firm. In recognition of the value of the services Schwab. provides, you may pay higher commissions and/or trading costs than those that may be available elsewhere. Under certain circumstances, HSG will provide investment advisory services for assets held at other qualified custodians. Client Directed Brokerage If the client directs that trades be executed through another Broker-Dealer, the client is responsible for negotiating the terms and conditions (including, but not limited to, commission rates) relating to all services to be provided by that Broker-Dealer. This practice may result in less favorable execution prices. Depending on the terms negotiated by the client, when combined with custodial fees this could result in higher costs to the client. Trade Aggregation Transactions for each client account generally will be executed independently unless the Firm decides to purchase or sell the same securities for several clients at approximately the same time. HSG may (but is not obligated to) combine or “batch” such orders to obtain best execution, to negotiate more favorable commission rates or to allocate equitably among its clients differences in prices and commissions or other transaction costs that might have been obtained had such orders been placed independently. Under this procedure, transactions will be averaged as to price and transaction costs and will be allocated among HSG’s clients in proportion to the purchase and sale orders placed for each client account on any given day. If HSG cannot obtain execution of all the combined orders at prices or for transactions costs that it believes are desirable, the Firm will allocate the securities that it does buy or sell as part of the combined orders by following HSG’s order allocation procedures. Research and Other Benefits HSG does not maintain soft dollar accounts. However, as described earlier in the document Schwab provides HSG with certain research and technology. Schwab may provide such services without cost or at a discount. HSG receives the software and support because it renders investment services to clients that maintain assets at Schwab. Schwab provides certain research services to HSG without monetary cost. This practice creates an economic benefit that creates a conflict of interest since these benefits can influence HSG’s choice of custodian over another custodian that does not furnish similar software, systems support, or services. These benefits may or may not benefit our advisory clients. Additionally, HSG receives the following benefits from Schwab: receipt of duplicate client confirmations and bundled duplicate statements; access to a trading desk that exclusively services its RIA participants; access to block trading which provides the ability to aggregate securities 14  transactions and then allocate the appropriate shares to client accounts, and access to an electronic communication network for client order entry and account information. Review of Accounts All managed accounts are reviewed on an ongoing basis by an IAR of HSG. Usually, written reviews are done at least quarterly but at a minimum annually (for clients paying an ongoing fee) depending on the type of account, the services contracted for, and the nature of investments. Reviews may be done more often if requested by the client or due to market fluctuations, a change in the client's financial situation or tax law changes. For clients who have contracted to have a one-time financial plan or consulting service, reviews will only be done at the request of the client or upon the client signing a new contract. The calendar is the triggering factor for quarterly and annual reviews. All reviews are performed by the IAR of the account. At least quarterly, the president of the corporation, Ronald J. Hochstein, will review with the appropriate IAR each account for which that person is responsible. The president's reviews are supervisory in nature with emphasis on regulatory compliance and critical comment. The Vice - President of HSG serves as the firm's designated compliance officer and is responsible for the supervision of all accounts. Client Referrals and Other Compensation HSG does not directly or indirectly compensate any person for client referrals. Custody All clients’ accounts are held in custody by unaffiliated broker/dealers or banks that are qualified custodians. This means that clients should always make checks to be deposited into their account payable to their custodian, not to HSG. HSG can access clients’ brokerage accounts through its ability to debit advisory fees. Additionally, HSG may transfer client funds pursuant to a standing letter of instruction or other similar asset transfer authorization arrangement established by a client with a qualified custodian (“SLOA”). For these reasons, HSG is considered to have custody of client assets. However, concerning the standing letters of authorization, HSG may avoid the annual surprise examination requirement of this Custody Rule providing the seven conditions outlined by the SEC’s no action letter are satisfied. 15  These conditions include: 1. The client provides an instruction to the qualified custodian, in writing, that includes the client’s signature, the third party’s name, and either the third party’s address or the third party’s account number at a custodian to which the transfer should be directed. 2. The client authorizes the investment adviser, in writing, either on the qualified custodian’s form or separately, to direct transfers to the third party either on a specified schedule or from time to time. 3. The client’s qualified custodian performs appropriate verification of the instruction, such as a signature review or other method to verify the client’s authorization and provides a transfer of funds notice to the client promptly after each transfer. 4. The client can terminate or change the instruction to the client’s qualified custodian. 5. The investment adviser has no authority or ability to designate or change the identity of the third party, the address, or any other information about the third party contained in the client’s instruction. 6. The investment adviser maintains records showing that the third party is not a related party of the investment adviser or located at the same address as the investment adviser. 7. The client’s qualified custodian sends the client, in writing, an initial notice confirming the instruction and an annual notice reconfirming the instruction. Given the guidelines around custody as it pertains to HSG’s ability to execute clients’ third- party standing letters of authorization, several clients have signed standing letters of authorization or other similar arrangement giving HSG authority to move money to a third party. Clients receive monthly or quarterly statements from their custodians. Clients should carefully review all statements, and we urge them to compare the account statements they receive from the qualified custodian to the performance reports received from us. The information in our reports may vary from information in the custodial statements based on accounting procedures, reporting dates, valuation methodologies of certain securities, or due to error. Investment Discretion HSG provides Investment Advisory and Portfolio Management services on either a discretionary or non-discretionary basis as directed by the client. Clients that want their accounts managed on a discretionary basis must sign an additional agreement that goes beyond the terms of a non- discretionary agreement. Discretionary accounts will have security transactions placed on client's behalf when deemed necessary and prudent by the client's advisor representative without obtaining prior client consent for each transaction. Discretionary accounts must agree that no restrictions may be placed on HSG as to trading as long as HSG 16  maintains its stated investment strategy. Any request that may hinder HSG’s investment strategy will result in the account designation changed to non-discretionary. Non- Discretionary accounts will require each transaction to be pre-approved by the client. Portfolios may contain a combination of various securities including, but not limited to, stocks, bonds, mutual funds, exchange traded funds, unit investment trusts, limited partnerships, options contracts, and fixed and variable insurance products. Voting Client Securities Client shall be responsible for: (1) directing the way proxies solicited by issuers of securities beneficially owned by the client shall be voted, and (2) making all elections relative to any mergers, acquisitions, tender offers, bankruptcy proceedings or other type events pertaining to the assets. HSG will be available to discuss proxies with client to help guide their response. HSG will not be responsible for final decision of client. Highstone Group does not send out proxies. Proxies will be provided to clients directly from either their custodian or a transfer agent. Financial Information HSG does not have any financial impairment that will preclude the firm from meeting contractual commitments to clients. A balance sheet is not required to be provided because HSG does not serve as a custodian for client funds or securities and does not require prepayment of fees of more than $500 per client, six months or more in advance. 17