STONEHEARTH CAPITAL MANAGEMENT LLC

Stonehearth Capital Management 100 Conifer Hill Drive, STE 105 Danvers, MA 01923 (978) 624-3000 www.stonehearthcapital.com September 17, 2025 FORM ADV PART 2A BROCHURE This brochure provides information about the qualifications and business practices of Stonehearth Capital Management. If you have any questions about the contents of this brochure, please contact us at (978) 624-3000 or Jamie@stonehearthcapital.com. 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 Stonehearth Capital Management is also available on the SEC's website at www.adviserinfo.sec.gov. Our Firm IARD/CRD number is 128866. Any references to Stonehearth Capital Management as a registered investment adviser or its related persons as registered advisory representatives does not imply a certain level of skill or training. 1  Item 2 Material Changes Form ADV Part 2 requires registered investment advisers to amend their brochure when information becomes materially inaccurate. If there are any material changes to an adviser's disclosure brochure, the adviser is required to notify you and provide you with a description of the material changes. Since the filing of our last annual updating amendment dated February 24, 2025, we have the following material change to report: • We may use artificial intelligence ("AI") in our business operations, in order to promote operational efficiency and augment our client service. We do not utilize AI in our investment selection process or to formulate the specific investment advice we render to you, and have no plans to do so in the future. For details, please refer to our updated Privacy Policy and see Item 8, Methods of analysis, Investment Strategies and Risk of Losses. Questions regarding the brochure and/or the information contained herein may be directed to the firm and its representatives. Additional information about Stonehearth Capital Management ("SCM"/"Advisor") is also available via the SEC's web site www.adviserinfo.sec.gov. The IARD number for SCM is 128866. The SEC's web site also provides information about any persons affiliated with SCM who are registered, or are required to be registered, as Advisory Representatives of SCM. 2  Item 3 Table Of Contents Item 1 Cover Page Item 2 Material Changes Item 3 Table Of Contents Item 4 Advisory Business Item 5 Fees and Compensation Item 6 Performance-Based Fees and Side-By-Side Management Item 7 Types of Clients Item 8 Methods of Analysis, Investment Strategies and Risk of Loss Item 9 Disciplinary Information Item 10 Other Financial Industry Activities and Affiliations Item 11 Code of Ethics, Participation or Interest in Client Transactions and Personal Trading Item 12 Brokerage Practices Item 13 Review of Accounts Item 14 Client Referrals and Other Compensation Item 15 Custody Item 16 Investment Discretion Item 17 Voting Client Securities Item 18 Financial Information Item 19 Requirements for State Registered Advisers Page 1 Page 2 Page 3 Page 4 Page 8 Page 11 Page 11 Page 12 Page 16 Page 16 Page 16 Page 17 Page 21 Page 21 Page 22 Page 23 Page 23 Page 24 Page 24 3  Item 4 Advisory Business Stonehearth Capital Management ("SCM" / "Advisor") is an investment advisory firm offering investment management services which includes financial planning and retirement planning customized to the needs of individuals, businesses, and organizations. In 1982 founder Richard E. Prout established a Massachusetts financial advisory firm to help families with their finances. This firm evolved into Wealth Management Group, LLC in 2004 and in 2014, became Stonehearth Capital Management. Due to its growth, the Advisor registered as an Investment Adviser with the Securities and Exchange Commission in May 2007. Jamie A. Upson is the Managing Member and sole owner of the Advisor. Mr. Upson has been in the financial services industry since 1999. The Advisor tailors its advisory services to the Client's individual needs. The Client may ask the Advisor to restrict and/or limit certain securities or types of securities when the Advisor invests for the Client. To begin the process, the Advisor will ask the Client to complete the Advisor's data-gathering form to assist the Advisor with obtaining information about the Client's financial situation and history. Additionally, the Advisor will meet with the Client and conduct an interview and data gathering session to continue the due diligence process. The Advisor will discuss the Client's desired level of risk, the Client's knowledge of investing, and how the Advisor can best meet the Client's needs. The information the Advisor collects will help the Advisor to provide a program customized to the Client's financial situation. Depending on the services the Client has requested, the Advisor will gather various financial information and history from the Client such as: Investment objectives Investment horizon • Retirement and financial goals • • • Financial needs • Cash flow analysis • Cost of living needs • Education needs • Savings tendencies • Other applicable financial information required by the Advisor in order to provide the investment advisory services requested. The Advisor may use the financial planning software, eMoney, to analyze the Client's financial strength. Investment Management Services The Advisor offers investment management services under the following programs: • Wrap Fee Program • Non-Wrap Fee Program Clients participating in a wrap fee program pay an all-inclusive fee which encompasses trade execution and portfolio management. In the non-wrap fee program, trade execution costs are in addition to the advisory fee. The amount of assets under management by the Advisor determines the Client's program eligibility (refer to Item 5 for further details). 4  The Advisor will gather financial information from the Client. Once the Advisor completes their analysis of a Client's situation, the Advisor will work with the Client to determine which strategy would be most suitable for the Client and what level of risk is most comfortable for the Client. The Advisor offers four different portfolio strategies: • Diversified Portfolio • Diversified CarbonLITE Portfolio • Diversified ETF-Only Portfolio • U.S. Stock Portfolio The Advisor will customize the Client's portfolio allocation for each strategy taking into consideration the Client's limitations or restrictions, the market and economy at the time, and the Client's financial situation, goals and objectives. The Advisor will present the Client with an Investment Policy Statement to outline how the Client's account will be managed. It will include the recommended portfolio allocation. Upon the Client's approval, the Advisor will implement the portfolio allocation. The Advisor will provide continuous and ongoing management of the Client's account on a discretionary basis. The Advisor will manage the Client's account and make changes to the allocation as deemed appropriate by the Advisor. The Advisor will determine the securities to be purchased and sold in the account and will alter the securities holdings from time to time, without prior consultation with the Client. The Advisor may actively trade securities and hold such holdings for periods of 30 days or less or maintain positions for longer periods. Within the Advisor's Diversified Portfolios, the Advisor will primarily use exchange traded funds (ETFs) and open-ended mutual funds (including no-load and load waived). Less frequently, the Advisor may recommend closed-end funds, stocks, limited partnerships, non-publicly traded real estate investment trusts (REITs), and variable annuities. Within the Advisor's U.S. Stock Portfolio, the Advisor will use primarily stocks, however, the Advisor may include ETFs at times. Transactions in the Client's account, account reallocations and rebalancing may trigger a taxable event, with the exception of retirement accounts (e.g., IRA or Roth). As previously stated, the Advisor will start the portfolio construction process by determining the strategy and risk profile that best meets the Client's suitability parameters. The Client's managed account may be similarly managed and contain similar holdings as compared to other Clients' managed accounts. As further described below, the Advisor has entered into a relationship to offer the Client brokerage and custodial services through Charles Schwab & Co., Inc. ("Schwab"). Schwab is a member SIPC, an unaffiliated SEC-registered broker-dealer and FINRA member. There is no affiliation between the Advisor and Schwab. Additionally, the Client may establish an account with other financial institutions (referred to as "outside accounts") such as mutual fund companies, 529 college savings plan providers, variable annuity companies, retirement plan providers and private and public partnerships. The Advisor will provide investment management services on the Client's assets held at other financial institutions provided the Advisor is listed on the account with limited trading authorization to allow the Advisor to place trades on 5  the Client's behalf. These accounts held at other financial institutions do not qualify for the Advisor's wrap fee program as described below. Any fees charged at these other financial institutions will be the Client's responsibility. Accounts held outside of Schwab (i.e., outside accounts) may not lend themselves to continuous and ongoing management of the assets within the account due to trading restrictions and limitations. In these instances, the Advisor will provide asset allocation and periodic monitoring services. Because of these restrictions, the Advisor tries to utilize products/procedures that do not require rebalancing trades such as: age-based funds, target date funds, asset allocation funds or automatic rebalancing options offered by the outside account custodian. For those Clients with less than $100,000 in investable assets, the Advisor typically invests these funds differently. In these situations, the Advisor will invest the Client in an asset allocation fund or in the Diversified ETF-Only Portfolio to keep trading fees low. When the Client's investable assets exceed $100,000, the Advisor will determine whether or not it makes sense to suggest that the Client switch to one of the other Diversified Portfolios. If/when the Client's investable assets fall below $80,000 the Advisor may recommend going back to the asset allocation product or the Diversified ETF-Only Portfolio offering. This distinction is in the spirit of reducing trading fees for smaller accounts. Wrap Fee Program As mentioned previously, the Advisor offers a wrap fee program. A wrap fee program is a fee-based account for which the Client will pay a single fee for portfolio review, investment management services, and brokerage services. Wrap Fee Program Qualifications: • Have $1,000,000 (cash or securities) or more of assets on which the Advisor or its Advisory Representatives receive any form of compensation, AND • Maintain an account at Schwab The $1,000,000 of assets can be comprised of accounts held at Schwab along with other financial institutions ("outside accounts") such as mutual fund companies, 529 college savings plan providers, variable annuity companies, retirement plans providers and private and public partnerships. These assets must be managed by the Advisor and the Advisor must receive (or have received) some form of compensation to qualify towards the minimum threshold. Under the wrap fee program, the Client will not pay any ticket charges or account maintenance fees on accounts held in custody with Schwab. All such fees and expenses will be borne by the Advisor. The Advisor and Advisory Representatives of the Advisor will receive a portion of the wrap fee for providing advisory services. At the discretion of the Advisor, ticket charges and account maintenance fees on accounts held with Schwab may be paid for by the Advisor for certain Clients participating in the non-wrap fee program. Further details of the Advisor's wrap fee program can be found in Item 5 - Fees & Compensation. 6  Financial Planning Services We offer financial planning services which typically involve providing a variety of advisory services to clients regarding the management of their financial resources based upon an analysis of their individual needs. These services can range from broad-based financial planning to consultative or single subject planning. If you retain our firm for financial planning services, we will meet with you to gather information about your financial circumstances and objectives. We may also use financial planning software to determine your current financial position and to define and quantify your long-term goals and objectives. Once we specify those long-term objectives (both financial and non-financial), we will develop shorter-term, targeted objectives. Once we review and analyze the information you provide to our firm and the data derived from our financial planning software, we will deliver a written plan to you, designed to help you achieve your stated financial goals and objectives. Financial plans are based on your financial situation at the time we present the plan to you, and on the financial information you provide to us. You must promptly notify our firm if your financial situation, goals, objectives, or needs change. Financial Consulting Services We offer financial consulting services that primarily involve advising clients on specific financial-related topics. Consulting services may include advice on tax planning, estate planning, business planning, and retirement planning. The Advisor will schedule a meeting with the Client and present the analysis of the Client's situation and provide recommendations to assist the Client towards the Client's financial goals. The Client is not obligated to implement advice through the Advisor or its Advisory Representatives. IRA Rollover Recommendations Effective December 20, 2021 (or such later date as the US Department of Labor ("DOL") Field Assistance Bulletin 2018-02 ceases to be in effect), for purposes of complying with the DOL's Prohibited Transaction Exemption 2020-02 ("PTE 2020-02") where applicable, Stonehearth is providing the following acknowledgment to you. When Stonehearth provides investment advice to you regarding your retirement plan account or individual retirement account, Stonehearth is a fiduciary within the meaning of Title I of the Employee Retirement Income Security Act and/or the Internal Revenue Code, as applicable, which are laws governing retirement accounts. The way Stonehearth makes money creates some conflicts with your interests, so Stonehearth operates under a special rule that requires us to act in your best interest and not put our interest ahead of yours. Under this special rule's provisions, Stonehearth must: • Meet a professional standard of care when making investment recommendations (give prudent advice); • Never put our financial interests ahead of yours when making recommendations (give loyal advice); • Avoid misleading statements about conflicts of interest, fees and investments; • Follow policies and procedures designed to ensure that we give advice that is in your best interest; • Charge no more than is reasonable for our services; and • Give you basic information about conflicts of interest. 7  Stonehearth benefits financially from the rollover of your assets from a retirement account to an account that Stonehearth manages or provides investment advice, because the assets increase Stonehearth's assets under management and, in turn, Stonehearth's advisory fees. As a fiduciary, Stonehearth only recommends a rollover when we believe it is in your best interest. General Information The investment recommendations and advice offered by the Advisor are not legal advice or accounting advice. The Client should coordinate and discuss the impact of financial advice with the Client's attorney and/or accountant. If the Client's financial situation, investment goals, and/or objectives should change, please inform the Advisor promptly. The change may trigger a need for adjustments in the Client's plan or portfolio. Failure to notify the Advisor of any such changes could result in investment recommendations not meeting the Client's needs. Assets Under Management As of January 15, 2025, the Advisor provides continuous management services for $386,744,154 in client assets on a discretionary basis. Item 5 Fees and Compensation Investment Management Services Fees are negotiable under certain circumstances (e.g., friends, family members, and employees of the Advisor) and are subject to change. Fees are not based on a share of capital gains upon or capital appreciation of the funds or any portion of the funds. Advisory fees will be charged quarterly in advance based on the market value of the account assets as of the close of business on the last day of the preceding quarter. If the management of an account commences at any time other than the beginning of a calendar quarter, the initial quarterly fee shall be charged in arrears. The initial quarterly fee will be based on the initial account balance and will be pro-rated based on the number of days during the quarter when the agreement was in effect. The Client may make additions to the account or withdrawals from the account, provided the account continues to meet minimum account size requirements. No fee adjustments will be made for additions or withdrawals from the account or for account appreciation or depreciation. Advisory fees for the wrap fee and non-wrap fee program are in accordance with the following fee schedule: Account Size Annual Fee First $250,000 1.25% Next $750,000 1.00% Next $2,000,000 0.75% Next $2,000,000 0.50% Ongoing 0.25% The Advisor may change the above fee schedule upon 30-days prior written notice to the Client. 8  Advisory fees are based on the aggregate value of all managed accounts within the established household. The value of the portfolio will include, but is not limited to, assets under the management of the Advisor held at Schwab as well as those assets under the Advisor's management held at other financial institutions (outside accounts). It is the Advisor's policy to charge half of the advisory fee on 529 plan account(s). If the Advisor's Advisory Representative recommends the purchase of non-publicly traded REITs, Limited Partnerships or other private investment offerings, the position(s) will be included in the calculation of the advisory fee. Since these investments are managed by a non-affiliated investment manager, the Client will pay an advisory fee to the non-affiliated investment manager in addition to the advisory fee charged by the Advisor. Certain Clients may hold non-publicly traded REITs or Limited Partnerships in their portfolios, for which Advisory Representative received a commission. In these situations, the position(s) will be excluded from the advisory fee calculation until the asset either liquidates, merges or goes public. At that time, the position(s) will be included in the fee calculation. Also, some stock positions that are held at the Client's request will be excluded or discounted for fee calculation purposes unless we are offering recommendations or analysis on the stock, in which case we will include the fair market value in the calculation of our management fee. Depending upon the circumstances, the Advisor may combine Client accounts from one household with Client accounts from other households to aggregate account values for fee calculations. The annual fee may then be based on an aggregate value of all accounts within the combined households. Advisory fees will be deducted directly from the Client's account(s) with Schwab, provided the Client has given the Advisor written authorization. The Client will be provided with an account statement reflecting the deduction of the advisory fee. If the account does not contain sufficient funds to pay advisory fees, the Advisor has limited authority to sell or redeem securities in sufficient amounts to pay advisory fees. The Client may reimburse the account for advisory fees paid to the Advisor, except for ERISA and IRA accounts. For outside accounts held at other financial institutions (besides Schwab) that are under the Advisor's management, the advisory fee will be deducted directly from that outside account when available. If unavailable, then the advisory fee will be deducted from a single designated account at Schwab chosen by the Advisor. If the Client does not have a Schwab account, the Advisor will invoice the Client quarterly in advance. A wrap fee program offers advisory services and brokerage services for a single fee. The fee may be higher or lower if the Client was to obtain these services separately. If the Client is eligible for participation in the Advisor's wrap fee program, the Client will not pay separate ticket charges and execution fees or account maintenance fees on those assets held at Schwab. The Client should read the wrap fee program disclosure brochure (Part 2A Appendix 1) for additional disclosures. Clients participating in the Advisor's wrap fee or non-wrap fee program with assets managed by the Advisor but not custodied at Schwab (i.e., outside accounts), will be subject to such fees if assessed. Ticket Charges: Schwab charges ticket charges for each trade placed on their platform. These charges, which typically range from $0.00 to $10.00, are paid by the Client unless the Client qualifies for the Advisor's wrap fee program. Wrap Fee Program Qualifications: • Have $1,000,000 (cash or securities) or more of assets on which the Advisor or its Advisory 9  Representatives receive any form of compensation, AND • Maintain an account at Schwab. The $1,000,000 of assets can be comprised of accounts held at Schwab along with other financial institutions ("outside accounts") such as mutual fund companies, 529 college savings plan providers, variable annuity companies, retirement plans providers and private and public partnerships. These assets must be managed by the Advisor and the Advisor must receive (or have received) some form of compensation to qualify towards the minimum threshold. The Advisor will monitor the Client's account values at least quarterly, and maybe more frequently, for continued eligibility in the Advisor's wrap fee program. Should the Client's account values fall below $800,000, the Client will no longer be eligible to participate in the wrap fee program. This means that the Advisor will no longer pay for ticket charges or account maintenance fees on the Client's account(s) held in custody with Schwab. Under certain circumstances, the Advisor may permit exceptions to the qualification requirements for the wrap fee program. In addition to the Advisor's advisory fee, the Client should also be aware that the products the Advisor utilizes within the Client's portfolio will also charge fees (i.e., mutual fund expense ratios). Such fees are not shared with the Advisor and are compensation to the fund managers. For additional information, please refer to Item 12 that describes the factors that the Advisor considers in selecting or recommending broker-dealers for Client transactions and determining the reasonableness of their compensation. The Client may deposit assets into the Client's fee-based account on which a commission was previously paid to an individual not associated with the Advisor. The Advisor will include such positions in the calculation of the Advisor's advisory fee. As stated above, the Advisor utilizes exchange traded funds (ETFs) and open-ended mutual funds (including no-load and load waived). While certain products may pay 12b-1 fees, the Advisor will not receive these fees. Where applicable and for those accounts under its custody, Schwab will retain the 12b-1 fees. The Client may purchase the securities recommended by the Advisor directly or through other brokers or agents not affiliated with the Advisor. Termination Provisions The Client may terminate investment advisory services obtained from the Advisor, without penalty, upon written notice within five (5) business days after entering into the advisory agreement with the Advisor. The Client will be responsible for any fees and charges incurred from third parties as a result of maintaining the account such as transaction fees for any securities transactions executed and account maintenance or custodial fees. Thereafter, the Client may terminate investment advisory services with written notice to the Advisor. Should the Client terminate investment advisory services during the quarter, the Client will be issued a pro-rated refund of the prepaid advisory fee from the date of termination to the end of the three-month billing period. Financial Planning and Consulting Services Stonehearth charges an hourly fee of $300 for financial planning/consulting services, including retirement planning, social security optimization, tax planning, financial caregiving/family planning and estate planning review. Hourly fees for Financial Planning Services are invoiced by the Advisor monthly and are due upon receipt. Please refer to the agreement for details. 10  If, within three months of the execution of this Agreement, the Client elects to engage Stonehearth Capital Management for ongoing investment management services and deposits at least $500,000 of billable assets, any consulting fees paid under this Agreement will be credited in full toward the ongoing management fee. For children of existing Stonehearth clients, this fee credit applies for investment accounts totaling $250,000 or more of billable assets. Fees are negotiable. The Client's fees will be dependent on several factors including time spent with the Advisor, number of meetings, complexity of the Client's situation, amount of research, services requested and staff resources. Clients retaining Stonehearth for estate planning coordination services will pay a flat fee to cover the third-party's costs who is handling the estate planning. The fee is negotiable and may be waived in Stonehearth's sole discretion. If deed work is requested by Client, these fees will be paid separately by the Client. Termination Provisions The consulting advisory agreement will commence upon execution and will continue until services are completed or terminated by either party with written notice. Fees earned through the termination date remain due and payable. Compensation for the Sale of Securities or Other Investment Products Persons providing investment advice on behalf of the Advisor's firm are licensed as independent insurance agents. These persons will earn commission-based compensation for selling insurance products, including insurance products they sell to the Client. Insurance commissions earned by these persons are separate and in addition to the Advisor's advisory fees. This practice presents a conflict of interest because persons providing investment advice on behalf of the Advisor's firm who are insurance agents, have an incentive to recommend insurance products to the Client for the purpose of generating commissions rather than solely based on the Client's needs. The Client is under no obligation, contractually or otherwise, to purchase insurance products through any person affiliated with the Advisor's firm. Item 6 Performance-Based Fees and Side-By-Side Management The Advisor does not charge performance-based fees. Item 7 Types of Clients The Advisor's services are geared toward individuals and their families including high net worth individuals, trusts, estates, as well as corporations and other business entities. The Advisor generally requires a minimum amount of assets be deposited to an account for the purpose of obtaining investment management services. The Advisor will generally require the Client to deposit a minimum of $500,000 (cash or securities). However, under certain circumstances, the Advisor may waive the minimum account size requirement and accept accounts less than $500,000. Such circumstances may include but not be limited to additional assets will soon be deposited, family members of existing Clients, or the Client has other accounts under management with the Advisor. The Client is advised that performance may suffer due to difficulties with diversifying smaller accounts and due to risk controls potentially being compromised. Performance of smaller accounts may vary from the performance of accounts with more dollars invested since fluctuations in the market may have a greater effect on a less diversified portfolio. 11  Item 8 Methods of Analysis, Investment Strategies and Risk of Loss Method of Analysis and Investment Process After determining the Client's appropriate risk level, the Advisor will assign the Client to one (or more) of the Advisor's asset allocation model portfolios. The Advisor's lower risk level asset allocation models contain a larger percentage of assets that do not correlate with the stock market. The Advisor's higher risk level asset allocation models contain a larger percentage of assets that DO correlate with the stock market. In constructing the portfolios, the Advisor uses Ycharts & Rixtrema software to identify if the risk and growth factors are appropriate for each risk level. In determining the composition of investments within each model portfolio, the Advisor uses a proprietary investment analysis strategy. The Advisor takes into account the following: • Experience of the manager and management team • Competitiveness of the expenses charged for managing the fund • Performance of the fund during prior market selloffs and rallies • Compensation for the risk taken within the fund (i.e., high risk, high reward) • Volatility of the fund • Consistency of returns by the fund • Value added by manager vs. buying cheap index fund The Advisor weighs each of the factors within the Ycharts software to identify products that the Advisor feels are appropriate to utilize within Client portfolios. The Advisor monitors these products to ensure they are still appropriate to utilize, or to identify if another product would be a better fit. The Advisor adheres to the following monitoring process: • At least quarterly the Advisor processes a global rebalancing trade. This global trade looks at each household to ensure their asset categories are within the desired drift range (25% of target exposure, for example 10% target, plus or minus 2.5% drift). • Monthly cash management screening to ensure Clients who have periodic draws from their accounts to supplement income needs run smoothly • Quarterly monitoring of fund performance to ensure fund managers are still competitive based on our proprietary screening process • Ongoing analysis of tax management strategies to help limit tax liabilities for Clients (i.e. Tax Loss Harvesting). The Advisor does not represent, warranty, or imply that the services or methods of analysis used by the Advisor can or will predict future results, successfully identify market tops or bottoms, or insulate the Client from losses due to major market corrections or crashes. Past performance is no indication of future performance. No guarantees can be offered that the Client's goals or objectives will be achieved. Further, no promises or assumptions can be made that the advisory services offered by the Advisor will provide a better return than other investment strategies. 12  As stated above, the Advisor primarily uses ETFs and mutual funds. The risks with these products include the costs and expenses for the product that can impact performance, change of managers, and fund straying from its objective. Open ended mutual funds do not typically have a liquidity issue and the price does not fluctuate throughout the trading day. ETFs can also trade at a premium or discount to their net asset value which can detract from performance. Investing in securities involves risk of loss, including the potential loss of principal. Therefore, the Client's participation in any of the management programs offered by the Advisor will require the Client to prepare to bear the risk of loss and fluctuating performance. Investment Management Process The Advisor manages four strategies which include: • Diversified Portfolio • Diversified CarbonLITE Portfolio • Diversified ETF-Only Portfolio • U.S. Stock Portfolio Diversified Portfolio: The Diversified Portfolio is constructed utilizing a variety of different asset categories including stock exposure, bond exposure and alternative (broadly defined as an asset category that does not fit within the definition of stock or bond exposure) exposure. This Portfolio is available in three different risk profiles: • Conservative: The primary objective is to minimize losses and to keep volatility to a minimum. The secondary objective is growth of assets. • Moderate: The primary objective is to equally balance minimizing losses and growing the assets. • Aggressive: The primary objective is growth of assets. The secondary objective is to minimize losses and to keep volatility to a minimum. There is no guarantee that the Advisor's expectations will be met within each of the three risk profiles. Diversified CarbonLITE Portfolio: The Advisor offers Clients a CarbonLITE portfolio solution ("CarbonLITE"), which is designed to lower the carbon footprint of the equity exposure within the portfolio while maintaining similar asset allocation, risk and expense characteristics as compared to the Diversified Portfolio offering. CarbonLITE is not a traditional "green portfolio" or "socially responsible" portfolio which invests more heavily in certain sectors of the marker (i.e. solar power) or avoid other sectors of the market. CarbonLITE seeks to reduce the portfolio's carbon footprint (based on greenhouse gas emissions of underlying companies in the fund) but not at the expense of altering the portfolios characteristics (i.e. asset allocation, risk, expenses). CarbonLITE does maintain fossil fuel exposure but at lower levels than our Diversified Portfolio offerings. The Advisor expects that if/when the fossil fuel industry experiences strong price fluctuations, the CarbonLITE strategy will see a larger discrepancy in performance when compared to the Diversified Portfolio offering. This Portfolio is available in three different risk profiles: • Conservative: The primary objective is to minimize losses and to keep volatility to a minimum. The secondary objective is growth of assets. • Moderate: The primary objective is to equally balance minimizing losses and growing the 13  assets. • Aggressive: The primary objective is growth of assets. The secondary objective is to minimize losses and to keep volatility to a minimum. There is no guarantee that the Advisor's expectations will be met within each of the three risk profiles. Diversified ETF-Only Portfolio: The Advisor offers Clients a Diversified ETF-Only Portfolio ("NTF ETF-Only"). ETF stands for Exchange Traded Fund. The Advisor expects this portfolio offering to have similar asset allocation and risk characteristics when compared to the Diversified Portfolio offering. The Advisor expects this portfolio to have a lower internal expense ratio compared to the Diversified Portfolio offering. Schwab does not charge securities transaction fees for ETFs. This Portfolio is available in three different risk profiles: • Conservative: The primary objective is to minimize losses and to keep volatility to a minimum. The secondary objective is growth of assets. • Moderate: The primary objective is to equally balance minimizing losses and growing the assets. • Aggressive: The primary objective is growth of assets. The secondary objective is to minimize losses and to keep volatility to a minimum. There is no guarantee that the Advisor's expectations will be met within each of the three risk profiles. U.S. Stock Portfolio: The Advisor ranks stocks on known quantitative factors that the Advisor believes help identify stocks that are good investments over a full market cycle. They are based on academic and real-world research. The Advisor ranks stocks on quality, value, price momentum, & dividend yield. The Advisor then combines the four scores into one "alpha" score to screen the Advisor's universe for stocks to invest in. The Advisor then applies a qualitative analysis to further help the Advisor identify stocks that are an attractive investment. The Advisor's focus is on high quality companies that return cash to shareholders that are inexpensive and are exhibiting positive price momentum based on quantitative factors. This strategy seeks to add value over the S&P 500, a broad market cap-based index. There is no guarantee that this goal will be met. Limited Partnerships: A limited partnership is a financial affiliation that includes at least one general partner and a number of limited partners. The partnership invests in a venture, such as real estate development or oil exploration, for financial gain. The general partner has management authority and unlimited liability. The general partner runs the business and, in the event of bankruptcy, is responsible for all debts not paid or discharged. The limited partners have no management authority and their liability is limited to the amount of their capital commitment. Profits are divided between general and limited partners according to an arrangement formed at the creation of the partnership. The range of risks are dependent on the nature of the partnership and disclosed in the offering documents if privately placed. Publicly traded limited partnership have similar risk attributes to equities. However, like privately placed limited partnerships their tax treatment is under a different tax regime from equities. You should speak to your tax adviser in regard to their tax treatment. Private Placements: A private placement (nonpublic offering) is an illiquid security sold to qualified investors and are not publicly traded nor registered with the Securities and Exchange Commission. 14  Risk: Private placements generally carry a higher degree of risk due to illiquidity. Most securities that are acquired in a private placement will be restricted securities and must be held for an extended amount of time and therefore cannot be sold easily. The range of risks are dependent on the nature of the partnership and are disclosed in the offering documents. Digital Assets: Digital Assets generally refers to an asset that is issued and/or transferred using distributed ledger or blockchain technology, including, "virtual currencies" (also known as crypto- currencies), "coins", and "tokens". We may invest client accounts in and/or advise clients on the purchase or sale of digital assets. This advice or investment may be in actual digital coins/tokens/currencies or via investment vehicles such as exchange traded funds (ETFs) or separately managed accounts (SMAs). The investment characteristics of Digital Assets generally differ from those of traditional securities, currencies. Digital Assets are not backed by a central bank or a national, international organization, any hard assets, human capital, or other form of credit and are relatively new to the marketplace. Rather, Digital Assets are market-based: a Digital Asset's value is determined by (and fluctuates often, according to) supply and demand factors, its adoption in the traditional commerce channels, and/or the value that various market participants place on it through their mutual agreement or transactions. The lack of history to these types of investments entail certain unknown risks, are very speculative and are not appropriate for all investors. • Price Volatility of Digital Assets Risk: A principal risk in trading Digital Assets is the rapid fluctuation of market price. The value of client portfolios relates in part to the value of the Digital Assets held in the client portfolio and fluctuations in the price of Digital Assets could adversely affect the value of a client's portfolio. There is no guarantee that a client will be able to achieve a better than average market price for Digital Assets or will purchase Digital Assets at the most favorable price available. The price of Digital Assets achieved by a client may be affected generally by a wide variety of complex factors such as supply and demand; availability and access to Digital Asset service providers (such as payment processors), exchanges, miners or other Digital Asset users and market participants; perceived or actual security vulnerability; and traditional risk factors including inflation levels; fiscal policy; interest rates; and political, natural and economic events. • Digital Asset Service Providers Risk: Service providers that support Digital Assets and the Digital Asset marketplace(s) may not be subject to the same regulatory and professional oversight as traditional securities service providers. Further, there is no assurance that the availability of and access to virtual currency service providers will not be negatively affected by government regulation or supply and demand of Digital Assets. Accordingly, companies or financial institutions that currently support virtual currency may not do so in the future. • Custody of Digital Assets Risk: Under the Advisers Act, SEC registered investment advisers are required to hold securities with "qualified custodians," among other requirements. Certain Digital Assets may be deemed to be securities. Many Digital Assets do not currently fall under the SEC definition of security and therefore many of the companies providing Digital Assets custodial services fall outside of the SEC's definition of "qualified custodian". Accordingly, clients seeking to purchase actual digital coins/tokens/currencies may need to use nonqualified custodians to hold all or a portion of their Digital Assets. • Government Oversight of Digital Assets Risk: Regulatory agencies and/or the constructs responsible for oversight of Digital Assets or a Digital Asset network may not be fully developed and subject to change. Regulators may adopt laws, regulations, policies or rules directly or indirectly affecting Digital Assets their treatment, transacting, custody, and valuation. 15  Artificial Intelligence Risk: We may use artificial intelligence ("AI") in our business operations, in order to promote operational efficiency and augment our client service. We currently do not knowingly utilize AI in our investment selection process or to formulate the specific investment advice we render to you. AI models are highly complex and may result in output that is incomplete or incorrect. Our use of AI includes certain third-party technologies aimed at driving operational efficiency by automating meeting prep, meeting notes, CRM updates, meeting recap notes, task management, and other client service related functions. We believe the use of this technology allows us to reduce administrative time, prepare for client engagement, and improve overall client experience. The use of AI poses risks related to the challenges the Company faces in properly managing its use. Content generated by AI technologies may be deficient, inaccurate, or biased, and the use of AI tools may lead to errors in decision-making. Use of AI tools could also pose risks related to the protection of client or proprietary information. Such risks may include the exposure of confidential information to unauthorized recipients, violation of data privacy rights, or other data leakage events. For example, in the case of generative AI, if confidential information, including material non-public information or personal identifiable information is input into an AI application, such information is at risk of becoming part of a dataset accessible by other AI applications and users. The regulatory environment relating to AI is rapidly evolving and could require changes in our adoption and implementation of AI technology in the future. The use of AI may also expose us to litigation risk or regulatory risk. Item 9 Disciplinary Information There is no reportable disciplinary information required for the Advisor or its Advisory Representatives. Item 10 Other Financial Industry Activities and Affiliations Advisory Representatives are licensed with various insurance companies. The insurance business is not a significant business to the Advisory Representatives and the Advisor does not concentrate resources toward the insurance business. However, it is important to know that if Advisory Representatives recommend insurance products and if the Client purchases insurance products through them, they may earn commissions (depending upon the insurance product). When a commission is paid, this represents a conflict of interest in that the Advisory Representative recommends the insurance product and compensation is received by the Advisory Representative. The Advisor attempts to mitigate the conflict of interest with the potential receipt of commission by disclosing this conflict to the Client and by informing the Client that the Client is under no obligation to purchase insurance products or services through the Advisor's Advisory Representatives. The Advisor may implement recommendations through other insurance agents. Item 11 Code of Ethics, Participation or Interest in Client Transactions and Personal Trading The Advisor has a fiduciary duty to the Client to act in the Client's best interest and always place the Client's interests first and foremost. The Advisor takes seriously its compliance and regulatory obligations and requires all staff to comply with such rules and regulations as well as the Advisor's policies and procedures. Further, the Advisor strives to handle the Client's non-public information in such a way to protect information from falling into hands that have no business or reason to know such information and provides the Client with the Advisor's Privacy Policy. As such, the Advisor maintains a code of ethics for its Advisory Representatives, supervised persons, and staff. The Code of Ethics contains provisions for standards of business conduct in order to comply with federal securities laws, personal securities reporting requirements, pre-approval procedures for certain transactions, code 16  violations reporting requirements, and safeguarding of material non-public information about the Client's transactions. Further, the Advisor's Code of Ethics establishes the Advisor's expectation for business conduct. A copy of the Advisor's Code of Ethics will be provided to the Client upon request. The Advisor and its associated persons may buy or sell securities identical to those securities recommended to the Client. This includes private investment offerings. Therefore, the Advisor and/or its associated persons may have an interest or position in certain securities that are also recommended and bought or sold to Clients. The Advisor and its associated persons will not put their interests before the Clients' interest. The Advisor and its associated persons may not trade ahead of the Client or trade in such a way to obtain a better price for themselves than for the Client or other Clients. The Advisor is required to maintain a list of all securities holdings for its associated persons and develop procedures to supervise the trading activities of associated persons who have knowledge of the Client's transactions and their related family accounts at least quarterly. Further, associated persons are prohibited from trading on non-public information or sharing such information. The Client has the right to decline any investment recommendation. The Advisor and its associated persons are required to conduct their securities and investment advisory business in accordance with all applicable Federal and State securities regulations. The wrap fee program may present conflicts of interest. Some products are offered on Schwab's platform with no or lower ticket charges, while others require higher ticket charges. Since the Advisor covers ticket charges for qualifying Clients, Stonehearth may be influenced by this fee when selecting products. Item 12 Brokerage Practices As previously stated, the Advisor has entered into a relationship to offer the Client brokerage and custodial services through Charles Schwab & Co., Inc. ("Schwab"). The Advisor is independently owned and operated and not affiliated with Schwab. In order to obtain investment management services from the Advisor (wrap fee and non-wrap fee services), the Client will need to maintain an account with Schwab. If the Client selects another brokerage firm for custodial and/or brokerage services, the Client may not be able to receive investment management services from the Advisor. This practice may prevent the Advisor from achieving the most favorable execution of Client transactions and may cost the Client more money. Not all investment advisers require the Client to maintain accounts at a specific broker-dealer. Although the Client would not be eligible for the Advisor's wrap fee program, the Client may maintain accounts at another broker-dealer. The Advisor will provide investment management services on these accounts provided the Advisor is listed on the account with limited trading authorization to allow the Advisor to place trades on the Clients' behalf. When first selecting Schwab, the Advisor conducted due diligence. The Advisor examined their abilities to service the Client, staying power as a company, industry reputation, reporting ability, trading platform, products, and available services, technology resources, and educational resources. Periodically, the Advisor will review alternative broker-dealers and custodians in the marketplace to ensure Schwab is meeting the Advisor's duty to provide best execution for the Client's accounts. Best execution does not simply mean the lowest transaction cost. When examining firms, the Advisor will compare overall expertise, cost competitiveness and financial condition. The quality of execution by 17  Schwab will be reviewed through trade journal evaluations. No single criteria will validate nor invalidate a custodian, but rather, all criteria taken together will be used in evaluating the currently utilized custodian. Additionally, product sponsors such as variable and investment companies and limited partnerships which are recommended to the Client may provide support to the Advisor and the Advisor's Advisory Representatives. Such support includes research, educational information, and monetary support for due diligence trips and Client events. There is an incentive for the Advisor and the Client's Advisory Representative to recommend one broker-dealer over another based on the products and services that the Advisor will receive rather than the Client's best interest. How We Select Brokers/Custodians The Advisor seeks to recommend a custodian/broker who will hold the Client's assets and execute transactions on terms that are, overall, most advantageous when compared to other available providers and their services. The Advisor considers a wide range of factors, including, among others: • Combination of transaction execution services and asset custody services (generally without a separate fee for custody) • Capability to execute, clear, and settle trades (buy and sell securities for the Client's account) • Capability to facilitate transfers and payments to and from accounts (wire transfers, check requests, bill payment, etc.) • Breadth of available investment products (stocks, bonds, mutual funds, exchange-traded funds [ETFs], etc.) • Availability of investment research and tools that assist the Advisor in making investment decisions • Quality of services • Competitiveness of the price of those services (commission rates, margin interest rates, other fees, etc.) and willingness to negotiate the prices • Reputation, financial strength, and stability • Prior service to the Advisor and the Advisor's other Clients • Availability of other products and services that benefit the Advisor, as discussed below. Schwab The custodian and brokers we use We do not maintain custody of your assets that we manage although we may be deemed to have custody of your assets if you give us authority to withdraw assets from your account (see Item 15 - Custody, below). Your assets must be maintained in an account at a "qualified custodian," generally a broker-dealer or bank. We recommend that our clients use Charles Schwab & Co., Inc. (Schwab), a registered broker-dealer, member SIPC, as the qualified custodian. We are independently owned and operated and are not affiliated with Schwab. Schwab will hold your assets in a brokerage account and buy and sell securities when we instruct them to. While we recommend that you use Schwab as custodian/broker, you will decide whether to do so and will open your account with Schwab by entering into an account agreement directly with them. Conflicts of interest associated with this arrangement are described below as well as in Item 14 (Client referrals and other compensation). You should consider these conflicts of interest when selecting your custodian 18  We do not open the account for you, although we may assist you in doing so. Even though your account is maintained at Schwab, and we anticipate that most trades will be executed through Schwab, we can still use other brokers to execute trades for your account as described below (see "Your brokerage and custody costs"). How we select brokers/custodians We recommend Schwab, a custodian/broker, to hold your assets and execute transactions. When considering whether the terms that Schwab provides are, overall, most advantageous to you when compared with other available providers and their services, we take into account a wide range of factors, including: • Combination of transaction execution services and asset custody services (generally without a • separate fee for custody) • Capability to execute, clear, and settle trades (buy and sell securities for your account) • Capability to facilitate transfers and payments to and from accounts (wire transfers, check requests, bill payment, etc.) • Breadth of available investment products (stocks, bonds, mutual funds, exchange-traded funds [ETFs], etc.) • Availability of investment research and tools that assist us in making investment decisions • Quality of services • Competitiveness of the price of those services (commission rates, margin interest rates, other fees, etc.) and willingness to negotiate the prices • Reputation, financial strength, security and stability • Prior service to us and our clients • Services delivered or paid for by Schwab • Availability of other products and services that benefit us, as discussed below (see "Products and services available to us from Schwab") Your brokerage and custody costs For our clients' accounts that Schwab maintains, Schwab generally does not charge you separately for custody services but is compensated by charging you commissions or other fees on trades that it executes or that settle into your Schwab account. Certain trades (for example, mutual funds and ETFs) do not incur Schwab commissions or transaction fees. Schwab is also compensated by earning interest on the un-invested cash in your account in Schwab's Cash Features Program. Schwab charges you a flat dollar amount as a "prime broker" or "trade away" fee for each trade that we have executed by a different broker-dealer but where the securities bought or the funds from the securities sold are deposited (settled) into your Schwab account. These fees are in addition to the commissions or other compensation you pay the executing broker-dealer. Because of this, in order to minimize your trading costs, we have Schwab execute most trades for your account. We are not required to select the broker or dealer that charges the lowest transaction cost, even if that broker provides execution quality comparable to other brokers or dealers. Although we are not required to execute all trades through Schwab, we have determined that having Schwab execute most trades is consistent with our duty to seek "best execution" of your trades. Best execution means the most favorable terms for a transaction based on all relevant factors, including those listed above (see "How we select brokers/custodians"). By using another broker or dealer you may pay lower transaction costs. Products and services available to us from Schwab Schwab Advisor Services™ is Schwab's business serving independent investment advisory firms like us. They provide us and our clients with access to their institutional brokerage services (trading, custody, reporting, and related services), many of which are not typically available to Schwab retail 19  customers. However, certain retail investors may be able to get institutional brokerage services from Schwab without going through us. Schwab also makes available various support services. Some of those services help us manage or administer our clients' accounts, while others help us manage and grow our business. Schwab's support services are generally available on an unsolicited basis (we don't have to request them) and at no charge to us. Following is a more detailed description of Schwab's support services: Services that benefit you. Schwab's institutional brokerage services include access to a broad range of investment products, execution of securities transactions, and custody of client assets. The investment products available through Schwab include some to which we might not otherwise have access or that would require a significantly higher minimum initial investment by our clients. Schwab's services described in this paragraph generally benefit you and your account. Services that do not directly benefit you. Schwab also makes available to us other products and services that benefit us but do not directly benefit you or your account. These products and services assist us in managing and administering our clients' accounts and operating our firm. They include investment research, both Schwab's own and that of third parties. We use this research to service all or a substantial number of our clients' accounts, including accounts not maintained at Schwab. In addition to investment research, Schwab also makes available software and other technology that: • Provide access to client account data (such as duplicate trade confirmations and account statements) • Facilitate trade execution and allocate aggregated trade orders for multiple client accounts • Provide pricing and other market data • Facilitate payment of our fees from our clients' accounts • Assist with back-office functions, recordkeeping, and client reporting Services that generally benefit only us. Schwab also offers other services intended to help us manage and further develop our business enterprise. These services include: • Educational conferences and events • Consulting on technology and business needs • Consulting on legal and compliance related needs • Publications and conferences on practice management and business succession • Access to employee benefits providers, human capital consultants, and insurance providers • Marketing consulting and support Schwab provides some of these services itself. In other cases, it will arrange for third-party vendors to provide the services to us. Schwab also discounts or waives its fees for some of these services or pays all or a part of a third party's fees. If you did not maintain your account with Schwab, we would be required to pay for those services from our own resources. Our interest in Schwab's services The availability of these services from Schwab benefits us because we do not have to produce or purchase them. We don't have to pay for Schwab's services. Schwab has also agreed to pay for certain technology, research, marketing, and compliance consulting products and services on our behalf. The fact that we receive these benefits from Schwab is an incentive for us to recommend the use of Schwab rather than making such a decision based exclusively on your interest in receiving the best value in custody services and the most favorable execution of your transactions. This is a conflict of interest. We believe, however, that taken in the aggregate our recommendation of Schwab as 20  custodian and broker is in the best interests of our clients. Our selection is primarily supported by the scope, quality, and price of Schwab's services (see "How we select brokers/ custodians") and not Schwab's services that benefit only us. Aggregated Trades We combine multiple orders for shares of the same securities purchased for advisory accounts we manage (this practice is commonly referred to as "aggregated trading"). We will then distribute a portion of the shares to participating accounts in a fair and equitable manner. Generally, non- wrap accounts will pay a fixed transaction cost regardless of the number of shares transacted. In certain cases, each participating account pays an average price per share for all transactions and pays a proportionate share of all transaction costs on any given day. If you participate in our wrap fee program described above, you will not pay any portion of the transaction costs in addition to the program fee. In the event an order is only partially filled, the shares will be allocated to participating accounts in a fair and equitable manner, typically in proportion to the size of each client's order. Accounts owned by our firm or persons associated with our firm may participate in aggregated trading with your accounts; however, they will not be given preferential treatment. On occasion circumstances may exist that make it appropriate to allocate the order on a basis different from that identified in the allocation statement. Any deviation from the initial allocation must be approved in writing by the Chief Investment Officer or Chief Compliance Officer. Item 13 Review of Accounts Investment Management Services The Client must notify the Advisor promptly of any changes to the Client's financial goals, objectives or financial situation. The Client's Advisory Representative will review the portfolio allocation and determine recommendations for changes. The Advisor will meet with Clients at least annually to review and discuss their account(s). The Client may request more frequent meetings based on the Client's specific needs. The Advisor will provide the Client with a written or electronic quarterly report which includes performance, current holdings, current asset allocation and an invoice for the Advisor's management fee. The invoice will specify the advisory fee, the value of the account and the period rate upon which the fee was calculated. The Client will also receive monthly or quarterly statements directly from the account custodian. Additionally, the custodian will provide the Client with trade confirmations of all transactions occurring in the Client's account. Financial Planning and Retirement Planning Services Clients participating in Financial and Retirement Planning Services will not receive regular reviews or reports other than the initial plan or analysis. The Advisor recommends that the Client has their plan reviewed and updated at least annually, or sooner if changes dictate. However, the Client will decide on the time and frequency of any further review. To obtain additional services, the Client will be required to re-contract with us based on the fee schedule disclosed under the program. Item 14 Client Referrals and Other Compensation Charles Schwab & Co., Inc - Institutional 21  We receive an economic benefit from Schwab in the form of the support products and services it makes available to us and other independent investment advisors whose clients maintain their accounts at Schwab. You do not pay more for assets maintained at Schwab as a result of these arrangements. However, we benefit from the referral arrangement because the cost of these services would otherwise be borne directly by us. You should consider these conflicts of interest when selecting a custodian. The products and services provided by Schwab, how they benefit us, and the related conflicts of interest are described above (see Item 12—Brokerage Practices). Product vendors recommended by the Advisor may provide monetary and non-monetary assistance with Client events and provide educational tools and resources. The Advisor does not select products as a result of any monetary or non-monetary assistance. The selection of product is first and foremost. The Advisor's due diligence of a product does not take into consideration any assistance it may receive. Therefore, this is not considered a conflict of interest but a benefit for the Client and the Advisor. The Advisor has entered into contractual arrangements with certain individual(s). The solicitor will refer Clients who may be a candidate for the Advisor's investment advisory services. In return, the Advisor will agree to compensate the solicitor for the referral. Compensation to the solicitor is dependent upon the Client entering into an advisory agreement with the Advisor for advisory services. The solicitor will be compensated by a percentage of the Advisor's advisory fee or a flat fee as agreed upon between the Advisor and the solicitor. Clients will not be charged additional fees based on this compensation arrangement. Incentive based compensation is contingent upon clients entering into an advisory agreement with the Advisor. Therefore, the individual has a financial incentive to recommend the Advisor to you for advisory services. This creates a conflict of interest; however, you are not obligated to retain the Advisor for advisory services. Comparable services and/or lower fees may be available through other firms. Additionally, the Advisor has entered into agreements with certain referral networks to receive client referrals. These referral networks are independent of and unaffiliated with the Advisor and there is no employee relationship between them. The referral networks provide a means for referring individuals and other investors seeking fiduciary personal investment management services or financial planning services to independent investment advisors. The compensation arrangements between the Advisor and the referral network vary depending on the network. Under the compensation arrangement with one referral network, the Advisor pays the network an on-going fee for each successful client referral based on a percentage of the advisory fees earned for managing the capital of the client or investor that was referred. Under the compensation arrangement with another referral network, the Advisor pays the network a fixed fee for each referral. The Advisor will not charge clients referred through a referral network any fees or costs higher than its standard fee schedule offered to its clients. Item 15 Custody With the exception of deduction of the Advisor's advisory fees from the Client's account(s), the Advisor does not have custody of the Client's funds or securities. Under government regulations, the Advisor is deemed to have custody of the Client's assets if the Client authorizes the Advisor to instruct Schwab to deduct the Advisor's advisory fees directly from the Client's account. However, the Client's custodian, Schwab, maintains the actual custody of the Client's assets. The Client will receive account statements directly from Schwab at least quarterly. They will be sent to the email or postal mailing address the Client provided to them. The Client should carefully review those statements promptly when the Client receives them. The Advisor also urges the Client to compare the account statements from Schwab with the quarterly portfolio reports the Client will receive from the Advisor. 22  Wire Transfer and/or Standing Letter of Authorization The Advisor, or persons associated with the Advisor, may effect wire transfers from client accounts to one or more third parties designated, in writing, by the client without obtaining written client consent for each separate, individual transaction, or we may have signatory and check writing authority for client accounts, as long as the client has provided us with written authorization to do so. Such written authorization is known as a Standing Letter of Authorization. An adviser with authority to conduct such third party wire transfers or to sign checks on a client's behalf has access to the client's assets, and therefore has custody of the client's assets in any related accounts. However, the Advisor does not have to obtain a surprise annual audit, as it otherwise would be required to by reason of having custody, as the Advisor meets the following criteria: 1. You provide a written, signed instruction to the qualified custodian that includes the third party's name and address or account number at a custodian; 2. You authorize us in writing to direct transfers to the third party either on a specified schedule or from time to time; 3. Your qualified custodian verifies your authorization (e.g., signature review) and provides a transfer of funds notice to you promptly after each transfer; 4. You can terminate or change the instruction; 5. We have no authority or ability to designate or change the identity of the third party, the address, or any other information about the third party; 6. We maintain records showing that the third party is not a related party to us nor located at the same address as us; and 7. Your qualified custodian sends you, in writing, an initial notice confirming the instruction and an annual notice reconfirming the instruction. Item 16 Investment Discretion By execution of the Advisor's advisory agreement, the Client will grant the Advisor authorization to manage the Client's account on a discretionary basis. The Advisor will have the authority to determine, without obtaining specific Client consent, the securities to be bought or sold and the amount of the securities to be bought or sold. The Client may terminate discretionary authorization at any time upon receipt of written notice by the Advisor. Discretionary trading authority facilitates placing trades in Client accounts so that the Advisor may promptly implement the investment policy that Clients have approved in writing. A limited power of attorney is a trading authorization for this purpose. Clients sign a limited power of attorney so that the Advisor may execute trades, subject to the limitations of the agreement. In all cases, such discretion is exercised in a manner consistent with the Client's Investment Policy Statement which specifies the Client's investment objectives, goals, and asset allocation for the account. Investment guidelines and restrictions must be provided to the Advisor in writing. Item 17 Voting Client Securities The Advisor does not vote on the Client's securities. Unless the Client suppresses proxies, securities proxies will be sent directly to the Client by the account custodian or transfer agent. 23  Item 18 Financial Information The Advisor will not require the Client to prepay more than $1,200 and six or more months in advance of receiving the advisory service. The Advisor is financially stable. There is no financial condition that is likely to impair the Advisor's ability to meet the Advisor's contract actual commitment to the Client or any other Client. The Advisor has not been the subject of a bankruptcy petition. Item 19 Requirements for State Registered Advisers This section is not applicable to the Advisor. The Advisor is not state registered. The Advisor is registered with the United States Securities and Exchange Commission. 24 

Stonehearth Capital Management Wrap Fee Program Stonehearth Capital Management 100 Conifer Hill Drive, STE 105 Danvers, MA 01923 (978) 624-3000 www.stonehearthcapital.com September 17, 2025 FORM ADV PART 2A Appendix 1 WRAP FEE PROGRAM BROCHURE This wrap fee program brochure provides information about the qualifications and business practices of Stonehearth Capital Management. If you have any questions about the contents of this brochure, please contact us at (978) 624-3000 or Jamie@stonehearthcapital.com. 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 Stonehearth Capital Management is also available on the SEC's website at www.adviserinfo.sec.gov . Our Firm IARD/CRD number is 128866. Any references to Stonehearth Capital Management as a registered investment adviser or its related persons as registered advisory representatives does not imply a certain level of skill or training. 1  Item 2 Summary of Material Changes This section identifies specific material changes that were made to the Stonehearth Capital Management Wrap Fee Program Brochure since the last annual update and provides you with a summary of such changes. The Advisor has made no material changes to our wrap fee program brochure since the last annual updating amendment dated February 24, 2025. A copy of our updated Wrap Fee Program Brochure is available to you free of charge and may be requested by contacting us at (978) 624-3000 or Jamie@stonehearthcapital.com. Additional information about SCM is also available via the SEC's website www.adviserinfo.sec.gov. The IARD number for SCM is 128866. The SEC's web site also provides information about any persons affiliated with SCM who are registered, or are required to be registered, as Advisory Representatives of SCM. 2  Item 3 Table of Contents Item 1 Cover Page Item 2 Summary of Material Changes Item 3 Table of Contents Item 4 Services, Fees, and Compensation Item 5 Account Requirements and Types of Investors Item 6 Portfolio Manager Selection and Evaluation Item 7 Client Information Provided to Portfolio Managers Item 8 Client Contact with Portfolio Managers Item 9 Additional Information Item 10 Requirements for State-Registered Advisers Page 1 Page 2 Page 3 Page 4 Page 7 Page 8 Page 11 Page 12 Page 12 Page 14 3  Item 4 Services, Fees, and Compensation Stonehearth Capital Management ("SCM"/"Advisor") is an investment advisory firm that sponsors a wrap fee program and provides portfolio management services under the wrap fee program. Clients electing to participate in a wrap fee program will receive portfolio management services and execution of securities transactions for a single fee. The Advisor has entered into a relationship to offer the Client brokerage and custodial services through Charles Schwab & Co., Inc. ("Schwab"). There is no affiliation between the Advisor and Schwab. Clients with an account atSchwab may participate in a wrap fee program. Schwab will act solely as a broker-dealer and not as an investment advisor to clients. They will have no discretion over client accounts and will act solely on instructions they receives from SCM. Schwab has no responsibility for SCM's services and undertakes no duty to clients to monitor SCM's management of client accounts or other services SCM provides to Clients. Schwab will hold your assets in a brokerage account and buy and sell securities and execute other transactions when SCM instructs them to. SCM does not open the account for clients. Under a wrap fee program, the Client will not pay any ticket charges, American depository receipt fees, asset-based pricing fees, exchange processing fees, foreign transaction taxes, prime broker/trade away fees, short term redemption fees, transaction-based pricing fees, trust reporting fees, alternative investment fees or unlisted foreign ordinary fees on accounts held in custody with Schwab. All such fees and expenses will be borne by the Advisor. Clients participating in our wrap fee program with assets managed by the Advisor but not custodied at Schwab (i.e., outside accounts), will be subject to such fees if assessed. The Advisor and Advisory Representatives of the Advisor may receive a portion of the wrap fee for providing advisory services. The Advisor manages four strategies, each of which has its own requirements to qualify for the SCM Wrap Fee Program. The four strategies include: • Diversified Portfolio • Diversified CarbonLITE Portfolio • Diversified ETF-Only Portfolio • U.S. Stock Portfolio Wrap Fee Program Qualifications: • Have $1,000,000 (cash or securities) or more of assets on which the Advisor or its Advisory Representatives receive any form of compensation AND maintain an account at Schwab. The $1,000,000 of assets can be comprised of accounts held at Schwab along with other financial institutions ("outside accounts") such as mutual fund companies, 529 college savings plan providers, variable annuity companies, retirement plan providers and private and public partnerships. These assets must be managed by the Advisor and the Advisor must receive (or have received) some form of compensation to qualify towards the minimum threshold. The Advisor will monitor the Client's account values at least quarterly, and maybe more frequently, for continued eligibility in our wrap fee program. Should the Client's account values fall below $800,000, the Client will no longer be eligible to participate in the wrap fee program. This means that the Advisor will no longer pay for ticket charges or account maintenance fees on the Client's accounts held in 4  custody with Schwab. Under certain circumstances, the Advisor may permit exceptions to the qualification requirements for the wrap fee program. Further information on the non-wrap fee investment management program is available in the Stonehearth Capital Management Brochure (Form ADV Part 2A). The Advisor offers portfolio review and investment management services on a discretionary basis. Discretionary trading authorization permits the Advisory Representative to make buys, sells and exchanges within the account as the Advisory Representative deems appropriate without contacting the Client prior to execution. The Client will need to execute a limited power of attorney granting discretionary trading authorization to Stonehearth Capital Management and the Client's Advisory Representative. The Advisor will manage the account exercising discretionary authority on the securities to be purchased and sold and the timing of such transactions. With the exception of the authorized payment of the Advisor's advisory fees, the Advisor will not have the authorization to withdraw Clients' securities or funds. Advisory Representatives will gather information on the Client's financial history, goals, objectives and financial concerns and assist the Client in developing an Investment Policy Statement which specifies the Client's investment objectives, goals, and an asset allocation strategy. The Client(s) will establish an account with Schwab and deposit cash, cash equivalents and securities, and engage an Advisory Representative to manage the Account. Based on the Client's investment objectives, risk tolerance and financial situation, the Client's Advisory Representative will provide investment management services on a continuous and ongoing basis consistent with the Client's Investment Policy Statement. Payment Schedule The annual fee for the wrap fee program is based on a percentage of assets under management, according to the schedule below. Fees are negotiable under certain circumstances (e.g., friends, family members, and employees of the Advisor) and are subject to change. Fees are not based on a share of capital gains upon or capital appreciation of the funds or any portion of the funds. Advisory fees will be charged quarterly in advance based on the market value of the account assets as of the close of business on the last day of the preceding quarter. If the management of an Account commences at any time other than the beginning of a calendar quarter, the initial quarterly fee shall be charged in arrears. The initial quarterly fee will be based on the initial account balance and will be pro-rated based on the number of days during the quarter when the agreement was in effect. Advisory fees for the wrap fee program are in accordance with the following fee schedule: Account Size Annual Fee First $250,000 1.25% Next $750,000 1.00% Next $2,000,000 0.75% Next $2,000,000 0.50% Ongoing 0.25% The Advisor may change the above fee schedule upon 30-days prior written notice to the Client. 5  Advisory fees are based on the aggregate value of all managed accounts within the established household. The value of the portfolio will include, but is not limited to, assets under the management of the Advisor held at Schwab, as well as those assets under the Advisor's management held at other financial institutions (outside accounts) such as mutual fund companies, 529 college savings plan providers, variable annuity companies, retirement plans providers and private and public partnerships. Further information on non-wrap fee investment management services is available in the Stonehearth Capital Management Brochure (Form ADV Part 2A). Depending upon the circumstances, the Advisor may combine Client accounts from one household with Client accounts from other households to aggregate account values for fee calculations. The annual fee may then be based on an aggregate value of all accounts within the combined households. If the Client participates in a wrap fee program, advisory fees will be deducted directly from the Client's account(s) withSchwab, provided the Client has given the Advisor written authorization. The Client will be provided with an account statement reflecting the deduction of the advisory fee. If the account does not contain sufficient funds to pay advisory fees, the Advisor has limited authority to sell or redeem securities in sufficient amounts to pay advisory fees. The Client may reimburse the account for advisory fees paid to the Advisor, except for ERISA and IRA accounts. Transactions in the Client's account, account reallocations and rebalancing may trigger a taxable event, with the exception of retirement accounts (e.g., IRA or Roth). A portion of the wrap fee may be paid to the following parties: • The Client's Advisory Representative, • Advisor, and • Schwab for brokerage and custodial services. If the wrap fee account is opened with securities previously purchased through the Advisor's Advisory Representative, the Advisory Representative may have already receive commissions on the purchase. SCM's wrap fee covers SCM's advisory services and the brokerage and execution services provided by Schwab. As a result, SCM has an incentive to execute transactions for your account at Schwab. In addition to SCM's advisory fee, the Client should also be aware that SCM's wrap fee does not cover all fees and costs. The fees not included in the wrap fee include charges imposed directly by a mutual fund, index fund, or exchange traded fund which shall be disclosed in the fund's prospectus (i.e., fund management fees and other fund expenses), mark-ups and mark-downs, spreads paid to market makers, managed account select/managed account access, personal choice retirement account, retirement plan services, stock plan services pricing/fees, sub-linked or block trade master accounts, fixed income trading commissions, fees (such as a commission or markup) for trades executed away from Schwab at another broker-dealer, wire transfer fees and other fees and taxes on brokerage accounts and securities transactions. The Advisor will utilize exchange traded funds (ETF) and open-ended mutual funds including no-load and load waived. While certain products may pay 12b-1 fees, the Advisor will not receive these fees. Where applicable and for those accounts under its custody, Schwab will retain the 12b-1 fees. Depending on the level of the wrap program fee being charged to the Client and the amount of portfolio activity in the Client's account, the cost of a wrap fee program may be more or less than if the Client obtained services separately or paid commissions or paid for execution services. A wrap fee account, as compared with a traditional commission-based account or a fee-based account where the Client pays transaction charges, may be more costly to the Client, particularly during periods when trading 6  activity is lower. Therefore, this may result in a higher annual cost than if transactional costs and investment advice were segregated. During periods when trading activity is heavier, such as when the account is first opened, wrap fee accounts may result in lower costs. Under the wrap fee program, the Advisor will pay transaction and execution charges in an Client's account held at Schwab. As such, there is a disincentive for Advisory Representatives to affect trades in these accounts held at Schwab. SCM's wrap fee covers SCM's advisory services and the brokerage and execution services provided by Schwab. As a result, we have an incentive to execute transactions for your account at Schwab. Our wrap fee does not cover all fees and costs. The fees not included in the wrap fee include charges imposed directly by a mutual fund, index fund, or exchange traded fund which shall be disclosed in the fund's prospectus (i.e., fund management fees and other fund expenses), mark-ups and mark-downs, spreads paid to market makers, fees (such as a commission or markup) for trades executed away from [Schwab] at another broker-dealer, managed account select/managed account access, personal choice retirement account, retirement plan services, stock plan services pricing/fees, sub-linked or block trade master accounts, fixed income trading commissions, wire transfer fees and other fees and taxes on brokerage accounts and securities transactions. Compensation received from a wrap fee program may be higher or lower than the compensation received should the Client have selected another advisory program or paid for brokerage and advisory services separately. Therefore, the Client's Advisory Representative may have a financial incentive to recommend the wrap fee program over other programs or services. Such a practice presents a conflict of interest and gives the Advisor and the Advisory Representatives incentive to recommend investment products based on the compensation received rather than the Client's needs. Termination Schedule The Client may terminate investment advisory services obtained from the Advisor, without penalty, upon written notice within five (5) business days after entering into the advisory agreement with the Advisor. The Client will be responsible for any fees and charges incurred from third parties as a result of maintaining the account such as transaction fees for any securities transactions executed and account maintenance or custodial fees. Thereafter, the Client may terminate investment advisory services with written notice to the Advisor. Should the Client terminate investment advisory services during the quarter, the Client will be issued a pro-rated refund of the prepaid advisory fee from the date of termination to the end of the three-month billing period. Item 5 Account Requirements and Types of Investors The Advisor's services are geared toward individuals and their families including high net worth individuals, trusts, estates, as well as corporations and other business entities. The Advisor manages four strategies, each of which has its own requirements to qualify for the SCM Wrap Fee Program. The four strategies include: • Diversified Portfolio • Diversified CarbonLITE Portfolio • Diversified ETF-Only Portfolio • U.S. Stock Portfolio Wrap Fee Program Qualifications: 7  • Have $1,000,000 (cash or securities) or more of assets on which the Advisor or its Advisory Representatives receive any form of compensation, AND • Maintain an account at Schwab. The $1,000,000 of assets can be comprised of accounts held at Schwab along with other financial institutions ("outside accounts") such as mutual fund companies, 529 college savings plan providers, variable annuity companies, retirement plans providers and private and public partnerships. These assets must be managed by the Advisor and the Advisor must receive (or have received) some form of compensation to qualify towards the minimum threshold. The Advisor will monitor the Client's account values at least quarterly, and maybe more frequently, for continued eligibility in the Advisor's wrap fee program. Should the Client's account values fall below $800,000, the Client(s) may no longer be eligible to participate in the wrap fee program. This means that the Advisor will no longer pay for ticket charges or account maintenance fees on the Client's accounts held in custody with Schwab. Under certain circumstances, the Advisor may permit exceptions to the account minimum threshold. Item 6 Portfolio Manager Selection and Evaluation Selection and Review of Portfolio Managers The Stonehearth Capital Management wrap fee program is proprietary to the Advisor. The Advisor manages all assets in the Program and does not offer access to other third-party portfolio managers through the Program. Advisory Services Offered In addition to offering investment management services through the Wrap Fee Program, the Advisor also offers investment management services through its traditional investment management program, as well as financial planning and retirement planning services. The Advisor will provide investment management services on assets under custody with Schwab, or on assets held at other financial institutions (outside accounts). A description of all programs and services offered by the Advisor is more fully disclosed in the Advisor's Disclosure Brochure. Under the wrap fee program, the Client will not pay any ticket charges, American depository receipt fees, asset-based pricing fees, exchange processing fees, foreign transaction taxes, prime broker/trade away fees, short term redemption fees, transaction-based pricing fees, trust reporting fees, alternative investment fees or unlisted foreign ordinary fees on accounts held in custody with Schwab. All such fees and expenses will be borne by the Advisor. The Advisor and Advisory Representatives of the Advisor may receive a portion of the wrap fee for providing advisory services. The Advisor will provide investment management services on the Client's assets held at other financial institutions (outside of Schwab) provided the Advisor is listed on the account with limited trading authorization to allow the Advisor to place trades on the Client's behalf. While the value of these outside accounts may be combined with the value of the Client's Schwab account(s), to qualify for the Advisor's wrap fee program, any fees charged at these other financial institutions will be the Client's responsibility. Accounts held outside of Schwab (i.e., outside accounts) may not lend themselves to continuous and ongoing management of the assets within the account due to trading restrictions and limitations. In these instances, the Advisor will provide asset allocation and periodic monitoring services. Because of 8  these restrictions, the Advisor tries to utilize products/procedures that do not require rebalancing trades such as: age-based funds, target date funds, asset allocation funds or automatic rebalancing options offered by the outside account custodian. The Advisor will manage a Client's account based on the individual needs and goals of the Client. The Client may impose restrictions on investing in certain securities or types of securities. The Client's Advisory Representative will gather information on the Client's financial history, goals, objectives, and financial concerns and assist the Client in developing an asset allocation strategy. All information gathered from the Client is confidential. The Advisor does not charge performance-based fees. Investment Management Process The Advisor manages four strategies which include: • Diversified Portfolio • Diversified CarbonLITE Portfolio • Diversified ETF-Only Portfolio • U.S. Stock Portfolio Diversified Portfolio: The Diversified Portfolio is constructed utilizing a variety of different asset categories including stock exposure, bond exposure and alternative (broadly defined as an asset category that does not fit within the definition of stock or bond exposure) exposure. This Portfolio is available in three different risk profiles: • Conservative: The primary objective is to minimize losses and to keep volatility to a minimum. The secondary objective is growth of assets. • Moderate: The primary objective is to equally balance minimizing losses and growing the assets. • Aggressive: The primary objective is growth of assets. The secondary objective is to minimize losses and to keep volatility to a minimum. There is no guarantee that the Advisor's expectations will be met within each of the three risk profiles. Diversified CarbonLITE Portfolio: The Advisor offers Clients a CarbonLITE portfolio solution ("CarbonLITE"), which is designed to lower the carbon footprint of the equity exposure within the portfolio while maintaining similar asset allocation, risk and expense characteristics as compared to the Diversified Portfolio offering. CarbonLITE is not a traditional "green portfolio" or "socially responsible" portfolio which invest more heavily in certain sectors of the marker (i.e., solar power) or avoid other sectors of the market. CarbonLITE seeks to reduce the portfolio's carbon footprint (based on greenhouse gas emissions of underlying companies in the fund) but not at the expense of altering the portfolios characteristics (i.e., asset allocation, risk, expenses). CarbonLITE does maintain fossil fuel exposure but at lower levels than our Diversified Portfolio offerings. The Advisor expects that if/when the fossil fuel industry experiences strong price fluctuations, the CarbonLITE strategy will see a larger discrepancy in performance when compared to the Diversified Portfolio offering. This Portfolio is available in three different risk profiles: • Conservative: The primary objective is to minimize losses and to keep volatility to a 9  minimum. The secondary objective is growth of assets. • Moderate: The primary objective is to equally balance minimizing losses and growing the assets. • Aggressive: The primary objective is growth of assets. The secondary objective is to minimize losses and to keep volatility to a minimum. There is no guarantee that the Advisor's expectations will be met within each of the three risk profiles. Diversified ETF-Only Portfolio: The Advisor offers Clients a Diversified ETF-Only Portfolio ("ETF-Only"). ETF stands for Exchange Traded Fund. The Advisor expects this portfolio offering to have similar asset allocation and risk characteristics when compared to the Diversified Portfolio offering. The Advisor expects this portfolio to have a lower internal expense ratio compared to the Diversified Portfolio offering. Schwab does not charge securities transaction fees for ETFs. This Portfolio is available in three different risk profiles: • Conservative: The primary objective is to minimize losses and to keep volatility to a minimum. The secondary objective is growth of assets. • Moderate: The primary objective is to equally balance minimizing losses and growing the assets. • Aggressive: The primary objective is growth of assets. The secondary objective is to minimize losses and to keep volatility to a minimum. There is no guarantee that the Advisor's expectations will be met within each of the three risk profiles. U.S. Stock Portfolio: The Advisor ranks stocks on known quantitative factors that the Advisor believes help identify stocks that are good investments over a full market cycle. They are based on academic and real-world research. The Advisor ranks stocks on quality, value, price momentum, & dividend yield. The Advisor then combines the four scores into one "alpha" score to screen the Advisor's universe for stocks to invest in. The Advisor then applies a qualitative analysis to further help the Advisor identify stocks that are an attractive investment. The Advisor's focus is on high quality companies that return cash to shareholders that are inexpensive and are exhibiting positive price momentum based on quantitative factors. This strategy seeks to add value over the S&P 500, a broad market cap-based index. There is no guarantee that this goal will be met. Method of Analysis and Investment Process After determining the Client's appropriate risk level, the Advisor will assign the Client to one of the Advisor's asset allocation model portfolios. The Advisor's lower risk level asset allocation models contain a larger percentage of assets that do not correlate with the stock market. The Advisor's higher risk level asset allocation models contain a larger percentage of assets that DO correlate with the stock market. In constructing the portfolios, the Advisor uses Ycharts and Rixtrema software to identify if the risk and growth factors are appropriate for each risk level. In determining the composition of investments within each model portfolio, the Advisor uses a proprietary investment analysis strategy. The Advisor takes into account the following: • Experience of the manager and management team • Competitiveness of the expenses charged for managing the fund • Performance of the fund during prior market selloffs and rallies • Compensation for the risk taken within the fund (i.e., high risk, high reward) 10  • Volatility of the fund • Consistency of returns by the fund • Value added by manager vs. buying cheap index fund The Advisor weigh each of the factors within YCharts software to identify products that the Advisor feels is appropriate to utilize within Client portfolios. The Advisor monitors these products to ensure they are still appropriate to utilize, or to identify if another product would be a better fit. The Advisor adheres to the following monitoring process: • At least quarterly the Advisor processes a global rebalancing trade. This global trade looks at each household to ensure their asset categories are within the desired drift range (25% of target exposure, for example 10% target, plus or minus 2.5% drift). • Monthly cash management screening to ensure Clients who have periodic draws from their accounts to supplement income needs run smoothly • Quarterly monitoring of fund performance to ensure fund managers are still competitive based on our proprietary screening process • Ongoing analysis of tax management strategies to help limit tax liabilities for Clients (i.e.,Tax Loss Harvesting). The Advisor does not represent, warrantee or imply that the services or methods of analysis used by the Advisor can or will predict future results, successfully identify market tops or bottoms, or insulate Clients from losses due to major market corrections or crashes. Past performance is no indication of future performance. No guarantees can be offered that Clients' goals or objectives will be achieved. Further, no promises or assumptions can be made that the advisory services offered by the Advisor will provide a better return than other investment strategies. As stated above, the Advisor primarily uses ETFs and mutual funds. The risks with these products include the costs and expenses for the product that can impact performance, change of managers, and fund straying from its objective. Open ended mutual funds do not typically have a liquidity issue and the price does not fluctuate throughout the trading day. ETFs can also trade at a premium or discount to their net asset value which can detract from performance. Investing in securities involves risk of loss, including the potential loss of principal. Therefore, the Client's participation in any of the management programs offered by the Advisor will require the Client to prepare to bear the risk of loss and fluctuating performance. Item 7 Client Information Provided to Portfolio Managers The Advisor will gather financial information from the Client such as: Information about the Client's personal finances Investment goals and objectives and risk tolerance. • Social Security or Tax Identification number • Birth date • Net worth and annual income • • Financial information such as bank accounts • Other investment accounts, balances, statements, account numbers, etc. • As the portfolio manager, the Client's Advisory Representative will use this information to customize an advisory program based on the Client's specific needs. Should this information change, the Client should notify their Advisory Representative. 11  Item 8 Client Contact with Portfolio Managers The Client may contact the Advisor and/or the Client's Advisory Representative at any time. The frequency of Client meetings are based on the value of the assets under management by the Advisor (see Review of Accounts in Item 9 - Additional Information for further details). Item 9 Additional Information There is no reportable disciplinary information required for the Advisor or its Advisory Representatives. Advisory Representatives are licensed with various insurance companies. The insurance business is not a significant business to the Advisory Representatives, and they do not concentrate resources toward the business. However, it is important to know that if Advisory Representatives recommend insurance products and if the Client purchases insurance products through them, they will earn commissions. This represents a conflict of interest in that the Advisory Representative recommends the insurance product and compensation is received by the Advisory Representative. While Advisory Representatives endeavor at all times to put the interests of the Client first as part of the Advisor's fiduciary duty, Clients should be aware that the receipt of additional compensation itself creates a conflict of interest and may affect the judgment of Advisory Representatives when making recommendations. The Advisor attempts to mitigate the conflict of interest with the potential receipt of commission by disclosing this conflict to the Client and by informing the Client that they are under no obligation to purchase insurance products or services through the Advisor's Advisory Representatives. The Client may implement recommendations through other insurance agents. Code of Ethics The Advisor has a fiduciary duty to the Client to act in the Client's best interest and always place the Client's interests first and foremost. The Advisor takes seriously its compliance and regulatory obligations and requires all staff to comply with such rules and regulations as well as the Advisor's policies and procedures. Further, the Advisor strives to handle Clients' non-public information in such a way to protect information from falling into hands that have no business or reason to know such information and provides the Client with the Advisor's Privacy Policy. As such, the Advisor maintains a code of ethics for its Advisory Representatives, supervised persons, and staff. The Code of Ethics contains provisions for standards of business conduct in order to comply with federal securities laws, personal securities reporting requirements, pre-approval procedures for certain transactions, code violations reporting requirements, and safeguarding of material non-public information about the Client's transactions. Further, the Advisor's Code of Ethics establishes the Advisor's expectation for business conduct. A copy of the Advisor's Code of Ethics will be provided to the Client upon request. The Advisor and its associated persons may buy or sell securities identical to those securities recommended to the Client. Therefore, the Advisor and/or its associated persons may have an interest or position in certain securities that are also recommended and bought or sold to Clients. The Advisor and its associated persons will not put their interests before the Clients' interest. The Advisor and its associated persons may not trade ahead of the Client or trade in such a way to obtain a better price for themselves than for Clients. 12  The Advisor is required to maintain a list of all securities holdings for its associated persons and develop procedures to supervise the trading activities of associated persons who have knowledge of Clients' transactions and their related family accounts at least quarterly. Further, associated persons are prohibited from trading on non-public information or sharing such information. The Client has the right to decline any investment recommendation. The Advisor and its associated persons are required to conduct their securities and investment advisory business in accordance with all applicable Federal and State securities regulations. The wrap fee program may present conflicts of interest. Some products are offered on Schwab's platform with no or lower ticket charges, while others require higher ticket charges. Since the Advisor covers ticket charges for qualifying Clients, the Advisor may be influenced by this fee when selecting products. Review of Accounts The Advisor will meet with Clients at least annually to review and discuss their account(s). The Client may request more frequent meetings based on the Client's specific needs. The Client must notify the Advisor promptly of any changes to the Client's financial goals, objectives or financial situation. The Client's Advisory Representative will review the portfolio allocation and determine recommendations for changes. The Advisor will provide the Client with a written or electronic quarterly report which includes performance, current holdings, current asset allocation and an invoice for the Advisor's management fee. The invoice will specify the advisory fee, the value of the account and the period rate upon which the fee was calculated. The Client will also receive monthly or quarterly statements directly from the account custodian. Additionally, the custodian will provide the Client with trade confirmations of all transactions occurring in the Client's account. Client Referrals and Other Compensation Product vendors recommended by the Advisor may provide monetary and non-monetary assistance with Client events and provide educational tools and resources. The Advisor does not select products as a result of any monetary or non-monetary assistance. The selection of product is first and foremost. The Advisor's due diligence of a product does not take into consideration any assistance it may receive. Therefore, this is not considered a conflict of interest but a benefit for the Client and the Advisor. As mentioned in Item 4, the Advisor has entered into a relationship to offer the Client brokerage and custodial services through Schwab. The advisor receives an economic benefit from Schwab in the form of the support products and services made available to the Advisor and other independent investment advisers who's Clients maintain their accounts at Schwab. These products and services, how they benefit the Advisor, and the related conflicts of interest are described below. The availability to the Advisor of Schwab's products and services is not based on the Advisor giving particular investment advice, such as buying particular securities for the Advisor's Clients. 13  In order to obtain the wrap fee investment management services from the Advisor, the Client will need to maintain an account with Schwab. If the Client selects another brokerage firm for custodial and/or brokerage services, the Client will not be able to receive the wrap fee investment management services from the Advisor. This practice may prevent the Advisor from achieving the most favorable execution of Client transactions and may cost the Client more money. Charles Schwab & Co., Inc - Institutional We receive an economic benefit from Schwab in the form of the support products and services it makes available to us and other independent investment advisors whose clients maintain their accounts at Schwab. You do not pay more for assets maintained at Schwab as a result of these arrangements. However, we benefit from the referral arrangement because the cost of these services would otherwise be borne directly by us. You should consider these conflicts of interest when selecting a custodian. The products and services provided by Schwab, how they benefit us, and the related conflicts of interest are described in Item 12 of SCM's disclosure brochure. The Advisor has entered into contractual arrangements with certain individual(s), including employees of the Advisor. The solicitor will refer Clients who may be a candidate for the Advisor's investment advisory services. In return, the Advisor will agree to compensate the solicitor for the referral. Compensation to the solicitor is dependent upon the Client entering into an advisory agreement with the Advisor for advisory services. The solicitor will be compensated by a percentage of the Advisor's advisory fee, or a flat fee as agreed upon between the Advisor and the solicitor. Clients will not be charged additional fees based on this compensation arrangement. Incentive based compensation is contingent upon clients entering into an advisory agreement with the Advisor. Therefore, the individual has a financial incentive to recommend the Advisor to you for advisory services. This creates a conflict of interest; however, you are not obligated to retain the Advisor for advisory services. Comparable services and/or lower fees may be available through other firms. Financial Information The Advisor will not require the Client to prepay more than $1,200 and six or more months in advance of receiving the advisory service. The Advisor is financially stable. There is no financial condition that is likely to impair the Advisor's ability to meet the Advisor's contract actual commitment to the Client or any other Client. The Advisor has not been the subject of a bankruptcy petition. Item 10 Requirements for State-Registered Advisers This section is not applicable to SCM. SCM is not state registered. SCM is registered with the Securities and Exchange Commission. 14