A. Mach-1 Financial Group Mach-1 Financial Group, LLC ("Mach-1 Financial" and/or "the firm") is an Arkansas limited liability corporation majority owned by Mach-1 Holdings, Inc. and indirectly owned by David A. Lee as Trustee of The Lee Family Trust. The firm was first registered as an investment adviser in February 2020, and provides asset management services to high net-worth individuals, individuals, trusts, corporations, partnerships, and other legal entities. A.1. Advisory Services Offered Mach-1 Financial is an independent investment advisory firm that may utilize one or more third party sub-advisers ("Sub-advisers") or managers ("Managers") for asset management services. Mach-1 Financial's portfolio management services are generally offered through third-party sub-adviser(s) on a sub-advised basis. Either Sub-advisers or Managers appointed by Sub-adviser provide access to various portfolios ("Portfolios"), Mach-1 Financial or its client determines which Portfolios the client assets are to be invested in, and thereafter Sub-adviser or the Manager, as firm's sub-adviser, implements all trades necessary to cause such assets to be invested in the Portfolios. Clients only have a direct relationship with Mach-1 Financial, and not any Sub-advisers or Managers, and therefore clients are considered clients of Mach-1 Financial. For the avoidance of doubt, neither Sub-advisers nor Managers provide a client with any investment advice based on the client's financial circumstances. Neither Sub-adviser or Manager has the ability to determine if any Portfolio is appropriate for the need of any client. Each client must authorize Sub-adviser and the Managers to direct trades for clients' accounts at the custodian. The custodian will have custody of assets and execute transactions for the accounts. Neither Sub-adviser nor Manager will have responsibility for the selection of or actions or inactions by any custodian.
Sub-advisers or Managers selected by Sub-advisers generally retain complete discretion to formulate, monitor, and revise the Portfolios. By electing to allocate client assets to a Portfolio, subject to any restrictions communicated to Sub-adviser or Manager, Mach-1 Financial grants the Sub-adviser or Manager limited authority to effect trades consistent with its direction with respect to the accounts - but in all cases Sub-adviser's and Manager's discretion is limited to implementing transactions necessary to allocate assets among Portfolios as directed by Mach-1 Financial. Neither any Sub-adviser nor any Manager will have possession or custody of cash and/or securities in any accounts, nor any responsibility or liability for custody, which will remain solely with custodian. Sub-advisers will not be liable to a client for any losses, decreases in value, or adverse tax consequences that may result from the termination of a Manager, the appointment of a new Manager, and any resulting transactions effected to changes in the composition of any Portfolio.
Currently, Mach-1 Financial has agreements with AE Wealth Management, which is our trading/billing platform, as well as Sub-adviser agreements with third-party investment advisers to provide Mach-1 Financial with access to Portfolios to recommend to its clients. Responsibility for determining whether services from a particular Sub-adviser are appropriate for a particular client is vested exclusively with Mach-1 Financial. Sub-advisers will deliver their disclosure brochures to each client and will deliver or otherwise make each Manager's disclosure brochure available to such client.
Sub-advisers and the Managers, or their respective affiliates, perform investment advisory and other services for other clients, and Sub-adviser, the Managers and their affiliates may buy, sell, or trade, or recommend any securities for its or their respective accounts in compliance with all applicable federal and state securities laws. Sub-adviser, the Managers, and their affiliates may give advice and take action with respect to any of its other clients, which may differ from the advice given, the timing or nature of action taken, or recommendations provided to Sub-adviser with respect to the accounts that are a part of the Portfolios. Sub-advisers and Managers and their respective affiliates may from time to 4 time come into possession of confidential and privileged information ("Nonpublic Information") about clients and their assets and financial matters as a result of their other activities. Sub-advisers will not be free to divulge or act upon Nonpublic Information in connection with management of client portfolios.
A.2. Fees and Compensation A.2.a. Fee Schedule Mach-1 Financial will charge a fee for its advisory services based on the value of the account at the annual percentages below. Fees are negotiable.
Account Asset ValueAnnual Management Fee $0 - $1,000,0001.85% $1,000,001 - $3,000,000 1.70% $3,000,001 - $5,000,0001.55% Above $5,000,001Negotiable Third-party Sub-advisers and third-party Managers will normally be paid out of the fee the client pays to Mach-1 Financial, as reflected in each client's investment advisory agreement with the firm. Sub- advisers may impose a minimum portfolio size, minimum fee, or otherwise condition the firm's use of portfolios. Please refer to such Sub-adviser's ADV Part 2A Brochure for specific information. As may be provided in a client's advisory agreement, a client may incur technology or other fees, and Mach-1 Financial's advisory fee may vary among different Portfolios, and therefore Mach-1 Financial has a conflict of interest in selecting Portfolios for which it receives a higher advisory fee than for Portfolios with lower advisory fees.
Asset-based fees are always subject to the investment advisory agreement between the client and Mach-1 Financial. Such fees are typically payable monthly in arrears or as dictated by the sub- adviser's billing protocol. The specific billing methodology will be disclosed in the Investment Advisory Agreement signed by the client. The fees are based on the market value of the assets in the account(s) on the last day of the immediately preceding month or the average daily balance dictated by the Sub-adviser's billing protocol subject to the custodian having this capability. If the applicable custodian does not offer average daily pricing, then we will continue to bill in arrears based upon the closing month's portfolio value. No adjustments for significant contributions or withdrawals will be made. The fees will be prorated if the investment advisory relationship commences otherwise than at the beginning of a calendar month.
These fees include charges for all transaction costs such as commissions on purchase and sales of stocks, bonds, exchange-traded funds and options, trade-away fees on bonds and mutual fund transactions fees. Except as otherwise provided below, client will incur no charges other than Mach-1 Financial's fee described above in connection with the maintenance of and activity in client's account. The wrap fee does not include annual account fees, technology fees, or other administrative fees, such as wire fees, charged by Managers or brokerage firms; certain odd-lot differentials, transfer taxes, transaction fees mandated by the Securities Act of 1934, postage and handling fees, and charges imposed by law with regard to transactions in the Client's account; and advisory fees, expenses or sales charges (loads) of mutual funds (including money market funds), closed-end investment companies or other managed investments, if any, held in Client's account. The wrap fee also does not cover certain costs associated with securities transactions in the over-the-counter market, such as fixed income securities where Manager must approach a dealer or market maker to purchase or sell a security. Such costs include the dealer's mark-up, mark-down or spread and odd-lot differentials or transfer taxes imposed by law.
5 The trading cost component of the above-mentioned advisory fees are estimated to range from $100 to $1000 per account per year.
If a Manager serves for less than the whole of any month, the Manager's Fee will be calculated and payable on a pro-rata basis for the period of the month for which it has served as a subadvisor hereunder. Significant Account withdrawals or contributions during a month will not modify the Mach-1 Fee calculation when it is based on month-end values. The foregoing fees will be in effect until 30 days after Mach-1 has provided a notice to the Client about a change in the Mach-1 Fees. A.2.b. Important Disclosure – Custodian Investment Programs Please be advised that the firm utilizes certain custodians/broker-dealers. Under these arrangements we can access certain investment programs offered by our custodian that offer certain compensation and fee structures that create conflicts of interest of which clients need to be aware. Please note the following: Limitation on Mutual Fund Universe for Custodian Investment Programs: Please note that as a matter of policy we prohibit the receipt of revenue share fees from any mutual funds utilized for our advisory clients' Portfolios. Nonetheless, if the firm decides to take these 12b-1 fees in the future, please note the following: There are certain programs offered by our custodian in which the firm may participate in that limit the types of mutual funds and mutual fund share classes to those in which our custodian has negotiated the receipt of 12b-1 and/or other revenue sharing fee payments from the mutual fund issuer or sponsor. As such, a client's investment options may be limited in certain of these programs to those mutual funds and/or mutual fund share classes that pay 12b-1 fees and other revenue sharing fee payments, and the client should be aware that the firm is not selecting from among all mutual funds available in the marketplace when

recommending Portfolios containing such mutual funds to the client. Such fees are deducted from the net asset value of the mutual fund and generally, all things being equal, cause the fund to earn lower rates of return than those mutual funds that do not pay revenue sharing fees. The client is under no obligation to utilize such programs or mutual funds. Although many factors will influence the type of fund to be used, the client should discuss with their investment adviser representative whether a share class from a comparable mutual fund with a more favorable return to investors is available that does not include the payment of any 12b-1 or revenue sharing fees given the client's individual needs and priorities and anticipated transaction costs. In addition, the receipt of such fees can create conflicts of interest in instances (i) where our adviser representative is also licensed as a registered representative of a broker-dealer and receives a portion of 12b-1 and or revenue sharing fees as compensation – such compensation creates an incentive for the investment adviser representative to recommend Portfolios which utilize funds that pay such additional compensation; and (ii) where the broker-dealer receives the entirety of the 12b-1 and/or revenue sharing fees and takes the receipt of such fees into consideration in terms of benefits it may elect to provide to the firm, even though such benefits may or may not benefit some or all of the firm clients.
Additional Disclosure Concerning Wrap Programs: In addition, our custodian offers certain wrap fee programs that (i) allow us to select or recommend Portfolios with mutual fund classes that either have no transaction fee costs associated with them but include embedded 12b-1 fees that lower the investor's return ("sometimes referred to as "A-Shares," depending on the mutual fund issuer), or (ii) allow the use of mutual fund classes that have transaction fees associated with them but do not carry embedded 12b-1 fees (sometimes referred to as "IShares," depending on the mutual fund sponsor). Our wrap fee program offers investment services and related transaction services for one all-inclusive fee (except as may be described elsewhere in this Brochure). The trading costs are typically absorbed by the firm and/or the investment representative. If a client's account holds A-Shares within Portfolio, the firm and/or its investment adviser representative avoids paying the transaction fees charged by 6 other mutual fund classes, which in effect decreases the firm's costs and increases its revenues from the account. Effectively the cost is transferred to the client from the firm in the form of a lower rate of return on the specific mutual fund. This creates an incentive for us to select or recommend Portfolios using such funds as opposed to those funds that may be equally appropriate for a client but do not carry the additional cost of 12b-1 fees borne by the client. As a policy matter, the firm does not allow funds that impose 12b-1 or revenue sharing fees in the Portfolios. Should a client prefer an A-Share class or mutual fund share class that has embedded 12b-1 and/or revenue sharing fees, then the utilization of such funds within a Portfolio requires specific written client consent acknowledging the conflict. Clients should understand and discuss with their investment adviser representative the types of mutual fund share classes available in the Portfolios and the basis for using one share class over another in accordance with their individual circumstances and priorities.
Current business practices of the broker-dealer/custodian(s) we use has led to the reduction or elimination of many transaction charges (commissions). Therefore, our commission costs for trading in certain types of securities within the wrap fee program have been reduced or eliminated which means we retain a larger portion of the advisory fee we charge you, depending on the types of securities transacted in your account. This presents a conflict of interest as we have not reduced our fees to you in conjunction with these savings. We have no way of predicting how the custodian will assess transaction costs in the future, and trading costs may be higher or lower. We believe our wrap fee is fair and reasonable based on the services we provide and the advice we deliver.
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, we are providing the following acknowledgment to you. When we provide investment advice to you regarding your retirement plan account or individual retirement account, we are fiduciaries 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 we make money creates some conflicts with your interests, so we operate 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, we 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. We benefit financially from the rollover of your assets from a retirement account to an account that we manage or provide investment advice, because the assets increase our assets under management and, in turn, our advisory fees. As a fiduciary, we only recommend a rollover when we believe it is in your best interest. B. Disclosure of Cost Difference if Services Purchased Separately Depending on a number of factors, such as the number, size and nature of the securities transactions in an advisory account, the overall fees and charges borne by the client over time could be more or less than what these fees and charges would be if the same services were provided on a separate basis. Bundled fees generally provide an economic incentive for the advisory firm to select investments 7 and strategies that minimize trading costs. Frequent trading in an account where transaction fees are included as part of the overall advisory fee to the client drive trading costs higher and reduce the overall fee revenue to the firm. As a result, higher trading costs in a bundled fee account have a negative impact on the firm's profitability.
C. Additional Client Fees and Terms of Payment C.1. Client Payment of Fees Mach-1 Financial does not require the prepayment of its investment supervisory fees. Mach-1 Financial is paid directly by the client, and Mach-1 Financial will pay the Sub-advisers' fees.
Mach-1 Financial is authorized to direct each custodian to deduct all client fees directly from accounts and remit the same to Mach-1 Financial, and therefrom Mach-1 Financial will remit to the Sub-advisers' fees as applicable. Sub-advisers will normally separately pay any Manager fees, if applicable, directly out of the fees paid by Mach-1 Financial to the Sub-adviser.
The custodian will deduct advisory fees directly from the client's account provided that (i) the client provides written authorization to the qualified custodian, and (ii) the qualified custodian sends the client a statement, at least quarterly, indicating all amounts disbursed from the account. The client is encouraged to review the quarterly custodian statement to verify the accuracy of the fee calculation, as the client's custodian will not verify the calculation. Both Mach-1 Financial and the third-party Sub- advisers have internal control procedures to verify the accuracy of the advisory account billing.
Termination provisions may vary by the third-party Sub-adviser. Please refer to such Sub-adviser's ADV Part 2A Brochure for specific information. Clients may terminate any advisory agreement any time as provided therein, or otherwise terminate that client's participation in any Portfolio; Mach-1 Financial or Sub-advisers may terminate their sub-advisory agreements at any time on 30 days' notice, or immediately in specified cases. Upon any such termination, client's assets will no longer be invested in the relevant Portfolios.
C.3. Additional Fees The fees charged by Mach-1 Financial do not include fees charged by exchange-traded funds or mutual funds, which are disclosed in the respective fund's prospectus. If a mutual fund also imposes sales charges, the client may pay an initial or deferred sales charge as further described in the mutual fund's prospectus. A client using Mach-1 Financial may be precluded from using certain mutual funds because they may not be offered by the client's custodian. Please refer to the Brokerage Practices section (Items 9.B.2 and 9.B.3) for additional information regarding the firm's brokerage practices.
D. External Compensation for the Sale of Insurance to Clients Mach-1 Financial's advisory professionals are compensated primarily through a salary and bonus structure and through asset-based fees generated from client accounts. Mach-1 Financial's advisory professionals may receive commission-based compensation for the sale of insurance products. Please see Item 9.A.2. for detailed information and conflicts of interest.
E. Client Assets Under Management As of December 31, 2023, we provide continuous management services for $354,368,522 in client assets on a discretionary basis.
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