Primarily, we benefit from the services we provide to you because of the fees we receive from you. This compensation may vary based on different factors, such as the size of your account or the strategy you select. Some subadvisors pay us a portion of their revenue based on breakpoints. This could create a conflict as we have an incentive to recommend you invest your assets in these strategies; however, since we generally do not solicit accounts, we believe this conflict is mitigated. The more assets that are in your advisory account, the more you will pay in fees, and we may therefore have an inventive to encourage you to increase the assets your account.

USA Financial Exchange is a wholly-owned subsidiary of USA Financial Corporation.  USA Financial Corporation also owns five other public-facing companies: USA Financial Securities Corporation, USA Financial Insurance Services Corporation, USA Financial Formulas Corporation, USA Financial Marketing Corporation and USA Financial Protocol.  USA Financial Securities is an SEC-registered investment adviser and broker-dealer. USA Financial Insurance Services Corporation wholesales fixed insurance products to independent insurance agents. USA Financial Formulas is an SEC-registered investment adviser.  USA Financial Marketing develops and distributes marketing and technology solutions for financial professionals. USA Financial Protocol provides business consulting and branding services to financial advisers. Michael Walters is the chief executive officer of USA Financial and all subsidiaries and Brent Enders is the president.

USA Financial Exchange and its affiliate, USA Financial Formulas (collectively, “USA Financial” for this discussion), utilize JUST Capital for research and marketing-support services, as referenced above in Item 5 – Fees and Compensation.  Specifically, USA Financial relies on JUST Capital’s research to create our ESG models. JUST Capital measures and ranks the performance of America’s largest publicly traded companies on the issues that matter most in defining just business behavior.  The issues and the weights they are afforded are determined by polling the American public.

USA Financial provides JUST Capital a share of the revenue derived from the Just Capital ESG model as compensation for their research services and marketing support.

Next: Conflicts of Interest