Advisors Asset Management Inc

Item 5.        Fees and Compensation

Generally, AAM’s advisory fees are based on a percentage of assets under management.
AAM generally does not charge fixed fees except in special situations.

Fees and services may be negotiated and will typically vary based on factors such as client
type, asset class, pre-existing relationship, service levels, portfolio complexity, number of
accounts, account size, anticipated future earning capacity, anticipated future additional
assets or based on other unique circumstances or requirements. Some existing clients may
pay higher or lower fees than new clients. Related accounts could be aggregated for fee
calculation purposes in certain circumstances at the discretion of AAM.

Fees and related terms of payment of such fees for all AAM advisory services are governed
by the terms of the applicable agreement(s).

Advisory Fees for SMAs

Fees for portfolio management services to SMAs will customarily be charged as a
percentage of assets under management. Annual fees for our fixed income strategies range
from 0.20% to 2.00%. Annual fees for our equity strategies range from 0.45% to 2.5%.
AAM can and has negotiated these terms and conditions with clients at its discretion.

NOTE: all fees referenced above reflect our standard ranges. Some accounts have fees that
fall outside our standard range.

SMA accounts, depending on the particular arrangement with each client, will be charged
either by invoicing clients or directly debiting their custodial accounts. Clients should
contact their custodian for more information relating to the deduction of fees from client
accounts.

For SMA accounts, AAM’s preference is to bill in advance however we do accommodate
both advance and arrears billing. Billing “in advance” or “in arrears” is based on the
portfolio value as of the last business day of the previous calendar quarter. In most cases,
the value is calculated using the trade date positions with ICE Data Services. ICE is a large,
well regarded, independent pricing service. In those few cases where ICE pricing is not
available due to non-traded corporate actions, custodian or proprietary pricing is used. The
fee is calculated by multiplying the portfolio value by the contracted rate. Typically, the

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fee is one quarter of the annual fee, but for new accounts, days are subtracted for billing in
arrears or added for billing in advance to reflect the proper number of days managed.
Frequency and timing of billing is determined by the applicable advisory agreement.

For direct accounts, AAM usually requires a minimum account size of $250,000 for fixed
income strategies and $100,000 for equity strategies. For platform accounts, AAM usually
requires a minimum account size of $250,000 for fixed income strategies and $100,000 for
equity strategies. AAM can and has negotiated these terms and conditions with clients at
its discretion. We could group certain related client accounts for the purposes of
determining the account size and/or annualized fee.

Clients can terminate their advisory agreement by providing us with a 30-day written notice
at our principal place of business subject to the terms of their advisory agreement. Upon
termination of any account, any prepaid, unearned fees will be promptly refunded and any
earned, unpaid fees will be due and payable.

Advisory Fees for Sub-Advisory Relationships

AAM also provides investment management services as a sub-adviser to certain accounts.
In other words, an investor may engage an independent investment adviser (the “primary
adviser”) which, in turn engages AAM to provide portfolio management services to all or
part of such investor’s portfolio. In this situation, AAM will typically receive a fee charged
as a percentage of assets sub-advised by AAM, typically ranging from 0.25% to 0.70% of
the assets managed by AAM. Such fees are generally charged by directly debiting the
end-investor’s custodial accounts although this will vary by agreement. Clients should
contact their custodian for more information relating to the deduction of fees from their
accounts.

For sub-advised accounts, AAM’s preference is to bill in advance however we do
accommodate both advance and arrears billing. Billing “in advance” or “in arrears” is based
on the portfolio value as of the last business day of the previous calendar quarter. In most
cases, the value is calculated using the trade date positions with ICE Date Services pricing.
ICE is a large, well regarded, independent pricing service. In those few cases where ICE
pricing is not available due to non-traded corporate actions, custodian or proprietary pricing
is used. The fee is calculated by multiplying the portfolio value by the contracted rate.
Typically, the fee is one quarter of the annual fee, but for new accounts, days are subtracted
for billing in arrears or added for billing in advance to reflect the proper number of days
managed. Frequency and timing of billing is determined by the applicable sub-advisory
agreement.

End-investors should refer to the primary adviser’s disclosure documents for full
information on the primary adviser’s advisory services.

As compensation for assistance provided by the primary adviser to AAM in connection
with AAM’s performance of services with respect to such accounts, AAM could, but
currently does not pay to the primary adviser a portion of the fee it receives for such sub-

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advised accounts. Payment of such compensation would likely increase the level of sub-
advisory fee charged by AAM relative to fees charged with respect to accounts for which
no similar amount is paid.

Advisory Fees for Non-Discretionary Accounts and Model Portfolio Advice

For certain strategies, AAM provides certain non-discretionary investment service to
clients such as banks, broker-dealers, investment adviser or other financial services firms.
Such services may include model portfolio recommendations. Such model portfolios are
...

Item 7.        Types of Clients

Our firm generally provides SMA advisory services to individuals, banking or thrift
institutions, trusts, estates, broker-dealers, pension or profit sharing plans, corporations or
other businesses, other Investment Advisers and charitable organizations. AAM also has
AAM-sponsored UITs as a type of client. AAM also provides investment advisory services
to open end management investment companies, as described above under “Advisory
Business.”

For direct accounts, AAM generally requires a minimum account size of $250,000 for fixed
income strategies and $100,000 for equity strategies. For platform accounts, AAM
generally requires a minimum account size of $250,000 for fixed income strategies and
$100,000 for equity strategies. AAM may negotiate these terms and conditions with any
client at its discretion. We may group certain related client accounts for the purposes of
determining the account size and/or annualized fee.

AAM provides investment advisory services to a Private Fund as described in Item 4 above.
Investors in the Private Fund must abide by the terms of the Private Fund’s governing
documents, pursuant to which they agree to be bound by the terms and provisions thereof.

Investment in the Private Fund requires that investors meet certain eligibility and
sophistication requirements under federal securities laws.