American Capital Management Inc

Item 5.          Fees and Compensation

         Compensation per annum is 1% of assets or as stipulated in our investment management
agreement. Fees are payable quarterly, in advance, based upon 0.25% of 1% of the portfolio’s market
value as of the last business day of each calendar quarter. We forward a quarterly invoice directly to the
client showing the amount owed, method of calculation and time period covered. Based on the clients’
instructions, a copy can also be sent to their custodian, in which case the client can authorize the
custodian to remit payment directly to ACM from the custody account. ACM receives income only from
the management of client assets. Intra-quarter fees will be pro-rated on a per diem basis for any period
that is less than a calendar quarter due to either the commencement or termination of this Agreement.
To the extent that the Client has overpaid as a result of the valid termination of this Agreement, ACM
shall provide a refund of such overpayment.

        Management fees are negotiable at ACM’s discretion. Discounts may be provided based on client
size, relationship history, related accounts, or other relevant considerations. ACM may also apply tiered
fee schedules or fee breakpoints, which reduce the fee percentage as asset levels increase.

         Invoices reflecting the fee calculation and the billing period are provided to clients quarterly. ACM
does not bill fees in advance for more than one quarter at a time and does not take physical custody of
client funds or securities.

        Other Fees or Expenses – Certain custodians who hold client assets may also charge a fee.
Clients will also incur transaction costs, which are commissions paid to brokers (see Item 12 Brokerage
Practices for more information) through which ACM processes trades for its accounts. Assets invested
in exchange traded funds or mutual funds are charged a fee by the fund managers in addition to ACM’s
management fee. We do not receive compensation for the sale of securities or investment products. We
do not receive commissions or sales fees and only charge fees for investment advice pursuant to an
investment advisory relationship.

        Termination – Our investment management agreement may be terminated within 10 days from
inception without penalty or by either party thereafter upon 30 days written notice of such termination.
Fees are refundable on a pro rata per diem basis from the date of notification.

Item 7.         Types of Clients

        ACM provides investment advice and portfolio management services primarily to high-net-worth
individuals, corporations, foundations, endowments, pension and profit-sharing plans, IRAs, and trusts.
In addition, we also provide investment management services to one UCITS fund. We generally require
a minimum of $2 million for new accounts. However, smaller accounts may be accepted at the discretion
of management.