Arcataur Capital Management LLC

Item 5 – Fees, Compensation, and Account Valuation

General Fee Information

The specific manner in which investment management fees are charged by Arcataur is
established in a client’s written agreement with Arcataur. Arcataur calculates its investment
management fees monthly based on the combined value of all cash and securities under
Arcataur’s management at the end of the month. Clients are billed in arrears each calendar
quarter and may not pay investment management fees in advance. Clients may elect to be
billed directly for investment management fees or authorize Arcataur to directly debit
investment management fees from client accounts. Investment management fees shall not be
prorated for each capital contribution and withdrawal made during the applicable calendar
quarter. Accounts initiated or terminated during a calendar quarter will be charged a prorated
investment management fee. Upon termination of any account, any earned, unpaid
investment management fees will be due and payable.

Arcataur’s investment management fees are the only fees charged by Arcataur to a client.
Clients may incur certain charges imposed by custodians, brokers and other third parties such
as brokerage commissions, transaction fees, custodial fees, wire transfer and electronic funds
transfer fees, and other fees and taxes on brokerage accounts and securities transactions.
Mutual funds and exchange traded funds also charge internal management fees and other
expenses, which are disclosed in a fund’s prospectus. Such charges, fees and commissions
are exclusive of and in addition to Arcataur’s investment management fees, and Arcataur
shall not receive any portion of these commissions, fees, and costs. Neither Arcataur nor any

of its supervised persons accepts compensation for the sale of securities or other investment
products, including asset-based sales charges or service fees from the sale of mutual funds.

Item 12 further describes the factors that Arcataur considers in selecting or recommending
broker dealers for client transactions and determining the reasonableness of their
compensation (e.g., commissions).

Unless a client has received this disclosure brochure at least 48 hours prior to signing the
investment management agreement, the investment management agreement may be
terminated by the client within five (5) business days of signing the agreement without
incurring any advisory fees.

Fee Schedule

The following schedule applies to all accounts:

Type of Account                        Asset Value                       Annual Rate
Large Cap Equity Portfolios            under $1 million                     .85%
                                       $1 million to $5 million             .80%
                                       $5 million to $ 10 million           .75%
                                       Over $10 million                     .70%

Investment Grade Fixed                 under $1 million                      .60%
Income Portfolios                      $1 million to $5 million              .55%
                                       $5 million to $10 million             .50%
                                       Over $10 million                      .45%

Managed Balance Portfolios
Consisting of: direct equities, ETFs   under $1 million                      .80%
and direct fixed income                $1 million to $5 million              .75%
                                       $5 million to $10 million             .70%
                                       Over $10 million                      .65%

Managed Balance Portfolios
Consisting of: ETFs and direct         under $3 million                      .60%
fixed income only                      $3 million to $5 million              .55%
                                       $5 million to $10 million             .50%
                                       Over $10 million                      .45%

All fees are subject to negotiation.

Account Valuation

Arcataur uses account market values to calculate assets under management, client investment
management fees and investment performance where applicable.

In all cases, Arcataur uses pricing information provided by its clients’ custodians (currently,
one custodian) to value the client portfolios. The custodian’s price is compared to the price
provided by FactSet (an independent pricing service) and variances greater than 3% are
investigated.

If the custodian is unable to provide a price, Arcataur will attempt to obtain a price from
FactSet, Yahoo Finance, Morningstar, or other outside sources. If a price is not available
from any of these sources, the security will be fair valued in accordance with the
methodology outlined in Arcataur’s pricing and valuation procedures.

Item 7 – Types of Clients

Arcataur provides portfolio management services to individuals, trusts, corporations and
other commercial entities, pension and profit-sharing plans, Taft-Hartley plans, charitable
institutions, religious organizations, foundations, endowments, and municipalities.

Arcataur generally prefers accounts with at least $500,000 in equity assets if a direct equity
solution is desired. This asset level would provide an opportunity to create appropriate
diversification and minimize the impact of normal trading costs related to a direct equity
portfolio solution. However, based upon a client’s needs and the use of exchange traded
funds (“ETFs”) to achieve appropriate diversification, Arcataur is comfortable assisting
clients with fewer assets. Utilizing equity index ETFs solely for the stock exposure allows
Arcataur to minimize the trading cost issues for lower dollar value accounts, while creating
the diversification required to be fully diversified. The important consideration is achieving
proper portfolio construction that meets the investment goals of the client. Arcataur currently
assists clients with assets less than $100,000 in this fashion.