Calton & Associates Inc

Item 5 - Fees and Compensation
Portfolio Management Services

Calton charges investment advisory fees for its portfolio management services based on a percentage
of assets in clients’ accounts up to 2.60%. Calton’s investment advisory fees may be negotiable,
depending on the individual client as agreed upon under the Investment Advisory Agreement. Calton’s
investment advisory fees will vary and are determined by the IAR managing the client’s investment
advisory account, and the type of program selected. The investment advisory fee may be higher or
lower than what other clients pay the IAR for similar services. TPMM investment advisers may charge
a separate investment advisory fee that is in addition to Calton’s investment advisory fee. The total
investment advisory fees charged to the client by Calton are outlined and disclosed in the Investment
Advisory Agreement signed by the client.

With respect to the T-MAP program, Calton’s investment advisory fee is separate from the investment
advisory fees charged by the Third-party Money Managers (“TPMMs”). Investment advisory fees that
the client pays to the TPMMs are outlined and disclosed in the Disclosure Brochure provided by each
TPMM. The investment advisory fees charged by the TPMMs may or may not be negotiable. Clients
should review the recommended TPMM’s Disclosure Brochure and review the TPMM’s investment
advisory fees adding them to Calton’s investment advisory fees to determine the total amount of
investment advisory fees the client will pay for the program selected.

Calton generally bills clients’ accounts its investment advisory fee quarterly in advance. However,
depending on the custodian of the account or TPMM selected, accounts may be billed either in
advance or in arrears on a quarterly, monthly, or daily basis. Clients should refer to their account
documents for information on how the total investment advisory fee will be charged and the billing
calculation method applicable to their specific account(s). If the Investment Advisory Agreement is
executed at any time other than the first day of a billing period, Calton will charge the investment
advisory fees on a pro rata basis on the number of days in the billing period from the date of account
opening.

Calton will deduct its investment advisory fee directly from clients’ accounts held at the qualified
custodians or send clients an invoice for the payment of the investment advisory fee. Calton will deduct
its investment advisory fee only when the client has authorized in writing the deduction of the
investment advisory fees from his or her account. The qualified custodian will deliver an account
statement to clients no less than quarterly. Clients should review all statements for accuracy.

Either the client or Calton may terminate the Investment Advisory Agreement upon 30 days written
notice to the other party. The investment advisory fee will be pro-rated for the billing period from the
date of cancellation. Calton will refund any unearned investment advisory fees back to the client.

Certain clients may be charged for portfolio investment performance by Calton under specific terms in
the Investment Advisory Agreement, pursuant to a performance-based fee schedule. Clients agreeing
to be charged under the performance-based fee schedule will be charged a quarterly fixed investment
advisory fee and a performance-based investment advisory fee based on a schedule detailed under

Item 7 - Types of Clients
Calton offers investment advisory services to individuals, pension and profit sharing plans, trusts,
estates, charitable organizations, corporations, and other business entities.

To open and maintain a portfolio management account with Calton, the firm generally requires that the
client have an initial account value of at least $50,000. Calton may at its discretion accept clients with
smaller account values.