Clean Yield Group Inc

Fees and Compensation
Description
Clients who contracted with Clean Yield for asset management services after June 30, 2010, pay fees
based on the appraised market value of the client's account according to the following schedule:

        Market Value of Account Balance          Annual Rate
         First $2,000,000                         1.00%
         Next $3,000,000                          0.75%
         Next $5,000,000                          0.60%
         Above                                    Negotiated

Clients who contracted with Clean Yield for asset management services prior to June 30, 2010 pay fees
based on the appraised market value of the client’s account according to the following schedule:

Equity Accounts

        Market Value of Account Balance          Annual Rate
         First $500,000                           1.25%
         Next $500,000                            1.00%
         Next $2,000,000                          0.80%
         Next$2,000,000                           0.50%
         Above                                    Negotiated

Balanced Accounts

        Market Value of Account Balance          Annual Rate
         First $500,000                           1.00%
         Next $500,000                            0.80%
         Next $2,000,000                          0.60%
         Next$2,000,000                           0.50%
         Above                                    Negotiated

These rates may be negotiated for lower, but not higher, fees. Family members of Clean Yield
employees typically pay lower or no fees.

Fees are paid quarterly in advance of service based on the account value at the end of the previous
quarter. For example, the fee for January – March is calculated using the value of the account on
December 31. This fee covers all portfolio management services provided to clients. We do not charge
any other fees for additional services.

Fee Billing
Clients are sent a copy of their quarterly management fee bill with their quarterly reports every quarter.
When clients set up their account to be managed by Clean Yield, they usually sign a limited power of
attorney, allowing Clean Yield to directly withdraw cash from their brokerage account to pay Clean

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Yield’s quarterly fees. In a few cases, clients pay their fees from an account that is not managed by Clean
Yield.

Other Fees
In very limited instances, when a client does not want his or her account actively invested, but instead
held in cash for a period of time, Clean Yield will charge a flat fee of $500/year. Decisions on when to re-
invest the account are made by the client, and at that time, the client will be charged a percentage of
assets under management.

Fees Paid in Advance
All fees are paid quarterly, in advance, based on the appraised market value of the client’s account at
the end of the prior quarter. A client can cancel the contract with Clean Yield within five days of signing
the contract without incurring any penalty or fee. A client, or Clean Yield, can cancel the investment
supervisory service contract with a written or email notification, allowing ten days before taking effect.
The client will be refunded any fees on a pro-rata basis.

Additional Compensation
Clean Yield does not charge clients fees other than their quarterly management fees. On occasion, Clean
Yield may provide consulting services to social businesses or other groups for a fee. These services are
intended to improve the socially responsible investment landscape and eventually provide more
investing opportunities for clients.

Performance-Based Fees & Side-by-Side
Management
Sharing of Capital Gains or Capital Appreciation
Clean Yield does not charge any performance fees. Clean Yield does not share in capital gains or capital
appreciation, except insofar as the account grows, Clean Yield’s fees also grow. Clean Yield only charges
a tiered management fee based on an account’s market value at the end of the preceding quarter or,
very occasionally, a flat or minimum fee, when appropriate, as discussed above under “Other Fees”.

Types of Clients
Description
Applicant provides investment supervisory services to clients, including individuals, institutions, trusts,
and foundations.

Account Minimums
Clean Yield imposes a minimum initial account size of one million dollars ($1,000,000). This minimum
may be waived at the sole discretion of an officer. Accounts may also be taken below the minimum but
may be charged a minimum annual management fee of $7,500. The accounts of family members of
clients may be accepted at amounts less than $1,000,000.

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Methods of Analysis, Investment Strategies and
Risk of Loss
Methods of Analysis & Investment Strategy
Clean Yield portfolio managers look at financial, social, governance, and environmental criteria when
analyzing stocks for inclusion in client portfolios.

Financial
Clean Yield’s investment strategy emphasizes quality stocks, with a focus on valuation. We seek to invest
in high quality, undervalued stocks that we anticipate will outperform the market over the long term.
We may include growth stocks that are trading at reasonable valuations relative to their historic
averages.

Clean Yield pays close attention to the balance sheet and related financial statements, regardless of
whether we are interested in a company for its growth or value characteristics. Our investment
philosophy is based on a long-term perspective. All stocks considered for inclusion must, at a minimum,
be consistent with the social and environmental screens, described below, and undergo assessment of
social and environmental profiles, including product and service attributes.

Our Investment Committee meets weekly, and includes all our investment analysts and portfolio
managers. During these sessions, the economy, the investment markets, and individual securities
(including the particular environmental or social merits of individual securities) are discussed at length.
Changes in investment strategy, as well as additions and deletions to the approved security universe, are
also discussed in these meetings.

For fixed income, Clean Yield uses a strategy of laddering short, mid, and occasionally long-term bonds
in client portfolios. Usually, these bonds will be Federal Agency bonds, but also may include CDs,
municipal bonds, corporate bonds, fixed income exchange traded funds or mutual funds, and preferred
stocks. In addition, Clean Yield invests in community investment promissory notes as a form of fixed
income.

When appropriate for a client, and only with their specific consent, Clean Yield may invest in an options
strategy to protect client portfolios from a substantial market downturn. This is done by purchasing
longer term “put” options. If a client would like to employ this strategy, Clean Yield will provide
additional disclosures and explanation of how “puts” work.

Social and Environmental Screens
Clean Yield aims to screen out companies materially involved in the following areas:

    •   Fossil fuel extraction, exploration, production, and refining
    •   Production of electric power generated primarily by coal, oil, or nuclear fuels
    •   Hydraulic fracturing (fracking) of oil and gas shale
    •   Deriving more than 5% of revenues from conventional or nuclear weapons and their support
        systems
    •   Deriving any portion of their revenues from chemical or biological weapons, cluster bombs and
        landmines

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    •   Deriving any portion of revenues from the manufacture or sale of firearms for civilian use
    •   Animal testing, beyond legal requirements*
    •   Fur production
    •   Abuse of animals for entertainment
    •   Factory farming
    •   Manufacture of gaming equipment or operation of casinos
    •   Tobacco, tobacco products, and e-cigarettes
    •   Use of genetically modified organisms (GMOs) in seed production
    •   Business activities that provide strategic economic support to repressive regimes (e.g., Burma
        and Sudan)
    •   We avoid investing in companies and sectors that benefit from or contribute to racism.

*Corporate disclosure on animal testing tends to be very poor. As such, we will adhere to this screen as
faithfully as possible.

Additional social screens are determined during an initial consultation with the client.

With regard to both social/environmental and financial screens, Clean Yield uses third party research,
databases, websites, journals, and trade and industry publications. In addition, we may speak with the
management of a company whose stock we are interested in buying or selling, and we may participate
in conference calls with the company.

From time to time, Clean Yield may approve funds for investment. When evaluating the environmental
and social credentials of fund for investment, Clean Yield focuses on the mandate of the fund and does
not screen underlying fund investments against Clean Yield’s social and environmental screens. Instead,
we trust the manager with security selection that is aligned with the fund mandate.

Risk of Loss
Investing in securities involves risk of loss that clients should be prepared to bear. Clean Yield feels it is
important that our clients understand the nature of investing in equity securities. Although stocks in
general have increased in value over the long term, they can rise or fall over the short term. Clients’
principal is not guaranteed, and if the securities in client accounts decline in value, the client will suffer
losses. The value of client portfolios may fluctuate over a wide range, depending in part on the
movement of the stock market and the economy. We believe, however, that prudent investment in
stocks provides the best opportunity to increase capital over the long term. Clients investing with Clean
Yield face a variety of risks:

    •   General market risk. This is the risk that the value of any security may fluctuate, sometimes
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