Cottage Street Advisors LLC

Item 5: Fees and Compensation
Compensation
CSA is a “fee-only” investment adviser, and accepts no compensation or commission, direct or
indirect, from any third party for any product or security sold to a third party. CSA bases its fees
on a percentage of assets under management and hourly or flat rate charges. CSA’s fee
schedules are described below.

Compensation – Investment Management and Financial Planning Services
Fees for Investment Management and Financial Planning services are typically range from
0.75% (75 basis points) to 1.00% (100 basis points) per year, charged semi-annually, quarterly,
or monthly in arrears, deducted from the client’s account.

Fees will be based upon the average value (market value or fair market value in the absence of
market value, including cash) of the client’s account for the period being billed.

Financial Planning Services are included in our investment management fee but are also
available at a fixed price (typically $2,500 - $10,000) for clients that would like planning only
services.

Compensation – Consulting Services
For financial consulting services that exceed the scope in the paragraph above, services are
provided on a negotiated hourly basis, (typically $250 - $500 per hour), billed in arrears, paid
directly by the client. The scope and cost of consulting services are agreed upon in advance with
the client.

Termination
Investment Advisory Agreements may be terminated at any time by either party, for any reason
upon receipt of written notice.

Any fees due will be charged on a pro rata basis.

Cash Balances
Some of your assets may be held as cash and remain uninvested. Holding a portion of your
assets in cash and cash alternatives, i.e., money market fund shares, may be based on your
desire to have an allocation to cash as an asset class, to support a phased market entrance
strategy, to facilitate transaction execution, to have available funds for withdrawal needs or to
pay fees or to provide for asset protection during periods of volatile market conditions. Your
cash and cash equivalents will be subject to our investment advisory fees unless otherwise
agreed upon.

Retirement Plan Rollover Recommendations

As part of our investment advisory services to our clients, we may recommend that clients roll
assets from their employer’s retirement plan, such as a 401(k), 457, or ERISA 403(b) account
(collectively, a “Plan Account”), to an individual retirement account, such as a SIMPLE IRA, SEP
IRA, Traditional IRA, or Roth IRA (collectively, an “IRA Account”) that we will advise on the
client’s behalf. We may also recommend rollovers from IRA Accounts to Plan Accounts, from
Plan Accounts to Plan Accounts, and from IRA Accounts to IRA Accounts.

If the client elects to roll the assets to an IRA that is subject to our advisement, we will charge
the client an asset-based fee as set forth in the advisory agreement the client executed with our
firm. This creates a conflict of interest because it creates a financial incentive for our firm to
recommend the rollover to the client (i.e., receipt of additional fee-based compensation).
Clients are under no obligation, contractually or otherwise, to complete the rollover. Moreover,
if clients do complete the rollover, clients are under no obligation to have the assets in an IRA
advised on by our firm. Due to the foregoing conflict of interest, when we make rollover
recommendations, we operate under a special rule that requires us to act in our clients’ best
interests and not put our interests ahead of our clients.’

Under this special rule’s provisions, we must:

   •    meet a professional standard of care when making investment recommendations (give
        prudent advice);
   •    never put our financial interests ahead of our clients’ when making recommendations
        (give loyal advice);
   •    avoid misleading statements about conflicts of interest, fees, and investments;
   •    follow policies and procedures designed to ensure that we give advice that is in our
        clients’ best interests;
   •    charge no more than a reasonable fee for our services; and
   •    give clients basic information about conflicts of interest.

Many employers permit former employees to keep their retirement assets in their company
plan. Also, current employees can sometimes move assets out of their company plan before
they retire or change jobs. In determining whether to complete the rollover to an IRA, and to
the extent the following options are available, clients should consider the costs and benefits of
a rollover. Note that an employee will typically have four options in this situation:

   1.   leaving the funds in the employer’s (former employer’s) plan;
   2.   moving the funds to a new employer’s retirement plan;
   3.   cashing out and taking a taxable distribution from the plan; or
   4.   rolling the funds into an IRA rollover account.

Each of these options has positives and negatives. Because of that, along with the importance
of understanding the differences between these types of accounts, we will provide clients with

an explanation of the advantages and disadvantages of both account types and document the
basis for our belief that the rollover transaction we recommend is in your best interests.

General Information on Compensation
Fees, account minimums and payment terms are negotiable depending on the client’s unique
situation – such as the size of the aggregate related party portfolio size, family holdings, low-
cost basis securities, or certain passively advised investments and pre-existing relationships
with clients. Certain clients may pay more or less than others depending on the amount of
assets, type of portfolio, or the time involved, the degree of responsibility assumed, complexity
of the engagement, special skills needed to solve problems, the application of experience and
knowledge of the client’s situation. Lower fees for comparable services may be available from
other sources.
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Types of Clients
As described in Item 4, CSA‘s clients include individuals, high-net-worth individuals, trust assets,
charitable trusts and estates, and corporations, or other business entities.

Account Minimums
CSA typically requires a minimum of $1,000,000 in assets under management. Waivers or
exceptions from the minimum may be granted at the exclusive discretion of CSA.

CSA may group certain related client accounts for the purposes of achieving the minimum
account size.