Douglas Capital Management Inc

Item 5 Fees and Compensation

Investment supervisory services, including the giving of continuous advice to clients as to the investment
of funds based on the individual needs of each client, are provided pursuant to the terms of the
investment advisory agreement in effect between Douglas Capital Management, Inc., and the individual
client. Services for each account are managed with regard to all relevant factors concerning the account,
which have been determined by the client and Douglas Capital. For such services, the client is normally
charged an annual fee, payable quarterly in advance at 25% of the annual fee rate, based on the market
value of the account at the end of each quarter. These fees are deducted from client assets on a quarterly
basis and the amount deducted is disclosed on the custodial statement.

The annual fee is negotiable and is set by agreement between each client and Douglas Capital
Management. The negotiated fee is a stated percentage of the market value of the assets in the account,
which may decrease in such percentage for specified incremental increases in the assets of the account.

Clients may incur additional custodial fees, mutual fund fees and will incur brokerage and other
transaction costs. Please review Item 12 - Brokerage Practices of this brochure for more detail on these
costs. If we recommend mutual funds, we will recommend “no-load” funds to minimize costs.

If the investment advisory agreement is terminated before the end of the billing period, client may be
eligible for a pro-rated refund of pre-paid fees according to the following policy. Investment Advisory
Agreements may be terminated at any time by either party giving to the other 30 days written notice of
such termination. Pro-rated fees (if any) will be reimbursed to the client within 90 days and will be
calculated 30 days from the date of termination or last account activity if no notice is given.

Douglas Capital Management may receive compensation for the purchase or sale of annuities or
insurance products. This practice may present a potential conflict of interest as we or our supervised
persons may have an incentive to recommend investment products based on the compensation received,
rather than on a client need. To minimize any potential conflict of interest, we will review the suitability of
annuities or insurance products with each client and explain that they have the option to purchase these
products through other brokers or agents not affiliated with us.

Item 7 Types of Clients

Douglas Capital Management provides investment management services for high-net worth individuals
and institutional investors, including retirement accounts, corporations, profit-sharing accounts,
association accounts and personal accounts and trusts.