Ensemble Capital Management LLC

Item 5          FEES AND COMPENSATION

INVESTMENT MANAGEMENT FEES
The following is the basic fee schedule for our investment management services. These fees are
negotiable in the sole discretion of the Firm, and arrangements with any particular client can
vary. Ensemble does not charge a minimum fee, but we do have clients with different fee
structures, which is mainly due to complexity of services, type of clients, historical fee schedules,
and/or amount of assets being managed. In addition, Ensemble’s investment management fees
charged to clients can be changed upon 30-day notice to the affected clients. Ensemble also
reserves the right to waive fees for certain friends and family of the firm.

         Account Size                                                   Annual Fees
         First $10 million                                                  1.00%
         Amounts in excess of $10 million & up to $25 million               0.80%
         Amounts in excess of $25 million & up to $100 million              0.60%
         Amounts in excess of $100 million                                  0.50%

For clients that are charged a tiered fee, when determining “Account Size” for annual fee
percentage amounts, Ensemble will consider all accounts managed by the Firm that belong to
certain familial relations of the client, which is typically referred to as “householding”.
Specifically, the total market value (as defined below) of a client’s account(s) will be aggregated
with the total market values of all managed accounts belonging to a client’s spouse, custodial
accounts for minor children who reside at the same address of client, and any trust assets where
the trustees, trustors and current beneficiaries all reside at the same address as client
(collectively, a “household”). Clients are required to notify Ensemble of any such “household”

relationships. Ensemble reserves the right to include additional related accounts at the firm’s
discretion.

For valuation and billing data, Ensemble uses a third-party service provider, which receives and
reconciles daily account holdings, valuations, and securities pricing data electronically from
clients’ custodians. Ensemble bills investment management clients, quarterly in advance. The
Firm’s investment management fees are calculated based on the total market value of a managed
account, as of the last day of each calendar quarter. The “total market value” of an account
includes the value of all securities held (based on trade date), cash and cash equivalents,
dividend and interest accruals, and any margin balance pertaining to the account that is $100,000
or more. The third-party service provider reconciles securities prices against the prices received
from our main custodian, Charles Schwab & Co., Inc. (“Schwab”), and will use Schwab’s price
when there is any discrepancy between custodian prices. Due to that, along with other factors
such as timing of transactions, calculations and billing, the total market value of an account for
fee billing purposes can be different (in some cases higher) than the market value of the account
as reflected on the custodian’s account statement. Clients should be aware that Ensemble is not
liable for any pricing errors made by clients’ custodians.

Should a client open an account during the quarter, investment management fees will be
prorated for managed assets held for a partial quarter based on the number of days that the
account was open (i.e., date cash/assets received in the account) during the quarter. In the event
that Ensemble’s services are terminated mid-quarter, the fee shall be prorated through the date
of termination as defined in the client agreement and any pre-paid unearned fees will be
promptly refunded to the client. Also, any single day addition to an account that is over
$100,000 will be prorated and billed on the next invoice. Fees are not prorated for any
withdrawals from an account.

Clients typically authorize Ensemble to invoice the custodian of the account for payment of the
above fee directly from clients’ accounts. Ensemble’s invoice, which is usually sent to each client
and their respective custodian within ten business days, states the amount of the fee for the
quarter in question, the value of the assets on which the fee is based, and the manner in which
the fee is calculated. Clients are strongly advised to verify the accuracy of the fee, as their
custodian will not determine whether the fee is properly calculated.

There are times when a client decides to use margin in their account. Use of margin in an
investment advisory account can increase a client’s asset-based investment management fee (as
outlined above). In addition, clients will be charged margin interest by the custodian on the debit
balance in their custodial account. Notably, the increased investment management fee that a
client pays presents a conflict since it creates an incentive for Ensemble to recommend the use of
margin. However, please note that using margin is not suitable for all investors; the use of
margin increases leverage in a client’s account and therefore increases overall risk. Please refer
to Item 8 below for information on the risks pertaining to margin accounts.

COMPENSATION FOR DATA PROVISION
As outlined in Item 4 above, Ensemble has an arrangement with a Software Provider and a
Third-Party Adviser, under which Ensemble receives compensation for providing access to
investment and securities data for use in research and trading. Under this arrangement,

Ensemble is paid fees based on participation and performance, and receives credits on the cost of
software provided by the Software Provider. All fees paid to Ensemble under the arrangement
are determined, calculated, and paid by the Third-Party Adviser.

The fees and credits are paid to Ensemble so long as the firm meets the qualification criteria
outlined in the agreement.

THE ENSEMBLE FUND MANAGEMENT FEES AND OTHER COSTS
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Item 7         TYPES OF CLIENTS

Our clients include individuals, families, trusts, estates, foundations and other entities. The Firm
also serves as investment adviser to an affiliated registered investment company, the Ensemble Fund.
We have established a $3 million minimum value of assets for opening an individual client
account. However, Ensemble has in the past and may in the future reduce or waive the
minimum.

Prior to engaging Ensemble to perform investment management services, each potential client
should carefully consider: 1) committing to management only those assets that the client believes
will not be needed for current purposes and that can be invested on a long-term basis, 2) that
volatility from investing can occur, and 3) that over time a client’s manage account value can
fluctuate and at any time be worth more or less than the amount invested.

If a client’s account is a pension or other employee benefit plan governed by the Employee
Retirement Income Security Act of 1974, as amended (“ERISA”), Ensemble is typically deemed a
fiduciary to the plan. In providing investment management services, the sole standard of care
imposed upon the Firm is to act with the care, skill, prudence and diligence under the
circumstances then prevailing that a prudent man acting in a like capacity and familiar with such
matters would use in the conduct of an enterprise of a like character and with like aims. The
Firm will provide certain required disclosures to the “responsible plan fiduciary” (as such term
is defined in ERISA) in accordance with Section 408(b)(2), regarding the services Ensemble
provides and the direct and indirect compensation we receive by the ERISA client. Generally,
these disclosures are contained in this Form ADV Part 2A, the investment management
agreement and/or in separate ERISA disclosure documents and are designed to enable the
ERISA plan’s fiduciary to: (1) determine the reasonableness of all compensation received by the
Firm; (2) identify any potential conflicts of interests; and (3) satisfy reporting and disclosure
requirements to plan participants.