Excalibur Management Corp

Item 5: Fees and Compensation

Investment Management Services
We offer discretionary investment management and advisory services for a percentage of
assets under management and/or on a fixed fee basis. We do not sell investment products, and
our only source of income is fees paid by clients.

Our fees for investment management and advisory services range up to 1.0% (100 basis points)
annually of account market value, including cash, as determined by the custodian, billed
quarterly in arrears.

Clients choose whether to have their fees deducted from accounts custodied with qualified
custodians or to be billed directly.

Integrated Financial Planning Services
Clients will pay a fixed fee based on the nature and complexity of each client’s individual
circumstances. We do not maintain a standardized fee schedule for these additional services.
All terms, including the additional services to be rendered, the fee for such services, the
method(s) of payment and termination provisions, are negotiated on a client-by-client basis.
Details of the fee charged for these additional services are more fully described in the advisory
agreement entered into with each client.

Termination
A client agreement may be canceled at any time, by either party, for any reason upon receipt of
written notice. Upon termination of any account, any earned, unpaid fees will be due and
payable. The client has the right to terminate an agreement without penalty within five
business days after entering into the agreement.

Accounts initiated or terminated during a calendar quarter may be charged a prorated fee.
Upon termination of an account, any earned, unpaid fees will be due and payable.

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 and Other Fees
In certain circumstances, fees, account minimums and payment terms are negotiable
depending on 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,
...

Types of Clients
We provide investment management and strategic wealth management services to a wide
range of clients. Our clients include high-net-worth individuals, individuals, and families, trusts:
revocable and irrevocable, family limited partnerships, estates, charitable organizations, closely
held business entities, not-for-profit entities, including foundations, retirement and profit-
sharing plans including IRAs, Roth IRAs, and SEP IRAs.

Account Minimums
We require a minimum net worth of $1,000,000 for investment advisory services and
financial planning services. Waivers or exceptions from the minimum may be granted at our
discretion.