Franklin Managed Options Strategies LLC

Item 5. Fees and Compensation
Generally, Franklin MOST’s advisory fees are based on a percentage of assets
under management as well as fixed fees. In certain circumstances, fees and
services are negotiable and vary based on factors such as client type, product
type, asset class, pre-existing relationship, service levels, portfolio complexity,
number of accounts, account size, anticipated future earning capacity, anticipated
future additional assets or based on other special client circumstances or
requirements. Some clients pay higher or lower fees than other clients. Related
accounts may be aggregated, on a case-by-case basis, for fee calculation
purposes in certain circumstances at the discretion of Franklin MOST.

Fees and related terms of payment of such fees for all Franklin MOST advisory
services are governed by the written terms of the applicable agreement(s). In
addition, clients may be subject to additional fees, such as brokerage and wrap-
fee costs from their custodian.

Advisory Fees in General

Clients should note that similar advisory services are available from other
registered (or unregistered) investment advisers for higher, similar or lower fees.

Negotiability of Fees

In certain circumstances, fees are negotiable. Further, Franklin MOST may waive
or discount advisory fees for family members and employees of our firm.

These fee waivers or discounts are not generally available to all advisory clients of
Franklin MOST. This creates a conflict of interest because certain clients will pay
lower fees than other clients.

Fee Calculation

Fees are typically calculated and charged in advance or in arrears (as outlined in
the investment management agreement), on a quarterly basis and will be provided
to the client in writing.

Termination of Advisory Relationship

A client agreement can be terminated at any time, by either party, for any reason
upon receipt of prior written notice and subject to the specific timeframes
delineated in the agreement. Upon termination of any account, any prepaid,
unearned fees will be promptly refunded, and any earned, unpaid fees will be due
and payable, subject to the specific timeframes delineated in the agreement.

Limited Prepayment of Fees

Under no circumstances does Franklin MOST require or solicit payment of fees in
excess of $1,200 more than six months in advance of services rendered.