Grace & White Inc

Item 5 Fees and Compensation

Fees for investment supervisory services are computed as a percentage of assets
under management, as agreed to in the Investment Counsel Agreement signed by
every client. The fee structure is generally:
            1.00% of the first $1 million of assets under management
             .60% of the excess over $1 million of assets under management
These fees are for advisory services only and do not include any transaction fees or
commissions. Client funds may be invested in the shares of money market or other
mutual funds, where a management fee is paid to the manager (not Grace & White) in
addition to the fee paid to Grace & White. In such cases, the client is, in effect paying
two management fees.
Unless agreed otherwise, fees are payable semi-annually in arrears, based upon
market values on the last day of such semi-annual period (June 30 and December 31).
The agreement may be terminated by the client at any time. If the account was
managed for less than the entire semi-annual period, the management fee will be pro-
rated based on the number of days that the account was open during the billing period.
On the valuation date, we determine the portfolio value based on the closing price on
the principal market where the securities are traded. If no market quotation is available
for certain securities, they are valued at the price reported by your custodian or a third
party pricing service. All other assets (such as private investments, loans, and real
estate) are included in the fee base and are valued at purchase price, modified based
on subsequent information available to us.
Fees may be negotiated for large accounts or family groups. Accounts of related
persons may be aggregated for fee purposes.
The valuation for fee purposes may be defined to exclude certain holdings (e.g. legacy
holdings, non-taxable securities or large blocks of specified securities).
The client may authorize us to invoice the custodian directly for management
fees, and authorize the Custodian to pay us directly from their account.

Gerald I. White and Marc E. Ravitz receive fees as trustee or investment
advisor to certain trusts. Those fees are either mandated by the state or
negotiated with the client or the outside trustee. In those cases, Grace & White
does not charge any fee. Both White and Grace & White also charge
administrative fees on some trusts, as negotiated with the outside trustee.
See item 12 of this brochure for related discussion.

Item 7      Types of Clients

Grace & White offers its services to
   •     individuals,
   •     retirement plans,
   •     trusts and estates,
   •     pension and profit sharing plans,
   •     limited partnerships,
   •     charitable institutions,
   •     corporations and endowments, and
   •     other qualified investors.

Grace & White has a required minimum account size of $1 million; however this
minimum may be waived. The majority of our clients are high-net-worth individuals and
their related accounts