Hanson & Doremus Investment Management

ITEM 5 – FEES AND COMPENSATION

The client can determine to engage the Registrant to provide discretionary investment advisory services
on a fee-only basis. Occasionally, Registrant may determine to provide investment advisory services on a
non-discretionary basis.

Investment Advisory Services
If a client determines to engage the Registrant to provide discretionary investment advisory services on a
fee-only basis, the Registrant’s annual investment advisory fee is based upon a percentage (%) of the
market value of the assets placed under the Registrant’s management. While the basic annual fee is
negotiable, it shall generally fall within the following ranges:

Assets Under Management % of Assets

             •   0.85% on the first $1,000,000 in assets

             •   0.60% on assets from $1,000,001 to $5,000,000

             •   0.40% on assets from $5,000,001 to $20,000,000

Fee Dispersion
The Registrant’s investment may adjust its advisory fee at its discretion, depending upon objective and
subjective factors including but not limited to: the amount of assets to be managed; portfolio composition;
the scope and complexity of the engagement; the anticipated number of meetings and servicing needs;
related accounts; future earning capacity; anticipated future additional assets; the professional(s) rendering
the service(s); prior relationships with the Registrant and/or its representatives, and negotiations with the
client. As a result of these factors, similarly situated clients could pay different fees, the services to be
provided by the Registrant to any particular client could be available from other advisers at lower fees, and
certain clients may have fees different than those specifically set forth above. The Registrant’s Chief

Compliance Officer, Elisabeth A. Ford, remains available to address any questions that a
client or prospective client may have regarding the above fee determination.

Investment-Related Consulting Services (Stand-Alone)

   A. To the extent requested by a client, the Registrant may determine to provide investment-
      related planning or consulting services that are generally incidental to the investment management
      process, such as a retirement planning analysis. Registrant’s planning and consulting fee is negotiable,
      but generally is $300 on an hourly rate basis. Neither the Registrant, nor any of its representatives,
      serves as an attorney, accountant, or licensed insurance agent, and no portion of the Registrant’s
      services should be construed as same. To the extent specifically requested by a client, the Registrant
      may recommend the services of other professionals for certain non-investment implementation
      purposes (i.e. attorneys, accountants, insurance, etc.). The client is under no obligation to engage
      the services of any such recommended professional. The client retains absolute discretion over all
      such implementation decisions and is free to accept or reject any recommendation from the
      Registrant. Please Note: If the client engages any such recommended professional, and a dispute
      arises thereafter relative to such engagement, the client agrees to seek recourse exclusively from
      and against the engaged professional. Please Also Note: It remains the client’s responsibility to
      promptly notify the Registrant if there is ever any change in his/her/its financial situation or
      investment objectives for the purpose of reviewing/evaluating/revising Registrant’s previous
      recommendations and/or services.

   B. Clients may elect to have the Registrant’s advisory fees deducted from their custodial account. Both
      Registrant's Investment Advisory Agreement and the custodial/clearing agreement may authorize the
      custodian to debit the account for the amount of the Registrant's investment advisory fee and to
      directly remit that management fee to the Registrant in compliance with regulatory procedures. In
      the limited event that the Registrant bills the client directly, payment is due upon receipt of the
      Registrant’s invoice. The Registrant shall deduct fees and/or bill clients quarterly in advance, based
      upon the market value of the assets on the last business day of the previous quarter.

   C. As discussed below, unless the client directs otherwise or an individual client’s circumstances
      require, the Registrant shall generally recommend that Charles Schwab and Co., Inc. (“Schwab”)
      serve as the broker-dealer/custodian for client investment management assets. Broker-dealers such
      as Schwab charge brokerage commissions and/or transaction fees for effecting certain securities
      transactions (i.e. transaction fees are charged for certain no-load mutual funds, commissions are
      charged for individual equity and fixed income securities transactions). In addition to Registrant’s
      investment management fee, brokerage commissions and/or transaction fees, clients will also incur,
      relative to all mutual fund and exchange traded fund purchases, charges imposed at the fund level
      (e.g. management fees and other fund expenses).

   D. Registrant’s annual investment advisory fee shall be prorated and paid quarterly, in advance, based
      upon the market value of the assets on the last business day of the previous quarter subject to
      adjustment for intra- quarter additions or withdrawals to assets under management. The Registrant
      generally requires a minimum household account size of $1,000,000 for investment advisory
      services. However, Registrant, in its sole discretion, may charge a lesser investment management fee
      and/or waive or reduce its asset minimum based upon certain criteria (i.e., anticipated future
      earning capacity, anticipated future additional assets, dollar amount of assets to be managed, related
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ITEM 7 – TYPES OF CLIENTS

The Registrant’s clients shall generally include individuals, business entities, trusts, estates, pension and
profit-sharing plans, financial institutions, and charitable organizations. The Registrant generally requires a
minimum account size of $1,000,000 for investment advisory services. However, Registrant, in its sole
discretion, may charge a lesser investment management fee based upon certain criteria (i.e., anticipated
future earning capacity, anticipated future additional assets, dollar amount of assets to be managed, related
accounts, account composition, competition, negotiations with client, etc.)