Hutner Capital Management Inc

Item 5. Fees and Compensation

Hutner Capital Management, Inc.'s fee schedule is as follows:
     1% per year of assets under management on the first $5,000,000;
     3/4% per year on the second $5,000,000;
     and 1/2% on assets above $10,000,000;
     with a basic minimum fee of $2,000 per year.

In some cases, related accounts may be aggregated for determining break points and resulting
fees.

Fees are computed quarterly on the market value of assets under management at the end of
each calendar quarter. A copy of the fee statement is sent to the client at the time of billing, and
the client may either pay the fee separately, or have it deducted from his or her account or a
related account.

Fees are payable quarterly in advance. A client may terminate our services at any time.
Management fees will be pro-rated to the date of termination and any unused fees will be
refunded.

Hutner Capital Management, Inc. will collect flat fees and negotiated fees on portfolios
for which we provide limited investment advisory services. We may advise certain clients on the
investment of their portfolios which we do not manage. We charge a 1/4% of asset value per year
fee for this service, billed quarterly.

In addition to investment management fees, clients may incur custody fees, depending on where
their account or accounts are custodied. We generally recommend bank custody for accounts
over $1 million. Bank custodians charge higher custody fees, but offer a greater degree of
security for larger accounts. Accounts of this size may be in custody at a broker if the client
requests or if individual circumstances warrant. We recommend broker custody for accounts
under $1 million.

Our fees are exclusive of brokerage commissions, transaction fees, and other related costs and
expenses, which are paid by the client (with the exception of the certain asset-based fees
described in the next section). Clients may incur certain charges imposed by custodians, brokers,
third party investments and other third parties, such as custodial fees, deferred sales charges,
odd-lot differentials, transfer taxes, wire transfer and electronic fund fees, and other fees and
taxes on brokerage accounts and securities transactions. Mutual funds and exchange-traded funds
also charge internal management fees, which are disclosed in a fund’s prospectus. Such charges,
fees, and commissions are exclusive of and in addition to our fee, and we shall not receive any
portion of these commissions, fees, and costs.

        Asset-based Pricing Option

        In addition to our traditional full-service accounts described above, we also offer a new
        option for smaller accounts based on an asset-based pricing structure negotiated with
        Pershing Advisor Solutions. Accounts created under this model will be charged an annual
        asset-based brokerage custody fee (assessed quarterly) and no trading commissions. This
        will generally be charged to the client, however, Hutner Capital may offer to pay the
        minimum custody fee until the account has outgrown it.

        This fee structure enables us to create diversified portfolios for smaller accounts, and to
        routinely invest small incremental additions that would not be feasible in a
        commission-paying account, making it an ideal option for a younger investor starting out,
        or for replicating our investment strategy in a small retirement account. Accounts under
        this model with similar objectives may be grouped and managed together for efficiency.
        The level of individual customization will be at the manager’s discretion, depending on
        the client’s needs.

The subject of brokerage practices is discussed in greater detail under Item 12. Brokerage
Practices. Clients that use one of our recommended brokers enjoy negotiated commission rates
that are significantly less than full-service retail rates.

Hutner Capital Management, Inc.'s clients whose assets are invested in an affiliated investment
limited partnership will not pay fees to Hutner Capital Management, Inc. on the portion of their
assets invested in the partnership.

Item 7. Types of Clients

Hutner Capital Management, Inc. provides investment management services to individuals, trusts,
estates, charitable organizations, and corporations. Approximately 62% of our clients are high net
worth individuals, with the remaining 38% consisting of other individuals, pooled investment
vehicles, charitable organizations, and corporations.

Hutner Capital Management, Inc. generally limits acceptance of new account relationships to
those with a market value of $1 million or greater. Multiple related accounts may be aggregated to
meet this minimum, and the president may make exceptions to this policy in his sole discretion.
Select smaller accounts may be accepted under our asset-based pricing option. Prospective clients
must be approved by the president before the firm begins to supervise their accounts.