Independent Investors Inc

Item 5. Fees and Compensation

Independent Investors, Inc. is compensated for portfolio management services based on a fee of
1% of assets under management. Fees are charged and billed quarterly in arrears at the end of
each quarter. The investment advisory fee is based on the full market value of a client’s
investment account, including any assets in the account bought or held as an accommodation to
the client, and the fee is directly debited from the client’s custodial account. The client and
investment advisor have equal powers to terminate service at any time upon written notice of
termination to the other. In case of termination, fees will be prorated.
The minimum account size at Independent Investors, Inc. is one million dollars and, therefore,
the minimum annual advisory fee is $10,000.00. However, fees and minimum account size may
be negotiated at the discretion of the advisor. Clients also pay custody fees directly to their
chosen custodian bank or broker. In addition, cash balances that are swept into money market
funds at the custodian broker or bank incur fees and expenses. Our clients, as investors in such
funds, pay their pro rata share of the fees and expenses charged by those funds. Mutual funds or
exchange traded funds (ETFs) purchased for, or held in, client accounts are also subject to
additional fees and expenses charged by the mutual fund or exchange traded fund. While clients
do pay a commission to the broker utilized for the purchase or sale of any security in their
account, Independent Investors, Inc., does not have any arrangement with any firm that
financially benefits our firm or employees based on products purchased for client accounts.

Item 7. Types of Clients

Independent Investors, Inc., provides portfolio management services to individuals, high-net-
worth individuals, trusts, charitable foundations and corporations. The minimum account size
at IndependentInvestors, Inc., is one million dollars and, therefore, the minimum annual
investment advisory fee is $10,000.00. On occasion we do waive the minimum account size,
based usually on a family relationship. Since we do not advertise, our business has grown
through client referrals, sometimes from family members. We appreciate the trust placed in
our firm and have waived minimums in the past and foresee the possibility of doing so again,
at our discretion, in the future.