M&G Investments USA Inc

Item 5 Fees and Compensation
MGIU provides discretionary investment management services to clients who are Group Affiliates.

Fees are negotiable between MGIU and Group Affiliates. For advisory services provided to Group
Affiliates, compensation received by MGIU is generally comprised of fees based on a percentage of
assets under management and performance-based amounts. MGIU’s asset-based fees range up to
15 basis points (per annum), although reductions may be negotiated on a case-by-case basis. We
do not currently have any external clients and therefore all revenue will be generated from
contractual arrangements with Group Affiliates. Fees are normally billed on a semi-annual, quarterly,
or monthly basis in arrears and are due from clients on receipt of a billing statement and are not
deducted directly from a client’s account.

Pursuant to a participating affiliate arrangement, MGIU also provides model portfolio services to
nonaffiliated asset managers. Fees for such services are calculated and paid quarterly in arrears and
determined in accordance with the master advisory agreement governing the services provided.

Unless otherwise agreed, MGIU is not obligated to pay any expenses of a client. Group Affiliate
clients will directly bear the costs associated with custodians and other service providers to their
separately-managed account, as well as brokerage and other transaction costs associated with
trading in the account.

Item 7 Types of Clients
Our services are provided to clients who are Group Affiliates, which include other investment advisers
and insurance companies, and certain non-Group Affiliates that receive model portfolio services from
MGIU.