M Kraus & Company

Item 5 Fees and Compensation
Compensation - Investment Advisory Services

M. Kraus & Company bases its fees on a percentage of the market value of assets under management
at the beginning of each calendar quarter. Investment management fees are billed quarterly in
advance.

                                        Annual Fee Schedule:
                                       1% of the first $1,000,000
                                     0.75% of the next $1,000,000
                                    0.50% of asset over $2,000,000

Non-profit organizations receive a 10% discount to the Annual Fee Schedule.

Cash balances held as money market funds are included in the value of the account for fee purposes.
Various fees levied on these funds by their managers, such as 12b-1 or operating expenses, are
separate from M. Kraus & Company fees.

In certain circumstances, fees, account minimums and payment terms are negotiable depending on a
client's unique situation such as the size of the aggregate related party portfolio, family holdings, low
cost basis securities, fixed income holdings, or certain passively advised investments and pre-existing
relationships with clients. Certain clients may pay more or less than others depending on the amount of
assets, type of portfolio, or the time involved, the degree of responsibility assumed, complexity of the
engagement, special skills needed to solve problems, the application of experience and knowledge of
the client's situation. Existing clients may have been grandfathered in from a lower fee schedule.

At times M. Kraus & Company will negotiate a fixed investment advisory fee with clients. Currently, this
fee ranges from $25 to $275 per quarter depending on the purpose of the specific account and is
payable in advance.

When M. Kraus & Company or one of its employees serves as a co-trustee or sole trustee of an
account for which the firm receives no investment management fees, trustee services will be charged
at a rate of $275 per hour as services are used.

Clients should note that similar advisory services may (or may not) be available from other sources for
similar or lower fees.

Compensation - Account Administration Services

M. Kraus & Company bases its fees on a percentage of the market value of assets under
administration at the beginning of each calendar quarter. Account administration fees are billed
quarterly in advance. Fees for account administration services are based on the level of services
provided and fees range from 0.05% to 0.50%.

Calculation and Payment

The specific manner in which fees are charged by M. Kraus & Company is established in the client's
written agreement with M. Kraus & Company.

M. Kraus & Company bills fees on a quarterly basis, in advance of each calendar quarter.

Fees are payable in one of two ways:

    1. Directly by the client, or
    2. Authorization in writing is filed with the custodian to debit the investment management fee
       directly from the client's account. M. Kraus & Company sends copies of the bill to the client,
       itemizing the market value and the formula used to calculate the fee. An electronic file is
       submitted to the custodian with the client's account number and the amount of the fee.

Option Two, the direct debiting of fees from accounts, is the most typical means of payment.

Accounts initiated during a calendar quarter will be charged a prorated fee for that stub period.

Termination of an Account

Clients may terminate the Investment Management Agreement without penalty or fee within five
business days after entering into the agreement if Form ADV 2 was delivered within 48 hours before
contract execution. Thereafter, either the client or the investment manager may terminate the
Agreement by written notice to the other party. Clients wishing to terminate the Agreement should send
written notice to M. Kraus & Company at the mailing address provided on the cover of this Brochure. At
termination, fees will be calculated on a pro rata basis for the portion of the quarter not completed from
the date that the written notice is received and returned to the client. The Agreement will terminate
automatically if it is assigned by the Advisor without the consent of the Client.

Other Fees

In addition to M. Kraus & Company's investment advisory fees, clients are also responsible for the fees
and expenses charged by custodians and imposed by broker dealers, including, but not limited to, any
transaction charges imposed by a broker dealer with which an independent investment manager
effects transactions for the client's account(s), wire transfer and electronic fund fees, reorganization
fees, and other fees and taxes (withholding and foreign) on brokerage accounts and securities
transactions.

Mutual funds and exchange traded funds may also charge fees, which include but are not limited to
internal management fees and sales fees; these fees are disclosed in a fund's prospectus.

Such charges, fees and commissions are exclusive of and in addition to M. Kraus & Company's fee. M.
Kraus & Company shall not receive any portion of these commissions, fees, and costs.

Custodians may charge transaction fees on purchases or sales of certain mutual funds and exchange-
traded funds. These transaction charges are usually small and incidental to the purchase or sale of a
security.

Types of Clients

M. Kraus & Company provides discretionary and non-discretionary investment management for
individuals, trusts, retirement plans, charitable institutions, corporations or other business entities
based on the specific needs of the client.

Account Minimums

M. Kraus & Company requires a minimum account of $500,000 for Investment Management clients.
This may be negotiable under certain circumstances. For example, M. Kraus & Company may group
certain related client accounts for the purposes of achieving the minimum account size.