Matienzo Laffourcade Juan Francisco

Item 5 Fees and Compensation

A. Fees and Compensation

1. Annualized Management Fee. Non-qualified legacy investors are subject to an annualized fee
based on a mutually agreed percentage applied to the total assets under management with our
firm on a daily basis. This fee is not a wrap fee as it does not include transaction costs, fund
expenses, and other administrative fees that are charged through client’s accounts by the selected
broker (see Item 12 Brokerage Practices below). No advance fees were or are asked to clients on
this type of fee.

Mercor Investment Group does not currently accept new clients on this type of fee.

2. Performance Fees. Performance-based fees are fees based on a share of capital gains or capital
appreciation of a client's account.

Mercor Investment Group’s performance-based fee is calculated for each one-year period ending
on December 31 based on a mutually agreed percentage of the net profits generated by the
client’s account on an annual basis.

Mercor Investment Group will charge the performance-based fee to a client only if the
appreciation in the client’s account for the period exceeds any depreciation in the client’s
account that has not been previously recouped (High-Watermark). This High-Watermark is
calculated every December 31, and it ensures that clients are only charged on amounts that
represent new highs for their accounts with respect to any previous end of year.

The High-Watermark for new client’s accounts shall be initially set at zero and adjusted for
additions to and withdrawals from the client’s account. Withdrawals in the current period reduce
any cumulative losses that are carried over from previous periods, in proportion to the percentage
of equity that was withdrawn.

The Performance Fee is based on unrealized, as well as realized, appreciation and depreciation of
the securities held in each client’s account. For the purpose of calculating performance fees, the
appreciation and depreciation on foreign exchange trades is included solely on the dates at which
the position is either open or closed and excludes the effect of any exchange rate fluctuations
between those dates.

Clients should be aware that a Performance Fee may create an incentive for Mercor Investment
Group to make investments that are riskier or more speculative than would be the case in the
absence of a fee based on the performance of its account.

Either party may terminate the Investment Advisory Agreement by providing written notice at
any moment.

Clients must pay their corresponding type of fee for the billing period in which they terminate
the Investment Advisory Agreement up to and including the day of termination.

Mercor investment Group will comply with Rule §275.205-3 of the Investment Advisers Act of
1940, which prohibits the use of performance-based fees unless the client is a “qualified client”
or is exempt from the compensation prohibition by the provisions of Section §205 [80b-5](b) of
the Investment Advisers Act of 1940.

Currently, Mercor Investment Group does not offer other types of fees, and it does not have
clients in other programs except for the ones described in this brochure.

B. Payments

Fees are withdrawn directly from the client’s account with the client’s written authorization.
Clients must provide their qualified account custodian with written authorization to have fees
deducted from their selected accounts.

Mercor Investment Group’s selected broker (see Item 12 Brokerage Practices below) will send
each client an invoice setting forth the amount of each performance fee each time the fee is
deducted from the client’s account. If a Client wishes to use a particular broker (Item 12
Brokerage Practices), Mercor Investment Group will send the invoice directly to the client for
the deducted fees.

Performance-based fees are paid annually while Management fees are paid daily as discussed
above.

C. Third-Party Fees

Clients are responsible for the payment of all third-party fees (i.e. custodian fees, brokerage fees,
mutual fund fees, transaction fees, etc.). Those fees are separate and distinct from the fees
charged by Mercor Investment Group.

For more information, please see Item 12 of this brochure regarding Brokerage Practices.

D. Prepayment Fees

Mercor Investment Group does not collect fees in advance.

E. Outside Compensation

Mercor Investment Group does not accept any compensation for the sale of securities or other
investment products, including asset-based sales charges or service fees from the sale of mutual
funds.

Item 7 Types of Clients

Mercor Investment Group provides services to any kind of individuals or corporation. Including
clients that fulfill the “qualified client” requirements or clients that fulfill the exception
requirements as mentioned in Item 6 above.
Mercor Investment Group does not currently accept new non-qualified clients, although it
manages legacy non-qualified client accounts.

Mercor Investment Group currently imposes a minimum account size requirement of $50,000.