McNab Pension LLC

Item 5 – Fees and Compensation

Investors in the funds managed by McNab Pension pay an annual management fee which is typically
paid quarterly. The management fee is either a fixed amount agreed with a client or can be calculated
as a percentage of the assets under management (AUM) as at an agreed calculation date.

McNab Pension also charges performance-based fees on performance accrued above the relevant
high-water mark or benchmark. These fees are typically accrued monthly and paid annually. The high-
water mark and benchmark are in place to ensure performance-based fees are only accrued on the
increase in assets taking into account any subscriptions/additions or redemptions/withdrawals.

The fees are charged as per the client agreements which are in place with investors and are not
payable in advance. McNab Pension therefore deduct fees from client’s assets or invoice clients
directly for fees incurred depending on the agreement in place.

Typically, clients will not incur other fees related to the McNab Pension’s ongoing business costs unless
explicitly stated in the agreement. However, all clients will bear the cost of brokerage and other
transaction costs (interest expense, stock borrowing costs, ticket fees and others) associated with
investments made on behalf of their accounts. Further details regarding the brokerage and transaction
costs discussed above can be found in this Brochure in Item 12 – Brokerage Practices.

McNab LLP pays an arms-length fee to McNab LLC for its services. Details on these services can be
found in Item 10.

McNab Pension nor any of our Supervised Persons do not receive compensation for the sale of
interests in the Funds or accounts.

                                    McNab Pension LLC – Brochure

Item 7 – Types of Clients

The Investment Funds are only available to persons who are “qualified purchasers” under the
Investment Company Act of 1940, as amended (the “Investment Company Act”) and/or “accredited
investor” as defined under Regulation D of the Securities Act of 1933, as amended, (the “1933 Act”).
The fees of the Investment Funds are typically non-negotiable.

McNab Pension currently serves directly or indirectly as manager, advisor, or subadvisor to foreign
private investment funds, and as a trading advisor to several foreign private investment funds. The
clients of the funds and accounts are typically high net worth individuals or institutional clients who
appoint McNab Pension as investment adviser for a segregated account or invest in the McNab Long
Only Pension Fund Limited, a pooled investment fund.

                                    McNab Pension LLC – Brochure

Item 8 – Method of Analysis, Investment Strategies and Risk of Loss

Methods of Analysis and Investment Strategies

In implementing its primary investment strategy which represents the majority of assets, the Firm will
seek to invest in listed securities, typically in the context of an event or catalyst, that it deems are
trading at an attractive valuation or discount. The Firm carries out fundamental, quantitative and
qualitative research on a company-by-company basis with the aim of identifying those securities which
are trading at an attractive valuation or discount. The Firm’s stock selection process is based on
analysing this data and information and then capitalising on the difference between the current
market value of a security and the likely future market value of a security.

The Firm’s investment strategies are speculative in nature and there are no assurances that the Firm
will achieve its objectives. Indeed, a client may lose all or a substantial amount of their investment.

Material Risks

Identification of investment opportunities

The success of the strategy employed requires the investment team to identify securities which are
trading at an attractive valuation or discount. The analysis of these securities relies upon the Firm’s
robust research processes and the proprietary dataset it has developed to aid in the analysis of
investment opportunities. Whilst the analysis conducted may point to a favourable opportunity, the
outcome of such an investment is still uncertain and may lead to a negative return.

Competition; availability of investments

Certain markets in which the Fund may invest are extremely competitive for attractive investment
opportunities and, as a result, there may be reduced expected investment returns. There can be no
assurance that the Investment Manager will be able to identify or successfully pursue attractive
investment opportunities in such environments. Among other factors, competition for suitable
investments from other pooled investment vehicles, the public equity markets and other investors
may reduce the availability of investment opportunities. There has been significant growth in the
number of firms organised to make such investments, which may result in increased competition to
the Fund in obtaining suitable investments.

Execution of orders

In the process of opening and closing market positions the Firm relies upon the execution of orders in
various financial instruments by third parties and their software. The Firm’s trading orders may not be
executed in a timely and efficient manner due to various circumstances, including, systems failures,
human error attributable to the Fund, its brokers or other service providers. In such event, the Fund
may not fully execute the desired trade and may incur a loss or opportunity cost in correcting the
execution. Trading through an electronic or order routing system is also subject to risks associated
with system or component failure. In this event, it is possible that for a certain period of time, it might

                                    McNab Pension LLC – Brochure

not be possible to submit new orders, execute existing orders or modify or cancel orders that were
previously entered.

Limited diversification

In the normal course of making investments the Firm may, but is not obligated to, diversify its
investments. However, the portfolios could become significantly concentrated, for example; in any
one issuer, industry, sector, strategy, country or geographic region, and such concentration of risk may
increase any losses suffered by the Fund. In addition, it is possible that the Investment Manager may
select investments that are concentrated in a limited number or type of financial instruments. This
limited diversity could expose the Fund to losses disproportionate to market movements in general if
there are disproportionately greater adverse price movements in those financial instruments.

General Economic and Market Conditions

The strategy is also exposed to the effects of general economic and market conditions such as interest
rates, the availability of credit, inflation rates, economic uncertainty, changes in laws (including laws
relating to the taxation of the Fund’s investments), trade barriers, currency exchange controls and
national and international political circumstances. The performance may also be adversely affected
by market fluctuations resulting from certain risks which are unprecedented in nature or magnitude
and therefore not amenable to existing risk management techniques which are based on modelling
past events and assigning probabilities to the recurrence of those events. Whilst the Firm monitors
risk and takes steps to reduce exposures this is not always sufficient and can result in negative
performance.

Currency exposure

The funds and accounts are valued in a base currency however the investments of these assets may
be in securities denominated in “foreign” currencies or in financial instruments whose prices are
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