Middleton & Company Inc

Item 5 – Fees and Compensation

Investment Management Fees
Middleton is compensated for investment services through payments of quarterly fees by
its clients. Typically, these fees are deducted directly from client accounts in advance based
on account values on the last business day of the previous quarter. In limited instances,
Middleton may also invoice its clients. Partial periods are prorated for the portion of time
that Middleton is managing the assets. Middleton’s standard fee schedule is as follows.

Fee Schedule - Annual Rate

   1.00% on the first $1,000,000 of assets
   0.90% on the next $1,000,000 of assets
   0.80% on the next $1,000,000 of assets
   0.70% on the next $1,000,000 of assets
   0.60% on the next $1,000,000 of assets
   0.45% on the next $5,000,000 of assets
   0.40% on the balance of assets above $10,000,000

Under certain circumstances, fees may be negotiated and may vary with respect to Middleton’s
standard fee schedule or fees paid by other individual clients.

Additional Fees and Expenses
Middleton’s investment management fees are exclusive of brokerage commissions,
transaction fees, custody fees, and other investment-related costs or expenses which are
borne by Middleton’s clients. Execution of equity trades may result in trade commissions and
bond trades may be subject to spreads charged by the brokers facilitating the trades. Please
see Item 12: Brokerage Practices for more information for more information on brokerage
practices.

Mutual Funds and Exchange Traded Funds (“ETFs”)
Middleton may, at times, invest a client’s assets in exchange traded funds, mutual funds, or
other pooled investments that assess additional expenses. ETFs typically charge a
management fee and other operating expenses while mutual funds generally assess
management, distribution and other annual operating fees in addition to potential
shareholder fees that may include sales loads, redemption or exchange fees, and account
maintenance fees.

Fees for the Purchase or Sale of Securities
Neither Middleton nor its employees receive transaction-based compensation for the
purchase or sale of securities or investments that are transacted in client accounts.
Middleton is compensated solely through investment management fees as described above.

Item 7 – Types of Clients

As noted in Item 4, Middleton’s clients include individuals, trusts, endowments, foundations,
and corporate pension and profit-sharing plans.

Middleton’s clients include investors with retirement assets that are covered under the
Employee Retirement Income Security Act of 1974 (ERISA). As such, Middleton is considered
a fiduciary under Title I of ERISA in certain instances when Middleton is deemed to be giving
rollover advice in relation to a client or prospective client’s ERISA assets. Similar to
Middleton’s fiduciary status as an SEC-registered investment advisor, as an ERISA fiduciary,
Middleton is required to make recommendations that are in the best interest of the client.

Conditions for Managing Accounts

Generally, Middleton’s seeks to initiate new client relationships where the family’s aggregate
assets are in excess of $1,000,000, but in certain instances Middleton will waive this
requirement at its sole discretion.