NLG Capital LLC

ITEM 5 - FEES AND COMPENSATION

 GENERAL:

As a general matter, the investment management agreement for each client describes the fees
payable to NLG Capital. Fees charged by NLG Capital may vary from client to client, but can
include a management fee and incentive fee, which are at rates and terms described in the Client’s
management agreement. Such advisory fees are calculated quarterly in arrears at calendar quarter
end and billed to the institutional clients in quarterly installments. NLG Capital also provides
discretionary investment management to other affiliates for which it may or may not charge a fee.
Fees charged by NLG Capital to its affiliates are negotiable. In addition to any advisory fees
payable to NLG Capital, each such institutional client bears and pays for expenses related to its
account, including brokerage commissions and other costs in connection with the purchase and sale
of securities, taxes and corporate fees payable by the client to federal, state, or other governmental
agencies, fees and costs of accounting and financial administration, custodian, legal counsel, and
auditors, and certain other expenses as may arise with respect to the client or its account.

Where NLG Capital has entered into sub-advisory relationships on behalf of its institutional clients,
fees of the sub-advisor may be payable by NLG Capital or directly passed through to the client.

The fees charged by NLG Capital as described above do not include any custodian fees that a client
may have to pay to a custodian. In addition, clients whose custodians provide cash sweep accounts
for investment of cash assets may pay an additional advisory fee on the cash portion of their account.
Brokerage commissions, transaction charges or other similar charges that may be incurred in
connection with the management of a client’s account are generally paid out of the assets in the
client’s account and are in addition to any fees a client pays to NLG Capital for investment advisory
services. For more information on brokerage costs, see “Item 12 - Brokerage Practices” below.

Fees and expenses of exchange-traded funds (“ETFs”) or mutual funds in which a client may invest
are fully disclosed in such fund’s prospectus. The fees charged by NLG Capital are separate and
distinct from any fees and expenses charged by ETFs or mutual funds. ETFs and mutual funds
generally pay advisory fees to their investment advisers, and such fees would be paid indirectly by
all ETF investors or mutual fund shareholders. If a client has ETFs or mutual funds in its account,
the client is effectively paying both NLG Capital and the ETF or mutual fund investment adviser
for the management of the assets in the client’s portfolio. Any mutual fund shares held in a client’s
account may also be subject to sales charges, 12b-1 fees, short-term redemption fees and other
mutual fund expenses.

NLG Capital reserves the right to negotiate and/or change its fee schedules for new or existing
clients, while continuing to charge some or all its existing clients based on fees and agreements in
force prior to the change.

 ALLOCATION OF SHARED EXPENSES:

Certain expenses borne by a client may also be incurred by, or allocable to, other clients or NLG

Capital. Therefore, from time to time, NLG Capital will be required to determine how certain costs
and expenses are to be allocated among multiple clients and NLG Capital or both. This analytical
process is inherently subjective, and NLG Capital may be viewed as biased in making such
determinations. The allocation of expenses presents an inherent conflict of interest, as different
allocations would result in clients and NLG Capital bearing more (or less) expenses. To the extent a
client, on the one hand, and NLG Capital or one or more other clients, on the other hand, incur
costs or expenses that are applicable to more than one of them, NLG Capital will allocate such
costs and expenses in a manner that it determines to be fair and reasonable, taking into account the
applicable facts and circumstances, notwithstanding its interest in the outcome. NLG Capital may
also make corrective allocations should it determine that such corrections are necessary or
advisable.

 PREPAYMENT OF FEES:

NLG Capital does not typically charge fees in advance. However, to the extent advisory fees are
paid in advance, NLG Capital will provide the applicable client with a pro rata refund if the
advisory contract with the client is terminated prior to the end of a payment period, in accordance
with the terms of the applicable advisory agreement.

 ADDITIONAL COMPENSATION AND CONFLICTS OF INTEREST:

Neither NLG Capital nor any of its supervised persons accept compensation for the sale of
securities or other investment products (e.g., brokerage commissions).

ITEM 7 - TYPES OF CLIENTS

NLG Capital currently provides discretionary investment management services to (i) institutional
clients consisting of affiliated insurance company general account clients, (ii) affiliated ERISA
and charitable foundation clients, and (iii) affiliated investment funds.