Research Affiliates LLC

Item 5 – Fees and Compensation
   A. Description of Fees

       1. Sub-Advisory Fees
For registered investment companies, private funds, separately managed accounts and UCITS
funds that Research Affiliates sub-advises, fees are paid to Research Affiliates by the third-party
investment adviser for such sub-advised accounts. Sub-advisory agreements and fees are
negotiated on a case-by-case basis with each third-party adviser. These fees are generally paid in
arrears and are an allocation of the fees received by the third-party investment adviser.

       2. Model Portfolio Fees
Where Research Affiliates provides model portfolio services on a non-discretionary basis, fees, if
applicable, are generally paid in arrears and in some instances includes an allocation of the fees
received by the third-party implementer of the Model Portfolio.

   B. Other Fee and Expense Information
All accounts, in addition to the advisory fees payable to Research Affiliates, may incur brokerage
commissions, transaction fees and other related costs and expenses in connection with the
management of such accounts. The costs are paid directly by the account to an unaffiliated broker-
dealer, custodian, or other service provider. Research Affiliates does not receive, directly or
indirectly, any of these costs charged to the clients. Please refer to Item 12 Brokerage Practices for
more information.
No employees receive, directly or indirectly, any compensation from the sale of securities or
investments that are purchased or sold for client accounts.

Research Affiliates has entered into a servicing agreement with RI whereby Research Affiliates
and its employees provide product, accounting, legal and IT support services. RI compensates
Research Affiliates for services provided on its behalf pursuant to the terms of this servicing
agreement.

Research Affiliates has also entered into licensing agreements with RI and other partners and earns
a licensing fee for its intellectual property. Additionally, Research Affiliates has advisory and
licensing arrangements (indirect and direct) with clients who have also entered into a licensing
arrangement with RI. Pursuant to the terms of RI’s licensing agreement, such clients are charged
separate asset-based fees for the specific service being performed. These arrangements may result
in conflicts of interest. See Item 11 Code of Ethics, Participation or Interest in Client Transactions
and Personal Trading for additional information about these potential conflicts of interest.

Item 7 – Types of Clients
Research Affiliates provides discretionary and non-discretionary sub-advisory services to
independent, third-party investment advisers to unaffiliated registered investment companies,
separately managed accounts, private funds and UCITS funds.

Research Affiliates also provides non-advisory services to RI and other index providers and earns
a licensing fee for its intellectual property. See Item 10.

Research Affiliates reserves the right to accept or decline a potential client for any reason in its
sole discretion. Prior to engaging Research Affiliates to provide any of the investment advisory
services described in this disclosure brochure, the client will be required to enter into one or more

written agreements setting forth the terms and conditions under which Research Affiliates shall
render its services.