Serenity Capital Advisors Inc

ITEM 5 FEES AND COMPENSATION

Fees and other charges

Individually Managed Accounts: (charged on household balances)

Fees for individually managed accounts are tier priced as follows:

                       Account Size                       Fee (annual percentage) *
                      0 – $1,000,000                                 1.50%
                 $1,000,001 - $5,000,000                             1.25%
                   $5,000,001 and above                              1.00%

                 *Management fee for portfolios over 10 million are negotiable
               *Donor Advised fund accounts with balance over $100k - fee is 1%

All asset-based fees are deducted by the qualified custodian of record quarterly in advance, or as
otherwise indicated in the client agreement. Client statements for prior deductions will be provided
on a quarterly basis.

All fees paid to the SCA for investment advisory services are separate and distinct from the
expenses charged by third-party managers and Investment Companies to their shareholders. These
fees and expenses are described to the client in separate disclosures. These fees will generally
include third-party management fees, an Investment Company management fee, other fund
expenses, and in some situations a possible distribution fee.

SCA will provide investment advisory services and portfolio management services but will not
provide custodial or other administrative services. At no time will the Advisor accept or maintain
custody of a client’s funds or securities except for authorized fee deduction. The Client may
contact the Custodian directly for disbursements, or account record changes, and may also do so
in writing to the custodian. SCA may act at the client’s convenience to facilitate such written

communications to the Custodian, provided that such action is not construed to be custody of client
assets.

Client is responsible for all custodial and securities execution fees charged by the custodian and
executing broker-dealer. Fees paid to SCA are separate and distinct from the custodian and
execution fees.

Clients may request to terminate their advisory contract with SCA, in whole or in part, by providing
advance written notice. Upon termination, any fees paid in advance will be prorated to the date of
termination and any excess will be refunded to the client through the Custodian. Client’s advisory
agreement with SCA is non-transferable without Client’s written approval.

Fee Deduction Disclosure

When the firm deducts its management fee from client accounts utilizing a qualified custodian, the
firm is required to meet the following requirements.

   a. Possess written authorization from the client to deduct advisory fees from an account held
      by a qualified custodian;
   b. send the qualified custodian a written invoice detailing the fee amount to be deducted from
      the client account; and
   c. The firm must ensure that on at least a quarterly basis, the custodian sends to the client a
      statement showing all transactions within the account during the reporting period

Right of Cancellation

In addition to the right to terminate an agreement pursuant to its terms, a client may cancel an
agreement with SCA within five (5) business days of first receiving a copy of this disclosure
brochure and supplement without penalty or fee.

Additional Fees

Clients may incur certain fees or charges imposed by third parties other than SCA in connection
with investments or recommendations made by SCA. We do not receive any portion of these fees.
These fees and charges are separate and distinct from the fees or charges stated above and may
include, but not be limited to: brokerage and transactions fees, mutual fund 12b-1 fees, certain
deferred sales charges on previously purchased mutual funds transferred into the account, other
transaction related fees, IRA and Qualified Retirement Plan fees, interest charged on margin
borrowing, bank service fees, interest charged on debit balanced, “spreads” imposed by brokers
and dealers representing implicit transaction costs, commissions and transfer taxes. Information
regarding fees or charges assessed by any mutual funds held in client accounts is available in the
appropriate prospectus. SCA is not responsible for, and does not receive any portion of, the fees
imposed by such third parties. Please note, such fees will differ from client to client based on their
own unique situation and selection of products and services.

Billing Methods

SCA’ investment management fees are based on the market value of assets under management at
the closing date of the previous quarter. Funds added or withdrawn from an account during the
previous quarter are charged on a pro-rata basis. Initially, fees are billed on a prorated basis from
inception of the account for the remainder of the calendar quarter and quarterly in advance
thereafter.

Fees are calculated by the Advisor and deducted from the Client’s account[s] by the Custodian.
The Advisor sends an invoice to the Custodian indicating the amount of the fees to be deducted
from the Client’s account[s] at the beginning of each quarter. The amount due is calculated by
applying the quarterly rate (annual rate divided by 4) to the total assets under management with
SCA at the end of the prior quarter. The Custodian provides each Client with a statement, at least
quarterly, that reflects the deduction of the Advisor’s fee. It’s the responsibility of the Client to
verify the accuracy of the fees reflected on each statement as the Custodian does not assume this
responsibility. Clients provide written authorization permitting advisory fees to be
deducted by Serenity Capital Management directly from their account[s] held by the Custodian as
part of the wealth management agreement and separate account forms provided by the Custodian.

Upon termination, any fees paid in advance will be prorated to the date of termination and any
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ITEM 7 TYPES OF CLIENTS

SCA provides Investment and Financial Planning Services to individuals, corporations, or other
business entities. SCA may impose minimum account size requirements with respect to certain of
its advisory services.

For individual clients and small- and medium-sized institutions, SCA typically requires a
minimum initial investment of $500,000 or a minimum fee level of $6750 to establish an

investment account. In certain circumstances, SCA will raise or lower the minimum investment
amount or accept an initial investment below the established minimum at its discretion or in
accordance with applicable law. SCA reserves the right to waive the account minimum at its
discretion.