Western Research and Management LLC

Item 5 – Fees and Compensation

The firm bills for investment management services on a quarterly basis, in arrears. In
addition, Western may be engaged by individuals or financial institutions to render
investment advice on either a retained or hourly basis. The fee schedule for Western is 1.50%
of assets under management, per annum, for equity and balanced accounts less than
$100,000, and 1.25% of assets under management, per annum, for equity and balanced
accounts from $100,000 through $750,000. For equity and balanced accounts greater than
$750,000 under management, an annual fee of 1.00% will be charged. All mutual fund
accounts are charged a fee of 1.50% of assets under management in addition to the internal
management fees charged by any selected mutual funds. Fixed income accounts are charged
1.00% of assets under management. Qualified Clients may also be invested in the Funds.

Separately Managed Account Clients simultaneously invested in a Fund of Funds product will
pay fees attributable to each type of product separately, however clients will not pay layered
fees. Lower fees for comparable services or funds may be available from other sources.
Clients may pay a reduced fee based upon certain circumstances. Any reduced fees are
subject to the discretion of Western’s management.

The specific manner in which fees are charged by Western is established in a Client’s written
agreement with Western. Western will generally bill its fees on a quarterly basis. Clients are
billed in arrears each calendar quarter. Clients may also elect to be billed directly for fees or
to authorize Western to directly debit fees from Client accounts. Accounts initiated or
terminated during a calendar quarter will be charged a prorated fee. Upon termination of an
account, any earned, unpaid fees will be due and payable.

Western’s fees are exclusive of brokerage commissions, transaction fees, and other related
costs and expenses which shall be incurred by the client. Clients may incur certain charges
imposed by custodians, brokers, and other third parties such as fees charged by managers,
custodial fees, deferred sales charges, odd-lot differentials, transfer taxes, wire transfer and
electronic fund fees, and other fees and taxes on brokerage accounts and securities
transactions. Mutual funds and exchange traded funds also charge internal management
fees, which are disclosed in a fund’s prospectus. Such charges, fees and commissions are
exclusive of and in addition to Western’s fee, and Western shall not receive any portion of
these commissions, fees, and costs.

Item 12 further describes the factors that Western considers in selecting or recommending
broker-dealers for client transactions and determining the reasonableness of their
compensation (e.g., commissions).

Fees and expenses charged to or by the Funds are set forth in each Fund’s private placement
memorandum or limited partnership agreement.

Item 7 – Types of Clients

Western provides portfolio management services to individuals, high net worth individuals,
banking institutions, charitable organizations, and corporations. Western also provides

advisory services to private funds. The minimum account size for each of the advisory
services offered follows. Western may choose to waive any minimum requirement at its
discretion.

                      Separately Managed Accounts                 $250,000

                      Private Funds                               $500,000