Marcellus Investment Managers Private Limited

MA`CELLUS
Schedule 3 - Consistent Compounders Investment Approach
Investment Objective To generate sustainable returns over medium to long term by making investments which primarily comprise of equity securities.

Description of Securities Under Consistent Compounders, client monies would primarily be invested in equity shares and equity linked instruments issued by
companies which are listed in India. Some part of client monies might be invested in units of money market and liquid funds and some
part might be retained as bank balance in bank account.

Basis of Selection of type The Consistent Compounders investment approach is based on generating returns by investing in participating instruments of
companies which have a proven track record of steady growth in revenues alongside the ability to consistently deliver a return on
of security capital employed in excess of the cost of capital. Hence, under this investment approach, investments are primarily made in equity
shares and equity linked instruments issued by companies listed in India. To keep some part of client monies in liquid form, such
monies are either invested in units of money market funds or liquid fund or they are retained in the bank account in form of bank
balance.
Allocation of portfolio across Type of security Allocation in portfolio
types of securities
Equity and equity linked instruments =>70%

Money market funds / Liquid funds / Bank balance up to 30%

Appropriate Benchmark to Nifty 50 Total Return Index

compare performance

Basis for choice of benchmark Most of the portfolio companies fall in large-cap category based on market capitalisation. Further, the portfolio managers reinvest the
dividends received unless the client provides instruction for pay-out of dividend. Hence, Nifty 50 Total Return Index has been selected
as the benchmark for comparing performance.

Minimum investment The minimum value of Funds/investments which will be accepted towards initial corpus under Consistent Compounders Investment
Approach would be decided by the Portfolio Manager from time to time and the minimum sum will not be less than any amount as may
be stipulated by the Regulations from time to time. The uninvested amounts forming part of the Client's Assets may be at the discretion
of the Portfolio Manager held in cash or deployed in liquid fund schemes, exchange traded index funds, debt oriented schemes of
mutual funds, gilt schemes, bank deposits and other short term avenues for investment. The Portfolio Manager may call for the
amount in tranches which shall be detailed in a separate Schedule. The Portfolio Manager will, however, be at liberty to call for the
amounts payable under the tranches ahead of the dates for payment mentioned in the said Schedule by giving a prior written notice of
10 days to the Client. The Client has the option to pay such amounts ahead of the dates to the Portfolio Manager if he/it deems fit. The
minimum value of funds/investments which will be accepted towards any additional investment in Consistent Compounders
Investment Approach will be decided by the Portfolio Manager from time to time.

Indicative tenure or 3 years – 20 years

investment horizon
Minimum tenure/Lock-in Minimum tenure not applicable under this investment approach / DPMS Investments managed under Consistent Compounders
period/ Exit loads Investment Approach shall not be subject to any lock-in period / There shall be no levy of exit load on withdrawal of monies being
managed under this approach.
Redemptions / Partial Partial withdrawal shall be allowed only to such extent that portfolio value after recovery of fees, charges, and payment of withdrawal
withdrawals amount is not less than the minimum investment specified in the Minimum investment clause in this schedule

Use of derivatives The Portfolio Manager might transact in derivatives in case it deems it necessary to protect the value of client's portfolios in periods of
market instability. If the client does not want the Portfolio Manager to use derivatives at all in his/her portfolio, then, he/she can mention
Derivatives as a negative security in the account opening form and the Portfolio Manager would be barred from using derivatives in
the client's portfolio

Risks associated with the investment approach

Risks associated with the investment approach
The investments made in Securities are subject to market risk and there is no assurance or guarantee that the objectives of investments will be achieved, and the Portfolio Manager
has no liability for any losses resulting from the Client availing of the Portfolio Management Services. The following are the current risk factors as perceived by management of the
Portfolio Manager. This list is not intended to be exhaustive in nature and is merely intended to highlight certain risks that are associated with investing in Securities:
(I) Investment in equities, derivatives and mutual funds and Exchange Traded Index Funds are subject to market risks and there is no assurance or guarantee that the
objective of investments will be achieved.
(ii) As with any investment in Securities, the Net Asset Value of the portfolio can go up or down depending upon the factors and forces affecting the capital markets.
(iii) The performance of the portfolio may be affected by changes in Government policies, general levels of interest rates and risks associated with trading volumes, liquidity
and settlement systems in equity and debt markets.
(iv) The past performance of the Portfolio Manager does not indicate its future performance. Investors are not being offered any guaranteed returns.
(v) The performance of the Assets of the Client may be adversely affected by the performance of individual Securities, changes in the marketplace and industry specific and
macro-economic factors. The investment approaches are given different names for convenience purpose and the names of the approaches do not in any manner indicate
their prospects or returns.
(vi) Investments in debt instruments and other fixed income securities are subject to default risk, liquidity risk and interest rate risk. Interest rate risk results from changes in
demand and supply for money and other macroeconomic factors and creates price changes in the value of the debt instruments. Consequently, the Net Asset Value of the
portfolio may be subject to fluctuation.
(vii) Investments in debt instruments are subject to reinvestment risks as interest rates prevailing on interest amount or maturity due dates may differ from the original coupon of
the bond, which might result in the proceeds being invested at a lower rate.
(viii) The Portfolio Manager may invest in non-publicly offered debt securities and unlisted equities. This may expose the Client's portfolio to liquidity risks.
(ix) Engaging in Securities lending is subject to risks related to fluctuations in collateral value/settlement/liquidity/counter party. The Portfolio Manager may use derivatives
instruments like index futures, stock futures and options contracts, warrants, convertible securities, swap agreements or any other derivative instruments for the purpose
of hedging and portfolio balancing, as permitted under the Regulations and guidelines. Usage of derivatives will expose the Portfolio to certain risks inherent to such
derivatives. As and when the Portfolio Manager deals in the derivatives market on behalf of the Client, there are risk factors and issues concerning the use of derivatives
that investors should understand.
(x) Derivative products are specialized instruments that require investment techniques and risk analyses different from those associated with stocks and bonds. The use of a
derivative requires an understanding not only of the underlying instrument but of the derivative itself.
(xi) Derivatives require the maintenance of adequate controls to monitor the transactions entered into, the ability to assess the risk that a derivative adds to the portfolio and the
ability to forecast price or interest rate movements correctly. There is the possibility that a loss may be sustained by the portfolio as a result of the failure of another party

All Holders Signature

1 1st Applicant 2nd Applicant 3rd Applicant

Marcellus Investment Managers Private Limited
MA`CELLUS
(usually referred to as the "counter party") to comply with the terms of the derivatives contract. Other risks in using derivatives include the risk of mispricing or improper
valuation of derivatives and the inability of derivatives to correlate perfectly with underlying assets, rates and indices. Thus, derivatives are highly leveraged instruments.
Even a small price movement in the underlying security could have a large impact on their value.
(xii) Re-investment Risk: This risk refers to the interest rate levels at which cash flows received from the Securities under a particular portfolio are reinvested. The additional
income from reinvestment is the "interest on interest" component. The risk is that the rate at which interim cash flows can be reinvested may be lower than that originally
assumed.
(xiii) There are inherent risks arising out of investment objectives, investment approach, asset allocation and non-diversification of portfolio.
(xiv) Prepayment risk: there may be unscheduled return of principal on a particular Security, which may result in a reinvestment risk.
(xv) Credit Risk: Credit risk or default risk refers to the risk that an issuer of a fixed income Security may default Because of this risk corporate debentures are sold at a higher
yield above those offered on Government Securities which are sovereign obligations and free of credit risk. Normally, the value of a fixed income security will fluctuate
depending upon the changes in the perceived level of credit risk as well any actual event of default.
(xvi) The Net Asset Value may be affected by changes in settlement periods and transfer procedures.
(xvii) Risks related to index linked securities: Performance of the reference index will have a direct bearing on the performance of the strategy. In the event the reference index is
dissolved or withdrawn by the Index Provider; in case of Securities such as debentures, the debenture trustees upon request by the issuer may modify the terms of issue of
the debentures so as to track a different and suitable index. Tracking errors are also inherent in any equity linked security and such errors may cause the equity index-linked
security to generate returns which are not in line with the performance of the reference index or one or more Securities covered and/or included in the reference index.
(xviii) Risks pertaining to investments in Gold ETF's will be as provided in the disclosure document of the Portfolio Management Services. However, some of the specific risks
may include market risks, currency risks, counter party risk, liquidity risk and loss of physical gold.
(xix) Currency Exchange Rate Risk: The Client's portfolio may from time to time enter into currency exchange transactions either on a spot basis or by buying currency
exchange forward contracts. Neither spot transactions nor forward currency exchange contracts eliminate fluctuations in the price of the Client's portfolio Securities or in
foreign exchange rates or prevent losses if the prices of these Securities should decline. Performance of the Client's Portfolio may be strongly influenced by movements in
foreign exchange rates because currency positions held by the Client's portfolio may not correspond with the Securities positions held.
(xx) In case of investments in mutual fund, the Client bear the recurring expenses of the Portfolio Manager in addition to the expenses of the underlying mutual fund schemes.
Hence, the Client may receive lower pre-tax returns compared to what the Client may have received had he invested directly in the underlying Securities of the mutual fund
schemes.
(xxi) After accepting the corpus for management, the Portfolio Manager may not get an opportunity to deploy the same or there may be a delay in deployment. In such a situation
the Client may suffer opportunity loss.
(xxii) Risks associated with investment in equity instruments using Quantitative Analysis/ Quant Model: Some of the Risks attached with Quantitative Analysis are: (i) Market
Risk: Like any other equity investments, these are subject to market risk.(ii) Modelling Error: Quant models are subject to price and volume inputs. It is possible that some of
these inputs are entered incorrectly. The quant model selected by the Portfolio Manager may not perform as tested; such a scenario is entirely possible and would result in
a loss.(iii) Deviation from theoretical model: A quant model is theoretical in nature, however at times the market may act unexpectedly resulting in a loss, the quant model
cannot account for any such market behaviour. The quant model may initiate a sell signal; however, the stock may not have adequate liquidity at that moment forcing the
portfolio manager to further drive down the stock price.
(xxiii) Spread risk: Investments in corporate bonds are exposed to the risk of widening of the Spread between corporate bonds and gilts. Prices of corporate bonds tend to fall if
this spread widens which will affect the Strategy accordingly.
(xxiv) Liquidity or Marketability Risk: This refers to the ease with which a security can be sold at or near to its valuation yield-to-maturity (YTM). The primary measure of liquidity
risk is the spread between the bid price and the offer price quoted by a dealer.
(xxv) Risks related to Special Situations: Special situation trades are subject to all risks under equity; however, in certain cases the risks can be specific as are mentioned: (i) The
promoter may choose not to accept the discovered prices (ii) Regulatory hurdles may delay any specific corporate action.
(xxvi) Risk Associated with Securitized Debt: Securitized debt may suffer credit losses in the event of the delinquencies and credit losses in the underlying pool exceeding the
credit enhancement provided. As compared to the normal corporate or sovereign debt, securitized debt is normally exposed to a higher level of reinvestment risk.
(xxvii) Risk factor specifically while using Options: The Portfolio Manager might buy options to enhance yield. In buying options the profit potential is unlimited, whereas the
maximum risk is the premium paid to buy the options. The Portfolio Manager may use Derivatives instruments like equity futures & options, or other Derivative instruments
as permitted under the Regulations and guidelines. Usage of Derivatives will expose the strategies to liquidity risk, open position risk, and opportunities risk etc. Such risks
include the risk of mispricing or improper valuation and the inability of Derivatives to correlate perfectly with underlying assets, rates and indices. In case of the Derivative
strategies, it may not be possible to square off the cash position against the corresponding Derivative position at the exact closing price available in the Value Weighted
Average Period.
(xxviii) Risk factors associated with Derivatives: Derivative products are leveraged instruments and can provide disproportionate gains as well as disproportionate losses to the
Investor. Execution of such strategies depends upon the ability of the Portfolio Manager to identify such opportunities. Identification and execution of the strategies to be
pursued by the Portfolio Manager involve uncertainty and the decision of Portfolio Manager may not always be profitable. No assurance can be given that the Portfolio
Manager will be able to identify or execute such strategies. The risks associated with the use of Derivatives are different from or possibly greater than, the risks associated
with investing directly in securities and other traditional investments. Trading in derivatives has the following risks: (i) An exposure to Derivatives in excess of the hedging
requirements can lead to losses. (ii) An exposure to Derivatives, when used for hedging purpose, can also limit the profits from a genuine investment transaction. (iii)
Derivatives carry the risk of adverse changes in the market price. (iv) Illiquidity Risk i.e. risk that a Derivative trade may not be executed or reversed quickly enough at a fair
price, due to lack of liquidity in the market.
(xxix) The risks of investing in equity instruments include share price falls, receiving no dividends or receiving dividends lower in value than expected. They also include the risk
that a company restructure may make it less profitable.
(xxx) Equity instruments face market volatility risk: Stock market tends to be very volatile in the short term. Even if fundamentals of the underlying companies do not materially
change in the short term, volatility in the broader stock market can result in volatility in share prices of stocks forming part of the Client's portfolio
(xxxi) Equity instruments face fundamental risk: If fundamentals of the companies chosen by the Portfolio Manager deteriorate over time, there is no guarantee or assurance
that the Portfolio Manager's analysts and fund managers will be able to identify such deterioration in fundamentals and take appropriate action in a timely manner which
could lead to higher volatility and a lower return from the portfolio companies.
(xxxii) Equity instruments face macro-economic and geo-political risks: Sudden changes to the macro-economic and geo-political environment within which Portfolio Manager's
companies operate, could lead to increase in volatility of share prices of these companies.

Name : First Applicant Name : Second Applicant Name : Third Applicant

. . .
Place Date D D M M Y Y Y Y

2
Marcellus Investment Managers Private Limited
MA`CELLUS
SCHEDULE 3.1: Fee structures and list of charges for Consistent Compounders Investment Approach (Partner)
Please Tick ( ) in anyone of the Fee Structure of your choice.

Discretionary (Fixed Fees Only) Fixed fee* at 2% Per Annum of the Net Asset Value1 - charged Quarterly2

Fixed fee* at 1% Per Annum of the Net Asset Value1 - charged Quarterly2
Discretionary (Fixed and Performance fees) Plus
Performance Fee** at 15% Per Annum on all returns in excess of 12.0%
Hurdle Rate of Return (No Catch up) subject to a High Water Mark - charged
Annually3
Performance Fee** at 20.0% Per Annum on all returns in excess of 8.0%
Discretionary (Performance fees only) Hurdle Rate of Return (No Catch up) subject to a High Water Mark - charged
Annually3

1. Portfolio Management and Advisory fees:

Portfolio Management Fee charged may be a Fixed Fee or a return-based fee (Performance Fee) or a combination of both. Fixed fees
charged to clients will range from 10 BPS to 250 BPS per annum. The Portfolio Manager also intends to charge Performance Fees
which will kick in after a Hurdle Rate of Return ranging from 6% (six percent) to 12% (twelve percent) per annum is achieved. The
Portfolio Manager intends to claim between 10%-40% (ten percent to forty percent) of the upside generated over and above the
Hurdle Rate of Return agreed with the Client. All specifics of Portfolio Management Fee for an Investment Approach would be agreed
with each Client and set out in more detail in the Fee Schedule of the Marcellus DPMS Agreement.
2. Custodian fee
These charges relate to the opening and maintenance of Depository Accounts and/or custody fee and charges paid to the Custodian
and/or Depository Participant, dematerialization of scrips, Securities lending and borrowing and their transfer charges in connection
with the operation and management of the Client's portfolio account and is expected to be in the range of 1- 25 BPS.
3. Fund accounting charges: Up to 5 BPS.
4. Registrar and transfer agent fee
This is fee payable to the Registrar and Transfer Agent for giving effect to transfers of Securities and may interalia include stamp duty
costs, courier, post and notary charge and is expected to be in the range of 10 BPS.
5. Brokerage and transaction cost
Charged at actuals. These are amounts payable to the broker for opening of an account, execution of transactions on the stock
exchange or otherwise for the transfer of Securities and may interalia include service charges, stamp duty costs, GST, STT etc. and is
expected to be in the range of 10 BPS
6. Goods and Service Tax or any other statutory levy: As applicable from time to time, charged over and above all fees and charges billed
to the Client.
7. Depository Charges: As may be applicable from time to time.
8. Bank Charges: As may be applicable at actuals.
9. Stamp duty: As may be applicable at actuals.
10. Legal costs and professional fees: Costs incurred for documentation, certifications, attestation and instituting or defending legal suits,
audit fees and other similar charges.
11. Incidental expenses:
Charges in connection with day to day operations like courier expenses, stamp duty, service tax, postal, telegraphic, opening and
operation of bank account or any other out of pocket expenses as may be incurred by the Portfolio Manager in the course of
discharging his duties to the Client. Provided that, in the event that any out of pocket expenses to be incurred by the Portfolio Manager
on behalf of the Client is to exceed 5% of the investment amount of the Client, the Portfolio Manager shall seek prior written consent of
the Client before incurring such an expense.
12. Portfolio Manager shall not charge any fees to Clients at the time of onboarding except the specific charges applicable for execution of
the agreement and related documents for account opening.
13. Operating expenses excluding brokerage, over and above the fees charged for Portfolio Management Service, shall not exceed
0.50% per annum of the client's average daily Assets under Management (AUM).

Incentive that shall be paid to Introducer for this account (if any):
(Absolute share: for e.g., if fixed fee of 2% and incentive share is 50%, please write fixed fee incentive as 1% (50% of 2%); if performance fee
of 20% over 10% hurdle, and incentive share is 50% then please write Performance Fee Incentive as 10%)

Fixed Fee Incentive: ___________% Performance Fee Incentive: ___________% Performance Hurdle: ___________%

All Holders Signature

3 1st Applicant 2nd Applicant 3rd Applicant

Marcellus Investment Managers Private Limited
MA`CELLUS
Notes to fees:
*Fixed Fee computed as % Per Annum of the Net Asset Value1 - charged Quarterly2
** subject to a High Water Mark - charged Annually3 (No Catch-up)
1
Net Asset Value based on average daily NAV over the course of the computation period.
2
End of calendar quarter (31-Mar, 30-Jun, 30-Sep, 31-Dec). Pro-rata for the first computation period.
3
12-months from the Account Activation Date or Account Activation Anniversary Date, as the case may be
If client makes partial redemptions out of PMS account, changes fee structure, switches to a different distributor or direct code or closes the
PMS account before the billing date for Fixed Fee Billing Period or Performance Fee Billing Period, then, pro-rata fees and charges as per
existing fees structure would be billed and recovered for the period between Last billing date/Account Activation Date / Account Activation
Anniversary Date (as the case may be) and Date of redemption / change of distributor/ account closure/switch. This billing and recovery of
fees and charges would happen at the time of giving effect to such change in Client account.

Definitions used in Fee Schedule:

"Account Activation Date" means the date on which a unique Client code is generated by the Portfolio Manager.
"Account Activation Anniversary Date" means the 12 (twelve) month anniversary of the Account Activation Date and every 12 (twelve)
month anniversary, thereafter
"Fixed Fee" means a fixed fee payable by the Client to the Portfolio Manager for DPMS Services as further specified in the Fee Schedule.
"Fixed Fee Billing Period" means the frequency at which the Fixed Fees will be payable by the Client to the Portfolio Manager as set out in
this Fee Schedule .
"Hurdle Rate of Return" shall mean a certain agreed level of return (as specified in the Fee Schedule) achieved in a Performance Fee
Billing Period calculated on the relevant Performance Fee Billing Period's opening NAV.
"Net Asset Value" or "NAV" for any given day in respect of any Client account will be calculated by aggregating the following:
a) The total market value of all Securities in client's account as on the end of the day,
b) Cash/Bank balance in client's account as at the end of the day,
c) All income (dividend, interest, etc.) accrued on the investments in client's account over the course of the day,
d) all receivables and payables due from / to the Client at the end of the day;
and reducing from this aggregate all the charges, fees, expenses, statutory levies and other costs payable by the Client as per the Fee
Schedule.
"Performance Fee" shall mean a performance linked fee payable by the Client to the Portfolio Manager for the DPMS Services ,as further
specified in the Fee Schedule that will be payable if the Portfolio Manager achieves a rate of return that is greater than the Hurdle Rate of
Return for the relevant Performance Fee Billing Period subject to the High Water Mark for the relevant Performance Fee Billing Period.
"Performance Fee Billing Period" means a 12-months period from the Account Activation Date or Account Activation Anniversary Date, as
the case may be.

If client has understood the fee calculations, client to write “I have understood the fee clause and computation of fee charged by
Portfolio Manager for the Discretionary Portfolio Investment Management Services” and sign below.

The parties have caused these schedules forming part of Marcellus Discretionary Portfolio Investment Management Service Agreement to
be signed on the day and year and manner hereinafter mentioned.

Name : First Applicant Name : Second Applicant Name : Third Applicant

. . .
Place Date D D M M Y Y Y Y

4
Marcellus Investment Managers Private Limited
MA`CELLUS
Schedule 3.2: Illustrations for fee computation under different fee structures for Consistent Compounders
Investment Approach
Illustration A: Fixed fees of 2% of Net Asset Value (with NAV calculated based on average daily NAV over the course of the quarter)
Assumptions: Size of sample portfolio: Rs 50,00,000, Period: 1 year , Upfront fees: Nil, Performance fees: Nil,
Fixed fees: 2% of the daily average NAV , Frequency of fee charging: Quarterly
Scenario 1: Scenario 2: Scenario 3:
Nature of fees Gain of 20% Loss of 20% No change
Amount in Rs Amount in Rs Amount in Rs
Capital contribution 50,00,000 50,00,000 50,00,000
Less: upfront fees 0 0 0
Less: any other fees 0 0 0
Assets under management (AUM) 50,00,000 50,00,000 50,00,000
Add/Less: Profit/Loss on investment during the year 10,00,000 10,00,000 0
of 20% of AUM
Less: brokerage/DP charges/any other charges* 0 0 0
Less: fixed fees of 2% per annum** 1,20,000 80,000 1,00,000
Less: performance fees 0 0 0
Total charges during the year 1,20,000 80,000 1,00,000
Net Asset Value (NAV) of the portfolio at year end 58,80,000 39,20,000 49,00,000
% change over capital contributed 17.60% -21.60% -2.00%

Illustration B: Fixed fee of 1% of the Net Asset Value (with NAV calculated based on average daily NAV over the course of the
quarter) plus Performance fee of 15% on all returns in excess of 12% subject to a high watermark
Assumptions: Assumptions: Size of sample portfolio: Rs 50,00,000, Period: 1 year , Upfront fees: Nil, Hurdle rate: 12%, Performance
fees: 15% of all returns in excess of the hurdle rate (subject to a high watermark), Fixed fees: 1% of the daily average NAV ,Frequency
of fee charging: Yearly for variable fees & quarterly for fixed fees.
Scenario 1: Scenario 2: Scenario 3:
Nature of fees Gain of 20% Loss of 20% No change
Amount in Rs Amount in Rs Amount in Rs
Capital contribution 50,00,000 50,00,000 50,00,000
Less: upfront fees 0 0 0
Less: any other fees 0 0 0
Assets under management (AUM) 50,00,000 50,00,000 50,00,000
Add/Less: Profit/Loss on investment during the year 10,00,000 10,00,000 0
of 20% of AUM
Less: brokerage/DP charges/any other charges* 0 0 0
Less: fixed fees of 1% per annum** 60,000 40,000 50,000
Less: performance fees*** 51,000# 0 #
0#
Total charges during the year 1,11,000 40,000 50,000
Net Asset Value (NAV) of the portfolio at year end 58,89,000 39,60,000 49,50,000
% change over capital contributed 17.78% -20.80% -1.00%
Assumptions:
* for illustrative purposes only. In reality, brokerage and DP charges will be around 15-20bps whilst custody & fund accounting charges will
be around 5-10 bps.
** for illustrative purposes only. In reality, fixed fees will be charged each quarter based on the average daily NAV in that quarter (rather
than on the year ending NAV).
*** charging 15% of all returns in excess of 12%.
#
This is for illustration purposes only. The actual performance fees on a client's account will be computed on the returns generated after
charging all sorts of fixed fees as well as expenses.

All Holders Signature

5 1st Applicant 2nd Applicant 3rd Applicant

Marcellus Investment Managers Private Limited
MA`CELLUS
Schedule 3.2: Illustrations for fee computation under different fee structures for Consistent Compounders
Investment Approach
Illustration C: Performance fee of 20% on all returns in excess of 8% subject to a high watermark
Assumptions: Size of sample portfolio: Rs 50,00,000, Period: 1 year , Upfront fees: Nil, Hurdle rate: 8%, Performance fees: 20% of all
returns in excess of the hurdle rate (subject to a high watermark),Frequency of fee charging: Yearly for variable fees & quarterly for fixed fees.
Scenario 1: Scenario 2: Scenario 3:
Nature of fees Gain of 20% Loss of 20% No change
Amount in Rs Amount in Rs Amount in Rs
Capital contribution 50,00,000 50,00,000 50,00,000
Less: upfront fees 0 0 0
Less: any other fees 0 0 0
Assets under management (AUM) 50,00,000 50,00,000 50,00,000
Add/Less: Profit/Loss on investment during the year 10,00,000 10,00,000 0
of 20% of AUM
Less: brokerage/DP charges/any other charges* 0 0 0
Less: fixed fees 0 0 0
Less: performance fees ##
1,20,000 #
0# 0#
Total charges during the year 1,20,000 0 0
Net Asset Value (NAV) of the portfolio at year end 58,80,000 40,00,000 50,00,000
% change over capital contributed 17.60% -20.00% 0.00%

Assumptions:
* for illustrative purposes only. In reality, brokerage and DP charges will be around 15-20bps whilst custody & fund accounting charges will
be around 5-10 bps.
** for illustrative purposes only. In reality, fixed fees will be charged each quarter based on the average daily NAV in that quarter (rather
than on the year ending NAV).
##
charging 20% of all returns in excess of 8%.
#
This is for illustration purposes only. The actual performance fees on a client's account will be computed on the returns generated after
charging all sorts of fixed fees as well as expenses.

Name : First Applicant Name : Second Applicant Name : Third Applicant

. . .
Place Date D D M M Y Y Y Y

6
Marcellus Investment Managers Private Limited
MA`CELLUS
Schedule 3.3: Additional*** Illustration to explain Performance Fee computation over a multi-year investment period.

Assumptions: Size of Sample Portfolio: INR 50,00,000/- , Period: 5 years, Hurdle Rate: 8% , Performance Fees: 20%

Return -10.00% 25.00% 5.00% 25.00% 20.00%

Particular/Year 1 2 3 4 5
Opening AUM 50,00,000 45,00,000 55,00,000 57,75,000 70,22,400
High Watermark (HWM) 50,00,000 50,00,000 56,25,000 56,25,000 72,18,750
Base for computing hurdle 50,00,000 45,00,000 55,00,000 57,75,000 70,22,400
Hurdle AUM** 54,00,000 48,60,000 59,40,000 62,37,000 75,84,192
Higher of HWM and Hurdle 54,00,000 50,00,000 59,40,000 62,37,000 75,84,192
Profit / Loss for the year (5,00,000) 11,25,000 2,75,000 14,43,750 14,04,480
Pre- fees AUM (Year end) 45,00,000 56,25,000 57,75,000 72,18,750 84,26,880
HWM crossed? No Yes Yes Yes Yes
Hurdle crossed? No Yes No Yes Yes
Fees 0 1,25,000 0 1,96,350 1,68,538
Ending AUM 45,00,000 55,00,000 57,75,000 70,22,400 82,58,342
Fees as % of Average AUM 0.00% 2.47% 0.00% 3.02% 2.18%

Assumptions:
Notes:
** Hurdle AUM is computed by multiplying the Hurdle Rate of Return with the post fees opening AUM for the relevant year
***Please note that this illustration does not demonstrate charges like broker fees etc. as the purpose of this illustration is to bring clarity to
the Client on the methodology of performance fees calculation over multiple years scenario. We have provided this illustration in addition
to the SEBI prescribed format (refer the table titled as Regulatory Illustration above) as the SEBI prescribed format only provides
calculation mechanism in a one year scenario than multiple years.

Name : First Applicant Name : Second Applicant Name : Third Applicant

. . .
Place Date D D M M Y Y Y Y

7
32