Terms and conditions

1. Glossary
1.1 In this Agreement, except where the context otherwise provides, the following words shall have the following meaning: Agreement means this Agreement as this may, from time to time be varied, amended or replaced by mutual agreement. Appendix means the Appendices of this agreement as these may, from time to time be varied, amended, replaced or expanded by mutual agreement. Authorised Representative / Attorney means the person described in clause 18 below. Directive means the appropriate directives of the SEBI for the professional competence of Investment Firms and the natural persons employed by them. Financial Instruments” means the Financial Instruments as these are defined by the Law as this may, from time to time be amended, replaced, expanded or re-enacted. Investments” means any investments and includes, without limitation, shares, stocks, debentures, share warrants, units of mutual funds, collective investment schemes, securities, deeds giving a right to shares or other securities, cash deposits and deposit certificates. It includes, at any event, transferable securities, shares in companies and other securities equivalent to shares in companies, bonds and other form of securitised debt which are negotiable on the Market, and any securities normally dealt in giving the right to acquire any such transferable securities by subscription or exchange or giving rise to a cash settlement, excluding instruments of payment. Investment Advice” means the provision of personal recommendation to a client, either after his request, or on the initiative of BE, in relation to one or more transactions related to financial instruments; for the purposes of this definition, a personal recommendation is given the meaning assigned to it in the Law. The Law, from time to time be amended, replaced, expanded or re-enacted and includes, where the context so justifies, any secondary legislation enacted in furtherance thereof including but not limited to the Directive. Market” means any market, including the National Stock Exchange, Bombay Stock Exchange and others as appropriate.
2. Services
2.1 (1) The Client hereby appoints BE as investment manager on a discretionary basis of such moneys, fixed income and fixed income related Investments, equity and equity related Investments and other Financial Instruments transferred to or held by BE under this Agreement from time to time, which, together with all Investments and re-investments made and the proceeds of those moneys and Investments and all earnings and profits, less all withdrawals, are referred to collectively as the Portfolio. The Portfolio may be divided into one or more sub-portfolios depending upon the Clients objectives and strategy. Each sub-portfolio shall hereinafter be referred to as a Sub-Portfolio”. The initial portfolio amount for which the Client appoints BE as investment manager is defined in Appendix 1 and can comprise of cash and/or one or more financial instruments deposited in an appropriate broking account. (2) BE hereby accepts its appointment as investment manager of the Portfolio on a discretionary basis, upon the terms of this Agreement.
2.2 BE agrees to provide the Client and the Client wishes to be provided with the Services of management of portfolio investment on a discretionary basis where such Portfolios include one or more Financial Instruments.
2.3 For the purposes of being provided with the Services, the Client agrees and undertakes to provide BE with access to their broking account on a need basis (upon daily authorization) and/or collateral including security credentials required to access the broking account that may be agreed between the Client and BE. Should the provision of securities and/or collateral by the Client be agreed between the Parties BE is entitled to treat the provision of such as a prerequisite to the commencement of the Services.
3. Classification of the Client
3.1 BE has already categorised the Client according to the Law and the Client acknowledges that the business relationship created hereby shall be conducted on the basis of this classification.
4. Client Representations
4.1 The Client warrants, declares and represents to BE, that:
(1) The Financial Instruments and other assets, deposited in the Clients broking account and which are managed by BE belong exclusively to the Client and are owned by him free from any right of lien, charge, pledge or any other encumbrance or claim by any third party, unless the Client has otherwise disclosed to BE in writing,
(2) In case of a legal person, that it is duly and lawfully registered, and has the power and authority to enter into the Agreement,
(3) The Financial Instruments and other assets which the Client may deliver from time to time to BE are not connected directly or indirectly to any illegal acts or criminal activities,
(4) Without prejudice to the rights of BE as set out herein, neither the Client nor any of his Authorised Representative / Attorney shall have any dealings in relation to or trade in any of the Financial Instruments or cash or any other property assets which he has delivered to or acquired through BE,
(5) The Client is acting in his personal capacity and not as an Authorised Representative / Attorney or trustee of any third party, unless he has presented to the satisfaction of BE, documents or power of attorney permitting him to act as an Authorised Representative / Attorney or trustee of any third party,
(6) The Financial Instruments or other document which he may deliver to BE are genuine, valid, free of any defect and they shall have the legal effect which they purport to have,
(7) The person signing this Agreement on behalf of the Client is duly authorised to do so, (8) The signing, delivery and performance of the Agreement by the Client do not and will not contravene or constitute a default under, or cause to be exceeded, any of the following, namely: (a) any law by which the Client or any of its assets is bound or affected; (b) rights of any third parties in respect of the Client or the Financial Instruments; (c) any agreement to which the Client is a party or by which any of its assets are bound.
4.2 The above representations and warranties will be deemed valid for all transactions entered into hereunder.
5. Obligations of BE
(1) BE shall have full discretion and authority, by obtaining the Clients prior approval through its portal and app, to manage the investment and trading of the Portfolio in order to achieve the objectives in accordance with the guidelines and with the chosen Sub-Portfolio strategy as set out and agreed from time to time between BE and Client, and shall use its reasonable efforts to increase the value of the Portfolio. In furtherance thereof, the Client hereby designates and appoints BE as its agent and attorney, with full power and authority and without further approval of the Client (except as expressly provided herein or as may be required by law) to take all reasonable and necessary actions in connection with its obligations and rights as set forth herein. The powers vested herein are continuing powers and shall remain in full force and effect until the termination of the Agreement. Except as otherwise may be agreed in writing and except as specified with respect to each Sub-Portfolio, or under the law, there are no prohibited categories of Investments, no restrictions on the size of holdings, no diversification or concentration limits and no sector or liquidity restrictions, as BE has full discretion on the management of the Portfolio.
(2) BE is authorised to place orders with brokers or dealers or other persons, including BE or any associate or affiliate or subsidiary of BE, for the purchase, sale, or otherwise disposal of any Investments or other property held or to be held in the Portfolio.
(3) BE will keep the Portfolio under review, manage the Portfolio in such a manner so as to further the Clients best interests and will enter into such transactions in relation to the Portfolio as it thinks necessary or advisable with a view to fulfilling the objectives in accordance with the guidelines agreed between BE and the Client. These guidelines may be amended at any time during the duration of the Agreement and any such action does not affect any other terms of the Agreement.
(4) The Client hereby agrees and confirms that nothing in the Agreement will limit the freedom of BE to provide other investment and ancillary services to any other person or entity or act as investment adviser or manager for any third party.
(5) BE is authorised to exercise or sell or to allow the lapse of rights arising in relation to the Portfolio Investments taking into account Best interests of the Portfolio. Upon making the investment decision in respect of such rights, BE shall give all instructions, and ensure that all necessary steps are taken to ensure the effective exercise of such rights in consonance with the investment decision.
(6) The Client hereby accepts that: (a) BE or any associate or affiliate or subsidiary of BE may act as principal in any transactions for disposal of Investments in the Portfolio or in the acquisition of Investments for the Portfolio and such transaction may be entered into on behalf of the Client at such prices as may be decided by BE taking into account the normal rate or price differential receivable in the ordinary course of business for such transactions; (b) BE may subscribe or apply for Investments on behalf of the Client upon any issue notwithstanding that BE or any associate or affiliate or subsidiary of BE is participating in some other capacity in the preparation or underwriting of such issue or offer or otherwise acting in connection with it; and (c) BE may acquire Investments for the Portfolio issued by any associate or affiliate or subsidiary of BE and enter into contractual commitments with any associate or affiliate or subsidiary of BE. The above constitutes assent of the Client to the above actions and no further notification to the Client need be given in the future by BE in relation thereto.
6. Clients bank account
(1) The Client shall continue to be responsible for all debits & credits to the broking account connected with appropriate bank accounts as required by the chosen broker. (2) BEs accounting books and records shall at all times deduce the net earnings on the portfolio through the access to the broking account.
7. Termination
Termination by both Parties (1) The Portfolio and any Sub-Portfolios shall have an initial and renewal term as indicated in Appendix 1 and shall be subject to the initial and renewal lock-up period as specified in Appendix 1. Such periods shall run from the date of signing of the Agreement. Appendix 1 may be amended, subject to an agreement in writing between the Parties, at any time during the duration of the Agreement and any such action does not affect any other terms of the Agreement.
(2) At any time after execution of the Agreement, either party may terminate the Agreement or terminate or redeem any amount in the Portfolio under the Agreement or any Sub-Portfolio by giving not less than 30 (thirty) calendar days prior written notice to the other party. Should the Client wish to redeem any amount of the Portfolio under the Agreement during the Initial Lock-Up Period applicable, a lock-up redemption fee specified in the appropriate section of Appendix 1 shall be payable. Should the Client wish to redeem any amount of the Portfolio at any time other than during the Initial Lock-Up Period or at the end of the term of such Sub-Portfolio no redemption fee is payable. A redemption fee shall not be payable in respect of any amount of the Portfolio should the Client wish to redeem it at the end of the initial term or the end of any subsequent renewal term. A termination or redemption of any Sub-Portfolio shall not affect any other Sub-Portfolio which shall continue in full force and effect.
(3) Termination of the Agreement or any Sub-Portfolio, as the case may be, shall be without prejudice to the completion of transactions already initiated or to BEs rights to compensation for any monies hereunder, including, but not limited to, any fees, costs or expenses. Transactions in progress shall be dealt with in accordance with the Clients instructions or, in the absence of such instructions, having regard to BEst interests of the Portfolio or the Sub-Portfolio, as the case may be. Any monies due to BE hereunder as a result of termination of any Sub-Portfolio hereunder shall be paid when such Sub-Portfolio is liquidated or when the assets held in the Sub-Portfolio are transferred to a third-party or to the Client.
(4) The Client may redeem all or any portion of his Investment in the Portfolio at any time at the Bid NAV (after the deduction of any fees, costs and expenses due to BE hereunder, including without limitation the redemption fee or the Lock-Up redemption fee as applicable).
(5) Notwithstanding any statement to the contrary, any redemption by the Client hereunder shall be subject to BE retaining sufficient assets to comply with prior commitments and being reimbursed for any costs incurred in arranging any withdrawal from the bank account and any fees due to him by the Client. (6) In BEs sole discretion and upon 7(seven) business days advance written notice from the Client to BE, the Client may at any time make additional Investments to the Portfolio in the increments as indicated in Appendix 1.
8. Termination by BE
8.1 The Parties shall be entitled to terminate the Agreement as provided in clause 7 above.
8.2 BE may terminate the Agreement immediately without giving notice in case of: (1) death of the Client, (2) filing of a petition or issue of judgment or order for winding up or liquidation or bankruptcy of the Client, (3) in case the Client comes into an agreement or arrangement with its creditors, (4) the Client being guilty of malicious conduct or gross negligence or fraud or of using fraudulent means in relation to the execution of this Agreement, (5) failure or refusal of the Client to fulfil or comply fully with any of its obligations under the Agreement,
8.3 It is further provided that in case of such termination of the Agreement, any lawful rights or obligations which have arisen during or before the termination of the Agreement shall not be affected and the Client shall be obliged to pay to BE, inter alia: (1) any outstanding fee of BE and any other amount payable to BE, (2) any additional expenses which BE incurs or shall incur as a result of the termination of the Agreement, and (3) any losses arising during the arrangement or the settlement of the outstanding obligations.
9. Acknowledgment of Risk
9.1 The Client acknowledges and accepts that:
(1) The Financial Instruments or funds of the Client may be held by a third party on behalf of BE and in such cases the Client may not be fully protected against the insolvency of the third party or in case of any act or omission of any such third party.

(2) The funds or Financial Instruments of the Client may be held in an omnibus account by a third party and in such cases the Client may not be fully protected against the insolvency of the third party or in case of any act or omission of any such third party.

(3) The Financial Instruments may be held with a third party and such Financial Instruments may not be separately identifiable from the proprietary Financial Instruments of that third party or of BE and in such cases the Client may not be fully protected against the insolvency of the third party or in case of any act or omission of any such third party.

(4) A depository may have a security interest or lien over, or right of set-off in relation to Financial Instruments or funds belonging to the Client.

(5) Notwithstanding any Investment Advice or information which may have been given by BE, the value of any investment in Financial Instruments may fluctuate either upwards or downwards.

(6) The existence of a substantial risk of incurring losses and damages as a result of the purchase or sale of any Financial Instrument and acknowledges his willingness to take such risk.

(7) When a Financial Instrument is negotiated in a currency other than the currency of the country of residence of the Client, any changes in the exchange rates may have a negative effect on its value.

(8) Any Financial Instrument in foreign markets may entail risks different than the ordinary risks in the market at the Clients country of residence.

(9) Investments might be based on unrated securities, which bear significant credit and exchange rate risk. While BE may attempt to put in place actual or synthetic hedging arrangements to address such risks, there can be no assurances that such hedging arrangements shall be available or that the hedging will be effective.

(10) Notwithstanding that BE will at all times act in good faith to carry out its obligations under the Agreement, some of the Investments contemplated herein may be volatile and illiquid and that there is no guarantee of a return on the Investment and no guarantee that a return of all of the invested amounts will be possible.

(11)There are significant risks in using derivative instruments. In general terms, a derivative instrument is one whose value depends on (or is derived from) the value of an underlying asset, interest rate or index. Options, futures, options on futures and interest rate swaps or other interest rate-related transactions are examples of derivatives. Derivative instruments involve risks different from the direct investment in underlying securities. These risks include imperfect correlation between the value of the instrument and the underlying assets; risks of default by the other party to certain transactions; risks that the transactions may result in losses that partially or completely offset gains in portfolio positions; risks that the transactions may not be liquid; and manager risk

(12) BE utilizes broking platforms provided by the broker under which the Client has chosen to create an account and manages investments through the same. BE is not responsible or liable for any negative impact to portfolio value due to system downtime at the broker or exchange.

(13) The Client will need to at a minimum provide trading approval within the requisite approval window for a minimum of 10 trading days a month. Anything below this will cause BE to invoice the Client from the >0% slab instead of the >=2% slab.

(14) All investments are subject to market risk. Please read the offer document carefully before investing says the disclaimer in the every advertisement of the mutual fund.

12. Breach of Obligations of Client

12.1 The Parties agree that in case BE carries out a transaction or incurs an expense or tax or other cost on behalf of the Client which is not covered by the balance of the Clients BE account, the latter shall immediately pay the difference between the balance and the cost of the transaction.

12.2 Under this agreement, all investment is done on the broking account held by the Client and accordingly all proceeds are credited to the Clients banking account. The Client will at periodic intervals set in the Appendix required to remit to BE the management fees at the rate as detailed in the annexure.

12.3 If the Client fails to fulfil financial obligations to BE, BE reserves the right to terminate the relationship permanently and may also accordingly choose to decline entering into a relationship with any other individuals or businesses connected with the Client.

12.4 If the Client owes any amount to BE, regardless of whether it is in arrears, BE may require the Client to deliver to BE as security for the amounts owed, any property assets or Financial Instruments which BE shall deem necessary, the value of which should be equal to such percentage of the amount owed to BE as BE shall specify, in each case. To this extent, the Client shall be obligated to sign any requisite document and take all necessary action for the granting of any such security in favour of BE.

12.5 BE may refuse to proceed with its obligations under the Agreement, for as long as it maintains any claims against the Client, whether these are due, future or contingent and regardless of whether these arise from the same transaction from which the abovementioned obligations of BE arise.

12.6 The Client shall fully reimburse BE as soon as he is required to do so for any loss sustained in any way, which is due to acts or commissions of the Client or his Authorised Representatives or Attorneys.

12.7 BE shall have no liability for any loss of opportunity as a result of which the value of the Financial Instruments of the Client would have otherwise been able to increase or for any decrease in the value of the Financial Instruments of the Client, howsoever caused, save to the extent that such loss or decrease is directly caused by the wilful neglect or fraud on the part of BE or its directors or its employees or its representatives.

12.8 The Client shall not tamper or utilize the underlying broking account under the Clients name while BE software is managing the same. This includes withdrawals, manual transactions, cancellations or any operation on the brokerage platform unless requested by BE.

12.9 The client shall need to clear all dues by 7th of every month failing which (a) BE may choose to stop trading for the Client immediately while continuing to charge the fixed portfolio management fees (b) 2nd electronic notice shall be sent by the 10th of every month if BE hasnt received dues against invoices (c ) A third electronic notice shall be sent by 15th following which all trading will be stopped by 18th of the cycle.

13.0 The client can be blacklisted upon activities deemed to be intentional towards non-clearance of dues along with notification to their referrers. Legal action may also be initiated.

13. Fee, Commissions, and other Expenses

13.1 BE shall be entitled to a fee in respect of the Services provided by it as this shall be specified by BE from time to time depending on the type of transaction and in accordance with BEs charging policy in force from time to time. The present amount and the method of payment of BEs fee as well as any commissions, taxes or other expenses shall be determined in Appendix 1.

BE on its own accord could choose to provider waivers of fees to the Client in cases which merit it.

Any amendment of the Appendix 1 affected by BE in accordance with this clause shall be notified to the Client. Appendix 1 may be amended at any time during the duration of this agreement and any such action does not affect any other terms of this Agreement. BE may elect to disclose the essential terms of the arrangements relating to the fees, commissions or non-monetary benefits in summary form. Further details, however, may be disclosed at the request of the Client. BE shall submit a statement to the Client in respect of the fee due for each investment period agreed between the Client and BE, showing the calculation of the fees and other expenses, costs or taxes and BE is authorised to withdraw the amount of any fees and other expenses, costs or taxes from the Portfolio. The Client shall in addition pay any value added or other tax on the amount of BEs fee, if such value added or other tax is applicable.

14. Duration of Agreement

14.1 The Agreement shall enter into force on the day of signing and be applicable for a period of 1 year.

15. Non-Exclusivity of Services
The Client agrees and acknowledges that BE may perform investment services for various clients including investment companies. The Client agrees that BE may give advice and take action with respect to any of its other clients which may differ from advice given, or the timing or nature of action taken, with respect to the account of the Client, so long as it is BEs policy, to the extent practical, to allocate investment opportunities to the account of the Client over a period of time on a fair and equitable basis relative to other clients. Nothing in the Agreement shall be deemed to limit or restrict BE or any of its members, managers, agents or employees from buying, selling or trading in any securities or other assets for their own accounts, and the Client acknowledges that BE, its members, managers, agents and employees, and other clients of BE, may at any time acquire, increase, decrease or dispose of positions in Investments which are at the same time being acquired, held or disposed of for the account. BE will not have any obligation to initiate the purchase or sale, or to recommend for purchase or sale, for the account of the Client any security or other asset which BE, its members, managers, agents or employees may purchase, hold or sell for their own accounts or for the accounts of any other clients of BE.

16. Confidentiality
16.1 The Parties shall have a duty of confidentiality with respect to their relationship hereunder during the term of this Agreement as well as after its termination. Such confidentiality shall cover all communication, documentation or other information exchanged during the course of such relationship.

16.2 BE shall have the right, without giving prior notice to the Client, to disclose such details of the transactions of the Client or such other details as BE may consider necessary in order to comply with applicable law, the requirements of any third person or other appropriate or regulating authority having the right to demand such disclosure or to comply with any obligation of BE to proceed to the said disclosure to any third person.

16.3 BE and the Client agree to comply with the Processing of Personal Data and to process personal information in accordance with such Law.

Appendix 1: Rate Chart/Fees/Minimum Investment
S/No Item Rate Card Comments
1 Performance Fees No performance fees payable if <2% ROI for the cycle >=2 % - 20% of amount above will be charged as commission + Service Tax Eg: For 3% with an investment of Rs. 5 lakhs in a month, 0.5% (= half of 1% = 3% -2 %) of 5 Lakhs = Rs. 2500 will be charged. This rate can be revised at any time applicable from next trading period. Appropriate notice will be given to all customers.
2 Late Settlement charges 0.2% per Calendar day + Service Tax Performance Fees Settlements for every cycle will have to be paid by 3rd of every month
3 Minimum investment amount Rs. 1,00,000 - Rs. 50 Lakhs Minimum lock for 1st month
7 Period of Contract 1 Year Can be renewed annually - rates may be revised periodically at sole discretion of BullsExchange and have no bearing on the agreement validity itself. 8 Minimum Trading All Trading Days The Client needs to provide the system approval (through a portal) every day in a given cycle - if the Client doesnt meet that condition, performance fees (item 1) would be applicable from the 0% slab instead of >=2%.