The Management Fee

Professionals who charge a fee rarely initiate a discussion of the subject with a prospective client. If coverage even appears in print, the
language is usually tucked away in some obscure place. We at Martin Capital Management are outspoken about the compensation
arrangement under which we labor in exchange for the fees you pay. Our fee structure is not about whether we do our job, its about how
well we do our joban arrangement unique (to our knowledge) in all the United States.

In most instances, the fee levied by a professional money manager will take the form of a fixed percentage of the value of your portfolio,
usually measured on a quarterly basis. Some managers assess fees on an la carte basis, adding layers of complexity that make
comparisons difficult and that often obscure miscellaneous charges like custody fees and equity transaction commissions. Hedge
funds are even more egregious, often charging a base fee of 2% and taking 20% of any gains.

We believe that our commitment to integrity should include the way we get paid. Therefore, the fee structure under which we operate
ties our revenues to the dollar growth of your portfolio, but does not take both a flat base fee and a performance bonus. Instead,
we assess a performance fee of 10% when your portfolio moves to new high ground. As you can see in the schedule below, ninety percent
of any new wealth created accrues to you and the remaining ten percent is the fee paid to Martin Capital Management. During any
period in which your portfolio value is lower than any previous high-water mark, we will assess a quarterly keep-the-lights-on fee 0.9% per
annum.

There are no hidden charges. We feel very strongly that if we cannot find investments that lead to growth in wealth, we should not
charge you as though we did. Our clients tell us that an equitable sharing of the rewards of wealth creation is intuitively appealing. They
also see integrity in the sharing of adversity that is, dramatically lower fees if the portfolio is not growing.

The unique MCM fee schedule is purposefully designed to put incentives in their proper place: First, the use of a high-water mark
encourages us to preserve your hard-earned capital and not fall significantly behind. Second, the performance fee rewards us for not
becoming complacent it functions as an incentive for us to prudently grow your capital over the long haul to levels not seen before.
The fee structure is entirely in harmony with our cardinal rules of investing: preservation first, prudent growth second. The result for
MCM clients has been long-term outperformance of the broader market.


MCM PERFORMANCE FEE SCHEDULE

The greater of:
A. A quarterly maintenance fee assessed as a percentage of assets: 0.90% (90 bps)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . OR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

B. A quarterly performance-based fee:
10% of the gain (above the high watermark), if earned.