OF THE
STATE OF MARYLAND, THE ARTICLES OF INCORPORATION AND THE NASAA GUIDELINES.
THE
FOREGOING INDEMNITY SHALL EXTEND, WITHOUT LIMITATION, TO ANY CLAIMS TO THE
EXTENT RELATING TO ANY OF THE EVENTS OR OUTCOMES SET FORTH IN THE PROSPECTUS AS
POSSIBLE RESULTS, OUTCOMES OR RISKS ASSOCIATED WITH THE BUSINESS AND INVESTMENT
OBJECTIVES OF THE COMPANY.
NOTWITHSTANDING THE FOREGOING, THE ADVISOR SHALL NOT
BE ENTITLED TO INDEMNIFICATION OR BE HELD HARMLESS PURSUANT TO THIS SECTION 5.01
FOR ANY ACTIVITY WHICH THE ADVISOR SHALL BE REQUIRED TO INDEMNIFY OR HOLD
HARMLESS THE COMPANY PURSUANT TO SECTION 5.02. ANY INDEMNIFICATION OF THE
ADVISOR MAY BE MADE ONLY OUT OF THE NET ASSETS OF THE COMPANY AND NOT FROM
STOCKHOLDERS.
19
5.02
INDEMNIFICATION BY ADVISOR.
THE ADVISOR SHALL
INDEMNIFY AND HOLD HARMLESS THE COMPANY FROM CONTRACT OR OTHER LIABILITY,
CLAIMS, DAMAGES, TAXES OR LOSSES AND RELATED EXPENSES INCLUDING ATTORNEYS' FEES,
TO THE EXTENT THAT SUCH LIABILITY, CLAIMS, DAMAGES, TAXES OR LOSSES AND RELATED
EXPENSES ARE NOT FULLY REIMBURSED BY INSURANCE AND ARE INCURRED BY REASON OF THE
ADVISOR'S BAD FAITH, FRAUD, MISFEASANCE, MISCONDUCT, NEGLIGENCE OR RECKLESS
DISREGARD OF ITS DUTIES, BUT THE ADVISOR SHALL NOT BE HELD RESPONSIBLE FOR ANY
ACTION OF THE BOARD IN FOLLOWING OR DECLINING TO FOLLOW ANY ADVICE OR
RECOMMENDATION GIVEN BY THE ADVISOR.
ARTICLE VI
MISCELLANEOUS
6.01
ASSIGNMENT TO AN AFFILIATE.
THIS AGREEMENT MAY BE
ASSIGNED BY THE ADVISOR TO AN AFFILIATE OF THE ADVISOR WITH THE APPROVAL OF A
MAJORITY OF THE BOARD (INCLUDING A MAJORITY OF THE INDEPENDENT DIRECTORS).
THE
ADVISOR MAY ASSIGN ANY RIGHTS TO RECEIVE FEES OR OTHER PAYMENTS UNDER THIS
AGREEMENT WITHOUT OBTAINING THE APPROVAL OF THE BOARD.
THIS AGREEMENT SHALL NOT
BE ASSIGNED BY THE COMPANY WITHOUT THE CONSENT OF THE ADVISOR, EXCEPT IN THE
CASE OF AN ASSIGNMENT BY THE COMPANY TO A CORPORATION OR OTHER ORGANIZATION
WHICH IS A SUCCESSOR TO ALL OF THE ASSETS, RIGHTS AND OBLIGATIONS OF THE
COMPANY, IN WHICH CASE SUCH SUCCESSOR ORGANIZATION SHALL BE BOUND HEREUNDER AND
BY THE TERMS OF SAID ASSIGNMENT IN THE SAME MANNER AS THE COMPANY IS BOUND BY
THIS AGREEMENT.
THIS AGREEMENT SHALL BE BINDING ON SUCCESSORS TO THE COMPANY
RESULTING FROM A CHANGE OF CONTROL OR SALE OF ALL OR SUBSTANTIALLY ALL THE
ASSETS OF THE COMPANY OR THE PARTNERSHIP, AND SHALL LIKEWISE BE BINDING UPON ANY
SUCCESSOR TO THE ADVISOR.
6.02
RELATIONSHIP OF ADVISOR AND COMPANY.
THE COMPANY
AND THE ADVISOR ARE NOT PARTNERS OR JOINT VENTURERS WITH EACH OTHER, AND NOTHING
IN THIS AGREEMENT SHALL BE CONSTRUED TO MAKE THEM SUCH PARTNERS OR JOINT
VENTURERS OR IMPOSE ANY LIABILITY AS SUCH ON EITHER OF THEM.
6.03
TREATMENT UNDER TEXAS MARGIN TAX.
FOR PURPOSES OF
THE TEXAS MARGIN TAX, THE ADVISOR'S PERFORMANCE OF THE SERVICES SPECIFIED IN
THIS AGREEMENT WILL CAUSE THE ADVISOR TO CONDUCT PART OF THE ACTIVE TRADE OR
BUSINESS OF THE COMPANY, AND THE COMPENSATION SPECIFIED IN ARTICLE III INCLUDES
BOTH THE PAYMENT OF MANAGEMENT FEES AND THE REIMBURSEMENT OF SPECIFIED COSTS
INCURRED IN THE