THE ADVISOR SHALL PREPARE A STATEMENT DOCUMENTING THE EXPENSES OF THE
COMPANY DURING EACH QUARTER, AND SHALL DELIVER SUCH STATEMENT TO THE COMPANY
WITHIN 45 DAYS AFTER THE END OF EACH QUARTER.
3.03
OTHER SERVICES.
SHOULD THE BOARD REQUEST THAT THE
ADVISOR OR ANY DIRECTOR, OFFICER OR EMPLOYEE THEREOF RENDER SERVICES FOR THE
COMPANY OTHER THAN SET FORTH IN SECTION 2.02, SUCH SERVICES SHALL BE SEPARATELY
COMPENSATED AT SUCH RATES AND IN SUCH AMOUNTS AS ARE AGREED BY THE ADVISOR AND
THE INDEPENDENT DIRECTORS, SUBJECT TO THE LIMITATIONS CONTAINED IN THE ARTICLES
OF INCORPORATION, AND SHALL NOT BE DEEMED TO BE SERVICES PURSUANT TO THE TERMS
OF THIS AGREEMENT.
3.04
REIMBURSEMENT TO THE ADVISOR.
THE COMPANY SHALL NOT
REIMBURSE THE ADVISOR FOR TOTAL OPERATING EXPENSES TO THE EXTENT THAT TOTAL
OPERATING EXPENSES (INCLUDING THE ASSET MANAGEMENT FEE), IN THE FOUR CONSECUTIVE
FISCAL QUARTERS THEN ENDED (THE "EXPENSE YEAR") EXCEED (THE "EXCESS AMOUNT") THE
GREATER OF 2% OF AVERAGE INVESTED ASSETS OR 25% OF NET INCOME FOR SUCH YEAR.
ANY EXCESS AMOUNT PAID TO THE ADVISOR DURING A FISCAL QUARTER SHALL BE REPAID TO
THE COMPANY.
REIMBURSEMENT OF ALL OR ANY PORTION OF THE TOTAL OPERATING
EXPENSES THAT EXCEED THE LIMITATION SET FORTH IN THE PRECEDING SENTENCE MAY, AT
THE OPTION OF THE ADVISOR, BE DEFERRED WITHOUT INTEREST AND MAY BE REIMBURSED IN
ANY SUBSEQUENT EXPENSE YEAR WHERE SUCH LIMITATION WOULD PERMIT SUCH
REIMBURSEMENT IF THE TOTAL OPERATING EXPENSE WERE INCURRED DURING SUCH PERIOD.
NOTWITHSTANDING THE FOREGOING, IF THERE IS AN EXCESS AMOUNT IN ANY EXPENSE YEAR
AND THE INDEPENDENT DIRECTORS DETERMINE THAT SUCH EXCESS WAS JUSTIFIED, BASED ON
UNUSUAL AND NONRECURRING FACTORS WHICH THEY DEEM SUFFICIENT, THE EXCESS AMOUNT
MAY BE REIMBURSED TO THE ADVISOR.
WITHIN 60 DAYS AFTER THE END OF ANY FISCAL
QUARTER OF THE COMPANY FOR WHICH THERE IS AN EXCESS AMOUNT WHICH THE INDEPENDENT
DIRECTORS CONCLUDE WAS JUSTIFIED AND REIMBURSABLE TO THE ADVISOR, THERE SHALL BE
SENT TO THE STOCKHOLDERS A WRITTEN DISCLOSURE OF SUCH FACT, TOGETHER WITH AN
EXPLANATION OF THE FACTORS THE INDEPENDENT DIRECTORS CONSIDERED IN DETERMINING
THAT SUCH EXCESS AMOUNT WAS JUSTIFIED. SUCH DETERMINATION SHALL BE REFLECTED IN
THE MINUTES OF THE MEETINGS OF THE BOARD.
THE COMPANY WILL NOT REIMBURSE THE
ADVISOR OR ITS AFFILIATES FOR SERVICES FOR WHICH THE ADVISOR OR ITS AFFILIATES
ARE ENTITLED TO COMPENSATION IN THE FORM OF A SEPARATE FEE.
ALL FIGURES USED IN
ANY COMPUTATION PURSUANT TO THIS SECTION 3.04 SHALL BE DETERMINED IN ACCORDANCE
WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES APPLIED ON A CONSISTENT BASIS.
17
ARTICLE IV
TERM AND TERMINATION
4.01
TERM; RENEWAL.
SUBJECT TO SECTION 4.02 HEREOF, THIS
AGREEMENT SHALL CONTINUE IN FORCE UNTIL THE FIRST ANNIVERSARY OF THE DATE
HEREOF.
THEREAFTER, THIS AGREEMENT MAY BE RENEWED FOR AN UNLIMITED NUMBER OF
SUCCESSIVE ONE-YEAR TERMS UPON MUTUAL CONSENT OF THE PARTIES.
IT IS THE DUTY OF
THE BOARD TO EVALUATE THE PERFORMANCE OF THE ADVISOR ANNUALLY BEFORE RENEWING
THE AGREEMENT, AND EACH SUCH RENEWAL SHALL BE FOR A TERM OF NO MORE THAN