E-Delivery

e Fund Manager's eligibility to receive the management fee for any month is subject to the Fund generating an increase in net income and comprehensive net income that is sufficient to provide a minimum 8.00% annualized return (the "Hurdle Rate") on the opening monthly capital of the Fund. e service fees paid by the Fund is equal to 1.00% per annum, calculated and paid quarterly, of the paid up capital for outstanding preferred shares of the Fund that are held by clients of each registered dealer. (iii) Compensation to directors As at February 28, 2015, the Fund has four directors that are both independent of the Fund and the Fund Manager on its board of directors. In respect of their services during the year, independent directors were provided compensation under the PSC plan as described in Note 3, or alternatively elected to receive annual cash compensation in the form of a $5,000 and $2,500 retainer for director and chair offices, respectively. For directors whose appointments were less than a full year, the cash retainer was prorated based on the number of months served. For the year ended February 28, 2015, the Fund paid remuneration fees to directors of $15,813 (2014 - $9,211). e Fund has issued 500 Class A preferred shares under the PSC at February 28, 2015 (February 28, 2014 - 500). During the year ended February 28, 2015, $5,396 (2014 - $5,461) of share based payments was included in director fees. Directors that are not independent of the Fund and the Fund Manager do not receive any cash or share compensation. (iv) Compensation to LRC members: As at February 28, 2015, the Fund has three independent members of the LRC. In respect of their services during the year, independent LRC members were provided compensation under the PSC plan as described in Note 3, or alternatively elected to receive annual cash compensation in the form of a $1,000 and $2,000 retainer for independent LRC member and chair offices, respectively. In addition to annual compensation amounts, effective April 1, 2014, members of the LRC that were independent of management were provided compensation of $250 for each meeting they attended during the year. Prior to April 1, 2014, members of the LRC received $100 for each meeting attended. For the year ended February 28, 2015, the Fund paid remuneration fees to independent LRC members of $8,713 (2014 - $2,575). e Fund has issued 300 Class A preferred shares under the PSC at February 28, 2015 (February 28, 2014 - nil and March 1, 2013 - nil). During the year ended February 28, 2015, $3,238 (2014 - $nil) of share based payments was included in lending review committee fees. (d) Due to/due from related party balances: (i) Due to Fund Manager: Amounts due to the Fund Manager by the Fund were comprised of $113,333 (February 28, 2014 - $66,209 and March 1, 2013 - $22,230) of management fees for the fiscal quarter ended February 28, 2015 and $149,983 (February 28, 2014 - $72,204 and March 1, 2013 - $27,083) of service fees for the fiscal quarter ended February 28, 2015. As of February 28, 2014, the Fund had $5,000 (March 1, 2013 - $nil) other assets balance in respect of a refundable loan application fee incurred by the Fund Manager on behalf of the Fund. As of February 28, 2015, the Fund had no such balance outstanding and the proposed line of credit related to this fee was not pursued. Amounts due to the Fund Manager are governed by the Fund Manager's normal collection terms of net 30 days. Subsequent to the reporting date, the Fund paid these amounts to the Fund Manager. 53

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