perating and Financing Strategies: First Oxford Corporation monitors, on an ongoing basis, compliance by its tenants with their lease obligations and the factors that could affect the financial performance of each of its properties. The Company reviews periodic financial statements with respect to each of its tenants and undertakes regular physical inspections of the condition and maintenance of its properties. The Company also monitors real estate market conditions, including market rents and occupancy trends in the area where its properties are located. The Company will respond to changes in such market conditions as appropriate, including by negotiating to extend the lease terms or by selling the property subject to the existing lease.

First Oxford's tenants generally are responsible for all operating and capital expenses relating to the properties they occupy, including real estate taxes, utilities, insurance, maintenance and capital improvement. As a result, the Company's operating costs are lower than would be the case if it invested in properties that were net leased.

Consistent with its investment policies, the Company employs leverage, when available on favorable terms, in connection with funding/purchase transactions and acquiring net leased properties. By borrowing on favorable terms, the Company believes it will provide a net return above the cost of the debt.

The Company may re-evaluate its financing policies and decrease or increase its ratio of debt to total capitalization from time to time in response to economic conditions, relative costs to the Company of debt and equity capital, growth and acquisition opportunities and other facts and circumstances.