ZINDEL ZELMANOVITCH
0000 Xxxx 00xx Xxxxxx
Xxxxxxxx, Xxx Xxxx 00000
June 18, 1998
East Coast Venture Capital, Inc.
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxx Xxxxxx, Treasurer
Freshstart Venture Capital Corp.
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxxxxx, Secretary
Ladies and Gentlemen:
The purpose of this letter agreement is to confirm the following
arrangement among us:
1. In my capacities as the President of East Coast Venture Capital,
Inc. ("East Coast") and the President of Freshstart Venture Capital Corp.
("Freshstart"), both of which are specialized small business investment
companies which seek to make loans to, and other investments in, small and
medium sized business concerns, various loan and investment opportunities come
or are brought to my attention.
2. If, as and when a loan or investment opportunity comes or is brought
to my attention, I shall present it to (the investment committees of) both East
Coast and Freshstart at or approximately at the same time.
3. East Coast and Freshstart shall each have the right to participate
in any such loan or other investment opportunity to the extent of fifty percent
(50%) thereof. If either East Coast or Freshstart determines to participate in
less than fifty percent (50%) of any such loan or investment opportunity, it
shall promptly so advise me and the other company, and in such case the other
company shall have the right, but not the obligation, to increase its
participation therein to the extent either of the companies declines to make
fifty percent (50%) of such loan or other investment.
4. In making its decision to participate in any loan or other
investment opportunity presented by me, each company shall cause such
opportunity to be reviewed by its board of directors (or the appropriate
committee of such board), and the loan or other investment decision shall be
made by a majority of the disinterested directors of such company (or a majority
of the disinterested directors who are members of such committee). Each company
shall record in the minutes of the meeting at which such loan or other
investment opportunity was presented a detailed description of such loan or
other proposed investment, the findings and other conclusions reached by the
board (or committee) with respect thereto, the reasons for such findings or
conclusions and shall include with such minutes copies of all written materials
presented to the board (or committee) in connection with such loan or
investment. Such proceedings and related materials shall be preserved by each
company in accordance with the requirements of the Investment Company Act of
1940 and the rules and regulations of the Securities and Exchange Commission
thereunder.
5. This agreement and the rights and obligations of East Coast and
Freshstart herein are conditioned upon the submission of this agreement to the
board of directors of each company and the affirmative vote of a majority of the
disinterested directors of each company for a resolution that this agreement (a)
is reasonable and fair to the stockholders of such company, (b) does not involve
overreaching, and (c) is consistent with the interests of its stockholders and
the fundamental and other policies of such company as expressed in its
prospectus and/or annual report.
Please be good enough to confirm your agreement and acceptance of the
above-described arrangements among us by countersigning in the spaces provided
below and returning to me the duplicate copies of this letter agreement.
Very truly yours,
Zindel Zelmanovitch
AGREED AND ACCEPTED:
East Coast Venture Capital, Inc.
By: /s/ XXXXXXXX XXXXXX
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Xxxxxxxx Xxxxxx
Freshstart Venture Capital Corp.
By: /s/ XXXX XXXXXXXXX
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Xxxx Xxxxxxxxx
