INVESTMENT ADVISORY AGREEMENT
This INVESTMENT ADVISORY
AGREEMENT (this “Agreement”) is made as of this 24th day of August, 2010,
by and between Persimmon Growth Partners Fund, L.P., a Delaware limited
partnership (the “Fund”), and Persimmon Capital Management, LP, a Delaware
limited partnership (the “Investment Adviser”).
WHEREAS,
the Fund is registered as a non-diversified, closed-end management investment
company under the Investment Company Act of 1940, as amended (the “Investment
Company Act”);
WHEREAS, the Fund has retained XX Xxxxx
& Company, Inc. (the “Administrator”) to provide administration of the
Fund’s operations, subject to the control of the Board of Directors of the
Fund;
WHEREAS, the Fund desires to retain the
Investment Adviser to render investment advisory services to the Fund, and the
Investment Adviser is willing to render such services; and
WHEREAS, capitalized terms used herein
but not otherwise defined herein shall have the meanings ascribed to them in the
Confidential Private Placement Memorandum for the Fund, dated as of August 24,
2010 (the “Offering Document”).
NOW, THEREFORE, in consideration of
mutual covenants herein contained, the parties hereto agree as
follows:
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1.
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Duties of Investment
Adviser. The Fund employs the Investment Adviser
to manage the investment and reinvestment of the assets of the Fund, and
to continuously review, supervise and (where appropriate) administer the
investment program of the Fund, to determine in its discretion (where
appropriate) the investments to be purchased or sold, to provide the
Administrator and the Fund with records concerning the Investment
Adviser’s activities which the Fund is required to maintain, and to render
regular reports to the Administrator and to the Fund’s officers and
Directors concerning the Investment Adviser’s discharge of the foregoing
responsibilities. The retention of a sub-adviser by the
Investment Adviser shall not relieve the Investment Adviser of its
responsibilities under this
Agreement.
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The
Investment Adviser shall discharge the foregoing responsibilities subject to the
control of the Board of Directors of the Fund and in compliance with such
policies as the Board of Directors may from time to time establish, and in
compliance with the objectives, policies, and limitations of the Fund as set
forth in the Offering Document, as amended from time to time, and applicable
laws and regulations.
The
Investment Adviser accepts such employment and agrees, at its own expense, to
render the services and to provide the office space, furnishings and equipment
and the personnel (including any sub-advisers) required by it to perform the
services on the terms and for the compensation provided herein. The
Investment Adviser will not, however, pay for the cost of securities,
commodities, and other investments (including brokerage commissions and other
transaction charges, if any) purchased or sold for the Fund.
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2.
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Fund
Transactions. The Investment Adviser is authorized to
select the brokers or dealers that will execute the purchases and sales of
the Fund’s investments and is directed to use its best efforts to obtain
the best net results as described from time to time in the Offering
Document. The Investment Adviser will promptly communicate to
the Administrator and to the officers and the Board of Directors such
information relating to the Fund’s investment transactions as they may
reasonably request.
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It is
understood that the Investment Adviser will not be deemed to have acted
unlawfully, or to have breached a fiduciary duty to the Fund or be in breach of
any obligation owing to the Fund under this Agreement, or otherwise, by reason
of its having directed a securities transaction on behalf of the Fund to a
broker-dealer in compliance with the provisions of Section 28(e) of the
Securities Exchange Act of 1934 or as described from time to time in the
Offering Document.
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3.
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Compensation of the Investment
Adviser. For the services to be rendered by the
Investment Adviser as provided in Sections 1 and 2 of this Agreement, the
Investment Adviser is entitled to receive from persons who purchase
Interests of the Fund (“Investors”) an annual advisory fee (the “Advisory
Fee”). The Advisory Fee is equal to 1.00% of the Net Asset
Value attributable to the Capital Account of each Investor during the
relevant calendar year. The Investment Adviser’s fee is
calculated and accrued monthly, and is paid out to the Investment Adviser
quarterly, in arrears. For purposes of determining the Advisory
Fee, net assets will be determined by taking into account net realized
gain or loss and the net change in unrealized appreciation or depreciation
of net assets.
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All
rights of compensation under this Agreement for services performed as of the
termination date shall survive the termination of this Agreement.
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4.
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Other
Expenses. The Investment Adviser shall pay all expenses
of printing and mailing reports, prospectuses, statements of additional
information, and sales literature relating to the solicitation of
prospective clients. The Fund shall pay all expenses relating
to mailing to existing Investors Offering Documents, proxy solicitation
materials and reports.
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5.
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Excess
Expenses. If the expenses for the Fund for any fiscal
year (including fees and other amounts payable to the Investment Adviser,
but excluding interest, taxes, brokerage costs, litigation, and other
extraordinary costs) as calculated every business day would exceed the
expense limitations imposed on investment companies by any applicable
statute or regulatory authority of any jurisdiction in which Interests of
the Fund are qualified for offer and sale, the Investment Adviser shall
bear such excess cost.
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6.
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Reports. The Fund and
the Investment Adviser agree to furnish to each other, if applicable,
Offering Documents, proxy statements, reports to Investors, certified
copies of their financial statements, and such other information with
regard to their affairs as each may reasonably
request.
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7.
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Status of Investment
Adviser. The services of the Investment Adviser to the
Fund are not to be deemed exclusive, and the Investment Adviser shall be
free to render similar services to others so long as its services to the
Fund are not impaired thereby. The Investment Adviser shall be
deemed to be an independent contractor and shall, unless otherwise
expressly provided or authorized, have no authority to act for or
represent the Fund in any way or otherwise be deemed an agent of the
Fund.
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8.
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Certain
Records. Any records required to be maintained and
preserved pursuant to the provisions of Rule 31a-1 and Rule 31a-2
promulgated under the Investment Company Act which are prepared or
maintained by the Investment Adviser on behalf of the Fund are the
property of the Fund and will be surrendered promptly to the Fund upon
request.
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9.
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Limitation of Liability of
Investment Adviser. The duties of the Investment Adviser
shall be confined to those expressly set forth herein, and no implied
duties are assumed by or may be asserted against the Investment Adviser
hereunder. The Investment Adviser shall not be liable for any
error of judgment or mistake of law or for any loss arising out of any
investment or for any act or omission in carrying out its duties
hereunder, except a loss resulting from willful misfeasance, bad faith or
gross negligence in the performance of its duties, or by reason of
reckless disregard of its obligations and duties hereunder, except as may
otherwise be provided under provisions of applicable state law or Federal
securities law which cannot be waived or modified hereby. (As
used in this Paragraph 9, the term “Investment Adviser” shall include
directors, officers, employees and other corporate agents of the
Investment Adviser as well as the Fund
itself).
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10.
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Permissible
Interests. Directors, agents, and Investors in the Fund
are or may be interested in the Investment Adviser (or any successor
thereof) as directors, partners, officers, or otherwise; directors,
partners, officers, and agents of the Investment Adviser are or may be
interested in the Fund as directors, partners, officers, or otherwise; and
the Investment Adviser (or any successor) is or may be interested in the
Fund as an Investor or otherwise. In addition, brokerage
transactions for the Fund may be effected through affiliates of the
Investment Adviser if approved by the Board of Directors, subject to the
rules and regulations of the Securities and Exchange
Commission.
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11.
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License of Investment Adviser’s
Name. The Investment Adviser hereby agrees to grant a
license to the Fund for use of its name in the names of the Fund for the
term of this Agreement and such license shall terminate upon termination
of this Agreement.
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12.
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Duration and Termination.
This Agreement, unless sooner terminated as provided herein, shall
remain in effect until two years from date of execution, and thereafter,
for periods of one year so long as such continuance thereafter is
specifically approved at least annually (a) by the vote of a majority of
those Directors of the Fund who are not parties to this Agreement or
interested persons of any such party, cast in person at a meeting called
for the purpose of voting on such approval, and (b) by the Directors of
the Fund or by vote of a majority of the outstanding voting Interests of
the Fund; provided, however, that if the Investors of the Fund fail to
approve the Agreement as provided herein, the Investment Adviser may
continue to serve hereunder in the manner and to the extent permitted by
the Investment Company Act and rules and regulations
thereunder. The foregoing requirement that continuance of this
Agreement be “specifically approved at least annually” shall be construed
in a manner consistent with the Investment Company Act and the rules and
regulations thereunder.
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This
Agreement may be terminated at any time, without the payment of any penalty by
vote of a majority of the Directors of the Fund or by vote of a majority of the
outstanding voting Interests of the Fund on not less than thirty (30) days nor
more than sixty (60) days written notice to the Investment Adviser, or by the
Investment Adviser at any time without the payment of any penalty, on ninety
(90) days written notice to the Fund. This Agreement will
automatically and immediately terminate in the event of its
assignment.
As used
in this Section 12, the terms “assignment”, “interested persons”, and a “vote of
a majority of the outstanding voting securities” shall have the respective
meanings set forth in the Investment Company Act and the rules and regulations
thereunder; subject to such exemptions as may be granted by the Securities and
Exchange Commission under the Investment Company Act.
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13.
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Notice. Any
notice required or permitted to be given by either party to the other
shall be deemed sufficient if sent by registered or certified mail,
postage prepaid, addressed by the party giving notice to the other party
at the last address furnished by the other party to the party giving
notice: if to the Fund, c/o Persimmon GP, LLC, 1777 Sentry
Parkway West, Gwynedd Hall, Suite 102, Blue Xxxx, PA 19422, Attention:
President, and if to the Investment Adviser, 0000 Xxxxxx Xxxxxxx West,
Xxxxxxx Xxxx, Xxxxx 000, Xxxx Xxxx, XX 00000, Attention:
President.
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14.
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Severability. If any
provision of this Agreement shall be held or made invalid by a court
decision, statute, rule or otherwise, the remainder of this Agreement
shall not be affected thereby.
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15.
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Governing
Law. This Agreement shall be construed in accordance
with the laws of the State of Delaware and the applicable provisions of
the Investment Company Act. To the extent that the applicable
laws of the State of Delaware, or any of the provisions herein, conflict
with the applicable provisions of the Investment Company Act, the latter
shall control.
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A copy of
the Certificate of Limited Partnership of the Fund is on file with the Secretary
of State of the State of Delaware, and notice is hereby given that this
instrument is executed on behalf of the Directors of the Fund as Directors, and
are not binding upon any of the Directors, officers, or Investors of the Fund
individually but binding only upon the assets and property of the
Fund.
IN
WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed as
of the day and year first written above.
PERSIMMON
GROWTH PARTNERS FUND, L.P.
By: /s/
Xxxxxxx X. Xxxx
Attest: /s/
Xxxx XxXxxxxxx
PERSIMMON
CAPITAL MANAGEMENT, LP
By: /s/
Xxxxxxx X. Xxxx
Attest: /s/ Xxxx XxXxxxxxx
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