SECURITY AGREEMENT
PGP LP -
Security Agreement 2005-10-26
SECURITY
AGREEMENT (as amended, supplemented or otherwise modified from time to time,
this “Agreement”) dated as
of October 27, 2005, between PERSIMMON GROWTH PARTNERS FUND, L.P., a limited
partnership organized under the laws of Delaware (the “Borrower”), and ROYAL
BANK OF CANADA, a Canadian chartered bank (together with its permitted
successors and assigns, the “Lender”).
WHEREAS,
pursuant to a Credit Agreement dated as of the date hereof between the Borrower
and the Lender (as amended, supplemented, restated or otherwise modified from
time to time, the “Credit Agreement”),
the Lender has agreed, subject to the terms and conditions set forth therein, to
provide a credit facility to the Borrower for Loans to the Borrower in a maximum
aggregate principal amount not exceeding US$10,000,000 at any one time
outstanding, with the Borrower’s indebtedness to the Lender in respect of such
Loans being evidenced by a Promissory Note dated October 27, 2005 (the “Note”);
WHEREAS,
the Borrower has appointed Royal Bank of Canada, acting through its Portfolio
Services Group, as custodian for the Borrower (together with its permitted
successor and assigns, the “Custodian”) pursuant
to a Custody Agreement dated as of September 27, 2005 between Royal Bank of
Canada, as the Custodian, and the Borrower (as amended, supplemented or
otherwise modified from time to time, the “Custody
Agreement”);
WHEREAS,
the Lender has agreed to make Loans to the Borrower on the condition that, among
other things, the Borrower enter into this Agreement to secure all obligations
of the Borrower to the Lender, whenever arising, under the Credit Agreement, the
Note, the other Facility Documents or otherwise; and
WHEREAS,
the Borrower is willing to enter into this Agreement on the terms and conditions
hereinafter provided;
NOW,
THEREFORE, for value received, in consideration of the premises, and in order to
induce the Lender to make Loans to the Borrower under the Credit Agreement, the
Borrower and the Lender agree as follows:
1.
Defined Terms;
Agreement Binding on Investment Manager.
1.1 Capitalized
terms used and not defined herein have the meanings ascribed to such terms in
the Credit Agreement, and the following terms have the following meanings (such
meanings to be equally applicable to both the singular and plural forms of the
terms defined):
(a) “Account”, “General Intangible”,
“Instrument”,
“Investment
Property”, “Letter-of-Credit
Right”, “Payment Intangible”,
“Proceeds” and
“Supporting
Obligation” have the meanings specified in the UCC. Other terms used
herein which are defined in the UCC (including “deposit account,”
“securities
intermediary,” “securities account,”
“securities,”
“financial
assets,” “security
entitlement,” and “entitlement order”)
shall have the meaning ascribed to such terms in the UCC unless otherwise
provided herein or the context otherwise requires.
(b) “Account List” has the
meaning specified in Section 2.
(c) “Applicable UCC” means
the Uniform Commercial Code as in effect in any applicable jurisdiction from
time to time and includes, for purposes hereof, laws other than the Uniform
Commercial Code as in effect from time to time in jurisdictions inside or
outside the United States that may apply to the attachment, perfection or
priority (or terms of similar import in such jurisdictions) of the Lender’s
claim to, security interest in, lien on, charge over and pledge of any of the
Collateral.
(d) “Collateral” has the
meaning specified in Section 2.
(e) “Collateral Account”
means the one or more custody accounts (including, but not limited to, any
securities account(s) or deposit account(s)) established and maintained by the
Custodian pursuant to the Custody Agreement, including, but not limited to, the
Custody Account, the Deposit Account and (with respect to Cash of the Borrower
credited thereto) the Secondary Account, all assets and funds from time to time
held in or credited to any such account (or any successor account) and all
security entitlements or other rights of the Borrower thereto, and all Proceeds
of any of the foregoing held in any such account (or successor
account).
(f) “Control” has the
meaning specified in the UCC with respect to investment property and deposit
accounts, as the case may be.
(g) “Control Agreement”
means an agreement, in form and substance satisfactory to the Lender, of the
Custodian acting as a securities intermediary for the Borrower or any other
securities intermediary acting for the Borrower, maintaining any securities
accounts and/or deposit accounts for the Borrower, which securities accounts and
any securities or other financial assets credited thereto and any security
entitlement of the Borrower thereto, and which deposit accounts and/or any funds
credited thereto, constitute Collateral hereunder, to comply with entitlement
orders and other instructions of the Lender with respect to the Collateral
without the further consent of the Borrower, subject to the further terms and
conditions provided therein. Notwithstanding anything to the contrary herein or
otherwise, any Control Agreement hereunder shall provide for exclusive control
by the Lender of the Collateral upon the occurrence of any Default hereunder or
any Default or Event of Default under (and as defined in) the Credit
Agreement.
(h) “Default” has the
meaning specified in Section 12.
(i) “Deposit Account” has
the meaning specified in the Custody Agreement.
(j) “Document” means (i)
each file, record, ledger sheet and document, whether now owned or hereafter
acquired, covering or relating to any of the Collateral, and (ii) any “document”
as defined in the UCC in respect of any Collateral.
(k) “Investee Fund” means
any hedge fund, investment partnership or other commingled investment vehicle
(regardless of legal form, including but not limited to limited partnerships and
limited liability companies) in which the Borrower has an interest from time to
time.
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(l) “Investee Fund
Interests” means all of the Borrower’s right, title and interest in and
to those number of shares, units or other ownership interests (including, but
not limited to, all dividends, Cash and other property or proceeds from time to
time received, receivable or otherwise distributed in respect of or in exchange
for all or any portion of such shares, units or other ownership interests) in
each of the Investee Funds credited to the Collateral Account, and such
additional or other interests in the same or other Investee Funds hereafter
acquired in accordance herewith which are intended to be credited to the
Collateral Account, including, but not limited to, rights under the related
subscription agreements and organizational documents (including, but not limited
to, limited partnership agreements and limited liability company operating
agreements), as amended from time to time, and rights of the Borrower to receive
the return of contributions or capital or otherwise to receive distributions of
any money or property now or hereafter contributed by the Borrower to such
Investee Funds or allocable to the Borrower in respect of such Investee Funds,
whether owned by the applicable Investee Fund or owing by the applicable
Investee Fund to the Borrower.
(m) “Notice of Exclusive
Control” means a notice of exclusive control referred to in Section 8
below and shall include a Notice of Exclusive Control as defined in any Control
Agreement.
(n) “Property” has the
meaning specified in the Custody Agreement.
(o) “Secondary Account”
has the meaning specified in the Custody Agreement.
(p) “Secured Obligations”
has the meaning specified in Section 3.
(q “Security Interest”
has the meaning specified in Section 2.
(r) “Share Register”
means the register, ledger, book or record kept by a corporation, company,
limited liability company, partnership, business trust or other entity or issuer
which evidences ownership or beneficial interests in and to the issuer or entity
and identifies the owners of the shares, units, interests or other evidence of
ownership thereof.
(s) “UCC” means the
Uniform Commercial Code as the same may from time to time be in effect in the
State of New York.
1.2 Agreement Binding on
Investment Manager. By its agreement and acknowledgment below, the
Investment Manager agrees that, to the extent it may act on behalf of the
Borrower with respect to the Collateral hereunder at any time and from time to
time, it shall be bound by all provisions hereof and of any Control Agreement,
and all obligations of the Borrower hereunder and thereunder, as if it were
itself a party hereto and thereto.
2.
Security
Interest. The Borrower hereby grants to the Lender a Lien on, charge over
and security interest in and right of set-off against (collectively, the
Lender’s “Security
Interest”), all of the Borrower’s now existing or hereafter acquired or
arising rights, title,
interests, powers and privileges in and to the following assets, wherever
situated (collectively, the “Collateral”):
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(a) the
Collateral Account;
(b) all
Investee Fund Interests;
(c) all
Investment Property and other property and assets carried in or credited to the
Collateral Account;
(d) all
Documents;
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(e)
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all
Accounts, General Intangibles (including Payment Intangibles),
Instruments, Letter-of-Credit Rights and all Supporting Obligations and
other property, in each case held in or credited to the Collateral
Account;
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(f) the
Property; and
(g) all
Proceeds or products of any and all of the foregoing.
The
accounts comprising the Collateral Account as of the date hereof are identified
on Schedule I hereto, which shall be amended, modified or supplemented to
reflect the addition or deletion of accounts hereafter, whenever any such
accounts shall be added or closed and, as so revised, shall be delivered to the
Lender no less frequently than on the last Business Day of each calendar month.
The assets comprising Collateral credited to said accounts shall be described in
an account list or statement for each such account, in form and substance
satisfactory to the Lender, delivered to the Lender from time to time upon
demand and, in any case, without demand on the last Business Day of each
calendar month (each such account list as amended, modified or supplemented, an
“Account
List”). For clarity and the avoidance of doubt, the Borrower shall have
satisfied its obligations for delivery of Schedule I and Account Lists hereunder
if it shall cause the Custodian timely to deliver such items, upon timely
receipt thereof by the Lender. Upon delivery, each Schedule I and Account List
so received by the Lender after the date hereof shall be deemed automatically to
be incorporated by reference herein and this Agreement shall automatically be
amended thereby; provided, however, any failure
of the Borrower or the Custodian so to deliver any such Schedule I or Account
List shall not impair the Security Interest granted herein; and provided, further, that no such
Schedule I or Account List delivered after the date hereof shall be effective to
release Collateral from the security interest granted hereunder unless the
Lender consents to such release or the disposition of Collateral reflected in
such Schedule I or Account List is permitted by this Agreement, but the Security
Interest granted hereunder shall extend to each item listed on any such Schedule
I or Account List.
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3. The Secured
Obligations. The Security Interest in the Collateral shall secure the
full and prompt payment and performance when due (whether at stated maturity, by
acceleration or otherwise) of (i) the indebtedness of the Borrower to the Lender
under the Credit Agreement and the Note, (ii) all other obligations of the
Borrower arising under this Agreement and the other Facility Documents, (iii)
all other obligations and liabilities, however arising, whether direct or
indirect, absolute or contingent, of the Borrower to the Lender or to the
Lender’s Affiliates, whether now or hereafter existing and whether for
principal, interest (including interest that accrues after any bankruptcy,
insolvency or similar proceeding), fees, expenses or otherwise, and (iv) all
costs and expenses of administering or maintaining Collateral and of enforcing
the Lender’s rights hereunder and under the other Facility Documents (including,
but not limited to, all costs incurred by and fees of the Lender and the
Custodian in connection with the administration of, custody of and enforcement
of remedies with respect to the Collateral and/or in connection with any
proceeding commenced by or against the Borrower under the Bankruptcy Code or any
other bankruptcy or insolvency laws of any jurisdiction) (collectively, the
“Secured
Obligations”).
4. Lender Authorized to Make
Filings. The Borrower hereby irrevocably authorizes the Lender (or the
Lender’s agent) at any time and from time to time to file in any jurisdiction,
as the Lender may determine to be necessary or appropriate to perfect or
evidence its Security Interest in the Collateral, any financing statement
(including any continuation thereof or amendment thereto) and/or any
registration of charge, mortgage or otherwise, including, but not limited to,
any filing or registration in a jurisdiction whose law generally requires
information concerning the existence of a nonpossessory security interest or
Lien or charge to be made generally available in a filing, recording, or
registration system as a condition to or result of a security interest, Lien or
charge obtaining priority over the rights of a lien creditor with respect to the
Collateral, in any case containing any information required under the Applicable
UCC and in each case without the signature of the Borrower to the extent
permitted by applicable Law, and the Borrower hereby authorizes the Lender to
sign any such financing statement or other instrument in the name of the
Borrower to the extent the Borrower is required to sign the same. The Borrower
hereby irrevocably ratifies and approves any such filing, registration or
recordation in any jurisdiction by the Lender (or the Lender’s agent) that has
occurred prior to the date hereof. The Borrower agrees to provide to the Lender
(or the Lender’s agent) any and all information required under the Applicable
UCC in furtherance hereof.
5. Dealings with
Collateral
(a) Pursuant
to the Custody Agreement and as provided therein, the Borrower shall be the
beneficial owner of and have rights comprising the Collateral as provided
therein; legal and record title to all assets constituting the Collateral
(whenever acquired) shall at all times be held by, and all Investee Fund
Interests or other assets issued in registered form constituting Collateral
shall at all times be registered in the name or nominee name of, the Custodian
or such other name as the Lender may direct, and if any assets constituting
Collateral are represented by instruments or are in certificated form, the
instruments or certificates representing such assets shall be delivered to the
Lender at its office in the State of New York as indicated in Section 19, or
otherwise as the Lender may direct, appropriately endorsed or accompanied by
duly executed instruments of transfer or undated assignments or stock powers in
blank and otherwise in accordance with the instructions of the Lender. Without
limiting the foregoing, the Borrower shall cause the Lender’s Security Interest
in all assets constituting Collateral at all times to be reflected on the
official books and records of the Borrower. All income and other Cash
distributions or dividends and any other Proceeds in the form of Cash arising
from or relating to any asset constituting Collateral shall be remitted to the
Custodian for credit to the Collateral Account and shall be Collateral
hereunder; provided that if any
Default shall have occurred hereunder or if the Lender shall have so instructed
the Custodian in accordance with the terms and conditions of the Control
Agreement (including, but not limited to, by delivery of a notice of exclusive
control), such Cash distributions, dividends or other Proceeds in the form of
Cash may be otherwise paid or credited as the Lender shall direct the Borrower
and/or the Custodian. Anything to the contrary notwithstanding, any failure of
the Borrower so to remit such funds as provided in the preceding sentence and
any failure of the Custodian so to credit such funds so remitted shall not
impair the Security Interest of the Lender therein and, to the extent such funds
continue to be held by the Borrower, the Borrower shall be deemed to hold them
in trust and as agent for the Lender.
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(b)
Except for sales or redemptions of Collateral made in accordance with this
Agreement and the Control Agreement, the Borrower shall not cause or permit the
termination of the Lender’s Security Interest in the Collateral, including, but
not limited to, the termination of any public filing or record reflecting the
Lender’s Security Interest. Except for the Lien granted to the Custodian
pursuant to the Custody Agreement, the Borrower shall not effect, and shall not
permit to occur, any assignment, sale, transfer, pledge, redemption or granting
of any security interest in, charge over or Lien or encumbrance on the
Collateral other than the Lender’s Security Interest (whether through
redemption, purchase or otherwise) without the Lender’s prior written consent,
and the Borrower shall not cause or permit any Person (other than the Lender or
the Custodian) to have or obtain control of the Collateral or file any UCC
financing statement in respect thereof; provided, that any
assignment, sale, transfer, pledge or redemption of Investee Funds and
withdrawals of Cash from the Deposit Account prior to the giving of a Notice of
Exclusive Control or the occurrence of a Default or Event of Default under the
Credit Agreement, in any case, in the ordinary course of the Borrower’s
business, shall be permitted, on written notice to the Lender, unless any such
assignment, sale, transfer, pledge, redemption or withdrawal (collectively, the
“permitted
transactions”) would cause, or result in the occurrence of, a Default.
The Borrower shall, in connection with all permitted transactions involving any
of the Collateral, deposit or cause to be deposited all Investee Fund Interests,
Investment Property, Proceeds and Cash constituting Collateral into the
Collateral Account to be Collateral hereunder. Anything to the contrary
notwithstanding, any failure of the Borrower so to deposit or cause such
Collateral to be deposited to the Collateral Account or any failure of the
Custodian so to credit such Collateral shall not impair the Security Interest of
the Lender therein and, to the extent such Collateral continues to be held by
the Borrower outside the Collateral Account, the Borrower shall be deemed to
hold it in trust and as agent for the Lender.
(c) With
respect to any permitted transactions described above or any permitted
acquisition of non-Cash assets (subsequent to the date hereof) which shall
constitute Collateral, the Borrower will cause its books and records to be
amended accordingly, and with respect to any such acquired asset will cause the
issuer of the underlying Investee Fund Interest or other Investment Property to
register such Collateral in the name or nominee name of the Custodian or, if the
Lender has so instructed the Custodian in accordance with the Control Agreement
(which may be by delivery of a Notice of Exclusive Control to the Custodian),
any name as the Lender may direct. The Borrower shall at all times act in good
faith and in a lawful manner with respect to the Collateral and the discharge of
its responsibilities hereunder in order to preserve and protect the value of the
Collateral and the Lender’s Security Interest in the Collateral as a first and
prior (subject only to Liens permitted by Section 6.02 of the Credit Agreement)
valid and perfected security interest.
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6. No Future Payments to
Investee Funds. With respect to each Investee Fund Interest now owned or
hereafter acquired by the Borrower, unless otherwise disclosed in writing to the
Lender, the Borrower represents, warrants and covenants that it has made, or at
the time of acquisition following the date hereof of any such Investee Fund
Interest it will have made, all required capital contributions or payments and
there are no further capital call requirements applicable to the Borrower with
respect to any Investee Fund Interest owned by Borrower, and the Borrower is not
otherwise subject to any assessments in respect of any Investee Fund
Interest.
7. No Fiduciary Relationship;
Lender Not Obligated in Respect of Collateral. (a) The Borrower
acknowledges that the Lender does not have a fiduciary relationship with, or
fiduciary duty to, the Borrower arising out of or in connection with this
Agreement. Unless otherwise specifically noted herein, the Lender may, in its
sole discretion, give or withhold its consent to any matter as to which its
consent is required hereunder. This Agreement does not create a joint venture or
partnership among the parties.
(b) All
obligations of the Borrower under or in respect of any item of Collateral or any
contract relating thereto (including any Investee Fund Interest) shall be and
remain enforceable only against the Borrower and shall not be enforceable
against the Lender. Notwithstanding any provision hereof to the contrary, the
Borrower shall at all times remain liable to observe and perform all of its
duties and obligations under or in respect of each item of Collateral and each
contract relating thereto, and the Lender’s exercise of any of its rights with
respect to the Collateral shall not release the Borrower from any of such duties
and obligations. The Lender shall not be obligated to perform or fulfill the
Borrower’s duties or obligations under any item of Collateral (including any
Investee Fund Interest) or any contract relating thereto or to make any payment
thereunder, or to make any inquiry as to the nature or sufficiency of any
payment or property received by it thereunder or the sufficiency of performance
by any party thereunder, or to present or file any claim, or to take any action
to collect or enforce any performance, any payment of any amounts, or any
delivery of any property.
8. Notices to the
Custodian. Upon the Lender’s determination that (i) there has occurred a
Default hereunder or a Default or Event of Default under (and as defined in) the
Credit Agreement, or (ii) instructions given by the Borrower to the Custodian or
any other securities intermediary maintaining any Collateral would, if given
effect, result in a Default hereunder or under (and as defined in) this Credit
Agreement, and at any time thereafter, Lender shall be entitled to exclusive
control of the Collateral as further provided in a Control Agreement, including,
but not limited to, the right to deliver to the Custodian (or any other
securities intermediary maintaining a Collateral Account) a notice of exclusive
control (including a Notice of Exclusive Control (as defined in any Control
Agreement)) and to give the Custodian entitlement orders and other instructions
with respect to the Collateral and the Collateral Account, including for the
disposition of Collateral. Until the determination by the Lender that (i) there
has occurred a Default hereunder or a Default or Event of Default under (and as
defined in) the Credit Agreement, or (ii) Borrower has given instructions of the
type specified in clause (ii) of the preceding sentence, the Lender may not, and
may not instruct the Custodian (or such other securities intermediary) to,
pledge, repledge, hypothecate, lend, relend, sell or otherwise transfer all or
any portion of the Collateral without the consent of the Borrower.
Notwithstanding anything to the contrary contained herein, as between the Lender
and the Custodian or any other securities intermediary maintaining the
Collateral Account, any notice of exclusive control or other instruction or
entitlement order given by the Lender shall be binding and conclusive on the
Custodian or such securities intermediary. For the avoidance of doubt, solely as
between the Lender and the Borrower, Section 2(b) of that certain Control
Agreement dated as of the date hereof between the Lender, the Borrower and the
Custodian shall not be interpreted as granting the Lender a right to deliver a
Notice of Exclusive Control in connection therewith and herewith absent the
determinations of the Lender contemplated in this Section 8.
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9.
Impairment of
Collateral. The Borrower shall promptly notify the Lender as soon as it
has knowledge or reasonable belief that the value of any Collateral has been or
may be impaired, and the Borrower shall, upon demand by the Lender or as
otherwise required by the Credit Agreement, provide additional Collateral or pay
Secured Obligations in an amount sufficient to comply with the requirements of
the Facility Documents. For the avoidance of doubt, the Lender shall be deemed
to have notice, solely for purposes of this Section 9, of any information
provided by an Investee Fund with respect to an Investee Fund Interest to the
Custodian with respect to ordinary course net asset valuation changes with
respect to such Investee Fund.
10. Expenses. The
Borrower shall pay when due or reimburse the Lender on demand for all costs of
collection of any of the Secured Obligations and all other out-of-pocket
expenses (including, in each case, all reasonable attorneys’ fees and expenses)
incurred by the Lender in connection with the creation, perfection,
satisfaction, protection, defense or enforcement of the Lender’s Security
Interest and/or the perfection or priority thereof and/or the preparation,
creation, continuance, protection, defense or enforcement of this Agreement or
any or all of the Secured Obligations, including, but not limited to, expenses
incurred in any litigation or bankruptcy or insolvency proceedings.
11. Representations, Warranties
and Covenants. The Borrower represents, warrants, covenants and agrees,
as of the date hereof and as of each Borrowing Date, as follows:
(a) The
Borrower (i) is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its formation, (ii) is duly qualified and in good
standing as a foreign corporation in each other jurisdiction in which it owns or
leases property or in which the conduct of its business requires it to so
qualify or be licensed and where failure so to qualify and be in good standing
or to be licensed could have a Material Adverse Effect; and (iii) has all
requisite corporate power and authority to own or lease and operate its
properties and to carry on its business as now conducted and as proposed to be
conducted.
(b) The
execution, delivery and performance by Borrower of this Agreement and any
Control Agreement, and the grant of the security interest contemplated hereby
with respect to the Collateral are within its powers, have been duly authorized
by all necessary action and do not (i) contravene Borrower’s constitutive
documents, (ii) contravene any contractual restriction binding on it or require
any consent under any agreement or instrument to which it or any of its
Affiliates is a party or by which any of its properties or assets is bound
(other than such consents, if any, required to be received from Investee Funds
in connection with any assignment, transfer or pledge contemplated by the
Facility Documents), (iii) result in or require the creation or imposition of
any Lien upon any property or assets of the Borrower other than Liens permitted
by Section 6.02 of the Credit Agreement or (iv) violate any Law (including, but
not limited to, the United States Securities Act of 1933 and the Securities
Exchange Act of 1934, each as amended from time to time, and the rules and
regulations thereunder), order, writ, judgment, injunction, decree,
determination or award. Borrower is not in violation of any Law, order, writ,
judgment, injunction, decree, determination or award or in breach of any
contractual restriction binding upon it, except for any such violation or breach
that would not have a Material Adverse Effect.
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(c) Except
for any filings or approvals specifically provided for herein and except such
consents, if any, required to be received from Investee Funds in connection with
any assignment, transfer or pledge contemplated by the Facility Documents, no
order, consent, approval, license, authorization or validation of, or filing,
recording or registration with, or exemption or waiver by, any governmental or
regulatory authority, body or entity or any other third party (except such as
have been obtained or made and are in full force and effect) is required to
authorize, or is required in connection with, (i) the execution, delivery and
performance by Borrower of this Agreement or any Control Agreement or (ii) the
legality, validity, binding effect or enforceability of this Agreement or any
Control Agreement.
(d) This
Agreement and the Control Agreement of even date herewith have been, and any
Control Agreement subsequent to the date hereof will be, duly executed and
delivered and are, or, in the case of any Control Agreement entered into
subsequent to the date hereof, when executed and delivered, will be, legal,
valid and binding obligations of Borrower enforceable against Borrower in
accordance with their respective terms, except as enforceability may be limited
by bankruptcy, insolvency or similar laws affecting the enforcement of
creditors’ rights generally or by general principles of equity (regardless of
whether such enforceability is considered in a proceeding at law or in
equity).
(e) The
Borrower is and at all times shall be the sole beneficial owner and holder of
the Collateral with the full power and authority to assign and grant the
Lender’s Security Interest in the Collateral, and the Lender is and at all times
shall be the sole secured party (other than holders of Liens permitted by
Section 6.02 of the Credit Agreement) with respect to all Investee Fund
Interests, Investment Property, funds, assets and property credited to the
Collateral Account.
(f) Except
as permitted by Section 6.02 of the Credit Agreement, the Collateral is and at
all times shall be free and clear of any security interest, Lien, charge or
other encumbrance in favor of any Person other than the Lender (or the Custodian
to the extent provided in the Custody Agreement) and there are and there shall
be no adverse claims of any other Person in or to the Collateral.
(g) Except
for sales or redemptions of Collateral permitted by Section 5(b), the Borrower
shall not sell or redeem the Collateral or permit any Person (other than the
Lender and the Custodian) to control the Collateral and shall at all times keep
or cause to be kept full and accurate transactional records relating to the
Collateral (including, but not limited to, a record of all payments received and
all credits granted with respect to the Collateral and all other permitted
dealings with the Collateral).
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(h) Subject
to Section 5, all non-Cash and Cash distributions and Proceeds in respect of
Collateral shall be directed by the Borrower to and received by the Custodian
for credit to the Collateral Account and administered by the Custodian pursuant
to the Custody Agreement and the Control Agreement as Collateral for the benefit
of the Lender. Except as expressly permitted hereunder, the Borrower will not
permit or consent to any revocation or amendment to, or any distributions to the
Borrower with respect to, any Investee Fund Interest or Investment Property,
without the Lender’s prior written consent, and should the Borrower receive any
such distributions, it will immediately deliver the same to the Custodian to be
held in the Collateral Account as Collateral hereunder and, pending such
turnover, the Borrower shall hold the same in trust for the benefit of the
Lender.
(i) No
financing statement, register of mortgages, charges and other encumbrances or
similar filing or public record covering the Collateral or any part thereof is
or shall be maintained at the registered office of the Borrower or on file in
any public office in any jurisdiction unless the same shall be in favor of the
Lender. The Borrower agrees that it will, at the request of the Lender, join
with the Lender in (i) executing one or more financing statements pursuant to
the Applicable UCC naming the Lender as secured party (and the Lender is
authorized to file any such financing statement without notice to or the
signature of the Borrower to the fullest extent permitted by law), (ii) (A)
causing the Collateral to be credited to a securities account or deposit account
of the Lender with any securities intermediary or depositary as the Lender shall
require, (B) executing a Control Agreement with any securities intermediary or
depositary maintaining a Collateral Account, naming the Lender as secured party,
and/or (C) causing any third party intermediary holding Collateral to
acknowledge in a signed writing that such third party holds such Collateral
solely on behalf of, and for the sole benefit of, the Lender as secured party;
and/or (iii) executing such other filings, registrations, mortgages or other
public records required under the laws of all jurisdictions necessary or
appropriate in the Lender’s judgment to perfect or evidence its Security
Interest in the Collateral.
(j) Subject
to applicable provisions of the Custody Agreement, and as any Control Agreement
may further provide, if the Lender determines that there has occurred a Default
hereunder or a Default or Event of Default under (and as defined in) the Credit
Agreement, and in any event at any time after the delivery by the Lender of a
Notice of Exclusive Control, Lender may vote or consent to actions (or instruct
the Custodian with respect thereto) in respect of the Collateral without any
notice to, or consent of, the Borrower being required; provided, however, that until
the Lender determines that there has occurred a Default hereunder or a Default
or Event of Default under (and as defined in) the Credit Agreement, the Borrower
shall have the right to vote so long as the Borrower does not vote in any manner
inconsistent with the terms of this Agreement, the Credit Agreement and the
other Facility Documents. Without limiting the Lender’s right under the
Agreement or any Control Agreement to deliver a Notice of Exclusive Control, if
the Lender reasonably determines that any such vote by the Borrower is
inconsistent, as aforesaid, then the Lender may exercise exclusive control over
the Collateral, including but not limited to the delivery to the Custodian of a
Notice of Exclusive Control in accordance with any Control Agreement,
notwithstanding that no Default may have occurred, and the Borrower’s right to
vote hereunder shall be immediately terminated. For the avoidance of doubt,
nothing in this provision or elsewhere in the Agreement shall be construed in
derogation of any rights that Lender may have under any Control Agreements or
otherwise limit its right to exercise “control”, within the meaning of Section
8-106 of the UCC of any Collateral Account.
-10-
(k) The
Borrower’s jurisdiction of organization or formation and principal place of
business or chief executive office are as set forth in Schedule II; the
Borrower’s name as set forth in its signature block below is its full legal name
as of the date hereof, and if Borrower had, or was known by, any other name
(such as a doing business name) in any jurisdiction in the past five years, such
names are set forth in Schedule II; the Borrower will not change its (i) legal
name, (ii) form of organization, (iii) jurisdiction of organization, (iv)
principal place of business, (v) chief executive office, (vi) location where any
Collateral is physically held, or (vii) custodian, bailee or depositary holding
any Collateral or maintaining any Collateral Account, without obtaining the
Lender’s prior written consent; as of the date of this Agreement, all Collateral
is maintained by the Borrower only with Royal Bank of Canada as the Custodian
under and pursuant to the Custody Agreement and the Custodian has executed a
Control Agreement in favor of the Lender;
(1) Borrower
agrees that if Borrower or any third party shall receive or shall have received,
by virtue of Borrower’s ownership of any Collateral, any (i) stock certificate
(including, without limitation, any certificate representing a stock dividend or
distribution in connection with any increase or reduction of capital,
reclassification, merger, consolidation, sale of assets, combination of shares,
stock split, spin-off or split-off), promissory note or other instrument in
respect of Collateral, (ii) option or right, whether as an addition to,
substitution for, or in exchange for, any Collateral, (iii) dividends payable in
cash or in securities or other property in respect of any Collateral, or (iv)
dividends or other distributions in connection with a partial or total
liquidation or dissolution of any Collateral or in connection with a reduction
of capital, capital surplus or paid-in surplus in respect of any Collateral,
Borrower shall receive, or cause any such third party to receive, such stock
certificate, promissory note, instrument, option, right, dividend, payment or
distribution in trust for the benefit of Lender, shall segregate it, or cause
such third party to segregate it, from Borrower’s or such third party’s other
property, and shall deliver it, or cause it to be delivered, forthwith to Lender
in the exact form received, with any necessary endorsement and/or appropriate
stock powers duly executed in blank, to be held by Lender as Collateral and as
further collateral security for the Secured Obligations; and
(m) The
Borrower agrees that, from time to time upon the Lender’s written request the
Borrower will execute and deliver such further documents and diligently perform
such other acts and things in any jurisdiction as the Lender may reasonably
request to fully effect the purposes of this Agreement and any Control Agreement
or to further assure the validity, enforceability, perfection and first (subject
only to Liens permitted by Section 6.02 of the Credit Agreement) priority of the
Lender’s Security Interest.
12. Default. The Borrower
shall be in default under this Agreement upon the happening of any of the
following events or conditions (each, a “Default”):
(a) Any
warranty, representation or statement made or furnished herein or in the Credit
Agreement by the Borrower is incorrect in any material respect when made or
deemed to be made;
(b) Any
transfer, sale and encumbrance of all or any portion of the Collateral in
violation of this Agreement or the occurrence of any levy, seizure or attachment
thereof or thereon;
-11-
(c) The
failure of the Lender at any time to have a valid, enforceable first priority
(subject only to Liens permitted by Section 6.02 of the Credit Agreement),
continuously perfected Security Interest in the Collateral, subject to no other
security interest, Lien, charge, encumbrance or adverse claim;
(d) The
breach of any covenant or agreement made by the Borrower herein;
(e) Reserved;
or
(f) The
occurrence of any Default or Event of Default under (and as defined in) the
Credit Agreement or the occurrence of any default or event of default on the
part of the Borrower under any other agreement (including, but not limited to,
any agreement with respect to derivatives) now or hereafter entered into between
the Lender and the Borrower.
13. Remedies.
(a) Without
limiting the Lender’s right to acquire exclusive control of the Collateral as
elsewhere provided herein, upon the occurrence and continuation of any Default,
the Lender shall have exclusive control of the Collateral, which may include, as
any Control Agreement shall provide, the delivery by the Lender to the Custodian
of a Notice of Exclusive Control but shall require no notice to or consent of
the Borrower. The Lender may, by written notice to the Borrower, declare all of
the Secured Obligations or any of them, notwithstanding any provisions thereof,
by written notice to the Borrower, immediately due and payable without other
demand or notice of any kind and the same thereupon shall immediately become due
and payable without other demand or notice; provided that no such notice shall
be required with respect to Secured Obligations which by the terms of any
Facility Document or other agreement become due and payable upon the occurrence
of a Default. Without limiting the rights and remedies of the Lender hereunder
or under any Control Agreement or other Facility Document, upon the occurrence
of a Default the Lender may exercise from time to time any and all rights and
remedies of a secured party under any applicable Law (including, but not limited
to, any Applicable UCC) in any jurisdiction where any rights and remedies may be
asserted and any and all rights and remedies available to it as a result of this
Agreement or any other Facility Document including, but not limited to, the
right, to the maximum extent permitted by law, to exercise all voting,
consensual and other powers of ownership pertaining to the Collateral
(including, but not limited to, the right to sell, transfer, pledge or redeem
any and all of the Collateral) as if the Lender were the sole and absolute owner
thereof (and the Borrower agrees to take all such action as may be appropriate
to give effect to such rights).
(b) Without
limiting the generality of the foregoing, the Lender may, without demand of
performance or other demand, presentment, protest, advertisement or notice of
any kind (except any notice required by applicable Law referred to below) to or
upon the Borrower or any other Person (all and each of which demands, defenses,
advertisements and notices are hereby waived to the fullest extent permitted by
applicable Law), upon the occurrence and continuation of any Default forthwith
collect, receive, appropriate and realize upon the Collateral, or any part
thereof, and/or forthwith sell, redeem, lease, assign, give option or options to
purchase, or otherwise dispose of and deliver the Collateral or any part thereof
(or contract to do any of the foregoing), in one or more parcels at public or
private sale or sales, at any exchange, broker’s board or office of the Lender
or elsewhere upon such terms and conditions as it may deem advisable and at such
prices as it may deem best, for Cash or on credit or for future delivery without
assumption of any credit risk. The Lender shall have the right upon any such
public sale or sales, and, to the extent permitted by applicable Law, upon any
such private sale or sales, to purchase the whole or any part of the Collateral
so sold, free of any right or equity of redemption in the Borrower, which right
or equity is hereby waived or released to the fullest extent permitted by
applicable Law. To the fullest extent permitted by applicable Law, the Borrower
waives all claims, damages and demands it may acquire against the Lender arising
out of the exercise by the Lender of any of its rights hereunder. If any notice
of a proposed sale or other disposition of Collateral shall be required by
applicable Law, such notice shall be deemed reasonable and proper if given at
least 10 days before such sale or other disposition.
-12-
(c) The
Borrower recognizes that, by reason of certain prohibitions contained in the
United States Securities Act of 1933, as amended, and applicable state
securities laws, or other laws, or because of certain provisions in the
organizational documents of certain Investee Funds or issuers of other
Investment Property, the Lender, in the exercise of its rights and remedies upon
the occurrence of a Default may be compelled, with respect to any sale of all or
any part of the Collateral, to limit purchasers to those who are not United
States persons and/or who will agree, among other things, to acquire the
Collateral for their own account, for investment and not with a view to the
distribution or resale thereof. The Borrower acknowledges that any such
restricted or private sales may be at prices and on terms less favorable to the
Borrower than those obtainable through a public sale without such restrictions
and agrees that such sales are commercially reasonable. The Borrower further
acknowledges that any specific disclaimer of any warranty of title or the like
by the Lender, and any disclaimer by the Lender of any representation or
warranty as to the business, operations, management, assets, investments or
investment strategy of any Investee Fund or the value of any Investee Fund
Interest, will not be considered to adversely affect the commercial
reasonableness of any sale of Collateral.
(d) The
proceeds of any collection, sale, or other realization of all or any part of the
Collateral pursuant hereto shall be applied, first, to the payment of the costs
and expenses of such collection, sale or other realization, including fees and
expenses of the Lender’s agents and counsel and, thereafter, to any remaining
Secured Obligations in such order as the Lender may elect. If the proceeds of
sale, collection or other realization of or upon the Collateral are insufficient
to cover the costs and expenses of such realization and the payment in full of
all other Secured Obligations, the Borrower shall remain liable for any
deficiency.
(e) For
the purpose of carrying out the provisions of this Section 13 and taking any
action and executing any instruments, endorsements or assignments which the
Lender may deem necessary or advisable to accomplish the purposes hereof, the
Borrower hereby makes, constitutes and appoints the Lender its attorney-in-fact
with full power of substitution, to act in its place and stead, from time to
time and at all times, in order to carry out the foregoing. Such appointment is
irrevocable and coupled with an interest.
(f) The
powers conferred on the Lender hereunder are solely to protect the Lender’s
interests in the Collateral and shall not impose any duty upon the Lender to
exercise any such powers. The Lender shall be accountable only for amounts that
it actually receives as a result of the exercise of such powers, and neither it
nor any of its officers, directors, employees or agents shall be responsible to
the Borrower for any act or failure to act hereunder. The Lender’s duty of care
with respect to Collateral in its possession (as imposed by law) shall be deemed
fulfilled if the Lender exercises reasonable care in physically safekeeping such
Collateral or, in the case of Collateral in the custody or possession of a
bailee or other third Person, exercises reasonable care in the selection of such
bailee or other third Person, and the Lender need not otherwise preserve,
protect, insure or care for any Collateral; provided that in the
case of any Collateral held by or for the Custodian or credited to a Custody
Account, the applicable standard of care shall be no greater than that specified
in the Custody Agreement. The Lender shall not be obligated to preserve any
rights the Borrower may have against prior parties or any other parties
obligated on or in respect of the Collateral, to realize on the Collateral at
all or in any particular manner or order or to apply any Cash proceeds of
Collateral in any particular order of application, except as expressly provided
herein.
-13-
14. Binding Effect;
Termination All rights of the Lender hereunder shall inure to the benefit
of its successors and assigns, and all obligations of the Borrower hereunder
shall bind the successors and assigns of the Borrower. When all Secured
Obligations shall have been indefeasibly paid in full and the Commitment under
the Credit Agreement terminated, this Agreement shall terminate and the Lender
shall, at the Borrower’s expense, forthwith cause to be assigned, transferred
and delivered, against receipt but without any recourse, warranty or
representation whatsoever, any remaining Collateral to or on the order of the
Borrower or to such other party as may be entitled thereto.
15. Governing Law. This
Agreement shall be governed by, and construed in accordance with, the laws of
the State of New York, without regard to its conflict of laws principles which
would make the laws of any other jurisdiction applicable to this Agreement other
than relevant provisions of any Applicable UCC or other applicable Law that
require the application of other Law to the creation, perfection, priority or
enforcement of the Lender’s Security Interest.
16. Submission to Jurisdiction;
Waiver of Immunity. (a) For purposes of any suit, action or proceeding
involving this Agreement, any Control Agreement or any judgment entered by any
court in respect of such suit, action or proceeding, the Borrower expressly
submits to the non-exclusive jurisdiction of any state or federal court sitting
in the Borough of Manhattan, The City of New York, New York, and agrees that any
order, process or other paper may be served upon the Borrower within or without
such court’s jurisdiction by mailing a copy by registered or certified mail,
postage prepaid, to the Borrower at the Borrower’s address for notices provided
in this Agreement, such service to become effective 30 days after such mailing.
The Borrower irrevocably waives any objection it may now or hereafter have to
the laying of venue of any suit, action of proceeding arising out of or relating
to this Agreement or any Control Agreement brought in any such court and further
irrevocably waives any claim that any such suit, action or proceeding brought in
any such court has been brought in an inconvenient forum. A final judgment in
any such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
The Borrower hereby irrevocably appoints Persimmon Capital Management, L.P. as
its agent to receive, accept and acknowledge for and on its behalf, and in
respect of its property, service of any and all legal process, summons, notices
and documents that may be served in any such action or proceeding. If for any
reason such agent shall cease to be available to act as such, the Borrower
agrees to designate a new agent in The City of New York on the same terms and
for the purposes of this provision reasonably satisfactory to the Lender.
Nothing contained in this Agreement or any other Facility Document shall affect
the Lender’s right to serve legal process in any other manner permitted by law
or to bring any action or proceeding against the Borrower, the Collateral or any
other property of the Borrower in the courts of other
jurisdictions.
-14-
(b) To
the extent that the Borrower has or hereafter may acquire any immunity from
jurisdiction of any court or from any legal process (whether through service or
notice, attachment prior to judgment, attachment in aid of execution, execution
or otherwise) with respect to itself or its property, the Borrower hereby
irrevocably waives such immunity in respect of its obligations under this
Agreement and each Control Agreement and, without limiting the generality of the
foregoing, agrees that the waivers set forth herein shall have the fullest scope
permitted under the Foreign Sovereign Immunities Act of 1976 of the United
States and are intended to be irrevocable for purposes of such Act.
17. Waiver of Jury Trial.
THE BORROWER AND THE LENDER
HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY RIGHT TO TRIAL BY JURY IN ANY JUDICIAL
PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN
TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO OR CONNECTED
WITH THIS AGREEMENT, ANY CONTROL AGREEMENT OR ANY RELATED INSTRUMENT OR DOCUMENT
OR THE RELATIONSHIP ESTABLISHED HEREUNDER OR THEREUNDER AND AGREE THAT ANY SUCH
PROCEEDING SHALL BE TRIED BEFORE A JUDGE SITTING WITHOUT A
JURY.
18. No Waiver, Amendments; the
Lender’s Consent. (a) No failure on the part of the Lender to exercise,
and no course of dealing with respect to, and no delay in exercising, any right,
power or remedy hereunder shall operate as a waiver thereof; nor shall any
single or partial exercise by the Lender of any right, power or remedy hereunder
preclude any other or further exercise thereof or the exercise of any other
right, power or remedy. All rights and remedies of the Lender are cumulative and
are not exclusive of any remedies provided by law. All rights and remedies of
the Lender may be exercised singly or concurrently, at the Lender’s option, and
the exercise or enforcement of any one such right or remedy shall neither be a
condition to nor bar the exercise or enforcement of any other. The terms of this
Agreement may not be waived, altered or amended except by an instrument in
writing duly executed by the Borrower and the Lender.
(b) No
consent or authorization on the part of the Lender with respect to the sale,
redemption, purchase or other disposition of any Investee Fund Interest or
Investment Property or other asset constituting Collateral that is proposed by
the Borrower shall constitute the approval thereof by the Lender for any purpose
other than in accordance with the Credit Agreement, nor shall such consent or
authorization constitute an opinion, advice, recommendation or endorsement of
the Lender with respect to such proposal.
19. Notices. Except as
otherwise specified herein, all notices, requests, demands or other
communications to or upon the respective parties hereto shall be in writing
unless otherwise specified herein. Written notices shall be deemed to have been
duly given or made (x) five Business Days after being mailed, properly addressed
with first class postage prepaid, or (y) upon actual receipt thereof by the
receiving party, if delivered by hand, overnight courier or facsimile
transmission (and, if received on any day that is not a Business Day or after
close of business on a Business Day, at the opening of business of the receiving
party on the next succeeding Business Day). Every such notice shall be addressed
to the receiving party at its address or facsimile number as set forth below, or
at such other address or facsimile number as such party shall have hereafter
specified by a written notice to the other party. As of the date hereof, the
address and facsimile number of each party is:
-15-
(a) the
Borrower:
Persimmon
Growth Partners Fund, L.P.
c/o
Persimmon
GP, LLC
000 Xxxx
Xxxxxxxxxx Xxxx
Xxxxx
000
Xxxxxxxx
Xxxxxxx, XX 00000
Attention:
Xxxxxxx Xxxx
Telephone
Number: (000) 000-0000
Facsimile
Number: (000) 000-0000
(b) the
Lender:
Royal
Bank of Canada
New York
Branch
Xxx
Xxxxxxx Xxxxx, 0xx Xxxxx
Xxx Xxxx,
XX 00000
Attention:
Xxxxxx Xxxxx
Telephone
Number: (000) 000-0000
Facsimile
Number: (000) 000-0000
20. Severability. If any
provision hereof is invalid or unenforceable in any jurisdiction, then, to the
fullest extent provided by law, (a) the other provisions hereof shall remain in
full force and effect in such jurisdiction and shall be liberally construed in
favor of the Lender in order to carry out the intentions of the parties hereto
as nearly as may be possible and (b) such invalidity or unenforceability shall
not affect the validity or enforceability of such provision in any other
jurisdiction.
21. Entire Agreement,
Counterparts. This Agreement, together with the Credit Agreement, the
Note and any Control Agreements, financing statements or other filings,
registrations, instruments and documents contemplated hereby, constitute the
entire agreement between the parties hereto relating to the subject matter
hereof and supersede any and all previous agreements and understandings, oral or
written, between the parties hereto relating to the subject matter hereof. This
Agreement may be executed in any number of counterparts, all of which taken
together shall constitute one agreement, and either of the parties hereto may
execute this Agreement by signing any such counterpart. Delivery of an executed
counterpart of a signature page of this Agreement by facsimile shall be
effective as delivery of a manually executed counterpart of this
Agreement.
22. Investment Manager.
By signing below the Investment Manager represents, warrants and confirms that
it is the Investment Manager of the Borrower and has full power and authority to
sign this Agreement and agrees to be bound by all provisions hereof applicable
to the Investment Manager.
(remainder
of this page intentionally left blank; signature page follows)
-16-
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
and delivered by their respective duly authorized representatives as of the day
and year first written above.
|
PERSIMMON
GROWTH PARTNERS FUND, L.P.
|
||
|
|
||
|
By:
Persimmon GP, LLC, its General
|
||
|
Partner
|
||
|
By:
|
/s/
Xxxxxxx X. Xxxx
|
|
|
Name:
|
Xxxxxxx
X. Xxxx
|
|
|
Title:
|
President
|
|
|
ROYAL
BANK OF CANADA
|
||
|
By:
|
/s/
Xxxxxx X. Xxxxxxx
|
|
|
Name:
|
XXXXXX
X. XXXXXXX
|
|
|
Title:
|
Managing
Director
|
|
|
By:
|
/s/ D.
Xxxxx
Xxxxxxxx
|
|
|
Name:
|
D.
Xxxxx
Xxxxxxxx
|
|
|
Title:
|
Vice
President
|
|
Agreed
and acknowledged,
as of the
date hereof
PERSIMMON
CAPITAL MANAGEMENT, L.P.,
as
[Investment Manager] for Persimmon Growth Partners Fund, L.P.
|
By:
|
/s/
Xxxxxxx X. Xxxx
|
|
Name:
|
Xxxxxxx
X. Xxxx
|
|
Title:
|
President
|
-17-
PGP LP -
Security Agreement 2005-10-26
SCHEDULE
I
DESCRIPTION
OF COLLATERAL
as of
October 27, 2005
|
CUSTODY ACCOUNTS
|
|
|
Account
Name
|
Number
|
|
Persimmon
Growth Partners, LP
|
PGP.
|
|
DEPOSIT ACCOUNTS
|
|
|
Account
Name
|
Number
|
|
Persimmon
Growth Partners, LP
|
000-000-0
|
|
SECONDARY
ACCOUNT
|
Ratable
interest of the Borrower in and to the following account: RBC NY BRANCH
CUSTODIAL CLEARING FOR UNDISCLOSED CLIENTS, IPBS GL # 120000
|
PERSIMMON
GROWTH PARTNERS FUND, L.P.
|
|
|
By:
|
/s/
Xxxxxxx X. Xxxx
|
|
Name:
|
Xxxxxxx
X. Xxxx
|
|
Title:
|
President
|
SCHEDULE
II
BORROWER’S
INFORMATION
[to be
completed or provided by Borrower]
Full
and correct legal name (as reflected in charter documents and organizing
agreements):
Persimmon
Growth Partners Fund, L.P.
Prior
Names of Borrower, or by which Borrower was known, in the past five years, and
any names by which Borrower is currently doing business other than its legal
name:
None
Date
and jurisdiction of organization or formation:
December
11, 2003 - Delaware
Registered
office OUTSIDE the U.S.:
None
Location
of each place of business and of chief executive office, if there is more than
one place of business:
000 Xxxx
Xxxxxxxxxx Xxxx
Xxxxx
000
Xxxxxxxx
Xxxxxxx, XX 00000
As of
January 28, 2009
Persimmon
Growth Partners Fund, L.P.
c/o
Persimmon Capital Management, LP
0000
Xxxxxx Xxxxxxx Xxxx
Xxxxxxx
Xxxx, Xxxxx 000
Xxxx
Xxxx, XX 00000
Attention:
Xxxxxxx X. Xxxx
Re: Amendment to Committed
Credit Facility
Ladies
and Gentlemen:
Reference
is made to the Credit Agreement dated October 27, 2005 (as amended through the
date hereof, the “Credit Agreement”)
between Persimmon Growth Partners Fund, L.P. (“Borrower”), and Royal
Bank of Canada (“Lender”), pursuant to which Lender makes available to Borrower
a committed credit facility, and to the Security Agreement dated October 27,
2005 (as amended through the date hereof, the “Security Agreement”)
between Borrower and Lender. Capitalized terms that are not defined herein have
the respective meanings given them in the Credit Agreement.
For good
and valuable consideration, subject the execution of this amendment letter, with
effect from the date hereof:
|
1.
|
the
amount “US$10,000,000” appearing in the recital on page 1 of the Credit
Agreement and in the definition of “Commitment” in Section 1.01 of
the Credit Agreement shall be changed to “US$5,000,000”;
and
|
|
2.
|
the
amount “US$10,000,000” appearing in the first recital on page 1 of the
Security Agreement shall be changed to
“US$5,000,000.
|
Except as
expressly amended hereby, the Credit Agreement and the Security Agreement shall
each remain unchanged and in full force and effect. By execution of this
amendment letter, Borrower represents and warrants to Lender that, on and as of
the date hereof, (i) the representations and warranties contained in Article V
of the Credit Agreement, after giving effect to this amendment letter, are true
and correct, (ii) the representations and warranties contained in Section 11 of
the Security Agreement, after giving effect to this amendment letter, are true
and correct, and (iii) no Default or Event of Default under the Credit Agreement
or Default under the Security Agreement exists or would result from this
amendment.
Please
indicate agreement to the foregoing by signing this amendment letter and
returning it to Lender at Xxx Xxxxxxx Xxxxx – 0xx Xxxxx,
Xxx Xxxx, XX 00000-0000. Attention: AAG Desk Counsel.
|
Yours
truly,
|
||||
|
ROYAL
BANK OF CANADA
|
||||
|
By:
|
/s/ Xxxxxx X. Xxxxxxx | |||
|
Name:
|
||||
|
Title:
|
||||
|
By:
|
/s/ Xxxxxx X. Xxxxx | |||
|
Name:
|
||||
|
Title:
|
||||
|
AGREED:
|
||||
|
PERSIMMON
GROWTH PARTNERS FUND. L.P.
|
||||
|
By:
Persimmon GP, LLC. its General Partner
|
||||
|
By:
|
/s/
Xxxxxxx X. Xxxx
|
|||
| Name: Xxxxxxx X. Xxxx | ||||
| Title: President | ||||
SECOND AMENDMENT TO SECURITY
AGREEMENT
SECOND
AMENDMENT TO SECURITY AGREEMENT (this "Amendment"), dated as
of August [__], 2010, between PERSIMMON GROWTH PARTNERS FUND, L.P., a limited
partnership organized under the laws of Delaware (the "Borrower"), and ROYAL
BANK OF CANADA, a Canadian chartered bank (together with its permitted
successors and assigns, the "Lender").
W I T N E S
S E T H:
WHEREAS, pursuant to the
Credit Agreement, dated as of October 27, 2005, between the Borrower and the
Lender (as amended by the amendment letter, dated as of January 28, 2009, the
"Credit
Agreement"), the Lender agreed, subject to the terms and conditions set
forth therein, to provide a credit facility to the Borrower for loans to the
Borrower in a maximum aggregate principal amount not exceeding US$5,000,000 at
any one time outstanding;
WHEREAS, in connection with
the Credit Agreement, the Borrower and the Lender entered into the Security
Agreement, dated as of October 27, 2005 (as amended by the amendment letter,
dated as of January 28, 2009, the "Security Agreement"),
pursuant to which the Borrower, among other things, granted to the Lender a
security interest in the Collateral (as defined in the Security Agreement) to
secure its obligations under the Credit Agreement;
WHEREAS, the Borrower and the Lender desire to
amend the Credit Agreement pursuant to that certain Second Amendment to Credit
Agreement, dated as of the date hereof (as amended, supplemented,
restated or otherwise modified from time to time, the "Second
Amendment") to, among other
things, permit the Borrower to register as an "investment company", as
defined in the Investment Company Act; and
WHEREAS, in connection with
the Second Amendment, the Borrower
and the Lender desire to amend the Security Agreement to permit such
registration.
NOW, THEREFORE, in
consideration of the mutual agreements, provisions and covenants contained
herein, and for other valuable consideration, the receipt and sufficiency of
which hereby are acknowledged, the parties hereto agree as follows:
1. Defined
Terms. Capitalized terms used but not defined herein shall
have the respective meanings ascribed to such terms in the Security Agreement or
the Credit Agreement, as applicable.
2. Amendments to Security
Agreement. Subject to Section 3 below
and based on the representations and warranties set forth herein, the Security
Agreement is hereby amended as follows:
a. Amendment to Section
5(b). Section 5(b) of the
Security Agreement is amended by inserting the following phrase
immediately prior to the period at the end of the second sentence of such
Section:
"or a
violation of the Investment Company Act"
b. Amendment to Section
7(a). Section 7(a) of the
Security Agreement is amended by replacing the first sentence in such Section in
its entirety with the following:
"The
Borrower acknowledges that the Lender does not have a fiduciary or investment
advisory relationship with, or fiduciary duty to, the Borrower arising out of or
in connection with this Agreement."
3. Effectiveness. The
effectiveness of this Amendment is subject to the fulfillment of each of the
following conditions precedent:
a. The Lender shall have received a
counterpart of this Amendment duly
executed by the Borrower; and
b. each
of the conditions precedent set forth in Section 4 of the
Second Amendment shall have been fulfilled or waived by the Lender.
4. Effect Of Amendment Upon
Credit Documents.
a. The
Security Agreement, as amended hereby, and each of the other Credit Documents
shall be and remain in full force and effect in accordance with their respective
terms and are hereby ratified and confirmed in all respects. The
execution, delivery and performance of this Amendment shall not operate, except
as expressly set forth herein, as a modification or waiver of any right, power,
or remedy of the Lender under the Security Agreement or any other Credit
Document. The modifications herein are limited to the specific
instances set forth herein, shall not apply with respect to any facts or
occurrences other than those on which the same are based, shall not excuse
future non-compliance with the Credit Documents, and shall not operate as a
consent to any further or other matter under the Credit Documents.
b. Each
reference in the Security Agreement to "this Agreement", "hereunder", "herein",
"hereof" or words of like import referring to the Security Agreement, and each
reference in the other Credit Documents to "the Security Agreement",
"thereunder", "therein", "thereof" or words of like import referring to the
Security Agreement, shall mean and be a reference to the Security Agreement as
amended hereby.
c. To
the extent that any terms and conditions in any of the Credit Documents shall
contradict or be in conflict with any terms or conditions of the Security
Agreement, after giving effect to this Amendment, such terms and conditions are
hereby deemed modified or amended accordingly to reflect the terms and
conditions of the Security Agreement as modified or amended hereby.
d. The
security interests granted to the Lender by the Borrower pursuant to the
Security Agreement are and shall remain unimpaired, in full force and effect and
continue to constitute fully perfected, first priority security interests in the
Collateral in favor of the Lender, with the same force, effect and priority in
effect both immediately prior to and after entering into this
Amendment. To the extent that any other Credit Document purports to
assign or pledge to the Lender a Lien on any Collateral as security for the
Obligations of the Borrower, such pledge, assignment and/or grant of a Lien is
hereby ratified and confirmed in all respects.
5. Representations And
Warranties. the Borrower hereby represents and warrants to the
Lender as follows:
a. This
Amendment is a legal, valid and binding obligation of the Borrower enforceable
against the Borrower in accordance with its terms, except as enforceability may
be limited by bankruptcy, insolvency or similar laws affecting the enforcement
of creditors' rights generally or by general principles of equity (regardless of
whether such enforceability is considered in a proceeding at law or in
equity).
b. The
representations and warranties set forth herein and, except as amended pursuant
to this Amendment, in the Security Agreement, are true and correct in all
material respects (except where any such representation and warranty is already
subject to a materiality standard, in which case such representation and
warranty is true and correct in all respects) on and as of the date hereof
(other than any such representations and warranties that, by their terms, are
specifically made as of a date other than the date hereof).
6. Amendment as Credit
Document. the Borrower hereby acknowledges and agrees that
this Amendment constitutes a "Credit Document" under the Credit
Agreement.
7. Counterparts. This
Amendment may be executed in any number of counterparts and by different parties
hereto in separate counterparts, each of which shall be deemed to be an
original, but all of which taken together shall constitute one and the same
agreement. Delivery of an executed counterpart of this Amendment by
telefacsimile or electronic mail shall be equally as effective as delivery of an
original executed counterpart of this Amendment.
8. Headings. Section
headings herein are included for convenience of reference only and shall not
constitute a part of this Amendment for any other purpose.
9. GOVERNING LAW; CHOICE OF
VENUE; WAIVER OF JURY TRIAL AND NOTICES. THIS AMENDMENT AND
THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE CHOICE OF LAW AND VENUE PROVISIONS SET FORTH
IN THE SECURITY AGREEMENT, AND SHALL BE SUBJECT TO THE JURY TRIAL WAIVER AND
NOTICE PROVISIONS OF THE SECURITY AGREEMENT.
10. Entire
Agreement. This Amendment and all other instruments,
agreements and documentation executed and delivered in connection with this
Amendment embody the final, entire agreement among the parties with respect to
the subject matter hereof and supersede any and all prior commitments,
agreements, representations and understandings, whether written or oral,
relating to the matters covered by this Amendment, and may not be contradicted
or varied by evidence of prior, contemporaneous or subsequent oral agreements or
discussions of the parties. There are no oral agreements among the
parties relating to the subject matter hereof or any other subject matter
relating to this Amendment.
11. Severability. Any
term or provision of this Amendment held by a court of competent jurisdiction to
be invalid or unenforceable shall not impair or invalidate the remaining
provisions of this Amendment and the effect thereof shall be confined to the
term or provision so held to be invalid or unenforceable.
12. Successors and
Assigns. This Amendment shall be binding upon and inure to the
benefit of the Borrower, the Lender and each of their respective permitted
successors and assigns.
[Remainder
of page intentionally left blank]
IN WITNESS WHEREOF, the
parties hereto have caused this Amendment to be executed and delivered by their
respective duly authorized officers as of the date first written
above.
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PERSIMMON
GROWTH PARTNERS FUND, L.P.
By: Persimmon
GP, LLC, its General Partner
By:
__________________________
Name:
________________________
Title:
_________________________
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ROYAL
BANK OF CANADA
By:
__________________________
Name:
________________________
Title:
_________________________
By:
__________________________
Name:
________________________
Title:
_________________________
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Agreed
and acknowledged
as
of the date hereof:
PERSIMMON CAPITAL MANAGEMENT,
L.P.,
as
Investment Manager for
Persimmon
Growth Partners Fund, L.P.
By:
__________________________
Name:
________________________
Title:
_________________________
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