CONSENT AND THIRD AMENDMENT OF TRANSACTION DOCUMENTS
Exhibit (f)(4)
Execution Version
THIS CONSENT AND THIRD AMENDMENT OF TRANSACTION DOCUMENTS (this “Amendment”), made as of June
25, 2010, by and among HORIZON CREDIT I LLC, a Delaware limited liability company, as the Borrower
(in such capacity, the “Borrower”), and as the Purchaser (in such capacity, the “Purchaser”)
COMPASS HORIZON FUNDING COMPANY LLC (the “Seller”), WESTLB AG, NEW YORK BRANCH, as the Lender (in
such capacity, together with its successors and assigns, the “Lender”) and as the Agent for the
Lender (in such capacity, together with its successors and assigns, the “Agent”), and U.S. BANK
NATIONAL ASSOCIATION, as the Custodian (in such capacity, the “Custodian”), and as the Paying Agent
(in such capacity, the “Paying Agent”). All capitalized terms used in this Amendment and not
otherwise defined herein shall have the meanings ascribed thereto in the Credit Agreement (as
defined below).
WITNESSETH:
WHEREAS, the Borrower, the Lender, the Agent, the Custodian and the Paying Agent entered into
that certain Credit and Security Agreement, dated as of March 4, 2008 (as amended, the “Credit
Agreement”);
WHEREAS, the Seller and the Purchaser entered into that certain Sale and Contribution
Agreement, dated as of March 4, 2008 (as amended, the “Sale and Contribution Agreement”);
WHEREAS, certain owners of the Seller intend to enter into an exchange transaction (the
“Exchange Transaction”), more fully described in the Registration Statement (the “HRZN Registration
Statement”) of Horizon Technology Finance Corporation (“HRZN”) attached hereto as Exhibit
A;
WHEREAS, the Exchange Transaction would constitute a Change of Control of the Seller under the
Credit Agreement;
WHEREAS, the Borrower, the Seller and the Servicer have requested that the Lender consent to
any Change of Control of the Seller that would result from the Exchange Transaction; and
WHEREAS, the parties to the Credit Agreement have agreed to amend certain provisions of the
Credit Agreement as more fully set forth herein;
WHEREAS, the parties to the Sale and Contribution Agreement have agreed to amend certain
provisions of the Sale and Contribution Agreement as more fully set forth herein.
NOW, THEREFORE, in consideration of the covenants and agreements herein contained, the parties
hereto amend the Credit Agreement, and covenant and agree, as follows:
1. Consent. Upon the effectiveness of this Amendment pursuant to Section 4 hereof,
the Lender and the Agent hereby consent to the consummation of the Exchange Transaction and any
Change of Control of Seller that would result therefrom.
2. Modification of the Credit Agreement. Upon the effectiveness of this
Amendment pursuant to Section 4 hereof, the following modifications to the Credit Agreement shall
hereby be made:
(a) Section 3.1(l) of the Credit Agreement is replaced in its entirety with the following:
“(l) Not an Investment Company. The Borrower is not an “investment
company” within the meaning of the “1940 Act.” The Borrower is not otherwise subject
to regulation under the 1940 Act, except to the extent described in the HRZN
Registration Statement. The business and other activities of the Borrower,
including but not limited to, the making of the Advances by the Lender, the
application of the proceeds and repayment thereof by the Borrower and the
consummation of the transactions contemplated by the Transaction Documents to which
the Borrower is a party do not result in any violations, with respect to the
Borrower, of the provisions of the 1940 Act or any rules, regulations or orders
issued by the SEC thereunder.”
(b) a new Section 5.1(t) of the Credit Agreement is inserted as follows:
“(t) Investment Company Act. Notwithstanding the provisions of Section
3.1(l), if the Borrower operates in such a manner as to be an “investment company”
within the meaning of the 1940 Act, the Borrower will register as an “investment
company” under the 1940 Act immediately upon being required to do so under the 1940
Act and will conduct its business and other activities in compliance with the
provisions of the 1940 Act and any rules, regulations or orders issued by the SEC
thereunder.
(c) a new Section 7.1(x) of the Credit Agreement is inserted as follows:
“(x) the business and other activities of the Borrower or the Seller
including but not limited to, the acceptance of the Advances by the Borrower
made by the Lender, the application and use of the proceeds thereof by the Borrower
and the consummation and conduct of the transactions contemplated by the Transaction
Documents to which the Borrower or the Seller is a party result in a
violation by the Borrower, the Seller, or any other Person of the 1940 Act or any
rules, regulations or orders issued by the SEC thereunder;
(d) the definition of “1940 Act” is hereby added to Exhibit I to the Credit Agreement in the
proper alphabetical order:
““1940 Act” means the Investment Company Act of 1940, as amended, or any
successor statute.”
(e) the definition of “Facility Limit” in Exhibit I to the Credit Agreement is replaced in its
entirety by the following new definition:
““Facility Limit” means One Hundred Twenty-Five Million Dollars ($125,000,000).”
(f) the definition of “SEC” is hereby added to Exhibit I to the Credit Agreement in the proper
alphabetical order:
““SEC” means the Securities and Exchange Commission, or any Governmental
Authority succeeding to its principal functions.”
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3. Modification of the Sale and Contribution Agreement. Upon the effectiveness of
this Amendment pursuant to Section 4 hereof, the following modifications to the Sale and
Contribution Agreement shall hereby be made:
(a) Section 4.1(n) of the Sale and Contribution Agreement is replaced in its entirety with the
following:
“(n) Not an Investment Company. The Seller is not an “investment
company” within the meaning of the 1940 Act. The Seller is not otherwise subject to
regulation under the 1940 Act, except to the extent described in the HRZN
Registration Statement. The business and other activities of the Seller, including
but not limited to, the sale of Venture Loans to the Purchaser and the consummation
of the transactions contemplated by the Transaction Documents to which the Seller is
a party do not result in any violations, with respect to the Seller, of the
provisions of the 1940 Act or any rules, regulations or orders issued by the SEC
thereunder.”
(b) a new Section 5.1(y) of the Sale and Contribution Agreement is inserted as follows:
“(y) Investment Company Act. Notwithstanding the provisions of Section
4.1(n), if the Seller operates in such a manner as to be an “investment company”
within the meaning of the 1940 Act, the Seller will register as an “investment
company” under the 1940 Act immediately upon being required to do so under the 1940
Act and will conduct its business and other activities in compliance with the
provisions of the 1940 Act and any rules, regulations or orders issued by the SEC
thereunder.
4. Effective Date; Conditions Precedent to Effectiveness. The consent and
modifications contained in Sections 1, 2 and 3 of this Amendment shall become effective on the date
on which the following conditions precedent have been satisfied or waived by the Agent (the
“Effective Date”):
(a) no Material Adverse Effect has occurred or would result from the transactions contemplated
by this Amendment or the consummation of the transactions described in the HRZN Registration
Statement;
(b) no event has occurred and is continuing, or would result from Xxxxxxxx’s execution and
delivery of this Amendment, that would constitute an Early Amortization Event, an Event of Default
or an Unmatured Event of Default;
(c) the representations and warranties contained in Section 3.1 of the Credit Agreement and
Section 4.1 of the Sale and Contribution Agreement (in each case, after giving effect to this
Amendment) are true and correct;
(d) each of the Borrower, the Seller and the Purchaser shall have delivered to the Agent and
the Lender such other documents reasonably requested by the Agent in connection with the
transactions contemplated by this Amendment including, without limitation, copies of documents
relating to the Exchange Transaction and the other transactions contemplated by the HRZN
Registration Statement;
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(e) each of the Borrower, the Seller and the Purchaser shall have delivered to the Agent a
certificate of its Secretary, certifying (i) as to the names and true signatures of the incumbent
officers of such party authorized to sign this Amendment and (ii) the resolutions of such party’s
board of managers approving and authorizing the execution, delivery and performance of this
Amendment; and
(f) the transactions described in the HRZN Registration Statement shall have closed and
Compass Horizon Partners LP shall own and control, directly or indirectly, not less than Twenty
Million Dollars ($20,000,000) of the voting shares of HRZN (as calculated on the market value of
HRZN on the Effective Date) as a result of such transactions.
5. Ratification. The Transaction Documents (as amended by this Amendment) are hereby
ratified and remain in full force and effect as of the date hereof and as of the Effective Date.
6. Representations and Warranties. The Borrower hereby represents and warrants to the
Agent and the Lender that as of the date hereof the representations and warranties contained in
Section 3.1 of the Credit Agreement are true and correct. The Seller hereby represents and
warrants to the Purchaser that as of the date hereof the representations and warranties contained
in Section 4.1 of the Sale and Contribution Agreement are true and correct.
7. Effect of Amendment. On and after the Effective Date, each reference in the Credit
Agreement, to “this Agreement”, “hereof”, “hereunder” or words of like import referring to the
Credit Agreement shall mean and be a reference to the Credit Agreement as modified, confirmed and
ratified hereby. On and after the Effective Date, each reference in the Sale and Contribution
Agreement, to “this Agreement”, “hereof”, “hereunder” or words of like import referring to the Sale
and Contribution Agreement shall mean and be a reference to the Sale and Contribution Agreement as
modified, confirmed and ratified hereby.
8. Termination. This Amendment shall terminate and be of no further force or effect
in the event that the Effective Date has not occurred on or before December 31, 2010.
9. Successors and Assigns. This Amendment shall inure to the benefit of the Agent,
the Lender and their respective successors and assigns, and bind the parties hereto and their
respective successors and permitted assigns.
10. Counterparts. This Amendment may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so executed shall be deemed
to be an original and all of which taken together shall constitute one and the same agreement.
11. Governing Law. This Amendment shall, in accordance with section 5-1401 of the
General Obligations Law of the State of New York, be governed by the laws of the State of New York,
without regard to any conflicts of law principles thereof that would call for the application of
the laws of any other jurisdiction.
12. Severability. In the event any term or provision of this Amendment or the
application thereof to any person or entity or circumstance, shall, for any reason or to any extent
be invalid or unenforceable, the remaining terms and provisions of this Amendment, or the
application of any such provision to persons, entities or circumstances other than those as to whom
or which it has been determined to be invalid or unenforceable, shall not be affected thereby, and
every provision of this Amendment shall be valid and enforceable to the fullest extent permitted by
law.
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IN WITNESS WHEREOF, each of the parties hereto have caused this CONSENT AND THIRD AMENDMENT OF
TRANSACTION DOCUMENTS to be executed by its duly authorized signatories, as of the date first above
written.
| HORIZON CREDIT I LLC, as the Borrower | ||
| By: COMPASS HORIZON PARTNERS, LP, its Manager | ||
| By: Navco Management Ltd., its General Partner |
| By: | /s/ Xxxx Xxx Xxxxxxxxxx | |||
| Name: | Xxxx Xxx Xxxxxxxxxx | |||
| Title: | Director/Treasurer | |||
| Address: | 00 Xxxxxxxxx Xxxx Xxxx | |||
| Farmington, CT 06032 | ||||
| Attention: | Xxxxxx X. Xxxxxxx, Xx. | |||
| Fax: | (000) 000-0000 | |||
| Telephone: | (000) 000-0000 | |||
| Email: | xxx@xxxxxxxxxxxxxxxxxx.xxx |
| HORIZON CREDIT I LLC, as the Purchaser By: COMPASS HORIZON PARTNERS, LP, its Manager By: Navco Management Ltd., its General Partner |
| By: | /s/ Xxxx Xxx Xxxxxxxxxx | |||
| Name: | Xxxx Xxx Xxxxxxxxxx | |||
| Title: | Director/Treasurer | |||
| Address: | 00 Xxxxxxxxx Xxxx Xxxx | |||
| Farmington, CT 06032 | ||||
| Attention: | Xxxxxx X. Xxxxxxx, Xx. | |||
| Fax: | (000) 000-0000 | |||
| Telephone: | (000) 000-0000 | |||
| Email: | xxx@xxxxxxxxxxxxxxxxxx.xxx |
Signature Page to Consent and
Third Amendment of Transaction Documents
Third Amendment of Transaction Documents
| COMPASS HORIZON FUNDING COMPANY LLC, as the Seller | ||
| By: COMPASS HORIZON PARTNERS, LP, its Manager | ||
| By: Navco Management Ltd., its General Partner |
| By: | /s/ Xxxx Xxx Xxxxxxxxxx | |||
| Name: | Xxxx Xxx Xxxxxxxxxx | |||
| Title: | Director/Treasurer | |||
| Address: | 00 Xxxxxxxxx Xxxx Xxxx | |||
| Farmington, CT 06032 | ||||
| Attention: | Xxxxxx X. Xxxxxxx, Xx. | |||
| Fax: | (000) 000-0000 | |||
| Telephone: | (000) 000-0000 | |||
| Email: | xxx@xxxxxxxxxxxxxxxxxx.xxx |
Signature Page to Consent and
Third Amendment of Transaction Documents
Third Amendment of Transaction Documents
| WESTLB AG, NEW YORK BRANCH, as the Lender |
||||
| By: | /s/ Xxxxxxx X’Xxxxxx | |||
| Name: | Xxxxxxx X’Xxxxxx | |||
| Title: | Executive Director | |||
| By: | /s/ Xxxxxx Xxxxxx | |||
| Name: | Xxxxxx Xxxxxx | |||
| Title: | Director | |||
| Address: | 000 Xxxxxxxxx Xxxxxx | |||
| New York, New York 10007 | ||||
| Attention: | Portfolio Exit Group | |||
| Fax: | 000-000-0000 |
| WESTLB AG, NEW YORK BRANCH, as the
Agent |
||||
| By: | /s/ Xxxxxxx X’Xxxxxx | |||
| Name: | Xxxxxxx X’Xxxxxx | |||
| Title: | Executive Director | |||
| By: | /s/ Xxxxxx Xxxxxx | |||
| Name: | Xxxxxx Xxxxxx | |||
| Title: | Director | |||
| Address: | 000 Xxxxxxxxx Xxxxxx | |||
| New York, New York 10007 | ||||
| Attention: | Portfolio Exit Group | |||
| Fax: | 000-000-0000 |
Signature Page to Consent and
Third Amendment of Transaction Documents
Third Amendment of Transaction Documents
| U.S. BANK NATIONAL ASSOCIATION, as the Custodian |
||||
| By: | /s/ Xxxxxxx X. Xxxxx | |||
| Name: | Xxxxxxx X. Xxxxx | |||
| Title: | Vice President | |||
| Address: | 0000 Xxxxxx Xxxxxx | |||
| St. Xxxx, Minnesota 55116 | ||||
| Attention: | Receiving Group — Horizon Credit I LLC | |||
| Fax: | (000) 000-0000 | |||
| Telephone: | (000) 000-0000 |
For all notices send copies to:
U.S. Bank National Association
000 X. XxXxxxx Xxxxxx, Xxx. 000,
Xxxxxxx, Xxxxxxxx, 00000
Attn: Structured Finance, Horizon Credit I LLC
Fax: (000) 000-0000
Tel.: (000) 000-0000
U.S. Bank National Association
000 X. XxXxxxx Xxxxxx, Xxx. 000,
Xxxxxxx, Xxxxxxxx, 00000
Attn: Structured Finance, Horizon Credit I LLC
Fax: (000) 000-0000
Tel.: (000) 000-0000
| U.S. BANK NATIONAL ASSOCIATION, as the Paying Agent |
||||
| By: | /s/ Xxxxxxx X. Xxxxx | |||
| Name: | Xxxxxxx X. Xxxxx | |||
| Title: | Vice President | |||
| Address: | 000 X. XxXxxxx Xxxxxx, Xxx. 000 | |||
| Chicago, Illinois, 60604 | ||||
| Attention: | Structured Finance, Horizon Credit I LLC | |||
| Fax: | (000) 000-0000 | |||
| Telephone: | (000) 000-0000 |
Signature Page to Consent and
Third Amendment of Transaction Documents
Third Amendment of Transaction Documents
