CAPITAL SUPPORT AGREEMENTEquity Contribution Agreement |
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NORTHERN TRUST CORP | Northern Trust Company | Northern Trust Corporation | Whistlejacket Capital LLC. RealDealDocs™ contains millions of easily searchable legal documents and clauses from top law firms. Search for free - click here. |
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Exhibit 10.7
CAPITAL SUPPORT AGREEMENT
THIS CAPITAL SUPPORT AGREEMENT (this “Agreement”) is made as of February 21st, 2008, by and between Northern Trust Corporation (the “Support Provider”) and The Northern Trust Company (“TNT”) as securities lending agent on behalf of the Core Select Securities Lending Cash Collateral Pool (the “Fund”).
W I T N E S S E T H:
WHEREAS, the Fund is a commingled pool maintained for the purpose of investing cash collateral on behalf of various securities lending clients by TNT as securities lending agent for which TNT seeks to maintain a stable net asset value of $1.00 per unit and to value the Fund’s assets on a cost rather than market value basis, all pursuant to the applicable law (“Applicable Law”);
WHEREAS, the Fund holds notes (“Notes”) issued by Whistlejacket Capital LLC and/or White Pine Finance LLC (together, the “Issuer”);
WHEREAS, a sale of the Notes under current market conditions is unlikely to result in the full recovery of the Fund’s investments, and may cause the Fund to realize losses to the extent that it could no longer maintain a stable net asset value of $1.00 per unit;
WHEREAS, it is in the interest of the Support Provider and certain of its affiliates to maintain a stable net asset value for the Fund of $1.00 per unit;
NOW, THEREFORE, in consideration of the above premises, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound, the Support Provider and TNT hereby agree as follows:
1. Definitions. In addition to the terms defined elsewhere in this Agreement, the following terms have the meanings indicated:
(a) “Amortized Cost Value” means, with respect to any Eligible Note held by the Fund, the value of that Eligible Note as determined using the amortized cost method (“Amortized Cost Method”) in accordance with Applicable Law on the relevant date.
(b) “Capital Contribution” means a cash contribution by the Support Provider to the Fund pursuant to this Agreement for which the Support Provider does not receive any units or other consideration from the Fund.
(c) “Contribution Event” means, with respect to any Eligible Note held by the Fund, any of the following occurrences:
| (i) | Any sale of the Eligible Note by the Fund for cash in an amount, after deduction of any commissions or similar transaction costs, less than the Amortized Cost Value of the Eligible Note sold as of the date of settlement; |
| (ii) | Receipt of final payment on the Eligible Note in an amount less than the Amortized Cost Value of that Eligible Note as of the date such payment is received; or |
| (iii) | Issuance of orders by a court having jurisdiction over the matter discharging the Issuer from liability for the Eligible Note and providing for payments on that Eligible Note in an amount less than the Amortized Cost Value of that Eligible Note as of the date such payment is received. |
The excess of the Amortized Cost Value of the Eligible Notes subject to a Contribution Event over the amount received by the Fund in connection with the Contribution Event shall constitute the “Loss” on such Eligible Notes.
(d) “Eligible Notes” means the Notes held by the Fund as portfolio securities on the date hereof or any securities or other instruments received in exchange for, or as a replacement of, the Notes as a result of an exchange offer, debt restructuring, reorganization or similar transaction pursuant to which the Notes are exchanged for, or replaced with, new securities of the Issuer or a third party other than Notes or securities which are or become “Eligible Securities,” as defined in paragraph (a) (10) of Rule 2a-7 promulgated under the Investment Company Act of 1940, as amended (as amended, “Rule 2a-7”).
(e) “Maximum Contribution Amount” with respect to the Fund means $10,000,000.00. The Maximum Contribution Amount may be increased at any time as agreed by TNT and the Support Provider.
(f) “Required Capital Contribution” means for the Fund on the date of any Contribution Event, a Capital Contribution in an amount sufficient for the Fund to maintain its net asset value per unit at no less than the Minimum Permissible NAV, after giving effect to the Contribution Event and all payments received by the Fund in respect of the Eligible Notes. The net asset value for purposes of calculating the amount of Required Capital Contribution shall exclude any account receivable or other asset representing the Support Provider’s obligations under this Agreement. Minimum Permissible NAV means $0.995 with respect to the Fund.
2. Covenants of the Fund. The Fund agrees that:
(a) To the extent consistent with the Fund’s interest, TNT shall consult with the Support Provider with respect to all decisions regarding each Eligible Note (including, but not limited to, any decision to sell the Eligible Note or to forgo the right to any payment) prior to the occurrence of a Contribution Event with respect to that Eligible Note. Nothing in this Agreement shall be construed to cause the delegation by TNT to any person any authority which is not permitted to be delegated under Applicable Law.
(b) The Fund will retain any Capital Contribution and not include the Required Capital Contribution in any income distribution to the Fund’s participants. For the avoidance of doubt, for purposes of this subparagraph, the withdrawal of the Fu
