Exhibit 10.16
 

August 30, 2011

THE FEMALE HEALTH COMPANY

as the Chargor

and

HEARTLAND BANK

as the Chargee

_______________________________________

Share Charge
_______________________________________

[fulbright.jpg]
85 Fleet Street
London
EC4Y 1AE
Tel: +44 20 7832 3600
www.fulbright.com

Ref: APSH/11107981

 
 

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CONTENTS
 
Clause
 
Page
1
DEFINITIONS AND INTERPRETATION
1
2
COVENANT TO PAY
3
3
SECURITY
3
4
OTHER OBLIGATIONS
3
5
ENFORCEMENT
5
6
APPOINTMENT AND RIGHTS OF RECEIVERS
6
7
DISTRIBUTION
8
8
CHARGEE'S RIGHTS
9
9
RESPONSIBILITIES OF CHARGEE, RECEIVERS AND DELEGATES
10
10
FURTHER ASSURANCE
10
11
POWER OF ATTORNEY
11
12
PROTECTION OF THIRD PARTIES
11
13
EXPENSES, STAMP DUTY AND INDEMNITIES
12
14
PAYMENTS
12
15
EFFECTIVENESS OF SECURITY
13
16
SET-OFF
15
17
COMMUNICATIONS
16
18
THIRD PARTIES
16
19
COUNTERPARTS
16
20
ASSIGNMENT
16
21
GOVERNING LAW AND SUBMISSION TO JURISDICTION
16
SCHEDULE 1 Details of the Investments
18
SCHEDULE 2 Proxy
19

 

 
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THIS DEED is dated August 30, 2011
 
BETWEEN:
 
(1)
THE FEMALE HEALTH COMPANY, a corporation organised and existing under the laws
of the State of Wisconsin (the "Chargor"); and

 
(2)
HEARTLAND BANK, a United States federal savings bank (the "Chargee").

 
IT IS AGREED as follows:
 
1.             DEFINITIONS AND INTERPRETATION
 
1.1           Definitions:  In this Deed:
 
"Charged Assets" means the assets from time to time subject, to or expressed to
be subject to, the Security or any part of those assets;
 
"Company" means The Female Health Company Limited, a company organised and
existing under the laws of England and Wales;
 
"Delegate" means a delegate, sub-delegate, attorney or co-trustee appointed,
directly or indirectly, pursuant to Clause 8.3 (Delegation);
 
"Dividends" means, in relation to any Share, all present and future:
 
 
(a)
dividends and distributions of any kind and any other sum received or receivable
in respect of that Share;

 
 
(b)
rights, shares, money or other assets accruing or offered by way of redemption,
bonus, option or otherwise in respect of that Share;

 
 
(c)
allotments, offers and rights accruing or offered in respect of that Share; and

 
 
(d)
other rights and assets attaching to, deriving from or exercisable by virtue of
the ownership of, that Share;

 
"Loan Agreement" means the second amended and restated loan agreement dated [  ]
between the Chargor and the Chargee;
 
"LPA" means the Law of Property Act 1925;
 
"Receiver" means a receiver, receiver and manager or other receiver appointed in
respect of the Charged Assets by the Chargee pursuant to this Deed;
 
"Release Date" has the meaning ascribed thereto in Clause 15.10 (Final
Redemption);
 
"Secured Liabilities" means all present and future obligations and other
liabilities of any nature of the Chargor due, owing or incurred under or in
connection with the Loan Documents to the Chargee and/or any Receiver
(including, without limitation, under any amendments, supplements or
restatements of the Loan Documents or in relation to any new or increased
advances or utilisations thereunder or any extension of any date for payment or
repayment thereunder), actual or contingent, matured or not matured, liquidated
or unliquidated, whether as principal or surety or in any other capacity
whatsoever;
 
 
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"Security" means the security created (or purported to be created) by this Deed;
 
"Shares" means
 
 
(a)
sixty-five per cent (65%) of all present and future shares in the Company issued
and outstanding from time to time, and which as at the date of this Deed
comprises the shares of the Company described in Schedule 1 (Shares); and

 
 
(b)
all rights relating to any of those shares which are deposited with or
registered in the name of any security agent, depositary, custodian, nominee,
fiduciary, investment manager or clearing system or other similar person or its
nominee, in each case whether or not on a fungible basis (including rights
against such person);

 
"this Deed" means this charge as varied, amended or supplemented from time to
time.
 
1.2           Loan Agreement
 
Unless otherwise expressly defined in this Deed or the context otherwise
required, words and expressions defined in the Loan Agreement shall have the
same meaning in this Deed or any notice given in relation to this Deed.
 
1.3           Construction
 
 
(a)
The provisions of Clauses 1.2 (Other Provisions) of the Loan Agreement shall
apply to this Deed with all necessary modifications as if they were expressly
set out in full in this Deed.

 
 
(b)
"rights" shall be construed as including rights, benefits, privileges, consents,
authorities, discretions, remedies and powers and "right" shall be construed
accordingly.

 
 
(c)
A reference to "Secured Liabilities" includes any liabilities which would be
treated as such but for the liquidation or dissolution or similar event
affecting the Chargor.

 
 
(d)
Any reference to the Chargee or the Chargor shall be construed so as to include
its or their (and any subsequent) successors and any permitted transferees in
accordance with their respective interests.

 
(e)
References in this Deed to any Clause or Schedule shall be to a clause or
schedule of this Deed unless otherwise specified. References to a Section are to
a Section of the Loan Agreement.

 
1.4           Law of Property (Miscellaneous Provisions) Act 1989
 
The terms of the documents under which the Secured Liabilities arise are
incorporated herein to the extent required for any purported disposition of the
Charged Assets contained in this Deed to be a valid disposition in accordance
with section 2(1) of the Law of Property (Miscellaneous Provisions) Act 1989.
 
1.5           Deed
 
This document is to take effect as a deed notwithstanding that the Chargee has
executed it under hand only.
 
 
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1.6           Covenants and Representations
 
 
(a)
Each covenant of the Chargor contained in this Deed remains in force until the
Release Date.

 
 
(b)
The representations and warranties set out in this Deed are made on the date of
this Deed and are, unless otherwise stated herein, deemed to be repeated by the
Chargor on each day from the date of this Deed until the Release Date with
reference to the circumstances existing at the time of repetition.

 
2.           COVENANT TO PAY
 
2.1           Covenant to Pay
 
The Chargor shall on demand pay or discharge to the Chargee the Secured
Liabilities when the same have become due in the manner provided for in the Loan
Documents.
 
3.           SECURITY
 
3.1           Creation of Charges
 
The Chargor charges in favour of the Chargee with full title guarantee and as
continuing security for the payment and discharge of all Secured Liabilities by
way of first fixed charge the Shares and the Dividends.
 
4.           OTHER OBLIGATIONS
 
4.1           Negative pledge and disposals
 
Except with the consent of the Chargee, the Chargor shall not:
 
 
(a)
create or permit to subsist any Lien over the Charged Assets save as expressly
permitted pursuant to the Loan Documents; or

 
 
(b)
sell, transfer, assign, or otherwise dispose of any of the Charged Assets or the
equity of redemption therein or permit any person to do any such thing except as
permitted pursuant to the terms of the Loan Documents.

 
4.2           Shares
 
 
 
(a)
Deposit of Documents

 
The Chargor shall, immediately upon the execution of this Deed and, where shares
in the Company are acquired by it after the date of this Deed, on the date of
that acquisition, deliver (or procure delivery) to the Chargee:
 
 
(i)
all certificates representing the Shares;

 
 
(ii)
all undated stock transfer forms and other documents which the Chargee may
reasonably request in such form and executed in such manner as the Chargee may
reasonably require with a view to perfecting or maintaining the Security over
the Charged Assets or registering any of the Shares in the name of the Chargee
or its nominees; and

 
 
(iii)
a signed but undated irrevocable proxy made in respect of the Shares in favour
of the Chargee in respect of all general meetings of the Company in the form set
out in Schedule 2

 
 
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to be dated by the Chargee and to become effective after an Event of Default has
occurred and for so long as it is continuing.

 
 
(b)
Voting Rights and Distributions

 
 
(i)
Until the Security has become enforceable, the Chargor shall be entitled to:

 
 
(A)
receive and retain all Dividends paid on or derived from the Shares; and

 
 
(B)
exercise or direct the exercise of the voting rights and other rights and powers
attached to the Shares in any manner as it sees fit other than in a manner
which:

 
 
(1)
is in breach of any Loan Document or which may adversely affect the validity or
enforceability of the Security or the value of the Shares; or

 
 
(2)
would cause the Chargee or its nominee to incur any cost or expense or render
itself subject to any liability for which it has not previously been indemnified
to its satisfaction or would otherwise prejudice the Chargee.

 
(ii)         After an Event of Default has occurred and is continuing:
 
 
(A)
the Chargee or the Receiver shall be entitled but not obliged to transfer the
Shares on behalf of the Chargor to such nominee as the Chargee shall select;

 
 
(B)
the Chargee or the Receiver shall be entitled but not obliged to receive and
retain all Dividends and apply the same in accordance with Clause 7.1
(Application); and

 
 
(C)
the Chargee or the Receiver shall be entitled but not obliged to exercise any
voting rights and any other rights and powers attached to any Share in such
manner as it considers fit as if it were the sole beneficial owner of the that
Share (including all powers given to trustees under Part II of the Trustee Act
2000); and

 
 
(D)
the Chargor shall comply, or procure the compliance, with any directions of the
Chargee or any Receiver in respect of the exercise of any rights and powers
exercisable in relation to the Charged Assets.

 
(c)         Representations regarding Shares
 
 
The Chargor represents and warrants to the Chargee that:

 
 
(i)
it is the sole legal and beneficial owner of the Shares;

 
 
(ii)
such Shares are free from all Liens, options and other third party rights
(except as created by this Deed);

 
 
(iii)
such Shares are fully paid;

 
 
(iv)
the Shares referred to in Schedule 1 constitute sixty-five per cent (65%) of all
of the authorised and issued share capital of the Company as at the date of this
Deed; and

 
 
(v)
the constitutional documents of the Company do not restrict or otherwise limit
the Chargor’s right to transfer or charge the Charged Assets.

 
 
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5.          ENFORCEMENT
 
5.1           Power of Sale
 
The power of sale or other disposal and other powers conferred on the Chargee
and on any Receiver by this Deed shall operate as a variation and extension of
the statutory power of sale and other powers conferred on mortgagees under
section 101 of the LPA and such powers shall arise on the date of this Deed free
from the restrictions imposed by section 103 of the LPA, which shall not apply
to the Charges.
 
5.2           Enforceability of Security
 
 
(a)
For the purposes of all powers implied by the LPA or any other applicable
statute, the Secured Liabilities shall be deemed to have become due and payable
upon the date of this Deed.

 
 
(b)
Save as provided in Clause 5.3 (Effect of Moratorium) below, the Security shall
become immediately enforceable upon:

 
 
(i)
the occurrence of an Event of Default which is continuing; or

 
 
(ii)
a petition being presented or application made for the appointment of an
administrator in respect of the Chargor; or

 
 
(iii)
notice being given by a person entitled to do so of the intention to appoint an
administrator or such notice being filed with the court,

 
and the power of sale conferred by section 101 of the LPA and all other powers
conferred on mortgagees and Receivers by law (as varied and extended by this
Deed) shall be exercisable in relation to the Security and the Chargee may take
possession, hold or dispose of any Charged Asset at any time after the Security
has become enforceable.
 
5.3           Effect of Moratorium
 
The Security will not become enforceable solely as a result of any person
obtaining or taking steps to obtain a moratorium under Schedule A1 of the
Insolvency Act 1986.
 
5.4           Contingencies
 
If the Security is enforced at a time when no amount is due under the Loan
Agreement but at a time when amounts may or will become due, the Chargee (or the
Receiver) may pay the proceeds of any recoveries effected by it into a suspense
account.
 
5.5           Right of Appropriation: Financial Collateral
 
To the extent that any of the Charged Assets constitute "financial collateral"
and this Deed and the obligations of the Chargor hereunder constitute a
"security financial collateral arrangement" (in each case as defined in, and for
the purposes of, the Financial Collateral Arrangements (No. 2) Regulations 2003
(SI 2003 No. 3226; the "Regulations")), the Chargee shall have the right
following enforcement of this Deed to appropriate all or any part of such
financial collateral in or towards discharge of the Secured Liabilities.  For
this purpose, the parties agree that the value of such financial collateral so
appropriated shall be, in the case of Investments, the market price of such
Investments determined by the Chargee by reference to a public index or by such
other process as the Chargee may select, including independent valuation.  In
each case, the parties agree that the method of valuation provided for in the
Deed shall constitute a commercially reasonable method of valuation for the
purposes of the Regulations.
 
 
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6.             APPOINTMENT AND RIGHTS OF RECEIVERS
 
6.1           Appointment of Receivers:
 
 
(a)
If:

 
 
(i)
an Event of Default occurs and is continuing;

 
 
(ii)
so requested by the Chargor; or

 
 
(iii)
a petition is presented or application made for the appointment of an
administrator, a liquidator or a provisional liquidator in respect of the
Chargor or notice is given by any person entitled to do so of the intention to
appoint an administrator or such notice is filed with the court,

 
the Chargee may, by deed or otherwise in writing signed by any officer of the
Chargee or any other person authorised by the Chargee for this purpose:
 
 
(A)
appoint one or more persons to be Receiver of any Charged Assets of the Chargor;
or

 
 
(B)
(subject to any requirement for a court order under the Insolvency Act 1986 or
any other applicable insolvency law) remove any Receiver so appointed and, at
its option, appoint another person(s) to be an additional or replacement
Receiver.

 
 
(b)
If more than one person is appointed Receiver of any assets, each Receiver may
act either jointly or severally unless the document appointing him states
otherwise.

 
 
(c)
Section 109(1) of the LPA does not apply to this Deed.

 
 
(d)
The powers of appointment of a Receiver under this Deed shall be in addition to
all other statutory and other powers of appointment of the Chargee under the LPA
or otherwise.

 
6.2           Rights of Receivers
 
Any Receiver appointed pursuant to this Deed shall (subject to any restrictions
in the instrument appointing him) have in relation to the Charged Assets (and
any other assets which when got in, would be Charged Assets) in relation to
which he is appointed:
 
 
(a)
all the powers conferred on an administrative receiver or receivers under the
Insolvency Act 1986;

 
 
(b)
all the powers conferred by the LPA or any other applicable law on mortgagees,
mortgagees in possession and on receivers; and

 
 
(c)
all the powers and rights of an absolute owner and power to do or omit to do
anything which the Chargor itself could do or omit to do.

 
In addition, a Receiver shall be entitled (either in his own name or in the name
of the Chargor or any trustee or nominee for the Chargor) or otherwise and in
such manner and upon such terms and conditions as the Receiver thinks fit and
either alone or jointly with any other person:
 
 
(a)
Take possession

 
to take possession of the Charged Assets, to require directors of such Chargor
to call up unpaid share capital and to take action to enforce payment of unpaid
calls;
 
 
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(b)           Contracts
 
to enter into any contract or arrangement and to perform, repudiate, rescind or
vary any contract or arrangement to which the Chargor is a party to the extent
necessary to dispose of the Charged Assets and to perform its obligations;
 
 
(c)
Deal with Charged Assets

 
to sell, transfer, assign, exchange, or otherwise dispose of, convert into money
or realise the Charged Assets either by public offer or auction, tender or
private contract to any person on any terms and for a consideration of any
nature he thinks fit;
 
(d)         New Subsidiary
 
 
(i)
to form or procure the formation of any new corporation, trust or partnership (a
"new vehicle");

 
 
(ii)
to subscribe for or acquire any investment in such new vehicle;

 
 
(iii)
to transfer or transfer any right in or grant any lease or licence in any
Charged Assets to such new vehicle; and

 
 
(iv)
to sell, transfer, assign, exchange or otherwise dispose of any such investments
or any rights attaching thereto;

 
(e)         Borrowings
 
to borrow or raise money either unsecured or on the security of the Charged
Assets either in priority to the Security or otherwise and on such terms as he
thinks fit;
 
(f)         Covenants and guarantees
 
to enter into bonds, covenants, commitments, guarantees, indemnities or like
matters and to make all requisite payments to effect, maintain or satisfy the
same;
 
(g)         Proceedings and Claims
 
to bring, prosecute, enforce, defend and abandon actions, suits and proceedings
in relation to the Charged Assets;
 
(h)         Compromise of Claims
 
to settle, adjust, refer to arbitration, compromise and arrange any claims,
accounts, disputes, questions and demands with or by any person who is or claims
to be a creditor of such Chargor or relating in any way to the Charged Assets;
 
(i)         Redemption of Security
 
to redeem any Lien (whether or not having priority to the Charges) over the
Charged Assets and to settle the accounts of encumbrancers;
 
 
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(j)            Receipts
 
to give a valid receipt for any moneys and execute any document which is
necessary or desirable for realising any Charged Assets; and
 
(k)          Other Powers
 
to do all such other acts and things the Receiver may consider necessary or
expedient for preserving, improving or realising the Charged Assets or the
getting in and collection of the Charged Assets (or any assets which when got in
would constitute Charged Assets) or which are incidental to the exercise of any
of the rights, powers and discretions conferred on the Receiver under or by
virtue of this Deed or by law.
 
Each of the powers specified in each of the above paragraphs shall (except as
otherwise provided) be distinct and shall not be in any way limited by reference
to any other paragraph or the order in which they appear.
 
6.3           Agent of Chargor
 
Any Receiver shall be the agent of the Chargor for all purposes unless and until
the Chargor goes into liquidation after which time the Receiver shall act as
principal and shall not become agent of the Chargee.  Subject to any applicable
law, the Chargor alone shall be responsible for his contracts, engagements,
acts, omissions, defaults and liabilities (other than where caused by his gross
negligence or wilful default) and for any payment of his remuneration.  The
Chargee shall not incur any liability by reason of the appointment of a Receiver
under this Deed.
 
6.4           Remuneration
 
The Chargee may from time to time determine the remuneration of any Receiver and
the maximum rate specified in section 109(6) of the LPA will not apply.  The
Chargee may direct payment of such remuneration out of moneys accruing to the
Receiver but the Chargor alone shall be liable for the payment of such
remuneration and for all other costs, charges and expenses of the Receiver.
 
7.             DISTRIBUTION
 
7.1           Application
 
All moneys from time to time received by the Chargee or a Receiver or Delegate
pursuant to this Deed or pursuant to the powers conferred by it shall (subject
to the payment of any liabilities having priority to the Secured Liabilities by
law and by way of variation of the provisions of the LPA), be applied in the
following order:
 
 
(a)
in or toward the payment of or provision for all costs, losses, liabilities and
expenses incurred by the Chargee or any Receiver or Delegate under or in
connection with this Deed or their appointment and the Receiver's remuneration
due in connection with this Deed;

 
 
(b)
in or toward discharge of the Secured Liabilities in accordance with the terms
of the Loan Agreement; and

 
 
(c)
in payment of any surplus to the Chargor or other person entitled thereto.

 
 
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7.2        Partial Application
 
All moneys from time to time received by the Chargee from the Chargor or any
person liable to pay the same or from any Receiver or otherwise on the
realisation or enforcement of the Charges may, subject to Clause 7.1
(Application), be applied by the Chargee either as a whole or in such proportion
as the Chargee shall think fit to any account or item of account or any
transaction to which the same may be applicable.
 
8.             CHARGEE'S RIGHTS
 
8.1           General Rights
 
All or any of the rights which are conferred by this Deed (either expressly or
impliedly) or by law upon a Receiver may be exercised after the Charges become
enforceable by the Chargee irrespective of whether the Chargee shall have taken
possession or appointed a Receiver of the Charged Assets.
 
8.2           Redemption of Prior Security
 
 
(a)
In the event of any action, proceeding or step being taken to exercise any
powers or remedies conferred by any prior ranking Lien or upon the exercise of
any power of sale under this Deed by the Chargee or any Receiver, the Chargee
may at any time redeem any Lien having priority to any Charges or procure the
transfer of that Lien to itself and may settle the accounts of the prior
encumbrancer and any accounts so settled shall, in the absence of manifest
error, be conclusive and binding on the Chargor.

 
 
(b)
The Chargor shall, on demand of the Chargee, pay to the Chargee all the costs
and expenses incurred by it in connection with any such redemption or transfer.

 
 
(c)
All the rights conferred by a prior charge upon the chargee or any receiver
thereunder shall be exercisable by the Chargee or a Receiver in like manner as
if the same were expressly included herein and the Chargee shall be entitled to
exercise all the rights of a receiver appointed thereunder.

 
8.3           Delegation
 
 
(a)
The Chargee or any Receiver may delegate in any manner to any person it may
think fit any right, power or discretion exercisable by it under this Deed.

 
 
(b)
Any such delegation may be made upon such terms, consistent with the terms of
the Loan Documents (including power to sub-delegate) as the Chargee or any
Receiver may think fit.

 
 
(c)
The Chargee shall not be in any way liable to the Chargor or any other person
for any losses, liabilities or expenses arising from any act, default, omission
or misconduct on the part of any Delegate other than where caused by the gross
negligence or wilful default of the Delegate.

 
8.4           Retention of Documents
 
The Chargee shall be entitled to continue to retain any document delivered to it
under this Deed relating to a Charged Asset until the Security over such Charged
Asset is released in accordance with this Deed.  If, for any reason, it ceases
to hold any such document before such time, it may by notice to the Chargor
require that the relevant document be redelivered to it and the Chargor shall
promptly comply with that requirement or procure that it is complied with.
 
 
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8.5           Custody
 
The Chargee shall be entitled to keep all certificates and documents of title
relating to the Charged Assets in safe custody at any of its branches or
otherwise provide for their safe custody by third parties and shall not be
responsible for any loss or damage occurring to or in respect thereof unless
such loss or damage shall be caused by its own gross negligence or wilful
misconduct.
 
9.           RESPONSIBILITIES OF CHARGEE, RECEIVERS AND DELEGATES
 
9.1           No Obligation to Remain in Possession
 
If the Chargee, any Receiver or any Delegate shall take possession of the
Charged Assets, it may from time to time in its absolute discretion relinquish
such possession.
 
9.2           No Liability as Mortgagee in Possession
 
Neither the Chargee nor any Receiver or Delegate will be liable, by reason of
entering upon or into possession of a Charged Asset (or viewing or repairing any
Charged Assets or otherwise), to account as mortgagee in possession in respect
of any Charged Assets or for any loss on realisation or for any default or
omission in respect of any Charged Assets for which a mortgagee in possession
might otherwise be liable.
 
9.3           Chargee's Obligation to Account
 
Neither the Chargee nor any Receiver or Delegate shall (either by reason of
taking possession of the Charged Assets or for any other reason):
 
 
(a)
be liable to account to the Chargor or any other person for anything except the
Chargee's own actual receipts which have not been distributed or paid to the
Chargor or the persons entitled (or at the time of payment believed by the
Chargee to be entitled) thereto; or

 
 
(b)
be liable to the Chargor or any other person for any costs, losses, liabilities
or expenses related to any realisation of any Charged Assets or from any act,
default, omission or misconduct of the Chargee, any Receiver, any Delegate or
their respective officers, employees or agents in relation to the Charged Assets
or in connection with the Loan Documents unless caused by its own gross
negligence or wilful misconduct.

 
10.           FURTHER ASSURANCE
 
The Chargor shall, at its own expense, promptly do all such acts and things as
the Chargee may reasonably require for:
 
 
(a)
creating, registering, perfecting, maintaining or protecting the Security or any
of the Charged Assets; or

 
 
(b)
facilitating the realisation of any Security after it has become enforceable or
the exercise of any right, power or discretion in relation to any Charged Asset
or Security vested in the Chargee, any Receiver or any Delegate,

 
including, without limitation, the execution (including by sealing) of any
transfer, assignment, mortgage, charge or Security or any other document or any
notice or instruction which the Chargee may reasonably require, including any
such document, notice or instruction required to enable the Chargee or its
nominee to obtain legal title to any Charged Assets in circumstances in which it
is entitled to obtain such legal title under this Deed.
 
 
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11.           POWER OF ATTORNEY
 
11.1           Appointment
 
The Chargor by way of security irrevocably appoints the Chargee, every Receiver
and every Delegate severally to be its attorney, such appointment to become
effective after an Event of Default has occurred and for so long as it is
continuing:
 
 
(a)
to do all acts and things which the Chargor is obliged to do under this Deed but
has failed to do, including, without limitation, to fill in the name of the
transferee and to date and complete any instrument of transfer in respect of any
Charged Assets which has been executed in blank by the Chargor and, in the case
of registered Charged Assets, to procure the registration of the transferee as
the holder of the relevant Charged Assets in circumstances in which the Charged
Assets are to be transferred under the terms of this Deed;

 
 
(b)
to transfer any interest in any Charged Assets in the circumstances in which
such transfer may be required under this Deed, including on an enforcement of
the Security over such Charged Assets;

 
 
(c)
in its name and on its behalf to exercise any right conferred on the Chargee,
any Receiver or any Delegate in relation to the Charged Assets under this Deed
or any other Loan Document or by law after such right has become exercisable;
and

 
 
(d)
to register or renew registration of the existence of the Charges or the
restrictions on dealing with the Charged Assets in any register in which the
Chargor is obliged (but has failed) to effect or maintain registration under the
terms of this Deed.

 
11.2          Ratification
 
The Chargor agrees to ratify and confirm whatever any such attorney shall do or
purport to do in the exercise or purported exercise of the power of attorney
granted by Clause 11.1 (Appointment).
 
11.3           Sums Recoverable
 
All moneys expended by the Chargee, any Receiver, any Delegate or any attorneys
shall be recoverable from the Chargor under Clause 13 (Expenses, Stamp Duty and
Indemnities) and Section 10.2 (Expenses) of the Loan Agreement.
 
12.           PROTECTION OF THIRD PARTIES
 
12.1          No Duty to Enquire
 
No person dealing with the Chargee, any Receiver or any Delegate shall be
concerned to enquire:
 
 
(a)
whether any right which the Chargee or any Receiver or Delegate is purporting to
exercise or any of its powers has arisen or become exercisable;

 
 
(b)
whether the Secured Liabilities have become payable or any amount remains
outstanding under the Loan Agreement;

 
 
(c)
as to the application of any money borrowed or raised or paid to the Chargee or
any Receiver or Delegate; or

 
 
(d)
as to the propriety or regularity of such dealings.

 
 
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12.2       Receipt
 
The receipt of the Chargee or any Receiver shall be conclusive discharge to a
purchaser and, in making any sale or disposal of any of the Charged Assets or in
making any acquisition, the Chargee or any Receiver may do so for any such
consideration, in such manner and on such terms as it thinks fit.
 
12.3         Statutory Protection
 
All the protection to purchasers contained in sections 104 and 107 of the LPA,
section 42(3) of the Insolvency Act 1986 or in any other applicable legislation
shall apply to any person purchasing from or dealing with the Chargee, any
Receiver or any Delegate.
 
13.           EXPENSES, STAMP DUTY AND INDEMNITIES
 
13.1         Expenses
 
The Chargor will on demand pay to and reimburse the Chargee or any Receiver,
Delegate, agent or attorney, on the basis of a full indemnity, all costs and
expenses (including legal fees and other out of pocket expenses and any VAT)
reasonably incurred by the Chargee or any Receiver, Delegate, agent or attorney
in connection with this Deed and will indemnify them against any failure to pay
such amounts including any amounts arising from any actual or alleged breach of
any law.
 
13.2         Currency Indemnity
 
 
(a)
If any sum (a "Sum") owing by the Chargor under this Deed, or any judgment,
award or order given in relation to this Deed, has to be converted from the
currency in which that Sum is payable into another currency for the purpose of:

 
 
(i)
making or filing a claim or proof against the Chargor;

 
 
(ii)
obtaining or enforcing an order, judgment or award in relation to any litigation
or arbitration proceedings; or

 
 
(iii)
applying the Sum in satisfaction of any Secured Liabilities,

 
the Chargor shall, as an independent obligation, within three Business Days of
demand, indemnify the Chargee or any Receiver or Delegate from any cost, loss or
liability incurred as a result of the conversion including any discrepancy
between (A) the rate of exchange used to make the conversion and (B) the rate or
rates of exchange available to that person at the time of its receipt of that
Sum.
 
 
(b)
The Chargor waives any right it may have in any jurisdiction to pay any amount
under this Deed in a currency or currency unit other than that in which it is
expressed to be payable unless required to do so by any applicable law.

 
14.           PAYMENTS
 
14.1         Certificates
 
A certificate, determination, notification or opinion of the Chargee as to the
amount of the Secured Liabilities or any other matter connected with this Deed
or the Charges shall, in the absence of manifest error, be conclusive evidence
of the matters to which it relates.
 
 
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14.2         Payments
 
All payments under or pursuant to this Deed (including damages in respect of
breaches hereof) shall be made in accordance with the Loan Agreement or in such
other manner as the Chargee may agree and direct.
 
15.           EFFECTIVENESS OF SECURITY
 
15.1         Chargor's Obligations Continuing
 
The Chargor's obligations under Clause 2 (Covenant to Pay) and the Charges are
continuing obligations and will extend to the ultimate balance of the Secured
Liabilities regardless of any intermediate payment or discharge in whole or in
part.
 
15.2         Cumulative Rights
 
The rights and remedies provided in this Deed are cumulative and in addition to
and independent of and not in any way prejudiced by any rights or remedies
provided by law or any other Security, guarantees or rights of set-off or
combination thereof held by the Chargee.
 
15.3         Failure to Exercise Rights
 
No failure by the Chargee to exercise or delay in the exercise of any right or
remedy under this Deed will operate as a waiver thereof nor will any single or
partial exercise of any right or remedy preclude any other or further exercise
thereof or the exercise of any other right or remedy.
 
15.4         Immediate Recourse
 
This Deed and the Chargor’s obligations under this Deed are in addition to, and
not to be prejudiced by or to be merged with, any other guarantee, indemnity or
Security at any time existing in favour of any person. The Chargor waives any
right it may have to require the Chargee (or any trustee or agent on its behalf)
to make demand of, proceed against or enforce any other rights or Security or
claim payment from any person before claiming against it. This waiver applies
irrespective of any law or any provision of any Loan Document to the contrary.
 
15.5         Grant of Waivers
 
A waiver given or consent granted by the Chargee under this Deed will be
effective only if given in writing and then only in the instance and for the
purpose for which it is given.
 
15.6          Waiver of Defences
 
Neither the Charges nor the obligations of the Chargor under this Deed shall be
discharged or affected by (and the Chargor hereby irrevocably waives any
defences it may now or hereafter acquire in any way relating to) any act,
omission, matter or thing which, but for this Clause 15, would reduce, release
or prejudice any of its obligations under this Deed (without limitation and
whether or not known to the Chargor or the Chargee) including:
 
 
(a)
any time, waiver or consent given to, or any composition with, any person;

 
 
(b)
the release of the Chargor or any other person under the terms of any
composition or arrangement with any creditor of the Chargor or any other person
(other than any express release of the Charges given in accordance with this
Deed);

 
 
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(c)
any amendment, novation, supplement, extension (whether of maturity or
otherwise) or restatement (in each case however fundamental and of whatever
nature) or replacement of any Loan Document or any other security or document;

 
 
(d)
the taking, perfection, enforcement, variation, compromise, exchange, renewal,
release of, or the refusal or neglect to take, perfect or enforce, any rights
against, or Lien over, assets of, or any guarantee or undertaking given by, any
person or any non-presentation or non-observance of any formality or other
requirement in respect of any instrument or any failure to realise the full
value of any Lien;

 
 
(e)
any incapacity or lack of power, authority or legal personality of or
dissolution or change in the members or constitution or status of the Chargee,
Chargor or any other person;

 
 
(f)
the illegality, invalidity or unenforceability of any obligation of any person
under, or expressed to arise under, any Loan Document or other document; and

 
 
(g)
any insolvency or similar proceedings under the laws of any jurisdiction or the
making of any arrangement or composition with or for the benefit of creditors by
the Chargee or any other person.

 
15.7         Partial Invalidity
 
If at any time any provision of this Deed is or becomes invalid, illegal or
unenforceable in any respect (or any of the Security is ineffective) in any
jurisdiction, that shall not affect the legality, validity or enforceability of:
 
 
(a)
the remaining provisions or the effectiveness of any of the remaining Security
in that jurisdiction; or

 
 
(b)
that or any other provision or the effectiveness of such Security  in any other
jurisdiction.

 
15.8         Reinstatement
 
If any discharge, release or arrangement (whether in respect of the obligations
of the Chargor or any security for those obligations or otherwise) is made by
the Chargee in whole or in part on the faith of any payment, security or other
disposition which is avoided or must be restored in insolvency, liquidation,
administration or otherwise, without limitation:
 
 
(a)
the liability of the Chargor will continue or be reinstated as if the release,
arrangement, discharge, settlement, avoidance or reduction had not occurred;

 
 
(b)
the Chargee shall be entitled to recover the value or amount of that release,
arrangement, discharge, security or settlement from each Chargor, as if the
payment, discharge, settlement, avoidance or reduction had not occurred together
with any other cost, loss, expense or liability incurred by the Chargee as a
result of such avoidance or discharge; and

 
 
(c)
the Chargor shall on demand indemnify the Chargee against any funding or other
cost, loss, liability or expense incurred by the Chargee as a result of the
Chargee being required for any reason to refund all or part of any amount
received by it in respect of any of the Secured Liabilities.

 
15.9          Security Retention
 
If the Chargee, acting reasonably, considers that any amount paid or credited
under any Loan Document is capable of being avoided or otherwise set aside under
any laws relating to insolvency or otherwise that amount shall not be treated as
paid for the purposes of determining whether the Secured Liabilities have been
paid.
 
 
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15.10        Final Redemption
 
 
(a)
The Chargee shall at the cost of the Chargor on the date on which it is
satisfied (acting reasonably) that all the Secured Liabilities have been
irrevocably and unconditionally paid and discharged in full and no further
Secured Liabilities are capable of becoming outstanding (the "Release Date")
take all reasonable steps to release the Charged Assets from the Security but
without recourse to or any representation or warranty by the Chargee or any of
its nominees.

 
 
(b)
All documents which are necessary in connection with the redemption of the
Security or the transfer of the Charged Assets back to the Chargor shall be in
such form as the Chargee shall reasonably require.

 
15.11        Consolidation
 
Section 93 of the LPA (restricting the right of consolidation of the Security
with any other Liens) shall not apply to the Security and the Chargee may
consolidate all or any of the Security with any other Liens to the extent
lawful.
 
15.12        Appropriations
 
 
(a)
Until all Secured Liabilities have been irrevocably and unconditionally paid and
discharged in full and all facilities which might give rise to Secured
Liabilities have been terminated, the Chargee (or any trustee or agent on its
behalf) may:

 
 
(i)
refrain from applying or enforcing any other moneys, security or rights held or
received by it (or any trustee or agent on its behalf) in respect of those
amounts, or apply and enforce the same in such manner and order as it sees fit
(whether against those amounts or otherwise) and the Chargor shall not be
entitled to the benefit of the same; and

 
 
(ii)
hold in an interest-bearing suspense account any moneys received from the
Chargor or on account of the Chargor's liability under this Deed.

 
16.           SET-OFF
 
16.1         Set-Off
 
After an Event of Default has occurred and for so long as it is continuing the
Chargee may set off or otherwise apply against the Secured Liabilities any
credit balance to which the Chargor is entitled on any account with the Chargee
and any other obligation (contingent or otherwise) owing by the Chargee
regardless of the place of payment, booking branch or currency of either
obligation or the terms of any deposit standing to the credit of such account.
The Chargee shall notify the Chargor of any action taken pursuant to this Clause
16.1 promptly after such action is taken.
 
16.2         Currency Conversion
 
The Chargee may exercise such rights notwithstanding that the obligations
concerned may be expressed in different currencies and the Chargee is authorised
to convert either obligation at a market rate of exchange in its usual course of
business for the purpose of the set-off.
 
16.3         Set-Off Rights Cumulative
 
This Clause 16 (Set-Off) shall be in addition to and without prejudice to any
rights of set-off or any other rights or remedies which the Chargor may have.
 
 
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17.           COMMUNICATIONS
 
Each communication under this Deed shall be made as provided in the Loan
Agreement.
 
18.           THIRD PARTIES
 
Save as expressly stated in this Deed, a person who is not a party to this Deed
has no right under the Contracts (Rights of Third Parties) Act 1999 to enforce
or to enjoy the benefit of any term of this Deed.
 
19.           COUNTERPARTS
 
19.1         Counterparts
 
This Deed may be executed in any number of counterparts, and this has the same
effect as if the signatures on the counterparts were on a single copy of the
Deed.
 
19.2           Non-signatories
 
Failure by one or more parties ("Non-Signatories") to execute this Deed on the
date hereof will not invalidate the provisions of this Deed as between the other
parties who do execute this Deed.  Such Non-Signatories may execute this Deed
(or a counterpart thereof) on a subsequent date and will thereupon become bound
by its provisions.
 
20.           ASSIGNMENT
 
The Chargee may at any time assign or otherwise transfer all or any part of its
rights under this Deed in accordance with and subject to the Loan Documents.
 
21.           GOVERNING LAW AND SUBMISSION TO JURISDICTION
 
21.1           Governing Law
 
This Deed is governed by, and shall be construed in accordance with, English
law. Any non-contractual obligations arising out of or in connection with this
Deed are governed by English law.
 
21.2         Jurisdiction
 
 
(a)
Subject to paragraph (c) below, the courts of England have exclusive
jurisdiction to settle any dispute arising out of or in connection with this
Deed (including a dispute regarding the existence, validity or termination of
this Deed or any non-contractual obligation arising out of or in connection with
this Deed) or the consequences of its nullity (a "Dispute").

 
 
(b)
The parties agree that the courts of England are the most appropriate and
convenient courts to settle any Disputes and accordingly no party will argue to
the contrary.

 
 
(c)
This Clause is for the benefit of the Chargee only.  As a result, the Chargee
shall not be prevented from taking:

 
 
(i)
proceedings relating to a Dispute in any other courts with jurisdiction; and

 
 
(ii)
to the extent allowed by law, concurrent proceedings in any number of
jurisdictions.

 
 
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IN WITNESS WHEREOF the parties hereto have caused this Deed to be duly executed
as a deed on the date first written above.
 

 
EXECUTED AS A DEED by
)
 
THE FEMALE HEALTH COMPANY, a company organized and existing under the laws of
the State of Wisconsin and signed and delivered as a deed on its behalf by O. B.
Parrish being a person who, in accordance with the laws of that jurisdiction,
is/are acting under the authority of that company in the presence of:
 
)
)
)
)
)
)
)
 
 
 
 
 
/s/  O. B. Parrish                                           
Witness signature:  /s/  Donna Felch
 
   
NAME:  Donna Felch
 
   
ADDRESS:  515 N State Street, Suite 2225
       Chicago, IL 60654
 
   
OCCUPATION:  V.P. and CFO
   

 

 
EXECUTED by
)
 
Colin McNulty, AVP on behalf of HEARTLAND BANK:
 
)
)
)
)
 
 
 
 
/s/  Colin McNulty                                
     
 
Witness signature:  /s/  Varsha Myers
 
   
NAME:  Varsha Myers
 
   
ADDRESS:  212 S Central Avenue,
       St. Louis, MO 63105
 
   
OCCUPATION:  Analyst
   

 
 
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SCHEDULE 1
Details of the Investments
 
Shares
 

 
Chargor
Company
Number of Shares (as at the date of this Deed)
Proportion of entire issued share capital of the Company
       
The Female Health Company
The Female Health Company Limited
3,900,130 ordinary shares of £1 each
65%

 

 
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SCHEDULE 2
Proxy
 
The Female Health Company Limited (the “Company”)
 
The Female Health Company, a company organized and existing under the laws of
the State of Wisconsin, hereby irrevocably appoints Heartland Bank as our proxy
in respect of the Shares to vote on our behalf at all general meetings of the
Company, such appointment to become effective after an Event of Default has
occurred and for so long as it is continuing.  Any capitalised terms used herein
and not otherwise defined herein shall have the meanings given such terms in the
Share Charge dated [         ], 2011 between The Female Health Company and
Heartland Bank.
 

 
Dated:
 

 
Signed by or on behalf of
The Female Health Company

 

 
___________________________
Authorised Signature

 

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