Exhibit 10.54
 
LIMITED WAIVER TO LOAN AND SECURITY AGREEMENT
 
This LIMITED WAIVER TO LOAN AND SECURITY AGREEMENT (this “Waiver”) dated as of
June 28, 2007 is by and among Hines Nurseries, Inc., a California corporation,
the parties hereto as lenders (each individually, a “Lender” and collectively,
“Lenders” as hereinafter further defined) and Bank of America, N.A., in its
capacity as agent for Lenders (in such capacity, “Agent”). Capitalized terms
used and not otherwise defined herein shall have the meanings assigned to them
in the Loan Agreement (defined below).
 
R E C I T A L S:

WHEREAS, Borrower, the Agent and the Lenders have entered into that certain Loan
and Security Agreement dated as of January 18, 2007 (as amended, the “Loan
Agreement”); and
 
WHEREAS, Borrower, Agent and Lenders have agreed to extend the date for
providing unaudited financial statements and waive certain Events of Default
upon the terms and conditions contained herein;
 
NOW, THEREFORE, in consideration of the premises contained herein, and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:
 
Section 1     Limited Waiver to the Loan Agreement. Borrower acknowledges that
certain Events of Default exist (or may arise) under Section 11.1 of the Loan
Agreement as a result of (a) Borrower’s failure to deliver annual audited
financial statements for the year ending December 31, 2006 by June 28, 2007 as
required by that certain Limited Waiver to Loan and Security Agreement dated as
of May 29, 2007 among the parties hereto and (b) Borrower’s failure to provide
notice of default under the Indenture for failure to provide the audited
financial statements for the year ending December 31, 2006 and unaudited
financial statements for the fiscal quarter ending March 31, 2007 (and related
public filings) as required by Section 10.1.3(c) of the Loan Agreement
(collectively, the “Events of Default”). Immediately upon the satisfaction of
each of the conditions precedent set forth in Section 2 below, the Agent and
Required Lenders hereby waive the Events of Default; provided, that Borrower
shall (x) deliver such audited financial statements for the fiscal year ending
December 31, 2006 required by Section 10.1.2 of the Loan Agreement (together
with any other financial information and documents required to be delivered in
connection with such financial statements) by no later than July 13, 2007, (y)
deliver the audited financial statements for the year ending December 31, 2006
required by the Indenture by no later than July 13, 2007 and (z) deliver the
unaudited financial statements for the fiscal quarter ending March 31, 2007
required by the Indenture and cure any related defaults thereunder by no later
than July 31, 2007, in each case the failure of which shall cause such waivers
to be terminated and result in such Events of Default continuing to exist under
the Loan Agreement. The foregoing is a limited waiver and shall not constitute a
waiver of any other Default or Event of Default that may exist or arise or
constitute a waiver or modification to any other term or condition set forth in
the Loan Agreement.

 
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Section 2     Conditions to Effectiveness. The effectiveness of the waiver set
forth in Section 1 above is subject to the satisfaction of each of the following
conditions:
 
(a) Agent shall have received a duly executed counterpart of this Waiver from
Borrower and the Required Lenders; and
 
(b) Agent shall have received a reaffirmation from Parent of its Guaranty.
 
Section 3     Representations, Warranties and Covenants. Borrower represents,
warrants and covenants to Agent and Lenders, upon the effectiveness of this
Waiver that:
 
(a) No Default; etc. No Default or Event of Default has occurred and is
continuing after giving effect to this Waiver or would result from the execution
or delivery of this Waiver or the consummation of the transactions contemplated
hereby.
 
(b) Corporate Power and Authority; Authorization. Borrower has the power and
authority to execute and deliver this Waiver.
 
(c) Execution and Delivery. Borrower has duly executed and delivered this
Waiver.
 
(d) Enforceability. This Waiver constitutes the legal, valid and binding
obligations of Borrower, enforceable against Borrower in accordance with its
terms, except as enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors’ right generally, and by general principles of equity.
 
(e) Indenture Notice. Borrower has not received any default notices under its
Indenture in respect of its 10.25% Senior Notes due 2011 dated as of September
30, 2003, between Hines Nurseries, Inc., Hines Horticulture, Inc., the
Subsidiary Guarantors named therein and the Bank of New York, as Trustee.

 
Section 4     Miscellaneous.
 
(a) Effect; Ratification. Borrower acknowledges that all of the reasonable legal
expenses incurred by Agent in connection herewith shall be reimbursable under
Section 3.4 of the Loan Agreement. The waiver set forth herein is effective
solely for the purposes set forth herein and shall be limited precisely as
written, and shall not be deemed to (i) be a consent to any amendment, waiver or
modification of any other term or condition of any Loan Document or
(ii) prejudice any right or rights that any Lender may now have or may have in
the future under or in connection with any Loan Document. This Waiver shall be
construed in connection with and as part of the Loan Documents and all terms,
conditions, representations, warranties, covenants and agreements set forth in
the Loan Documents, except as herein amended are hereby ratified and confirmed
and shall remain in full force and effect.
 

 
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(b) Counterparts; etc. This Waiver may be executed in any number of
counterparts, each such counterpart constituting an original but all together
one and the same instrument. Delivery of an executed counterpart of this Waiver
by fax shall have the same force and effect as the delivery of an original
executed counterpart of this Waiver. Any party delivering an executed
counterpart of this Waiver by fax shall also deliver an original executed
counterpart, but the failure to do so shall not affect the validity,
enforceability or binding effect of this Waiver.
 
(c) Governing Law. This Waiver shall be deemed a Loan Document and shall be
governed by, and construed and interpreted in accordance with the internal laws
of the State of New York but excluding any principles of conflicts of law.
 
(d) Reaffirmation. Parent hereby reaffirms all of its obligations as a guarantor
of the Obligations pursuant to its Guaranty dated as of January 18, 2007.
 
 
[Signature Pages Follow]

 
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IN WITNESS WHEREOF, Agent, Lenders and Borrower have caused this Limited Waiver
to Loan and Security Agreement to be duly executed as of the day and year first
above written.
 
BORROWER:
 
HINES NURSERIES, INC.
 
By:/s/ Claudia Pieropan                                                       
Title: CFO                                                            
                   
Name: Claudia Pieropan                                                      

PARENT:
 
HINES HORTICULTURE, INC.
 
By:/s/ Claudia Pieropan                                                    
Title: CFO                                                                       
   
Name: Claudia Pieropan                                                   

AGENT AND LENDERS:

BANK OF AMERICA, N.A., as Agent and a Lender

By:/s/ Jason
Riley                                                               
Title: Vice President                                                           
Name: Jason Riley                                                              

PNC BANK, NATIONAL ASSOCIATION, as a Lender

By:/s/ Pete Martinez                                                           
Title: Sr. Vice President                                                      
Name: Pete Martinez                                                           

GMAC COMMERCIAL FINANCE LLC, as a Lender

By:/s/ Robert Richardson                                                  
Title: Director                                                                      
Name: Robert Richardson                                                 

 
 
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