INDENTURE
DATED AS OF OCTOBER 18, 2005
BY AND BETWEEN
DULOXETINE ROYALTY SUB,
AN EXEMPTED COMPANY INCORPORATED WITH LIMITED LIABILITY
UNDER THE LAWS OF THE CAYMAN ISLANDS,
AS ISSUER OF THE NOTES DESCRIBED HEREIN,
AND
U.S. BANK NATIONAL ASSOCIATION,
AS INITIAL TRUSTEE OF THE NOTES DESCRIBED HEREIN
Table of Contents
Page
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GRANTING CLAUSE.......................................................... 1
HABENDUM CLAUSE.......................................................... 2
Article I
DEFINITIONS
Section 1.1 Definitions.............................................. 5
Section 1.2 Rules of Construction.................................... 5
Section 1.3 Compliance Certificates and Opinions..................... 6
Section 1.4 Acts of Noteholders...................................... 7
Article II
THE NOTES
Section 2.1 Amount Not to Exceed the Initial Outstanding Principal
Balance; Terms; Form; Execution and Delivery............. 8
Section 2.2 Restrictive Legends...................................... 11
Section 2.3 Registrar and Paying Agent............................... 15
Section 2.4 Paying Agent to Hold Money in Trust...................... 16
Section 2.5 Method of Payment........................................ 16
Section 2.6 Minimum Denominations.................................... 18
Section 2.7 Transfer and Exchange; Cancellation...................... 18
Section 2.8 Mutilated, Destroyed, Lost or Stolen Notes............... 19
Section 2.9 Payments of Transfer Taxes............................... 20
Section 2.10 Book-Entry Provisions.................................... 20
Section 2.11 Special Transfer Provisions.............................. 22
Section 2.12 Temporary Definitive Notes............................... 26
Section 2.13 Statements to Noteholders................................ 26
Section 2.14 CUSIP, CINS, ISIN and Private Placement Numbers.......... 27
Section 2.15 Refinancing Notes........................................ 28
Section 2.16 Class B Notes............................................ 29
Section 2.17 Original Class A Notes................................... 31
Article III
REDEMPTIONS; INTERCREDITOR AGREEMENT PROVISIONS
Section 3.1 Redemptions.............................................. 31
Section 3.2 Procedure for Redemptions................................ 33
Section 3.3 Incorporation of Intercreditor Agreement Provisions...... 34
Article IV
DEFAULT AND REMEDIES
Section 4.1 Events of Default........................................ 34
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Section 4.2 Remedies................................................. 35
Section 4.3 Limitation on Suits...................................... 36
Section 4.4 Waiver of Existing Defaults.............................. 37
Section 4.5 Restoration of Rights and Remedies....................... 37
Section 4.6 Remedies Cumulative...................................... 38
Section 4.7 Authority of Courts Not Required......................... 38
Section 4.8 Rights of Noteholders to Receive Payment................. 38
Section 4.9 Trustee May File Proofs of Claim......................... 38
Section 4.10 Undertaking for Costs.................................... 38
Section 4.11 Control by Noteholders................................... 39
Section 4.12 Senior Trustee........................................... 39
Section 4.13 Application of Proceeds.................................. 39
Section 4.14 Waivers of Rights Inhibiting Enforcement................. 39
Section 4.15 Security Interest Absolute............................... 40
Article V
COVENANTS
Section 5.1 Covenants................................................ 41
Section 5.2 Reports and Other Deliverables by Royalty Sub............ 45
Section 5.3 Payment of Additional Amounts............................ 46
Article VI
THE TRUSTEE
Section 6.1 Acceptance of Trusts and Duties.......................... 48
Section 6.2 Copies of Documents and Other Notices.................... 48
Section 6.3 Representations and Warranties........................... 49
Section 6.4 Reliance; Agents; Advice of Counsel...................... 49
Section 6.5 Not Acting in Individual Capacity........................ 51
Section 6.6 Compensation of Trustee.................................. 51
Section 6.7 Notice of Defaults....................................... 51
Section 6.8 May Hold Notes........................................... 52
Section 6.9 Corporate Trustee Required; Eligibility.................. 52
Section 6.10 Reports by the Trustee................................... 52
Section 6.11 Calculation Agent........................................ 52
Section 6.12 Second Lien Pledge and Security Agreement................ 53
Section 6.13 Custody of the Collateral................................ 53
Section 6.14 Preservation and Disclosure of Noteholder Lists.......... 53
Section 6.15 Intercreditor Agreement.................................. 54
Section 6.16 Intercreditor Agreement Purchase Option.................. 54
Article VII
SUCCESSOR TRUSTEES
Section 7.1 Resignation and Removal of Trustee....................... 54
Section 7.2 Appointment of Successor................................. 55
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Article VIII
INDEMNITY
Section 8.1 Indemnity................................................ 56
Section 8.2 Noteholders' Indemnity................................... 56
Section 8.3 Survival................................................. 56
Article IX
MODIFICATION
Section 9.1 Modification with Consent of Noteholders................. 57
Section 9.2 Modification Without Consent of Noteholders.............. 58
Section 9.3 Amendment of Intercreditor Agreement..................... 59
Section 9.4 Subordination; Priority of Payments...................... 59
Section 9.5 Execution of Amendments by Trustee....................... 59
Section 9.6 Conformity with Trust Indenture Act...................... 59
Article X
SUBORDINATION
Section 10.1 Subordination of the Notes............................... 59
Article XI
DISCHARGE OF INDENTURE
Section 11.1 Discharge of Indenture................................... 61
Article XII
MISCELLANEOUS
Section 12.1 Right of Trustee to Perform.............................. 61
Section 12.2 Waiver................................................... 61
Section 12.3 Severability............................................. 62
Section 12.4 Restrictions on Exercise of Certain Rights............... 62
Section 12.5 Notices.................................................. 62
Section 12.6 Assignments.............................................. 64
Section 12.7 Application to Court..................................... 64
Section 12.8 GOVERNING LAW............................................ 64
Section 12.9 Jurisdiction............................................. 64
Section 12.10 Counterparts............................................. 66
Section 12.11 Table of Contents and Headings........................... 66
Section 12.12 Trust Indenture Act...................................... 66
Section 12.13 Confidential Information................................. 67
Section 12.14 Intercreditor Agreement.................................. 68
Section 12.15 Limited Recourse......................................... 68
Annex A Defined Terms
Schedule 1 Class A Principal Payment Schedule
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Exhibit A Form of Original Class A Notes
Exhibit B Form of Resale Confidentiality Agreement
Exhibit C Agents for Service of Process
Exhibit D Coverage of Distribution Report
Exhibit E Form of Certificate of Euroclear or Clearstream for Permanent
Regulation S Global Note
Exhibit F Form of Certification of Beneficial Owner of Temporary Regulation
S Global Note
Exhibit G Form of Certification of Euroclear or Clearstream for Payments
Exhibit H Form of Certificate of Proposed Transferor
Exhibit I Form of Certificate of Proposed Institutional Accredited Investor
Transferee
Exhibit J UCC Financing Statements
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INDENTURE
This INDENTURE, dated as of October 18, 2005, is by and between DULOXETINE
ROYALTY SUB, an exempted company incorporated with limited liability under the
laws of the Cayman Islands, as issuer of the Notes described herein, and U.S.
Bank National Association, a national banking association, as initial trustee of
the Notes described herein.
GRANTING CLAUSE
NOW, THEREFORE, THIS INDENTURE WITNESSETH, that, in consideration of the
premises and the acceptance by the Trustee of the trusts hereby created and of
the purchase and acceptance of the Notes by the Noteholders, and for other good
and valuable consideration, the receipt of which is hereby acknowledged, in
order to secure (i) the prompt payment of the principal of, Premium (if any) and
interest on, and all other amounts due with respect to, the Notes from time to
time Outstanding hereunder, including any break funding costs and interest rate
swap breakage costs, (ii) the payment of any fees, expenses or other amounts
that Royalty Sub is obligated to pay under or in respect of the Notes, this
Indenture or any other Transaction Document to which Royalty Sub is a party,
(iii) the payment and performance of all the obligations of Royalty Sub in
respect of any amendment, modification, extension, renewal or refinancing of the
Notes and (iv) the performance and observance by Royalty Sub of all the
agreements, covenants and provisions expressed or implied herein and in the
Notes for the benefit of the Noteholders (collectively, the "Secured
Obligations") and for the uses and purposes and subject to the terms and
provisions hereof, Royalty Sub does hereby grant, bargain, sell, assign,
transfer, convey, mortgage, pledge and confirm unto the Trustee, its successors
and assigns, for the security and benefit of the Noteholders from time to time
of the Notes, a continuing security interest, second in priority only to the
security interest granted to the Administrative Agent, its successors and
assigns for the security and benefit of the Lenders under the Credit Agreement,
in all right, title and interest of Royalty Sub in, to and under the following
described property, rights and privileges (each property, including all other
property hereafter specifically subjected to the lien of this Indenture or any
indenture supplemental hereto, being the "Collateral" and, collectively,
including all other property hereafter specifically subjected to the lien of
this Indenture or any indenture supplemental hereto, are included within and
defined as the "Indenture Estate"), to wit:
(1) the Royalty Sub Rights;
(2) the Purchase and Sale Agreement, the Servicing Agreement, the Hedge
Agreement and all other Transaction Documents and other agreements to which
Royalty Sub is a party, including those relating to the rights of Royalty Sub in
respect of the sale, transfer, conveyance, assignment, contribution, grant and
servicing of the Royalty Sub Rights;
(3) (A) all Accounts established under the Intercreditor Agreement at any
time, (B) all amounts from time to time credited to such Accounts, (C) all cash,
financial assets and other investment property, instruments, documents, chattel
paper, general intangibles, accounts and other property from time to time
credited to such Accounts or representing investments and reinvestments of
amounts credited to such Accounts and (D) all interest, principal payments,
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dividends and other distributions payable on or with respect to, and all
proceeds of, (i) all property so credited or representing such investments and
reinvestments and (ii) such Accounts;
(4) all of Royalty Sub's rents, issues, profits, revenues and other income
of the property subjected or required to be subjected to the lien of this
Indenture;
(5) all other property and assets of Royalty Sub with respect to which a
security interest can be created under Article 9 of the UCC, including all
goods, deposit accounts, investment property, financial assets, letter-of-credit
rights, supporting obligations, commercial tort claims, accounts, contract
rights, general intangibles and cash (except (i) to the extent permitted to be
distributed by Royalty Sub to the Pledgor pursuant to Section 3.12 of the
Intercreditor Agreement and (ii) proceeds from the Loans and any Notes);
(6) all rights of Royalty Sub (contractual and otherwise) constituting,
arising under, connected with or in any way related to any or all of the
foregoing property;
(7) all books, records, ledger cards, files, correspondence, computer
programs, tapes, disks and related data processing software (owned by Royalty
Sub) that at any time evidence or contain information relating to any of the
foregoing property or are otherwise necessary or helpful in the collection
thereof or realization thereupon;
(8) all documents of title, policies and certificates of insurance,
securities, chattel paper and other documents or instruments evidencing or
pertaining to any of the foregoing property of Royalty Sub; and
(9) all proceeds and products of any and all of the foregoing property;
BUT EXCLUDING from the foregoing and from the Collateral and the Indenture
Estate the Initial Capital Amount Account and SUBJECT TO all of the terms and
conditions of this Indenture and the Intercreditor Agreement.
HABENDUM CLAUSE
TO HAVE AND TO HOLD all and singular the aforesaid property unto the
Trustee, its successors and assigns, in trust for the benefit and security of
the Noteholders from time to time of each class of the Notes, without any
priority of any one class of Notes over any other class of Notes by reason of
difference in time of issuance or otherwise, except as expressly provided
herein, and for the uses and purposes and subject to the terms and provisions
set forth in this Indenture.
PROVIDED, HOWEVER, that, notwithstanding any of the foregoing provisions or
anything to the contrary herein, so long as no Event of Default shall have
occurred and be continuing, Royalty Sub shall have the right, to the exclusion
of the Trustee and the Noteholders, to exercise in Royalty Sub's name all rights
and powers of Royalty Sub under the Purchase and Sale Agreement, the Servicing
Agreement, the Hedge Agreement and any other agreement to
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which Royalty Sub may be a party, SUBJECT TO all of the terms and conditions of
this Indenture and the Intercreditor Agreement.
It is expressly agreed that anything herein contained to the contrary
notwithstanding, Royalty Sub shall remain liable under the Transaction Documents
and any other contracts and agreements included in the Collateral to the extent
set forth therein and shall perform all of the duties and obligations of Royalty
Sub thereunder to the same extent as if this Indenture had not been executed in
accordance with and pursuant to the terms and provisions thereof, the exercise
by the Trustee of any of its rights hereunder shall not release Royalty Sub from
any of its duties or obligations under any such Transaction Documents or other
contracts or agreements included in the Collateral, and, prior to the
foreclosure of the lien of this Indenture under Section 4.2, the Trustee and the
Noteholders shall have no obligation or liability under any thereof by reason of
or arising out of this Indenture or the assignment hereunder, nor shall the
Trustee or the Noteholders be required or obligated in any manner to perform or
fulfill any obligations or duties of Royalty Sub under or pursuant to any
Transaction Document or any other contract or agreement included in the
Collateral or, except as herein expressly provided, to make any payment, make
any inquiry as to the nature or sufficiency of any payment received by it,
present or file any claim or take any action to collect or enforce any claim for
payment assigned hereunder or the payment of any amounts which may have been
assigned to it or to which it may be entitled at any time or times.
Subject to the provisions of the Intercreditor Agreement, Royalty Sub does
hereby constitute and appoint the Trustee the true and lawful attorney of
Royalty Sub, irrevocably, granted for good and valuable consideration and
coupled with an interest and with full power of substitution, and with full
power (in the name of Royalty Sub or otherwise), to ask, require, demand,
receive, compound and give acquittance for any and all monies and claims for
monies (in each case including insurance and requisition proceeds) due and to
become due under or arising out of any Transaction Document and all other
property which now or hereafter constitutes part of the Indenture Estate, to
endorse any checks or other instruments or orders in connection therewith and to
file any claims or take any action or institute any proceedings which the
Trustee may deem to be necessary or advisable in the premises; provided, that
the Trustee shall not exercise any such rights except upon the occurrence and
during the continuance of an Event of Default hereunder in accordance with
Section 4.2.
Royalty Sub agrees that, at any time and from time to time, at Royalty
Sub's expense and upon the Trustee's reasonable request, Royalty Sub will
promptly and duly execute and deliver or cause to be duly executed and delivered
any and all such further instruments and documents, and take all further action,
that may be necessary or desirable in the reasonable discretion of the Trustee,
in order to perfect the security interest in the Collateral and to carry out the
provisions of this Indenture or to enable the Trustee to exercise and enforce
its rights and remedies hereunder with respect to any Collateral. Royalty Sub
also agrees that, at any time and from time to time, at Royalty Sub's expense,
Royalty Sub will file (or cause to be filed) such UCC continuation statements
and such other instruments or notices as may be necessary, including UCC filing
statements or amendments thereto, that the Trustee may reasonably request in
order to perfect and preserve the security interests and other rights granted or
purported to be granted to the
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Trustee hereby. With respect to the foregoing and the grant of the security
interest hereunder, Royalty Sub hereby authorizes the Trustee to file one or
more financing or continuation statements, and amendments thereto, relative to
all or any part of the Collateral without the signature of Royalty Sub where
permitted by law. Royalty Sub agrees that a carbon, photographic or other
reproduction of this Indenture or any financing statement covering the
Collateral or any part thereof shall be sufficient as a financing statement
where permitted by law.
If Royalty Sub fails to perform any agreement contained herein after
receipt of a written request to do so from the Trustee (it being understood that
no such request need be given after the occurrence and during the continuance of
an Event of Default under this Indenture), the Trustee may itself perform, or
cause performance of, such agreement, in which case the reasonable expenses of
the Trustee, including the fees and expenses of its counsel, incurred in
connection therewith shall be payable by Royalty Sub under Section 8.1. Royalty
Sub further agrees that it has never filed any tax return or report under any
name other than its exact legal name, and such exact legal name may not be
changed, amended or altered at any time except following 30 days' notice given
by Royalty Sub to the Trustee. Royalty Sub hereby authorizes the Trustee to file
financing statements describing as the collateral covered thereby "all of the
debtor's personal property or assets" or words to that effect, notwithstanding
that such wording may be broader in scope than the Collateral described in this
Indenture.
Royalty Sub does hereby (a) represent and warrant that it has not assigned
or pledged, and (b) covenant that it will not assign or pledge, so long as the
assignment hereunder shall remain in effect and has not been terminated pursuant
to Section 11.1, any of its right, title or interest in the Collateral hereby
assigned, to anyone other than the Collection Agent, the Administrative Agent or
the Trustee.
As of the date hereof, Royalty Sub represents and warrants as follows: (a)
Royalty Sub is the sole legal and beneficial owner of the Collateral free and
clear of any Lien other than the Lien created pursuant to this Indenture and the
First Lien Documents; no security agreement, financing statement or other public
notice with respect to all or any part of the Collateral is on file or of record
in any public office, except such as may have been filed in favor of the
Administrative Agent or the Trustee pursuant to this Indenture and the First
Lien Documents; (b) no consent of any other party (including directors,
officers, members, managers or creditors of Royalty Sub) and no government
approval is required which has not been obtained (i) for the pledge by Royalty
Sub of the Collateral pursuant to this Indenture or (ii) for the exercise by the
Trustee of the rights provided for in this Indenture or the remedies in respect
of the Collateral pursuant to this Indenture; and (c) this Indenture creates a
valid security interest in the Collateral securing the payment of the Secured
Obligations; Royalty Sub has filed or caused to be filed all statements in the
appropriate offices therefor (or has executed and delivered to the Trustee
originals thereof suitable for filing in such offices) and has taken all of the
actions necessary to create perfected security interests in the applicable
Collateral including, in the case of Collateral comprised of deposit accounts,
such actions causing the Trustee (or an agent thereof) to have "control" (as
defined in Section 8-106 of the UCC, as such term relates to deposit accounts).
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It is hereby further agreed that any and all property described or referred
to in the Granting Clause which is hereafter acquired by Royalty Sub shall ipso
facto, and without any other conveyance, assignment or act on the part of
Royalty Sub or the Trustee, become and be subject to the Security Interest
herein granted as fully and completely as though specifically described herein,
but nothing contained in this paragraph shall be deemed to modify or change the
obligations of Royalty Sub contained in the foregoing paragraphs.
Except where the context clearly indicates a different meaning, all terms
defined in Article 1, 8 or 9 of the UCC, as in effect on the date of this
Indenture and the Intercreditor Agreement, are used in the Granting Clause and
this Habendum Clause with the meanings therein ascribed to them; such terms
include "document", "general intangibles", "instrument", "investment property",
"proceeds" and "security interest". In addition, all capitalized terms used in
the Granting Clause and this Habendum Clause, including the terms "account" and
"security interest", when capitalized, shall have the meanings specified in
Annex A attached hereto.
Royalty Sub does hereby ratify and confirm this Indenture and the other
Transaction Documents to which it is a party and, subject to the other terms of
this Indenture, does hereby agree that it will not take or omit to take any
action, the taking or omission of which might result in an alteration or
impairment of the assignment hereunder or of any of the rights created by any
thereof.
IT IS HEREBY COVENANTED AND AGREED by and between the parties hereto as
follows:
ARTICLE I
DEFINITIONS
Section 1.1 Definitions. Unless otherwise defined herein, capitalized terms
used herein are defined in Annex A hereto, which is hereby incorporated by
reference into this Indenture as if set forth fully herein.
Section 1.2 Rules of Construction. Unless the context otherwise requires:
(a) A term has the meaning assigned to it and an accounting term not
otherwise defined has the meaning assigned to it in accordance with GAAP.
(b) The terms "herein", "hereof" and other words of similar import
refer to this Indenture as a whole and not to any particular Article, Section or
other subdivision.
(c) Unless otherwise indicated in context, all references to Articles,
Sections or Exhibits refer to an Article or Section of, or an Exhibit to, this
Indenture.
(d) Words of the masculine, feminine or neuter gender shall mean and
include the correlative words of other genders, and words in the singular shall
include the plural, and vice versa.
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(e) The terms "include", "including" and similar terms shall be
construed as if followed by the phrase "without limitation".
(f) Unless otherwise indicated, references to a class of Notes shall
be to the Original Class A Notes, to the Class B Notes or to a class of
Refinancing Notes, as applicable.
(g) References in this Indenture to an agreement or other document
(including this Indenture) include references to such agreement or document as
amended, restated, supplemented or otherwise modified in accordance with the
provisions of this Indenture, and the provisions of this Indenture apply to
successive events and transactions.
(h) References in this Indenture to any statute or other legislative
provision shall include any statutory or legislative modification or
re-enactment thereof, or any substitution therefor.
(i) References in this Indenture to the Notes include the terms and
conditions in this Indenture applicable to the Notes, and any reference to any
amount of money due or payable by reference to the Notes shall include any sum
covenanted to be paid by Royalty Sub under this Indenture in respect of the
Notes.
(j) References in this Indenture to any action, remedy or method of
judicial proceeding for the enforcement of the rights of creditors or of
security shall be deemed to include, in respect of any jurisdiction other than
the State of New York, references to such action, remedy or method of judicial
proceeding for the enforcement of the rights of creditors or of security
available or appropriate in such jurisdiction as shall most nearly approximate
such action, remedy or method of judicial proceeding described or referred to in
this Indenture.
(k) Where any payment is to be made, any funds are to be applied or
any calculation is to be made hereunder on a day which is not a Business Day,
unless any Transaction Document otherwise provides, such payment shall be made,
such funds shall be applied and such calculation shall be made on the next
succeeding Business Day, and payments shall be adjusted accordingly, including
interest unless otherwise specified; provided, however, that no interest shall
accrue in respect of any payments made on Fixed Rate Notes on that next
succeeding Business Day.
Section 1.3 Compliance Certificates and Opinions. Upon any application or
request by Royalty Sub to the Trustee to take any action under any provision of
this Indenture, Royalty Sub shall furnish to the Trustee an Officer's
Certificate stating that, in the opinion of the signer thereof in his or her
capacity as such, all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with, and an
Opinion of Counsel stating that, in the opinion of such counsel, all such
conditions precedent, if any, have been complied with, except that, in the case
of any such application or request as to which the furnishing of such documents
is specifically required by any provision of this Indenture relating to such
particular application or request, no additional certificate or opinion need be
furnished.
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Every certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture (other than a certificate provided
pursuant to Section 5.2) or any indenture supplemental hereto shall include:
(a) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions in this
Indenture relating thereto;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of each such individual in his or
her capacity as such, he or she has made such examination or investigation as is
necessary to enable him or her to express an informed opinion as to whether or
not such covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such individual,
such condition or covenant has been complied with.
Section 1.4 Acts of Noteholders.
(a) Any direction, consent, waiver or other action provided by this
Indenture in respect of the Notes of any class to be given or taken by
Noteholders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Noteholders in person or by an agent
or proxy duly appointed in writing, and, except as herein otherwise expressly
provided, such action shall become effective when such instrument or instruments
are delivered to the Trustee or to Royalty Sub. Such instrument or instruments
(and the action embodied therein and evidenced thereby) are herein sometimes
referred to as the "Act" of the Noteholders signing such instrument or
instruments. Proof of execution of any such instrument or of a writing
appointing any such agent shall be sufficient for any purpose under this
Indenture and conclusive in favor of the Trustee or Royalty Sub, if made in the
manner provided in this Section 1.4(a).
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the certificate of any notary public or
other officer of any jurisdiction authorized to take acknowledgments of deeds or
administer oaths that the Person executing such instrument acknowledged to him
or her the execution thereof, or by an affidavit of a witness to such execution
sworn to before any such notary or such other officer and, where such execution
is by an officer of a corporation or association, trustee of a trust or member
of a partnership, on behalf of such corporation, association, trust or
partnership, such certificate or affidavit shall also constitute sufficient
proof of his or her authority. The fact and date of the execution of any such
instrument or writing, or the authority of the Person executing the same, may
also be proved in any other reasonable manner that the Trustee deems sufficient.
(c) In determining whether the Noteholders have given any direction,
consent, request, demand, authorization, notice, waiver or other Act (a
"Direction") under this Indenture,
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Notes owned by Royalty Sub, Quintiles or any Affiliate of any such Person shall
be disregarded and deemed not to be Outstanding for purposes of any such
determination. In determining whether the Trustee shall be protected in relying
upon any such Direction, only Notes that a Responsible Officer of the Trustee
actually knows to be so owned shall be so disregarded. Notwithstanding the
foregoing, (i) if any such Person owns 100% of the Notes of any class
Outstanding, such Notes shall not be so disregarded as aforesaid, and (ii) if
any amount of Notes of such class so owned by any such Person have been pledged
in good faith, such Notes shall not be disregarded as aforesaid if the pledgee
establishes to the satisfaction of the Trustee the pledgee's right so to act
with respect to such Notes and that the pledgee is not Royalty Sub, Quintiles or
an Affiliate of any such Person.
(d) Royalty Sub may, at its option, by delivery of Officer's
Certificate(s) to the Trustee, set a record date other than the Record Date to
determine the Noteholders in respect of the Notes of any class entitled to give
any Direction in respect of such Notes. Such record date shall be the record
date specified in such Officer's Certificate, which shall be a date not more
than 30 days prior to the first solicitation of Noteholders in connection
therewith. If such a record date is fixed, such Direction may be given before or
after such record date, but only the Noteholders of the applicable class at the
close of business on such record date shall be deemed to be Noteholders for the
purposes of determining whether Noteholders of the requisite proportion of
Outstanding Notes of such class have authorized, agreed or consented to such
Direction, and for that purpose the Outstanding Notes of such class shall be
computed as of such record date; provided, that no such Direction by the
Noteholders on such record date shall be deemed effective unless it shall become
effective pursuant to the provisions of this Indenture not later than one year
after the record date.
(e) Any Direction or other action by the Noteholder of any Note shall
bind the Noteholder of every Note issued upon the transfer thereof, in exchange
therefor or in lieu thereof, whether or not notation of such action is made upon
such Note, and any Direction or other action by the Beneficial Holder of any
Beneficial Interest in any Note shall bind any transferee of such Beneficial
Interest.
ARTICLE II
THE NOTES
Section 2.1 Amount Not to Exceed the Initial Outstanding Principal Balance;
Terms; Form; Execution and Delivery.
(a) The Outstanding Principal Balance of any class of Notes which may
be authenticated and delivered from time to time under this Indenture shall not
exceed, with respect to the Original Class A Notes, the initial Outstanding
Principal Balance for the Original Class A Notes set forth in the definition
thereof or, with respect to any Class B Notes or class of Refinancing Notes, the
initial Outstanding Principal Balance authorized in the Board Resolution
establishing such Class B Notes or Refinancing Notes; provided, that the
Outstanding Principal Balance of any such class of Refinancing Notes shall not
be less than the Redemption Price of the class of Notes being refinanced in
whole thereby and any Redemption Premium, plus
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Transaction Expenses relating thereto, and that any Refinancing Notes shall be
issued in accordance with Section 2.15 and that any Class B Notes shall be
issued in accordance with Section 2.16.
(b) There shall be issued, authenticated and delivered on the Closing
Date and on the date of issuance of any Class B Notes or Refinancing Notes to
each of the Noteholders Notes in the principal amounts and maturities and
bearing the interest rates, in each case in registered form and, in the case of
the Original Class A Notes, substantially in the form set forth in Exhibit A or,
in the case of any Class B Notes or Refinancing Notes, substantially in the form
set forth in any indenture supplemental hereto, with such appropriate
insertions, omissions, substitutions and other variations as are required or
permitted by this Indenture, and may have such letters, numbers or other marks
of identification and such legends or endorsements typewritten, printed,
lithographed or engraved thereon, as may, consistently herewith, be prescribed
by the Trustee. The Trustee shall authenticate Notes and make Notes available
for delivery only upon the written order of Royalty Sub signed by a Responsible
Officer of Royalty Sub. Such order shall specify the aggregate principal amount
of Notes to be authenticated, the date of issue, whether they are to be issued
as Global Notes or Definitive Notes and delivery instructions.
Definitive Notes of each class shall be typewritten, printed, lithographed
or engraved or produced by any combination of these methods, as determined by
the Trustee.
Any Notes offered and sold in reliance on Rule 144A shall be issued
initially in the form of one or more permanent Global Notes in registered form,
substantially in the form set forth in the applicable Exhibit to this Indenture
or in any indenture supplemental hereto (each, a "Permanent Global Note"),
registered in the name of the nominee of DTC, deposited with the Trustee, as
custodian for DTC, duly executed by Royalty Sub and authenticated by the Trustee
as hereinafter provided. The aggregate principal amount of each Permanent Global
Note may from time to time be increased or decreased by adjustments made on the
books and records of the Registrar, as hereinafter provided.
Any Notes offered and sold to institutions in offshore transactions in
reliance on Regulation S shall be issued initially in the form of one or more
temporary global Notes in registered form substantially in the form set forth in
the applicable Exhibit to this Indenture or in any indenture supplemental hereto
(each, a "Temporary Regulation S Global Note"), registered in the name of the
nominee of DTC, deposited with the Trustee, as custodian for DTC, duly executed
by Royalty Sub and authenticated by the Trustee as hereinafter provided. At any
time following the applicable Regulation S Global Note Exchange Date, upon
receipt by the Trustee and Royalty Sub of a certificate substantially in the
form of Exhibit E, executed by Euroclear or Clearstream, as the case may be,
together with copies of certificates from Euroclear or Clearstream, as the case
may be, certifying that it has received certification of non-U.S. beneficial
ownership of a Temporary Regulation S Global Note (or portion thereof) with
respect to any Notes to be exchanged, one or more permanent Global Notes for
such Notes in registered form substantially in the form set forth in the
applicable Exhibit to this Indenture or in any indenture supplemental hereto
(each, a "Permanent Regulation S Global Note" and, together with each Temporary
Regulation S Global Note, the "Regulation S Global Notes") duly executed by
9
Royalty Sub and authenticated by the Trustee as hereinafter provided shall be
deposited with the Trustee, as custodian for DTC, and the Registrar shall
reflect on its books and records the date and a decrease in the principal amount
of the Temporary Regulation S Global Note of such class in an amount equal to
the principal amount of such Temporary Regulation S Global Note exchanged. Until
the Regulation S Global Note Exchange Date with respect to any Temporary
Regulation S Global Note, Beneficial Interests in such Temporary Regulation S
Global Note may be held only through Agent Members acting for and on behalf of
Euroclear and Clearstream.
Notes, if so provided herein or in any indenture supplemental hereto, shall
be issued in the form of permanent certificated Notes in registered form in
substantially the form set forth in the applicable Exhibit to this Indenture
(collectively with any definitive, fully registered Notes issued pursuant to
Section 2.10(b), the "Definitive Notes").
(c) Interest shall accrue on any class of Floating Rate Notes from the
Closing Date (or, with respect to any Class B Notes or Refinancing Notes, the
date of issuance of such Class B Notes or Refinancing Notes) and shall be
computed for each Interest Accrual Period on the basis of a 360-day year and the
actual number of days elapsed in such Interest Accrual Period on the Outstanding
Principal Balance of such Notes. Interest shall accrue on the Original Class A
Notes and on any other class of Fixed Rate Notes from the Closing Date (or, with
respect to any Class B Notes or Refinancing Notes, the date of issuance of such
Class B Notes or Refinancing Notes) and shall be computed for each Interest
Accrual Period on the basis of a 360-day year consisting of twelve 30-day months
on the Outstanding Principal Balance of such Notes.
(d) On the date of any Refinancing, Royalty Sub shall issue and
deliver as provided in Section 2.15 an aggregate principal amount of Refinancing
Notes having the maturities and bearing the interest rates and such other terms
authorized by one or more Board Resolutions or in any indenture supplemental
hereto providing for the issuance of such Notes or specified in the form of such
Notes, in each case in accordance with Section 2.15.
(e) On the date of issuance, if any, of any Class B Notes, Royalty Sub
shall issue and deliver, as provided in Section 2.16, an aggregate principal
amount of Class B Notes having the maturities and bearing the interest rates and
such other terms authorized by one or more Board Resolutions or in any indenture
supplemental hereto providing for the issuance of such Notes or specified in the
form of such Notes, in each case in accordance with Section 2.16.
(f) The Notes shall be executed on behalf of Royalty Sub by the manual
or facsimile signature of a Responsible Officer.
(g) Each Note bearing the manual or facsimile signature of any
individual who was at the time such Note was executed a Responsible Officer
shall bind Royalty Sub, notwithstanding that any such individual has ceased to
hold such office prior to the authentication and delivery of such Notes or any
payment thereon.
(h) At any time and from time to time after the execution of any
Notes, Royalty Sub may deliver such Notes to the Trustee for authentication and,
subject to the provisions of
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Section 2.1(i), the Trustee shall authenticate such Notes by manual or facsimile
signature upon receipt by it of a written order of Royalty Sub. The Notes shall
be authenticated on behalf of the Trustee by any Responsible Officer of the
Trustee.
(i) No Note shall be entitled to any benefit under this Indenture or
be valid or obligatory for any purpose, unless it shall have been executed on
behalf of Royalty Sub as provided in Section 2.1(f) and authenticated by or on
behalf of the Trustee as provided in Section 2.1(h). Such signatures shall be
conclusive evidence that such Note has been duly executed and authenticated
under this Indenture. Each Note shall be dated the date of its authentication.
Section 2.2 Restrictive Legends. Each Note (and all Notes issued in
exchange therefor or upon registration of transfer or substitution thereof)
shall bear the following legend on the face thereof (the "Private Placement
Legend"):
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), THE SECURITIES LAWS OF ANY STATE OR THE
SECURITIES LAWS OF ANY OTHER JURISDICTION, NOR IS SUCH REGISTRATION
CONTEMPLATED. NEITHER THIS NOTE NOR ANY INTEREST HEREIN MAY BE ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED, SOLD OR OFFERED FOR SALE OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION UNDER THE SECURITIES ACT OR
AN EXEMPTION FROM SUCH REGISTRATION THEREUNDER AND ANY OTHER APPLICABLE
SECURITIES LAW REGISTRATION REQUIREMENTS. EACH PERSON WHO ACQUIRES OR
ACCEPTS THIS NOTE OR AN INTEREST HEREIN BY SUCH ACQUISITION OR ACCEPTANCE
(1) REPRESENTS THAT (A) IT IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED
IN RULE 144A UNDER THE SECURITIES ACT) AND IS PURCHASING THIS NOTE IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A UNDER THE SECURITIES ACT,
(B) IT IS AN INSTITUTIONAL ACCREDITED INVESTOR WITHIN THE MEANING OF
SUBPARAGRAPH (a) (1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT
(AN "INSTITUTIONAL ACCREDITED INVESTOR"), HAS SUFFICIENT KNOWLEDGE AND
EXPERIENCE IN FINANCIAL AND BUSINESS MATTERS TO BE CAPABLE OF EVALUATING
THE MERITS AND RISKS OF THE PURCHASE OF THIS NOTE AND IS ABLE AND PREPARED
TO BEAR THE ECONOMIC RISK OF INVESTING IN AND HOLDING THIS NOTE, (C) IT IS
AN INSTITUTION THAT IS NOT A U.S. PERSON AND IS ACQUIRING THIS NOTE IN AN
OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 903 OR 904 OF REGULATION S
UNDER THE SECURITIES ACT OR (D) IT IS AN INSTITUTION ACQUIRING THIS NOTE
AFTER THE RESALE RESTRICTION TERMINATION DATE (AS DEFINED BELOW), (2)
AGREES THAT IT WILL NOT PRIOR TO (X) THE DATE THAT IS TWO YEARS (OR SUCH
SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144(k)
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UNDER THE SECURITIES ACT OR ANY SUCCESSOR PROVISION THEREUNDER) AFTER THE
LATER OF THE ORIGINAL ISSUE DATE HEREOF (OR ANY PREDECESSOR OF THIS NOTE)
AND (Y) SUCH LATER DATE, IF ANY, AS MAY BE REQUIRED BY APPLICABLE LAW (THE
"RESALE RESTRICTION TERMINATION DATE") OFFER, SELL OR OTHERWISE TRANSFER
THIS NOTE OR AN INTEREST HEREIN, EXCEPT (A) TO ROYALTY SUB OR A SUBSIDIARY
THEREOF, (B) FOR SO LONG AS THIS NOTE IS ELIGIBLE FOR RESALE PURSUANT TO
RULE 144A UNDER THE SECURITIES ACT, TO A PERSON IT REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A UNDER THE SECURITIES ACT,
(C) TO AN INSTITUTIONAL ACCREDITED INVESTOR THAT IS PURCHASING THIS NOTE OR
AN INTEREST HEREIN, AS THE CASE MAY BE, FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR FOR INVESTMENT
PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH,
ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT OR (D) TO AN
INSTITUTION OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN
COMPLIANCE WITH RULE 903 OR 904 OF REGULATION S UNDER THE SECURITIES ACT
(IF AVAILABLE), (3) AGREES THAT IT WILL NOT AFTER THE RESALE RESTRICTION
TERMINATION DATE OFFER, SELL OR OTHERWISE TRANSFER THIS NOTE OR AN INTEREST
HEREIN EXCEPT TO AN INSTITUTION AND (4) AGREES THAT IT WILL GIVE TO EACH
PERSON TO WHOM THIS NOTE OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND; PROVIDED, THAT ROYALTY SUB AND
THE TRUSTEE SHALL HAVE THE RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER
PURSUANT TO CLAUSE (2)(C) OR (D) OF THIS PARAGRAPH TO REQUIRE THE DELIVERY
OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION
SATISFACTORY TO EACH OF THEM. AS USED HEREIN, THE TERMS "OFFSHORE
TRANSACTION", "UNITED STATES" AND "U.S. PERSON" HAVE THE RESPECTIVE
MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT. THE
INDENTURE REFERRED TO HEREINAFTER CONTAINS A PROVISION REQUIRING THE
REGISTRAR APPOINTED THEREUNDER TO REFUSE TO REGISTER ANY TRANSFER OF THIS
NOTE IN VIOLATION OF THE FOREGOING RESTRICTIONS.
Each Note shall also bear the following legend on the face thereof:
BY ITS PURCHASE AND ACCEPTANCE OF THIS NOTE, EACH PURCHASER WILL BE DEEMED
TO HAVE REPRESENTED AND
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WARRANTED THAT EITHER (I) NO ASSETS OF A PLAN HAVE BEEN USED TO PURCHASE
THIS NOTE OR (II) TO THE EXTENT THAT SUCH ASSETS ARE USED TO PURCHASE THIS
NOTE (X) ONE OR MORE PROHIBITED TRANSACTION STATUTORY OR ADMINISTRATIVE
EXEMPTIONS APPLIES SUCH THAT THE USE OF PLAN ASSETS TO PURCHASE AND HOLD
THIS NOTE WILL NOT CONSTITUTE A NON-EXEMPT PROHIBITED TRANSACTION, (Y) SUCH
ASSETS ARE NOT CONSIDERED PLAN ASSETS BY REASON OF BEING HELD IN A SEPARATE
ACCOUNT OF AN INSURANCE COMPANY, UNDER WHICH AMOUNTS PAYABLE OR CREDITED TO
THE PLAN AND TO ANY PARTICIPANT OR BENEFICIARY OF THE PLAN ARE NOT AFFECTED
BY THE INVESTMENT PERFORMANCE OF THE SEPARATE ACCOUNT, OR (Z) SUCH ASSETS
ARE ASSETS OF ONE OR MORE EMPLOYEE BENEFIT PLANS, EACH OF WHICH HAS BEEN
IDENTIFIED TO ROYALTY SUB, DULOXETINE HOLDCO ROYALTY SUB (THE "PLEDGOR")
AND QUINTILES TRANSNATIONAL CORP. ("QUINTILES") IN WRITING. "PLAN" MEANS
ANY EMPLOYEE BENEFIT PLAN (WITHIN THE MEANING OF SECTION 3(3) OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA")) OR
OTHER RETIREMENT PLAN OR ARRANGEMENT (INCLUDING, WITHOUT LIMITATION, AN
INDIVIDUAL RETIREMENT ACCOUNT OR ANNUITY) THAT IS SUBJECT TO ERISA AND/OR
THE CODE, AND ANY ENTITY THAT MAY BE DEEMED TO HOLD THE ASSETS OF ANY SUCH
PLAN.
THIS NOTE MAY NOT BE RESOLD OR TRANSFERRED EXCEPT AS SET FORTH IN THE
INDENTURE REFERRED TO HEREINAFTER, AND, IN ADDITION, EACH PERSON WHO
ACQUIRES OR ACCEPTS THIS NOTE OR AN INTEREST HEREIN BY SUCH ACQUISITION OR
ACCEPTANCE AGREES THAT IT SHALL CAUSE ANY PROPOSED TRANSFEREE TO EXECUTE A
RESALE CONFIDENTIALITY AGREEMENT IN THE FORM ATTACHED AS EXHIBIT B TO SUCH
INDENTURE AND DELIVER SUCH RESALE CONFIDENTIALITY AGREEMENT TO THE
REGISTRAR (AS DEFINED IN SUCH INDENTURE) AND FURTHER AGREES TO OTHERWISE
COMPLY WITH THE TRANSFER RESTRICTIONS SET FORTH IN SUCH INDENTURE,
INCLUDING SECTION 2.11 THEREOF, AND FURTHER ACKNOWLEDGES AND AGREES TO THE
PROVISIONS SET FORTH IN SECTION 2.5 OF SUCH INDENTURE.
THIS NOTE MAY NOT BE SOLD OR TRANSFERRED TO ANY PERSON THAT IS ENGAGED IN
THE BUSINESS OF DEVELOPING, MANUFACTURING OR MARKETING PHARMACEUTICAL OR
DIAGNOSTIC PRODUCTS OR TO AN AFFILIATE (AS DEFINED IN THE INDENTURE
REFERRED TO HEREINAFTER) OF ANY SUCH PERSON ENGAGED IN ANY SUCH BUSINESS.
13
Each Global Note shall also bear the following legend on the face thereof:
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY TO ROYALTY SUB OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT HEREON IS
MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN
PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS NOTE SHALL BE LIMITED
TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN SECTION
2.11 OF THE INDENTURE REFERRED TO HEREINAFTER.
Each Temporary Regulation S Global Note shall also bear the following
legend on the face thereof:
THIS NOTE IS A TEMPORARY REGULATION S GLOBAL NOTE WITHIN THE MEANING OF THE
INDENTURE REFERRED TO HEREINAFTER AND IS SUBJECT TO RESTRICTIONS ON THE
TRANSFER AND EXCHANGE THEREOF AND ON THE PAYMENT OF INTEREST THEREON AS
SPECIFIED IN THE INDENTURE REFERRED TO HEREINAFTER.
Each Note shall also bear the following legend on the face thereof:
NOTWITHSTANDING ANYTHING IN THIS NOTE TO THE CONTRARY, THE EXERCISE OF ANY
RIGHT OR REMEDY BY THE TRUSTEE HEREUNDER IS SUBJECT TO THE PROVISIONS OF
THE INTERCREDITOR AGREEMENT (AS DEFINED IN THE INDENTURE). IN THE EVENT OF
ANY CONFLICT BETWEEN THE TERMS OF THE INTERCREDITOR AGREEMENT AND THIS
NOTE, THE TERMS OF THE INTERCREDITOR AGREEMENT SHALL GOVERN AND CONTROL.
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Section 2.3 Registrar and Paying Agent.
(a) With respect to each class of Notes, there shall at all times be
maintained an office or agency in the location set forth in Section 12.5 where
the Notes of such class may be presented or surrendered for registration of
transfer or for exchange (including any additional registrar, each, a
"Registrar") and for payment thereof (including any additional paying agent,
each, a "Paying Agent") and where notices and demands to or upon Royalty Sub in
respect of such Notes may be served. The Trustee shall be the initial Paying
Agent and Registrar, and Royalty Sub shall not be permitted to act as a Paying
Agent or a Registrar. Royalty Sub shall cause each Registrar to keep a register
of such class of Notes for which it is acting as Registrar and of their transfer
and exchange (the "Register"). Written notice of the location of each such other
office or agency and of any change of location thereof shall be given by the
Trustee to Royalty Sub and the Noteholders of such class of Notes. In the event
that no such office or agency shall be maintained or no such notice of location
or of change of location shall be given, presentations and demands may be made
and notices may be served at the Corporate Trust Office.
(b) Each Authorized Agent in the location set forth in Section 12.5
shall be a bank, trust company or corporation organized and doing business under
the laws of the U.S., any state or territory thereof or of the District of
Columbia, with a combined capital and surplus of at least U.S.$75,000,000 (or
having a combined capital and surplus in excess of U.S.$5,000,000 and the
obligations of which, whether now in existence or hereafter incurred, are fully
and unconditionally Guaranteed by a bank, trust company or corporation organized
and doing business under the laws of the U.S., any state or territory thereof or
of the District of Columbia and having a combined capital and surplus of at
least U.S.$75,000,000) and shall be authorized under the laws of the U.S., any
state or territory thereof or the District of Columbia to exercise corporate
trust powers, subject to supervision by federal or state authorities (such
requirements, the "Eligibility Requirements"). Each Registrar other than the
Trustee shall furnish to the Trustee, at least five Business Days prior to each
Payment Date, and at such other times as the Trustee may request in writing, a
copy of the Register maintained by such Registrar.
(c) Any Person into which any Authorized Agent may be merged or
converted or with which it may be consolidated, or any Person resulting from any
merger, consolidation or conversion to which any Authorized Agent shall be a
party, or any Person succeeding to all or substantially all of the corporate
trust business of any Authorized Agent (including the administration of the
fiduciary relationship contemplated by this Indenture), shall be the successor
of such Authorized Agent hereunder, if such successor corporation is otherwise
eligible under this Section 2.3, without the execution or filing of any paper or
any further act on the part of the parties hereto or such Authorized Agent or
such successor Person.
(d) Any Authorized Agent may at any time resign by giving written
notice of resignation to the Trustee and Royalty Sub. Royalty Sub may, and at
the request of the Trustee shall, at any time terminate the agency of any
Authorized Agent by giving written notice of termination to such Authorized
Agent and to the Trustee. Upon the resignation or termination of an Authorized
Agent or if at any time any such Authorized Agent shall cease to be eligible
under
15
this Section 2.3 (when, in either case, no other Authorized Agent performing the
functions of such Authorized Agent shall have been appointed by the Trustee),
Royalty Sub shall promptly appoint one or more qualified successor Authorized
Agents, reasonably satisfactory to the Trustee, to perform the functions of the
Authorized Agent that has resigned or whose agency has been terminated or who
shall have ceased to be eligible under this Section 2.3. Royalty Sub shall give
written notice of any such appointment made by it to the Trustee, and in each
case the Trustee shall mail notice of such appointment to all Noteholders of the
related class of Notes as their names and addresses appear on the Register for
such class of Notes.
(e) Royalty Sub agrees to pay, or cause to be paid, from time to time
to each Authorized Agent reasonable compensation for its services and to
reimburse it for its reasonable expenses to be agreed to pursuant to separate
agreements with each such Authorized Agent.
Section 2.4 Paying Agent to Hold Money in Trust. The Trustee shall require
each Paying Agent other than the Trustee to agree in writing that all moneys
deposited with any Paying Agent for the purpose of any payment on the Notes
shall be deposited and held in trust for the benefit of the Noteholders entitled
to such payment, subject to the provisions of this Section 2.4 and the
Intercreditor Agreement. Moneys so deposited and held in trust shall constitute
a separate trust fund for the benefit of the Noteholders with respect to which
such money was deposited.
Subject to the provisions of the Intercreditor Agreement, the Trustee may
at any time, for the purpose of obtaining the satisfaction and discharge of this
Indenture or for any other purpose, direct any Paying Agent to pay to the
Trustee all sums held in trust by such Paying Agent, and, upon such payment by
any Paying Agent to the Trustee, such Paying Agent shall be released from all
further liability with respect to such money.
Section 2.5 Method of Payment.
(a) Subject to the provisions of the Intercreditor Agreement, on each
Payment Date (to the extent amounts are received by the Trustee from the
Collection Agent, if applicable), the Trustee shall, or shall instruct a Paying
Agent to, pay, to the extent of the Available Collections Amount for such
Payment Date and any funds withdrawn from the Capital Account by the Collection
Agent pursuant to Section 3.8 of the Intercreditor Agreement, to the Noteholders
all interest, principal and Premium, if any, on each class of Notes in the
amounts determined by the Collection Agent pursuant to Section 3.5 of the
Intercreditor Agreement; provided, that payment on a Temporary Regulation S
Global Note shall be made to the Noteholder thereof only in conformity with
Section 2.5(c) and payment on any Note may be deferred as provided in Section
2.5(d). Each payment on any Payment Date other than the final payment with
respect to any class of Notes shall be made by the Trustee or Paying Agent to
the Noteholders as of the Record Date for such Payment Date. The final payment
with respect to any class of Notes, however, shall be made only upon
presentation and surrender of such Note by the Noteholder or its agent at the
Corporate Trust Office or agency of the Trustee or Paying Agent.
16
(b) At such time, if any, as the Notes of any class are issued in the
form of Definitive Notes, payments on a Payment Date shall be made by check
mailed to each Noteholder of a Definitive Note on the applicable Record Date at
its address appearing on the Register maintained with respect to such class of
Notes. Alternatively, upon application in writing to the Trustee, not later than
the applicable Record Date, by a Noteholder, any such payments shall be made by
wire transfer to an account designated by such Noteholder at a financial
institution in New York, New York; provided, that the final payment for any
class of Notes shall be made only upon presentation and surrender of the
Definitive Notes of such class by the Noteholder or its agent at the Corporate
Trust Office or agency of the Trustee or Paying Agent. Payments in respect of
the Notes represented by a Global Note (including principal, Premium, if any,
and interest) shall be made by wire transfer of immediately available funds to
the account specified by DTC.
(c) The beneficial owner of a Temporary Regulation S Global Note may
arrange to receive payments through Euroclear or Clearstream on such Temporary
Regulation S Global Note only after delivery by such beneficial owner to
Euroclear or Clearstream, as the case may be, of a written certification
substantially in the form of Exhibit F and upon delivery by Euroclear or
Clearstream, as the case may be, to the Paying Agent of a certification or
certifications substantially in the form of Exhibit G. No interest shall be paid
to any beneficial owner and no interest shall be paid to Euroclear or
Clearstream on such beneficial owner's interest in a Temporary Regulation S
Global Note unless Euroclear or Clearstream, as the case may be, has provided
such a certification to the Paying Agent with respect to such interest.
(d) Not later than five Business Days prior to each Payment Date or
any other date on which a Distribution Report is to be distributed to
Noteholders and Beneficial Holders pursuant to Section 2.13(a), the Registrar
shall use commercially reasonable efforts to (i) prepare a list (the "Approved
Holder List") of each Noteholder and Beneficial Holder as of the related Record
Date that has executed and delivered to the Registrar a Confidentiality
Agreement, (ii) obtain from DTC a list (the "DTC List") of the Agent Members
holding Beneficial Interests in the Notes as of such Record Date, (iii) obtain
from each such Agent Member as of such Record Date the corresponding Beneficial
Holders of the Beneficial Interests held by each such Agent Member set forth on
the DTC List as of such Record Date and prepare a list thereof (the "Actual
Beneficial Holder List"), (iv) prepare a list (the "Escrow List"), if necessary,
that identifies any differences between (x) the Noteholders and Beneficial
Holders listed on the Approved Holder List and (y)(A) the Noteholders of
Definitive Notes set forth in the Register and (B) the Beneficial Holders listed
on the Actual Beneficial Holder List (or those Beneficial Holders that the
Registrar actually knows have not executed and delivered to the Registrar
Confidentiality Agreements), in each case as of such Record Date, and (v)
provide the Approved Holder List, the DTC List, the Actual Beneficial Holder
List and any Escrow List to Royalty Sub, Servicer, the Trustee and the
Collection Agent. Each Noteholder, Agent Member and Beneficial Holder hereby
agrees, acknowledges and consents that (I) with respect to a Noteholder of any
Notes (other than DTC or its nominee) that has not executed and delivered to the
Registrar a Confidentiality Agreement as of such Record Date and, therefore, is
listed on the Escrow List, the Trustee promptly (but in no event less than three
Business Days prior to the applicable Payment Date) shall use commercially
reasonable efforts to notify such Noteholder of such
17
failure and, on the applicable Payment Date, cause any payment of principal,
Premium, if any, or interest on such Notes to be paid directly to the Escrow
Account and (II) with respect to a Beneficial Holder of any Beneficial Interest
in a Note that has not executed and delivered to the Registrar a Confidentiality
Agreement as of such Record Date and, therefore, is listed on the Escrow List,
the Trustee promptly (but in no event less than three Business Days prior to the
applicable Payment Date) shall direct the Collection Agent to use commercially
reasonable efforts to cause the Beneficial Interest of such Beneficial Holder to
be transferred into the name of the Collection Agent (including the Collection
Agent acting as an Agent Member with respect to such Beneficial Interests) and
shall use commercially reasonable efforts to cause any payment of principal,
Premium, if any, or interest on such Notes or Beneficial Interests received on
such Payment Date to be deposited into the Escrow Account upon receipt thereof;
provided, that the Record Date with respect only to such Beneficial Holder shall
be changed to the Business Day immediately prior to the related Payment Date.
Upon receipt by the Trustee and Royalty Sub of written notice from the Registrar
that the applicable Noteholder or Beneficial Holder has executed and delivered
to the Registrar a Confidentiality Agreement, the Trustee will direct the
Collection Agent to distribute such amounts, without interest, from the Escrow
Account to the Trustee for distribution to each such Noteholder or Beneficial
Holder.
Section 2.6 Minimum Denominations. Each class of Notes shall be issued in
minimum denominations of U.S.$250,000 and integral multiples of U.S.$1,000 in
excess thereof.
Section 2.7 Transfer and Exchange; Cancellation. The Notes are issuable
only in registered form. A Noteholder or a Beneficial Holder may transfer a Note
or a Beneficial Interest therein only by written application to the Registrar
stating the name of the proposed transferee and otherwise complying with the
terms of this Indenture, including the requirement for the execution and
delivery of a Confidentiality Agreement by such proposed transferee to the
Registrar relating to such transfer as set forth in Section 2.11(j). No such
transfer shall be effected until, and such proposed transferee shall succeed to
the rights of a Noteholder or a Beneficial Holder only upon, final acceptance
and registration of the transfer by the Registrar and confirmation by the
Registrar pursuant to Section 2.11(j) that such Noteholder or such Beneficial
Holder has executed and delivered an appropriate Confidentiality Agreement to
the Registrar.
Prior to the due presentment for registration of transfer of a Note and
satisfaction of the requirements specified in the last sentence of the preceding
paragraph, Royalty Sub and the Trustee may deem and treat the applicable
registered Noteholder as the absolute owner and holder of such Note for the
purpose of receiving payment of all amounts payable with respect to such Note
and for all other purposes and shall not be affected by any notice to the
contrary. The Registrar (if different from the Trustee) shall promptly notify
the Trustee in writing and the Trustee shall promptly notify Royalty Sub of each
request for a registration of transfer of a Note by furnishing Royalty Sub a
copy of such request.
Furthermore, any Noteholder of a Global Note shall, by acceptance of such
Global Note, agree that, subject to Section 2.10(b) and Section 2.11, transfers
of Beneficial Interests in such Global Note may be effected only through a
book-entry system maintained by the Noteholder of
18
such Global Note (or its agent) and that ownership of a Beneficial Interest in
such Global Note shall be required to be reflected in a book-entry system. When
Notes are presented to the Registrar with a request to register the transfer or
to exchange them for an equal principal amount of Notes of other authorized
denominations, the Registrar shall register the transfer or make the exchange as
requested if its requirements for such transactions are met (including, in the
case of a transfer, that such Notes are duly endorsed or accompanied by a
written instrument of transfer in form satisfactory to the Trustee and Registrar
duly executed by the Noteholder thereof or by an attorney who is authorized in
writing to act on behalf of the Noteholder). To permit registrations of
transfers and exchanges, Royalty Sub shall execute and the Trustee shall
authenticate Notes at the Registrar's request. Except as set forth in Section
2.8 and Section 2.9, no service charge shall be made for any registration of
transfer or exchange or redemption of the Notes.
The Registrar shall not be required to exchange or register the transfer of
any Notes as above provided during the 15-day period preceding the Final
Maturity Date of any such Notes or during a 15-day period preceding the first
mailing of any notice of Redemption or Refinancing of Notes to be redeemed or
refinanced. The Registrar shall not be required to exchange or register the
transfer of any Notes that have been selected, called or are being called for
Redemption or Refinancing except, in the case of any Notes where written notice
has been given that such Notes are to be redeemed in part, the portion thereof
not so to be redeemed.
Royalty Sub at any time may deliver Notes to the Trustee for cancellation.
The Trustee and no one else shall cancel and destroy in accordance with its
customary practices in effect from time to time (subject to the record retention
requirements of the Exchange Act) any such Notes, together with any other Notes
surrendered to it for registration of transfer, exchange or payment. Royalty Sub
may not issue new Notes (other than Refinancing Notes issued in connection with
any Refinancing) to replace Notes it has redeemed, paid or delivered to the
Trustee for cancellation.
Section 2.8 Mutilated, Destroyed, Lost or Stolen Notes. If any Note shall
become mutilated, destroyed, lost or stolen, Royalty Sub shall, upon the written
request of the Noteholder thereof and presentation of the Note or satisfactory
evidence of destruction, loss or theft thereof to the Trustee or Registrar and a
confirmation by the Registrar to the Trustee that such Noteholder (or Beneficial
Holder of the Beneficial Interest therein) has executed and delivered to the
Registrar a Confidentiality Agreement, issue, and the Trustee shall authenticate
and the Trustee or Registrar shall deliver in exchange therefor or in
replacement thereof, a new Note, payable to such Noteholder in the same
principal amount, of the same maturity, with the same payment schedule, bearing
the same interest rate and dated the date of its authentication. If the Note
being replaced has become mutilated, such Note shall be surrendered to the
Trustee or the Registrar and forwarded to Royalty Sub by the Trustee or such
Registrar. If the Note being replaced has been destroyed, lost or stolen, the
Noteholder thereof shall furnish to Royalty Sub, the Trustee and the Registrar
(a) such security or indemnity as may be required by Royalty Sub, the Trustee
and the Registrar to save each of them harmless (an unsecured indemnity from any
QIB being satisfactory security or indemnity) and (b) evidence satisfactory to
Royalty Sub, the Trustee and the Registrar of the destruction, loss or theft of
such Note and of the ownership
19
thereof (an affidavit from any QIB being satisfactory evidence). The Noteholders
will be required to pay any tax or other governmental charge imposed in
connection with such exchange or replacement and any other expenses (including
the fees and expenses of the Trustee and the Registrar) connected therewith.
Section 2.9 Payments of Transfer Taxes. Upon the transfer of any Note or
Notes pursuant to Section 2.7, Royalty Sub or the Trustee may require from the
party requesting such new Note or Notes payment of a sum to reimburse Royalty
Sub or the Trustee for, or to provide funds for the payment of, any transfer tax
or similar governmental charge payable in connection therewith.
Section 2.10 Book-Entry Provisions.
(a) Global Notes shall (i) be registered in the name of DTC or a
nominee of DTC, (ii) be delivered to the Trustee as custodian for DTC and (iii)
bear the Private Placement Legend.
Members of, or participants in, DTC ("Agent Members") shall have no rights
under this Indenture with respect to any Global Note held on their behalf by
DTC, or the Trustee as its custodian, or under such Global Note, and DTC may be
treated by Royalty Sub, the Trustee and any agent of Royalty Sub or the Trustee
as the absolute owner of such Global Note for all purposes whatsoever.
Whenever notice or other communication to the Noteholders of any class of
Global Notes is required under this Indenture, unless and until Definitive Notes
shall have been issued pursuant to Section 2.10(b), the Trustee shall give all
such notices and communications specified herein to be given to Noteholders of
such class of Global Notes to DTC and/or the Agent Members, and shall make
available additional copies as requested by such Agent Members, subject to the
limitations on distribution contained in Section 2.13.
Notwithstanding the foregoing, nothing herein shall prevent Royalty Sub,
the Trustee or any agent of Royalty Sub or the Trustee from giving effect to any
written certification, proxy or other authorization furnished by DTC or impair,
as between DTC and its Agent Members, the operation of customary practices
governing the exercise of the rights of a Noteholder under any Global Note.
Neither Royalty Sub nor the Trustee shall be liable for any delay by DTC in
identifying the Agent Members in respect of the Global Notes, and Royalty Sub
and the Trustee may conclusively rely on, and shall be fully protected in
relying on, instructions from DTC for all purposes (including with respect to
the registration and delivery, and the respective principal amounts, of any
Global Notes to be issued).
(b) Transfers of a Global Note shall be limited to transfers of such
Global Note in whole, but not in part, to DTC, its successors or their
respective nominees. Interests of Agent Members in a Global Note may be
transferred in accordance with the rules and procedures of DTC and the
provisions of Section 2.11. Except as set forth in Section 2.11(a), Definitive
Notes shall be issued to the individual Agent Members or Beneficial Holders or
their nominees in exchange for their Beneficial Interests in a Global Note with
respect to any class of Notes only if
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(i) Royalty Sub advises the Trustee in writing that DTC is no longer willing or
able to properly discharge its responsibilities as depositary with respect to
such Notes and the Trustee or Royalty Sub is unable to appoint a qualified
successor within 90 days of such notice, (ii) Royalty Sub, at its option, elects
to terminate the book-entry system through DTC or (iii) Noteholders of a
majority of the Outstanding Principal Balance of a class of Notes advise Royalty
Sub, the Trustee and DTC through the Agent Members in writing that the
continuation of a book-entry system through DTC (or a successor thereto) is no
longer in the best interests of the Noteholders of such class. Upon the
occurrence of any event described in the immediately preceding sentence, the
Trustee shall notify all affected Noteholders of such class, through DTC, of the
occurrence of such event and of the availability of Definitive Notes of such
class; provided, however, that in no event shall the Temporary Regulation S
Global Note be exchanged for Definitive Notes prior to the later of (x) the
Regulation S Global Note Exchange Date and (y) the date of receipt by Royalty
Sub of any certificates determined by it to be required pursuant to Rule 903 or
904 under the Securities Act. Upon surrender to the Trustee of the Global Notes
of such class held by DTC, accompanied by registration instructions from DTC for
registration of Definitive Notes, Royalty Sub shall issue and the Trustee shall
authenticate and deliver the Definitive Notes of such class to the Agent Members
and Beneficial Holders of such class or their nominees in accordance with the
instructions of DTC.
None of Royalty Sub, the Registrar, the Paying Agent or the Trustee shall
be liable for any delay in delivery of such instructions and may conclusively
rely on, and shall be fully protected in relying on, such registration
instructions. Upon the issuance of Definitive Notes of such class, the Trustee
shall recognize the Persons in whose name the Definitive Notes are registered in
the Register as Noteholders hereunder. Neither Royalty Sub nor the Trustee shall
be liable if the Trustee or Royalty Sub is unable to locate a qualified
successor to DTC.
Definitive Notes of any class will be freely transferable and exchangeable
for Definitive Notes of the same class at the office of the Trustee or the
office of the Registrar upon compliance with the requirements set forth herein.
In the case of a transfer of only part of a holding of Definitive Notes, a new
Definitive Note shall be issued to the transferee in respect of the part
transferred and a new Definitive Note in respect of the balance of the holding
not transferred shall be issued to the transferor and may be obtained at the
office of the applicable Registrar.
(c) Any Beneficial Interest in one of the Global Notes as to any class
that is transferred to a Person who takes delivery in the form of an interest in
another Global Note will, upon transfer, cease to be an interest in such Global
Note and become an interest in such other Global Note and, accordingly, will
thereafter be subject to all transfer restrictions, if any, and other procedures
applicable to Beneficial Interests in such other Global Note for as long as it
remains such an interest.
(d) Any Definitive Note delivered in exchange for an interest in a
Global Note pursuant to Section 2.10(b) shall bear the Private Placement Legend
applicable to a Global Note.
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Section 2.11 Special Transfer Provisions.
(a) The following provisions shall apply with respect to any proposed
transfer of a Beneficial Interest in a Permanent Global Note, a Permanent
Regulation S Global Note or a Definitive Note to any Institutional Accredited
Investor that is not a QIB (excluding Non-U.S. Persons) prior to the Resale
Restriction Termination Date:
(i) The Registrar shall register the transfer of any Definitive
Note if the proposed transferee has delivered to the Registrar (A) a
certificate substantially in the form of Exhibit I (such certificate also
to be delivered to Royalty Sub), (B) an Opinion of Counsel acceptable to
Royalty Sub that such transfer is in compliance with the Securities Act and
(C) a Confidentiality Agreement duly executed by such transferee.
(ii) If the proposed transferor is an Agent Member holding a
Beneficial Interest in a Permanent Global Note or a Permanent Regulation S
Global Note, upon receipt by the Registrar of (A) the documents required by
Section 2.11(a)(i), including the Confidentiality Agreement, and (B)
instructions given in accordance with DTC's and the Registrar's procedures,
the Registrar shall reflect on its books and records the date and a
decrease in the principal amount of the applicable Global Note in an amount
equal to the principal amount of the Beneficial Interest in the Global Note
to be transferred, and Royalty Sub shall execute, and the Trustee shall
authenticate and deliver, one or more Definitive Notes of like tenor and
amount.
(b) The following provisions shall apply with respect to any proposed
transfer of a Beneficial Interest in a Permanent Global Note, a Permanent
Regulation S Global Note or a Definitive Note to a QIB (excluding Non-U.S.
Persons) prior to the Resale Restriction Termination Date:
(i) If the Note to be transferred consists of (A) Definitive
Notes, the Registrar shall reflect the transfer on its books and records if
such transfer is being made by a proposed transferor who has checked the
box provided for on the form of Note stating, or has otherwise advised
Royalty Sub and the Registrar in writing, that the sale has been made in
compliance with the provisions of Rule 144A to a transferee who has signed
the certification provided for on the form of Note stating, or has
otherwise advised Royalty Sub and the Registrar in writing, that (w) it is
purchasing the Note for its own account or an account with respect to which
it exercises sole investment discretion and that it and any such account
are QIBs within the meaning of Rule 144A, (x) it is or such QIBs are aware
that the sale to it or them is being made in reliance on Rule 144A and
acknowledge that it has or they have received such information regarding
Royalty Sub as it has or they have requested pursuant to Rule 144A or has
or have determined not to request such information, (y) it is or such QIBs
are aware that the transferor is relying upon the foregoing representations
in order to claim the exemption from registration provided by Rule 144A and
(z) it has and all such QIBs have duly executed and delivered to the
Registrar a Confidentiality Agreement or (B) a Beneficial Interest in a
Permanent Global Note or a Permanent Regulation S Global Note, the transfer
of such Beneficial
22
Interest may be effected only through the book-entry system maintained by
DTC and to the extent provided in the agreement with DTC, and, in each
case, each transferee has delivered to the Registrar a Confidentiality
Agreement duly executed by such transferee.
(ii) If the proposed transferee is an Agent Member, and the Note
to be transferred is a Definitive Note, upon receipt by the Registrar of
the documents referred to in Section 2.11(b)(i), including the
Confidentiality Agreement, and instructions given in accordance with DTC's
and the Registrar's procedures, the Registrar shall reflect on its books
and records the date and an increase in the principal amount at maturity of
the Permanent Global Note in an amount equal to the principal amount at
maturity of the Definitive Note to be transferred, and the Trustee shall
cancel the Definitive Note so transferred (upon written direction from the
Registrar if different from the Trustee).
(iii) If the proposed transferee is an Agent Member, and the Note
to be transferred is represented by a Beneficial Interest in a Permanent
Regulation S Global Note, upon receipt by the Registrar of the documents
referred to in Section 2.11(b)(i), including the Confidentiality Agreement,
and instructions given in accordance with DTC's and the Registrar's
procedures, the Registrar shall reflect on its books and records the date
and a decrease in the principal amount of the Permanent Regulation S Global
Note in an amount equal to the principal amount of the Beneficial Interest
in the Permanent Regulation S Global Note to be transferred, and the
Registrar shall reflect on its books and records an increase in the
principal amount of the Permanent Global Note in an amount equal to such
transferred amount.
(c) With respect to any proposed transfer of a Beneficial Interest in
a Temporary Regulation S Global Note prior to the Resale Restriction Termination
Date, the Registrar shall reflect on its books and records the transfer of such
Beneficial Interest (A) if the proposed transferee is a Non-U.S. Person, the
proposed transferor has delivered to the Registrar a certificate substantially
in the form of Exhibit H (such certificate also to be delivered to Royalty Sub)
and the proposed transferee has duly executed and delivered to the Registrar a
Confidentiality Agreement (in which case the transferee will receive a
corresponding Beneficial Interest in the Temporary Regulation S Global Note) or
(B) if the proposed transferee is a QIB and the proposed transferor has checked
the box provided for on the form of Note stating, or has otherwise advised
Royalty Sub and the Registrar in writing, that the sale has been made in
compliance with the provisions of Rule 144A to a transferee who has signed the
certification provided for on the form of Note stating, or has otherwise advised
Royalty Sub and the Registrar in writing, that (w) it is purchasing the Note (or
the Beneficial Interest therein) for its own account or an account with respect
to which it exercises sole investment discretion and that it and any such
account are QIBs within the meaning of Rule 144A, (x) it is or such QIBs are
aware that the sale to it or them is being made in reliance on Rule 144A and
acknowledge that it has or they have received such information regarding Royalty
Sub as it has or they have requested pursuant to Rule 144A or has or have
determined not to request such information, (y) it is or such QIBs are aware
that the transferor is relying upon the foregoing representations in order to
claim the exemption from registration provided by Rule 144A and (z) it has and
all such QIBs have duly executed and delivered to the Registrar a
Confidentiality Agreement (in which case the
23
Registrar shall reflect on its books and records the date and an increase in the
principal amount of the Permanent Global Note of the relevant class, in an
amount equal to the principal amount of the Temporary Regulation S Global Note
(or the Beneficial Interest therein) of such class to be transferred, and the
Trustee shall decrease the amount of the Temporary Regulation S Global Note of
such class (upon written direction from the Registrar if different from the
Trustee)).
(d) Except as set forth in Section 2.11(c), prior to the Resale
Restriction Termination Date, the following provisions shall apply with respect
to any transfer of a Note (or a Beneficial Interest therein) to a Non-U.S.
Person:
(i) Except as set forth in Section 2.11(c), prior to the
applicable Regulation S Global Note Exchange Date, the Registrar shall not
register or reflect on its books and records any proposed transfer of a
Note (or a Beneficial Interest therein) to a Non-U.S. Person.
(ii) The Registrar shall register or reflect on its books and
records, as the case may be, any proposed transfer of a Note (or a
Beneficial Interest therein) to any Non-U.S. Person if the Note to be
transferred is a Definitive Note or a Beneficial Interest in a Permanent
Global Note, upon receipt of a certificate substantially in the form of
Exhibit H from the proposed transferor and a Confidentiality Agreement duly
executed and delivered to the Registrar by such Non-U.S. Person.
(iii) (A) If the proposed transferor is an Agent Member holding a
Beneficial Interest in a Permanent Global Note, upon receipt by the
Registrar of (x) the documents, if any, required by Section 2.11(d)(ii) and
(y) instructions in accordance with DTC's and the Registrar's procedures,
the Registrar shall reflect on its books and records the date and a
decrease in the principal amount of the Permanent Global Note in an amount
equal to the principal amount of the Beneficial Interest in such Permanent
Global Note to be transferred, and (B) if the proposed transferee is an
Agent Member, upon receipt by the Registrar of instructions given in
accordance with DTC's and the Registrar's procedures, the Registrar shall
reflect on its books and records the date and an increase in the principal
amount of the Permanent Regulation S Global Note of the relevant class in
an amount equal to the principal amount of the Beneficial Interest in such
Permanent Global Note or any Definitive Notes issued in exchange for such
Beneficial Interest in such Permanent Global Note to be transferred, and
the Trustee shall cancel the Definitive Note, if any, so transferred or
decrease the amount of the Permanent Global Note (upon written direction
from the Registrar if different from the Trustee).
(e) With respect to any proposed transfer of any Note (or a Beneficial
Interest therein) after the Resale Restriction Termination Date, the Registrar
shall reflect the transfer of such Note or Beneficial Interest on its books and
records if the proposed transferee has duly executed and delivered to the
Registrar a Confidentiality Agreement.
(f) Upon the transfer, exchange or replacement of Notes bearing the
Private Placement Legend, the Registrar shall deliver only Notes that bear the
Private Placement Legend.
24
(g) By its acceptance of any Note bearing the Private Placement
Legend, each Noteholder of such Note acknowledges the restrictions on transfer
of such Note set forth in this Indenture and in the Private Placement Legend and
agrees that it will transfer such Note (or the Beneficial Interest therein) only
as provided in this Indenture and in accordance with the Private Placement
Legend. The Registrar shall not register or reflect on its books and records a
transfer of any Note (or any Beneficial Interest therein) unless such transfer
complies with the restrictions on transfer of such Note set forth in this
Indenture and in accordance with the Private Placement Legend. In connection
with any transfer of Notes (or Beneficial Interests therein), each Noteholder
agrees by its acceptance of the Notes to furnish the Trustee the certifications
and legal opinions described herein to confirm that such transfer is being made
pursuant to an exemption from, or a transaction not subject to, the registration
requirements of the Securities Act; provided, that the Trustee shall not be
required to determine (but may rely on a determination made by Royalty Sub with
respect to) the sufficiency of any such legal opinions.
(h) The Notes shall be issued pursuant to an exemption from
registration under the Securities Act. Royalty Sub agrees that it will not at
any time (i) apply to list, list or list upon notice of issuance, (ii) consent
to or authorize an application for the listing or the listing of, or (iii)
enable or authorize the trading of, the Notes on an established securities
market, including (w) a national securities exchange registered under the
Exchange Act or exempted from registration because of the limited volume of
transactions, (x) a foreign securities exchange that, under the law of the
jurisdiction where it is organized, satisfies regulatory requirements that are
analogous to the regulatory requirements under the Exchange Act applicable to
exchanges described in Section 2.11(h)(w), (y) a regional or local exchange or
(z) an over-the-counter market, as the term "established securities market" and
the terms in this Section 2.11(h) are defined for purposes of Section 7704 of
the Code.
(i) The Trustee shall retain copies of all letters, notices and other
written communications received pursuant to Section 2.10 or this Section 2.11.
Royalty Sub shall have the right to inspect and make copies of all such letters,
notices, Confidentiality Agreements or other written communications at any
reasonable time upon the giving of reasonable written notice to the Trustee.
(j) Each Noteholder, Agent Member and Beneficial Holder agrees, by
acceptance of any Note or any Beneficial Interest therein, that it will not take
any action to transfer any Note (or any Beneficial Interest therein) to a
proposed transferee without causing such proposed transferee to execute and
deliver to the Registrar an appropriate Confidentiality Agreement relating to
such transfer as set forth in this Section 2.11. After the Closing Date with
respect to the Original Class A Notes (or the date of issuance with respect to
any Class B Notes or Refinancing Notes), forms of Confidentiality Agreements
will be available to Noteholders, Agent Members and Beneficial Holders and
proposed transferees of the Notes (or the Beneficial Interests therein) from the
Registrar, initially at the Corporate Trust Office. Each such Confidentiality
Agreement shall be delivered to the Registrar promptly upon execution by the
parties thereto, and the Registrar shall record the receipt of such
Confidentiality Agreement. The Registrar shall promptly, but in any event no
later than two Business Days of receipt of any such executed Confidentiality
Agreement, furnish a copy of such executed Confidentiality Agreement
25
to the Trustee, Royalty Sub and Servicer and shall maintain a list of proposed
transferees (including Noteholders and Beneficial Holders) who have furnished
such executed Confidentiality Agreements, whether or not such proposed
transferees purchase any Notes (or any Beneficial Interests therein), and make
such list available for inspection at the request of the Trustee, Royalty Sub or
Servicer.
Section 2.12 Temporary Definitive Notes. Pending the preparation of
Definitive Notes of any class, Royalty Sub may execute and the Trustee may
authenticate and deliver temporary Definitive Notes of such class that are
printed, lithographed, typewritten or otherwise produced, in any denomination,
containing substantially the same terms and provisions as are set forth in the
applicable Exhibit or in any indenture supplemental hereto, except for such
appropriate insertions, omissions, substitutions and other variations relating
to their temporary nature as the Responsible Officer executing such temporary
Definitive Notes may determine, as evidenced by his or her execution of such
temporary Definitive Notes.
If temporary Definitive Notes of any class are issued, Royalty Sub shall
cause such Definitive Notes of such class to be prepared without unreasonable
delay. After the preparation of Definitive Notes of such class, the temporary
Definitive Notes shall be exchangeable for Definitive Notes upon surrender of
such temporary Definitive Notes at the Corporate Trust Office, without charge to
the Noteholder thereof. Upon surrender for cancellation of any one or more
temporary Definitive Notes of any class, Royalty Sub shall execute and the
Trustee shall authenticate and deliver in exchange therefor Definitive Notes of
like class, in authorized denominations and in the same aggregate principal
amounts. Until so exchanged, such temporary Definitive Notes shall in all
respects be entitled to the same benefits under this Indenture as Definitive
Notes.
Section 2.13 Statements to Noteholders.
(a) On each Payment Date and any other date for distribution of any
payments with respect to any class of Notes then Outstanding, the Trustee shall
deliver a report, in form reasonably acceptable to the Noteholders covering the
information set forth in Exhibit D and prepared by Servicer, giving effect to
such payments (each, a "Distribution Report"), to each Noteholder and Beneficial
Holder included on the Approved Holder List, and to no other Person. Each
Noteholder and Beneficial Holder shall be entitled to receive the Distribution
Report only if such Noteholder or Beneficial Holder has executed and delivered
to the Registrar a Confidentiality Agreement.
(b) Each Distribution Report provided to each Noteholder and
Beneficial Holder by the Trustee for each Payment Date pursuant to Section
2.13(a), commencing January 15, 2006, shall be accompanied by (i) a statement
prepared by Servicer setting forth an analysis of the Collection Account
activity for the period commencing on the day next following the preceding
Calculation Date and ending on the Calculation Date relating to such Payment
Date, (ii) such information, if any, that Quintiles shall have provided to the
Trustee pursuant to Section 6.4 of the Purchase and Sale Agreement during the
Interest Accrual Period then ended and (iii) the information, if any, that
Royalty Sub shall have provided to the Trustee pursuant to Section
26
5.2 (or Servicer shall have provided to the Trustee pursuant to Section 4.1 of
the Servicing Agreement) during the Interest Accrual Period then ended.
(c) After the end of each calendar year but not later than the latest
date permitted by law, the Trustee shall (or shall instruct any Paying Agent to)
furnish to each Person who at any time during such calendar year was a
Noteholder of any class of Notes a statement (for example, a Form 1099 or any
other means required by law) prepared by the Trustee containing the sum of the
amounts determined pursuant to the information covered by Exhibit D with respect
to the class of Notes for such calendar year or, in the event such Person was a
Noteholder of any class of Notes during only a portion of such calendar year,
for the applicable portion of such calendar year, and such other items as are
readily available to the Trustee and which a Noteholder shall reasonably request
as necessary for the purpose of such Noteholder's preparation of its U.S.
federal income or other tax returns. So long as any of the Notes are registered
in the name of DTC or its nominee, such report and such other items will be
prepared on the basis of such information supplied to the Trustee by DTC and the
Agent Members and will be delivered by the Trustee to DTC and by DTC to the
applicable Beneficial Holders in the manner described above. In the event that
any such information has been provided by any Paying Agent directly to such
Person through other tax-related reports or otherwise, the Trustee in its
capacity as Paying Agent shall not be obligated to comply with such request for
information.
(d) At such time, if any, as the Notes of any class are issued in the
form of Definitive Notes, the Trustee shall prepare and deliver the information
described in Section 2.13(c) to each Noteholder of a Definitive Note of such
class for the relevant period of beneficial ownership of such Definitive Note as
appears on the books and records of the Trustee, subject to confirmation that
each such Noteholder has executed and delivered to the Registrar a
Confidentiality Agreement.
(e) The Trustee shall be at liberty to sanction any method of giving
notice to the Noteholders of any class if, in its opinion, such method is
reasonable, having regard to the number and identity of the Noteholders of such
class and/or to market practice then prevailing, is in the best interests of the
Noteholders of such class, and any such notice shall be deemed to have been
given on such date as the Trustee may approve; provided, that notice of such
method is given to the Noteholders of such class in such manner as the Trustee
shall require.
Section 2.14 CUSIP, CINS, ISIN and Private Placement Numbers. Royalty Sub
in issuing the Notes may use CUSIP, CINS, ISIN, private placement or other
identification numbers (if then generally in use), and, if so, the Trustee shall
use such CUSIP, CINS, ISIN, private placement or other identification numbers,
as the case may be, in notices of redemption or exchange as a convenience to
Noteholders; provided, that any such notice shall state that no representation
is made as to the correctness of such numbers either as printed on the Notes or
as contained in any notice of redemption or exchange and that reliance may be
placed only on the other identification numbers printed on the Notes; provided,
further, that failure to use CUSIP, CINS, ISIN, private placement or other
identification numbers in any notice of redemption or exchange shall not affect
the validity or sufficiency of such notice.
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Section 2.15 Refinancing Notes.
(a) Subject to Section 2.15(b), Section 2.15(c) and Section 5.1(d),
Royalty Sub may issue Refinancing Notes pursuant to this Indenture for the
purpose of refinancing all of the Outstanding Principal Balance of any class of
Notes (including a refinancing of Refinancing Notes). Each refinancing of any
class of Notes with the proceeds of an offering of Refinancing Notes (a
"Refinancing") shall be authorized pursuant to one or more Board Resolutions.
Each Refinancing Note shall be designated generally as a Note for all purposes
under this Indenture, with such further designations added or incorporated in
such title as specified in the related Board Resolution or in any indenture
supplemental hereto providing for the issuance of such Notes or specified in the
form of such Notes, as the case may be. The Refinancing Notes shall be issued on
the Payment Date on which the Redemption in whole of the class of Notes being
refinanced is to occur as provided in Section 3.2.
(b) A Refinancing of any class of Notes shall be effected as a
Redemption pursuant to Section 3.1, provided that a Refinancing of the Original
Class A Notes shall be effected as an Optional Redemption pursuant to Section
3.1(a). On the date of any Refinancing, Royalty Sub shall issue and sell an
aggregate principal amount of Refinancing Notes in an amount not less than the
sum of the Redemption Price of the Notes being refinanced thereby plus the
Refinancing Expenses relating thereto and any Redemption Premium. The proceeds
of each sale of Refinancing Notes shall be used to make the deposit required by
Section 3.2(b), to pay such Refinancing Expenses and for such other purposes, if
any, as shall be specified in the Board Resolution authorizing the issuance of
such Refinancing Notes. Once a notice of a Redemption in respect of any
Refinancing is published in accordance with Section 3.2(a), each class of Notes
to which such notice applies shall become due and payable on the Refinancing
Date stated in such notice at their Redemption Price.
(c) Each Refinancing Note shall contain such terms as may be
established in or pursuant to the related Board Resolution (subject to Section
2.1) or in any indenture supplemental hereto providing for the issuance of such
Notes or specified in the form of such Notes to the extent permitted below. No
less than seven Business Days prior to the issuance of any Refinancing Notes,
any or all of the following, as applicable, with respect to the related issue of
Refinancing Notes shall have been determined by Royalty Sub and set forth in
such Board Resolution or in any indenture supplemental hereto providing for the
issuance of such Notes or specified in the form of such Notes, as the case may
be:
(i) the class of Notes to be refinanced by such Refinancing
Notes;
(ii) the aggregate principal amount of each class of Refinancing
Notes which may be issued in respect of such Refinancing;
(iii) the proposed date of such Refinancing;
(iv) if applicable, the Scheduled Final Payment Date and the
Final Maturity Date of each class of such Refinancing Notes;
28
(v) the rate at which such Refinancing Notes shall bear interest
or the method by which such rate shall be determined;
(vi) the denomination or denominations in which any class of such
Refinancing Notes shall be issuable;
(vii) whether any such Refinancing Notes are to be issuable
initially in temporary or permanent global form and, if so, whether
beneficial owners of interests in any such permanent global Refinancing
Note may exchange such interests for Refinancing Notes of such class and of
like tenor of any authorized form and denomination and the circumstances
under which any such exchanges may occur, if other than in the manner
provided in Section 2.7, and the circumstances under which and the place or
places where any such exchanges may be made and the identity of any initial
depositary therefor; and
(viii) any other terms, conditions, rights and preferences (or
limitations on such rights and preferences) relating to the class of
Refinancing Notes (which terms shall comply with Applicable Law and not be
inconsistent with the requirements or restrictions of this Indenture).
(d) If any of the terms of any issue of Refinancing Notes are
established by action taken pursuant to one or more Board Resolutions, such
Board Resolutions shall be delivered to the Trustee setting forth the terms of
such Refinancing Notes.
Section 2.16 Class B Notes.
(a) Subject to Section 2.16(b) and Section 5.1(d), Royalty Sub may
issue Class B Notes pursuant to this Indenture (a "Class B Issuance") for any
purpose, including, at the option of Royalty Sub, for the purpose of funding a
redemption of the Class A Notes, in whole or in part. Each Class B Issuance
shall be authorized pursuant to one or more Board Resolutions. Each Class B Note
shall be designated generally as a Note for all purposes under this Indenture.
Each Class B Note shall have such further designations added or incorporated in
such title as specified in the related Board Resolution or in any indenture
supplemental hereto providing for the issuance of such Notes or specified in the
form of such Notes, as the case may be. If the proceeds of the Class B Notes are
being used to redeem the Class A Notes, in whole or in part, the Class B Notes
shall be issued on the Payment Date on which the Optional Redemption of the
Class A Notes being refinanced is to occur as provided in Section 3.2.
(b) If the proceeds of the Class B Notes are being used to redeem any
Class A Notes, such redemption shall be effected as an Optional Redemption
pursuant to Section 3.1. On the date of any such Optional Redemption, Royalty
Sub shall issue and sell an aggregate principal amount of Class B Notes in an
amount not less than the sum of the Redemption Price of the Notes being
refinanced thereby and any Redemption Premium plus the Transaction Expenses
relating thereto. The proceeds of each sale of Class B Notes shall be used to
make the deposit required by Section 3.2(b), if applicable, to pay such
Transaction Expenses and/or for such other purposes, if any, as shall be
specified in the Board Resolution authorizing the issuance of such
29
Class B Notes. Once a notice of Redemption in respect of any Class B Issuance is
published in accordance with Section 3.2(a), each class of Notes to which such
notice applies shall become due and payable on the Redemption Date stated in
such notice at their Redemption Price.
(c) Each Class B Note shall contain such terms as may be established
in or pursuant to the related Board Resolution (subject to Section 2.1) or in
any indenture supplemental hereto providing for the issuance of such Notes or
specified in the form of such Notes to the extent permitted herein, and shall be
subordinate to the Class A Notes to the extent provided in this Indenture. No
less than seven Business Days prior to the issuance of the Class B Notes, any or
all of the following, as applicable, with respect to the related Class B
Issuance shall have been determined by Royalty Sub and set forth in such Board
Resolution or in any indenture supplemental hereto or specified in the form of
such Class B Notes, as the case may be, with respect to the Class B Notes to be
issued:
(i) the aggregate principal amount of any such Class B Notes that
may be issued;
(ii) the proposed date of such Class B Issuance;
(iii) if applicable, the Scheduled Final Payment Date and the
Final Maturity Date of any such Class B Notes;
(iv) whether any such Class B Notes are to have the benefit of
any reserve account and, if so, the amount and terms thereof;
(v) the rate at which such Class B Notes shall bear interest or
the method by which such rate shall be determined;
(vi) the denomination or denominations in which such Class B
Notes shall be issuable;
(vii) whether any such Class B Notes are to be issuable initially
in temporary or permanent global form and, if so, whether beneficial owners
of interests in any such permanent global Class B Note may exchange such
interests for Class B Notes of like tenor and of any authorized form and
denomination and the circumstances under which any such exchanges may
occur, if other than in the manner provided in Section 2.7, and the
circumstances under which and the place or places where any such exchanges
may be made and the identity of any initial depositary therefor; and
(viii) any other terms, conditions, rights and preferences (or
limitations on such rights and preferences) relating to Class B Notes
(which terms shall comply with Applicable Law and not be inconsistent with
the requirements or restrictions of this Indenture, including Section
5.1(d) and Section 12.13).
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(d) If any of the terms of any issue of Class B Notes are established
by action taken pursuant to one or more Board Resolutions, such Board
Resolutions shall be delivered to the Trustee setting forth the terms of such
Class B Notes.
Section 2.17 Original Class A Notes. If any part of the Outstanding
Principal Balance of the Original Class A Notes is prepaid pursuant to an
Optional Redemption under Section 3.1(a), the amount of such prepayment shall be
allocated to reduce each Scheduled Remaining Notes Balance on the Class A
Principal Payment Schedule pro rata in accordance with the proportion of the
amount of such prepayment to the Outstanding Principal Balance of the Original
Class A Notes. For the avoidance of doubt, except as expressly provided in the
immediately preceding sentence and otherwise in this Indenture, the amount of
principal payable on the Original Class A Notes on any Payment Date shall not
exceed the amount needed to reduce the Outstanding Principal Balance of the
Original Class A Notes to the Scheduled Remaining Notes Balance specified in the
Class A Principal Payment Schedule for such Payment Date.
ARTICLE III
REDEMPTIONS; INTERCREDITOR AGREEMENT PROVISIONS
Section 3.1 Redemptions.
(a) Subject to the provisions of Section 3.2, on any Payment Date
(but, except with respect to a Refinancing that is permitted under Section
5.1(d), only on a Payment Date on or after the Discharge of First Lien
Obligations), Royalty Sub may elect to redeem the Original Class A Notes, in
whole but not in part, out of the proceeds of the Refinancing Notes, in the case
of a Refinancing of the Original Class A Notes, or, in whole or in part, out of
amounts available in the Repayment/Redemption Account for such purpose, if any,
including the proceeds of any Class B Notes but excluding any Available
Collections Amount, in each case, at the Redemption Price (any such redemption,
an "Optional Redemption"). Royalty Sub shall give written notice of any such
Optional Redemption to the Trustee and Servicer not later than seven Business
Days prior to the date on which notice is to be given to Noteholders in
accordance with Section 3.2(a). Such written notice to the Trustee shall include
a copy of the Board Resolution authorizing such Optional Redemption and shall
set forth the relevant information regarding such Optional Redemption, including
the information to be included in the notice given pursuant to Section 3.2(a).
(b) Subject to the provisions of the Intercreditor Agreement, an
indenture supplemental hereto providing for the issuance of any Class B Notes or
Refinancing Notes may authorize one or more redemptions, in whole or in part, of
such Notes, on such terms and subject to such conditions as shall be specified
in such indenture supplemental hereto.
(c) Subject to the provisions of Section 3.2, after the Discharge of
First Lien Obligations, the Original Class A Notes will be subject to mandatory
redemption, as a whole but not in part, at the Redemption Price on the first
Payment Date after the occurrence of a Change of Control described in Section
6.1(l) or 6.2(f) of the Purchase and Sale Agreement that gives rise to such
mandatory redemption (any such redemption, a "Mandatory Redemption"). Royalty
31
Sub shall give notice of any Mandatory Redemption to the Trustee and Servicer as
promptly as practicable prior to the date on which notice is to be given to
Noteholders in accordance with Section 3.2(a). Such notice to the Trustee shall
set forth the relevant information regarding such Mandatory Redemption,
including the information to be included in the notice given pursuant to Section
3.2(a).
(d) Subject to the provisions of Section 3.2, on any Payment Date
after the Discharge of First Lien Obligations, Royalty Sub may elect to redeem
the Original Class A Notes, as a whole but not in part, at the Redemption Price
(any such redemption, a "Special Tax Redemption"), in the event a Payor has
become or would become obligated to pay, on the next date on which any amount
would be payable with respect to the Notes, any Additional Amounts, in each case
as a result of:
(i) a change in or an amendment to the laws or treaties
(including any regulations, protocols or rulings promulgated thereunder) of
any Relevant Taxing Jurisdiction affecting taxation; or
(ii) any change in or amendment to any official position
regarding the application, administration or interpretation of such laws or
treaties (including the decision of any Governmental Authority),
which change or amendment is announced or becomes effective on or after the date
of the Private Placement Memorandum (or, if later, the date that a Payor becomes
a company organized under the laws of such jurisdiction) and the Payor cannot
avoid such obligation by taking reasonable measures available to it. No notice
of redemption pursuant to Section 3.2 may be given (a) earlier than 90 days
prior to the earliest date on which a Payor would be obligated to pay such
Additional Amounts were a payment in respect of the Notes then due and payable
and (b) unless at the time such notice is given such obligation to pay such
Additional Amounts remains in effect. Before Royalty Sub publishes or mails such
notice of redemption of the Notes as described above, it will deliver to the
Trustee an Officer's Certificate to the effect that Royalty Sub cannot avoid its
obligation to pay Additional Amounts by taking reasonable measures available to
it. Royalty Sub also will deliver to the Trustee an opinion of independent
counsel that a Payor is or would be obligated to pay Additional Amounts as a
result of a change in tax laws or regulations or the application or
interpretation of such laws or regulations. The Trustee will accept such opinion
of counsel as sufficient existence of the satisfaction of the conditions
precedent described above, which shall be conclusive and binding on the
Noteholders. Royalty Sub shall give notice of any such Special Tax Redemption to
the Trustee and Servicer not later than seven Business Days prior to the date on
which notice is to be given to Noteholders in accordance with Section 3.2(a).
Such notice to the Trustee shall include a copy of the Board Resolution
authorizing such Special Tax Redemption and shall set forth the relevant
information regarding such Special Tax Redemption, including the information to
be included in the notice given pursuant to Section 3.2(a).
32
Section 3.2 Procedure for Redemptions.
(a) The Trustee (or Servicer acting as its agent (or any authorized
agent of Servicer)) shall give written notice in respect of any Redemption of
any class of Notes under Section 3.1 to each Noteholder of such Notes at least
30 days but not more than 60 days before such Redemption Date; provided, that,
in connection with a Mandatory Redemption, if the events giving rise to such
Mandatory Redemption shall have occurred within the 30 days prior to such
Redemption Date, then such written notice shall be given to each Noteholder as
promptly as practicable. Except in connection with a Mandatory Redemption, the
Trustee shall not be permitted to deliver any notice under this Section 3.2(a)
unless and until it shall have received evidence reasonably satisfactory to it
that amounts sufficient to pay (i) the Redemption Price for such class of Notes
plus the Redemption Premium, if any, (ii) all accrued and unpaid interest,
including Additional Interest, in respect of each class of Notes ranking pari
passu therewith or prior thereto and (iii) the Transaction Expenses relating to
such Redemption are deposited, or will be deposited on or before the Redemption
Date, in the Repayment/Redemption Account established in respect of such
Redemption. Each notice in respect of a Redemption given pursuant to this
Section 3.2(a) shall state (A) the applicable Redemption Date and whether the
Redemption is a Mandatory Redemption, a Special Tax Redemption, an Optional
Redemption or any other redemption of Notes described in Section 3.1(b), (B) the
Trustee's arrangements for making payments in respect of such Redemption, (C)
the Redemption Price of the Notes to be redeemed and the Redemption Premium, if
any, (D) in the case of a Redemption of the Notes of any class in part, the
portion of the Outstanding Principal Balance of the Notes that will be redeemed,
(E) that Notes to be redeemed in a Redemption in whole must be surrendered
(which action may be taken by any Noteholder or its authorized agent) to the
Trustee to collect the Redemption Price and Redemption Premium, if any, on such
Notes and (F) that, unless Royalty Sub defaults in the payment of the Redemption
Price or Redemption Premium, if any, interest on Notes called for Redemption in
whole shall cease to accrue on and after the Redemption Date. If mailed in the
manner herein provided, the notice shall be conclusively presumed to have been
given whether or not the Noteholder receives such notice. Failure to give notice
or any defect in the notice shall not affect the validity of the notice.
(b) On or before any Redemption Date in respect of a Redemption under
Section 3.1, Royalty Sub shall, to the extent an amount equal to the Redemption
Price and Redemption Premium, if any, of the Notes to be redeemed and any
Transaction Expenses as of the Redemption Date is not then held by Royalty Sub
or on deposit in the Repayment/Redemption Account, deposit or cause to be
deposited in the Repayment/Redemption Account an amount in immediately available
funds equal to such amount.
(c) After notice has been given under Section 3.2(a) as to the
Redemption Date in respect of any Redemption, the Outstanding Principal Balance
of the Notes to be redeemed on such Redemption Date shall become due and payable
at the Corporate Trust Office, and from and after such Redemption Date (unless
there shall be a default by Royalty Sub in the payment of the Redemption Price
or the Redemption Premium, if any) such principal amount shall cease to bear
interest. Upon surrender of any Note for redemption in accordance with such
notice, the Redemption Price and Redemption Premium, if any, of such Note shall
be paid as provided for in
33
Section 3.9(b) of the Intercreditor Agreement. If any Note to be redeemed shall
not be so paid upon surrender thereof for redemption, the Outstanding Principal
Balance thereof shall continue to bear interest from the Redemption Date until
paid at the interest rate applicable to such Note. All Notes that are redeemed
will be surrendered to the Trustee for cancellation and may not be reissued or
resold.
Section 3.3 Incorporation of Intercreditor Agreement Provisions. The
provisions of Sections 3.1 through 3.12 of the Intercreditor Agreement are
incorporated by reference into this Indenture as if fully set forth herein. To
the extent such provisions of the Intercreditor Agreement shall conflict with
the remaining provisions of this Indenture, the provisions of the Intercreditor
Agreement shall apply.
ARTICLE IV
DEFAULT AND REMEDIES
Section 4.1 Events of Default. Each of the following events or occurrences
shall constitute an "Event of Default" hereunder with respect to any class of
Notes, and each such Event of Default shall be deemed to exist and continue so
long as, but only so long as, it shall not have been waived or remedied, as
applicable:
(a) (i) in the case of the Original Class A Notes, failure to pay the
interest on the Original Class A Notes due on any Payment Date other than the
Final Maturity Date or any Redemption Date in full by the next succeeding
Payment Date, together with Additional Interest on any interest not paid on the
Payment Date on which it was originally due, and (ii) in the case of any class
of Notes other than the Original Class A Notes, failure to pay when due interest
on any Notes of such class on any Payment Date;
(b) failure to pay when due principal and Premium, if any, and accrued
and unpaid interest on any Notes of such class on the applicable Final Maturity
Date or to pay the Redemption Price and the Redemption Premium, if any, when due
on any Redemption Date for such class;
(c) failure to pay any amount (other than interest, Premium, if any,
and principal on the Notes) when due and payable in connection with such class
of Notes and the continuance of such default for a period of five Business Days
or more after written notice thereof is given to Royalty Sub by the Trustee;
(d) (i) failure by Royalty Sub to comply in any material respect with
any of the covenants set forth in Section 5.1 (other than Section 5.1(j),
Section 5.1(n) or Section 5.1(o)), Section 5.2(a), Section 5.2(b) or Section
5.2(c), and written notice thereof being given to Royalty Sub by the Trustee at
the Direction of Noteholders of a majority of the Outstanding Principal Balance
of the Notes; or (ii) failure by Royalty Sub to comply in any material respect
with any of the other covenants, obligations, conditions or provisions binding
on it under this Indenture or the Notes (other than a payment default for which
provision is made in Section 4.1(a), Section 4.1(b) or Section 4.1(c)), if (in
the case of this Section 4.1(d)(ii) only) such failure continues for a period of
30 days or more after written notice thereof has been given to Royalty Sub by
the
34
Trustee or by the Direction of Noteholders of a majority of the Outstanding
Principal Balance of the Notes;
(e) Royalty Sub becomes subject to a Voluntary Bankruptcy or an
Involuntary Bankruptcy;
(f) any judgment or order for the payment of money in excess of
U.S.$1,000,000 shall be rendered against Royalty Sub and either (i) enforcement
proceedings have been commenced by any creditor upon such judgment or order or
(ii) there is any period of ten consecutive days during which a stay of
enforcement of such judgment or order, by reason of a pending appeal or
otherwise, shall not be in effect;
(g) Quintiles or the Pledgor shall have failed to perform in any
material respect any of its respective covenants under the Purchase and Sale
Agreement; or
(h) the Pledgor shall have failed to perform in any material respect
any of its covenants under the Second Lien Pledge and Security Agreement.
Section 4.2 Remedies. Upon the occurrence and continuation of an Event of
Default with respect to the Notes, neither the Trustee nor the Noteholders shall
have the right to accelerate the Outstanding Principal Balance of the Notes.
Subject to the provisions of the Intercreditor Agreement, if any Event of
Default shall have occurred and be continuing, the Senior Trustee may at all
times, but only at the Direction of Noteholders of a majority of the Outstanding
Principal Balance of the Senior Class of Notes, pursue any available remedy by
proceeding at law or in equity to collect the payment of principal of, Premium,
if any, or interest on the Notes or to enforce the performance of any provision
of the Notes, this Indenture, the Servicing Agreement or the Second Lien Pledge
and Security Agreement, including any of the following, to the fullest extent
permitted by law, subject to the receipt of such Direction:
(a) The Senior Trustee may obtain the appointment of a Receiver of the
Indenture Estate as provided in Section 12.7 and Royalty Sub consents to and
waives any right to notice of such appointment.
(b) The Senior Trustee may, without notice to Royalty Sub and at such
time as the Senior Trustee in its sole discretion may determine, exercise any or
all of Royalty Sub's rights in, to and under or in any way connected with or
related to any or all of the Indenture Estate, including (i) demanding and
enforcing payment and performance of, and exercising any or all of Royalty Sub's
rights and remedies with respect to the collection, enforcement or prosecution
of, any or all of the Indenture Estate (including the Royalty Sub Rights and
Royalty Sub's rights under the Purchase and Sale Agreement), in each case by
legal proceedings or otherwise, (ii) settling, adjusting, compromising,
extending, renewing, discharging and releasing any or all of, and any legal
proceedings brought to collect or enforce any or all of, the Royalty Sub Rights
and otherwise under the Transaction Documents and (iii) preparing, filing and
signing the name of Royalty Sub on (A) any proof of claim or similar document to
be filed in any bankruptcy or similar proceeding involving the Indenture Estate
(including the Royalty Sub
35
Rights) and (B) any notice of lien, assignment or satisfaction of lien, or
similar document in connection with the Indenture Estate (including the Royalty
Sub Rights).
(c) The Senior Trustee may, without notice except as specified herein,
sell or cause the sale of all or any part of the Indenture Estate in one or more
parcels at public or private sale, at any of the Senior Trustee's offices or
elsewhere, for cash, on credit or for future delivery, and upon such other terms
as the Senior Trustee may deem commercially reasonable, provided, that, so long
as the Co-Promotion Agreement has not been terminated, the Senior Trustee shall
make any such sale only to a Person that is a Permitted Holder. Royalty Sub
agrees that, to the extent notice of sale shall be required by law, at least ten
days' notice to Royalty Sub of the time and place of any public sale or the time
after which any private sale is to be made shall constitute reasonable
notification. The Senior Trustee shall not be obligated to make any sale of all
or any part of the Indenture Estate regardless of notice of sale having been
given. The Senior Trustee may adjourn any public or private sale from time to
time by announcement at the time and place fixed therefor, and such sale may,
without further notice, be made at the time and place to which it was so
adjourned.
(d) The Senior Trustee may, instead of exercising the power of sale
conferred upon it by Section 4.2(c) and Applicable Law, proceed by a suit or
suits at law or in equity to foreclose the Security Interest and sell all or any
portion of the Indenture Estate under a judgment or a decree of a court or
courts of competent jurisdiction, provided, that, so long as the Co-Promotion
Agreement has not been terminated, the Senior Trustee shall make any such
foreclosure sale only to a Person that is a Permitted Holder.
(e) The Senior Trustee may require Royalty Sub to, and Royalty Sub
hereby agrees that it shall at its expense and upon request of the Senior
Trustee, forthwith assemble all or part of the Indenture Estate as directed by
the Senior Trustee and make it available to the Senior Trustee at a place to be
designated by the Senior Trustee that is reasonably convenient to both parties.
(f) In addition to the rights and remedies provided for in this
Indenture, the Senior Trustee may exercise in respect of the Indenture Estate
all the rights and remedies of a secured party upon default under the UCC
(whether or not the UCC applies to the affected property included in the
Indenture Estate) and under all other Applicable Law; provided, that, so long as
the Co-Promotion Agreement has not been terminated, the Senior Trustee shall
cause any sale of the Collateral to be made only to a Person that is a Permitted
Holder.
(g) The Senior Trustee may maintain a proceeding even if it does not
possess any of the Notes or does not produce any of them in the proceeding.
Section 4.3 Limitation on Suits. Without limiting the provisions of Section
4.8 and the final sentence of Section 12.4, no Noteholder shall have any right
to institute any proceeding, judicial or otherwise, with respect to this
Indenture, the Second Lien Pledge and Security Agreement or the Notes, for the
appointment of a receiver or trustee or for any other remedy hereunder, unless:
36
(a) such Noteholder is a holder of the Senior Class of Notes and has
previously given written notice to the Senior Trustee of a continuing Event of
Default;
(b) the Noteholders of a majority of the Outstanding Principal Balance
of the Senior Class of Notes make a written request to the Senior Trustee to
pursue a remedy hereunder;
(c) such Noteholder or Noteholders offer to the Senior Trustee an
indemnity reasonably satisfactory to the Senior Trustee against any costs,
expenses and liabilities to be incurred in complying with such request;
(d) the Senior Trustee does not comply with such request within 60
days after receipt of the request and the offer of indemnity; and
(e) during such 60-day period, Noteholders of a majority of the
Outstanding Principal Balance of the Senior Class of Notes do not give the
Senior Trustee a Direction inconsistent with such request.
No one or more Noteholders may use this Indenture to affect, disturb or
prejudice the rights of another Noteholder or to obtain or seek to obtain any
preference or priority not otherwise created by this Indenture and the terms of
the Notes over any other Noteholder or to enforce any right under this
Indenture, except in the manner herein provided.
Section 4.4 Waiver of Existing Defaults.
(a) The Senior Trustee or the Noteholders of a majority of the
Outstanding Principal Balance of the Senior Class of Notes by written notice to
the Senior Trustee may waive any existing Default (or Event of Default)
hereunder and its consequences, except a Default (or Event of Default) (i) in
the payment of the interest on, principal of, and Premium, if any, on any Note
or (ii) in respect of a covenant or provision hereof which under Article IX
cannot be modified or amended without the consent of the Noteholder of each Note
affected thereby. Upon any such waiver, such Default shall cease to exist, and
any Event of Default arising therefrom shall be deemed to have been cured for
every purpose of this Indenture, but no such waiver shall extend to any
subsequent or other Default (or Event of Default) or impair any right consequent
thereon.
(b) Any written waiver of a Default or an Event of Default given by
Noteholders to the Senior Trustee and Royalty Sub in accordance with the terms
of this Indenture shall be binding upon the Senior Trustee and the other parties
hereto. Unless such writing expressly provides to the contrary, any waiver so
granted shall extend only to the specific event or occurrence which gave rise to
the Default or Event of Default so waived and not to any other similar event or
occurrence which occurs subsequent to the date of such waiver.
Section 4.5 Restoration of Rights and Remedies. If the Senior Trustee or
any Noteholder of the Senior Class of Notes has instituted any proceeding to
enforce any right or remedy under this Indenture, and such proceeding has been
discontinued or abandoned for any
37
reason or has been determined adversely to the Senior Trustee or such
Noteholder, then in every such case Royalty Sub, the Senior Trustee and the
Noteholders shall, subject to any determination in such proceeding, be restored
severally and respectively to their former positions hereunder, and thereafter
all rights and remedies of the Senior Trustee and the Noteholders shall continue
as though no such proceeding has been instituted.
Section 4.6 Remedies Cumulative. Each and every right, power and remedy
herein given to the Trustee specifically or otherwise in this Indenture shall be
cumulative and shall, to the extent permitted by law, be in addition to every
other right, power and remedy herein specifically given or now or hereafter
existing at law, in equity or by statute, and each and every right, power and
remedy whether specifically herein given or otherwise existing may be exercised
from time to time and as often and in such order as may be deemed expedient by
the Trustee, and the exercise or the beginning of the exercise of any power or
remedy shall not be construed to be a waiver of the right to exercise at the
same time or thereafter any other right, power or remedy. No delay or omission
by the Trustee in the exercise of any right, remedy or power or in the pursuance
of any remedy shall impair any such right, power or remedy or be construed to be
a waiver of any Default on the part of Royalty Sub or to be an acquiescence.
Section 4.7 Authority of Courts Not Required. The parties hereto agree
that, to the greatest extent permitted by law, the Trustee shall not be obliged
or required to seek or obtain the authority of, or any judgment or order of, the
courts of any jurisdiction in order to exercise any of its rights, powers and
remedies under this Indenture, and the parties hereby waive any such requirement
to the greatest extent permitted by law.
Section 4.8 Rights of Noteholders to Receive Payment. Notwithstanding any
other provision of this Indenture, the right of any Noteholder to receive
payment of interest on, principal of, or Premium, if any, on any Note on or
after the respective due dates therefor expressed in such Note, or to bring suit
for the enforcement of any such payment on or after such respective dates, shall
not be impaired or affected without the consent of such Noteholder.
Section 4.9 Trustee May File Proofs of Claim. The Trustee may file such
proofs of claim and other papers or documents as may be necessary or advisable
in order to have the claims of the Trustee and of any Noteholder allowed in any
judicial proceedings relating to any obligor on the Notes, its creditors or its
property.
Section 4.10 Undertaking for Costs. All parties to this Indenture agree,
and each Noteholder by its acceptance hereof shall be deemed to have agreed,
that, in any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as Trustee, a court in its discretion may require the filing by any party
litigant in such suit of an undertaking to pay the costs of such suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in such suit, having due regard to
the merits and good faith of the claims or defense made by the party litigant.
This Section 4.10 does not apply to a suit instituted by the Trustee, a suit
instituted by any Noteholder for the enforcement of the payment of interest,
principal, or Premium, if any, on any Note on or after the respective due dates
expressed in such Note or a
38
suit by a Noteholder or Noteholders of at least 10% of the Outstanding Principal
Balance of the Notes.
Section 4.11 Control by Noteholders. Subject to the provisions of the
Intercreditor Agreement, Section 4.2, Section 4.3 and the rights of the Trustee
hereunder, Noteholders of a majority of the Outstanding Principal Balance of the
Notes shall have the right to direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee or exercising any trust,
right or power conferred on the Trustee under any Transaction Document;
provided, that:
(a) such Direction shall not be in conflict with any rule of law or
with this Indenture and would not involve the Trustee in personal liability or
expense; and
(b) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such Direction.
Section 4.12 Senior Trustee. The Trustee irrevocably agrees (and the
Noteholders (other than the Noteholders represented by the Senior Trustee) shall
be deemed to agree by virtue of their purchase of the Notes) that the Senior
Trustee shall have all of the rights granted to it under this Indenture,
including the right to direct the Trustee to take certain action as provided for
in this Indenture, and the Trustee hereby agrees to act in accordance with each
such authorized direction of the Senior Trustee.
Section 4.13 Application of Proceeds. All cash proceeds received in respect
of any sale of, collection from or other realization upon all or any part of the
Indenture Estate shall be deposited in the Collection Account and distributed as
provided in the Intercreditor Agreement. Any surplus of such cash proceeds held
and remaining after payment in full of all Secured Obligations shall be paid
over to Royalty Sub or whomsoever may be lawfully entitled to receive such
surplus as provided in Section 3.7 of the Intercreditor Agreement. Subject to
the provisions of the Intercreditor Agreement, any amount received for any sale
or sales conducted in accordance with the terms of Section 4.2 shall to the
extent permitted by Applicable Law be deemed conclusive and binding on Royalty
Sub and the Noteholders.
Section 4.14 Waivers of Rights Inhibiting Enforcement. Royalty Sub waives
(a) any claim that, as to any part of the Indenture Estate, a private or public
sale, should the Senior Trustee elect so to proceed, is, in and of itself, not a
commercially reasonable method of sale for such part of the Indenture Estate,
(b) the right to assert in any action or proceeding between it and the Senior
Trustee offsets or counterclaims that it may have, (c) except as otherwise
provided in any of the Transaction Documents, TO THE EXTENT PERMITTED BY
APPLICABLE LAW, NOTICE OR JUDICIAL HEARING IN CONNECTION WITH THE TRUSTEE'S
TAKING POSSESSION OR DISPOSITION OF ANY OF THE INDENTURE ESTATE, INCLUDING ANY
AND ALL PRIOR NOTICE AND HEARING FOR ANY PREJUDGMENT REMEDY OR REMEDIES AND ANY
SUCH RIGHT THAT ROYALTY SUB WOULD OTHERWISE HAVE UNDER THE CONSTITUTION OR ANY
STATUTE OF THE U.S. OR OF ANY STATE, AND ALL OTHER REQUIREMENTS AS TO THE TIME,
PLACE AND TERMS OF SALE OR OTHER REQUIREMENTS WITH RESPECT TO THE
39
ENFORCEMENT OF THE TRUSTEE'S RIGHTS HEREUNDER, (d) all rights of redemption,
appraisement, valuation, stay and extension or moratorium and (e) except as
otherwise provided in any of the Transaction Documents, all other rights the
exercise of which would, directly or indirectly, prevent, delay or inhibit the
enforcement of any of the rights or remedies under this Indenture or the
absolute sale of the Indenture Estate, now or hereafter in force under any
Applicable Law, and Royalty Sub, for itself and all who may claim under it,
insofar as it or they now or hereafter lawfully may, hereby waives the benefit
of all such laws and rights.
Section 4.15 Security Interest Absolute. All rights of the Trustee and
security interests hereunder, and all obligations of Royalty Sub hereunder,
shall be absolute and unconditional irrespective of, and Royalty Sub hereby
irrevocably waives any defenses it may now have or may hereafter acquire in any
way relating to, any or all of the following:
(a) any lack of validity or enforceability of any of the Transaction
Documents or any other agreement or instrument relating thereto (other than
against the Trustee);
(b) any change in the time, manner or place of payment of, or in any
other term of, all or any of the Secured Obligations, or any other amendment or
waiver of or any consent to any departure from the Transaction Documents or any
other agreement or instrument relating thereto;
(c) any taking, exchange, surrender, release or non-perfection of any
Collateral or any other collateral, or any release or amendment or waiver of or
consent to any departure from any guaranty, for all or any of the Secured
Obligations;
(d) any manner of application of any Collateral or any other
collateral, or proceeds thereof, to all or any of the Secured Obligations, or
any manner of sale or other disposition of any Collateral or any other
collateral for all or any of the Secured Obligations or any other obligations of
Royalty Sub under or in respect of the Transaction Documents or any other assets
of Royalty Sub;
(e) any change, restructuring or termination of the corporate
structure or existence of Royalty Sub;
(f) the failure of any other Person to execute this Indenture or any
other agreement or the release or reduction of liability of Royalty Sub or other
grantor or surety with respect to the Secured Obligations; or
(g) any other circumstance (including any statute of limitations) or
any existence of or reliance on any representation by the Trustee that might
otherwise constitute a defense available to, or a discharge of, Royalty Sub.
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ARTICLE V
COVENANTS
Section 5.1 Covenants. Royalty Sub covenants with the Trustee that, so long
as any Notes are Outstanding, it will perform and comply with each of the
following covenants and not engage in any activity prohibited by this Indenture
without the prior written consent of the Trustee (acting at the Direction of the
Noteholders of a majority of the Outstanding Principal Balance of the Notes)
authorizing Royalty Sub not to perform any such covenants or to engage in any
such activity prohibited by this Indenture, in each case on such terms and
conditions, if any, as shall be specified in such prior written consent:
(a) Except as expressly permitted by any Transaction Document, Royalty
Sub shall not take any action, whether orally or in writing, which would amend,
waive, modify, supplement, restate, cancel or terminate or discharge or
prejudice the validity or effectiveness of this Indenture, the Notes, the Second
Lien Pledge and Security Agreement, the Purchase and Sale Agreement, the Hedge
Agreement or the Servicing Agreement, or permit any party to any such document
to be released from such obligations. In addition, Royalty Sub will not consent
to any amendment, supplement, waiver or other modification of, or enter into any
forbearance from exercising any rights with respect to the terms or provisions
contained in any of, or take any action, whether orally or in writing, to
discharge or prejudice the validity or effectiveness of, any First Lien
Documents except as provided in the Intercreditor Agreement or, to the extent
not provided in the Intercreditor Agreement, as permitted by such First Lien
Documents.
(b) Royalty Sub shall not, directly or indirectly, (i) declare or pay
any dividend or make any distribution on its Capital Securities, whether in
cash, property, securities or a combination thereof, to the Pledgor or any owner
of a beneficial interest in Royalty Sub or otherwise with respect to any
ownership of its Capital Securities, except that Royalty Sub may distribute to
the Pledgor (x) all or any portion of any amounts transferred to Royalty Sub
pursuant to Section 3.7(b)(ix) or Section 3.12 of the Intercreditor Agreement or
(y) any proceeds from a Class B Issuance (except to the extent such proceeds are
required under Section 5.1(d) to voluntarily prepay the Loans), (ii) purchase,
redeem, retire or otherwise acquire for value any issued Capital Securities of
Royalty Sub, (iii) make any payment of principal, interest or Premium, if any,
on the Notes or make any voluntary or optional redemption, repurchase,
defeasance or other acquisition or retirement for value of, or make any deposit
(including the payment of amounts into a sinking fund or other similar fund)
with respect to, Indebtedness of Royalty Sub other than in accordance with the
Notes and this Indenture, the Intercreditor Agreement or the First Lien
Documents or (iv) make any loan or advance to a Person, any purchase or other
acquisition of any beneficial interest, shares, warrants, rights, options,
obligations or other securities of such Person, any capital contribution to such
Person or any other investment in such Person (other than Eligible Investments
and investments permitted under Section 5.1(f)).
(c) Royalty Sub shall not (and shall not consent to Quintiles or the
Pledgor taking any action that would) incur or suffer to exist any Lien over or
with respect to any of Royalty Sub's assets, other than (i) any Permitted Lien
or (ii) any security interest created or
41
required to be created hereunder or under the First Lien Documents, subject to
the terms of the Intercreditor Agreement, including in connection with the Loans
or the issuance of any Class B Notes and Refinancing Notes.
(d) Royalty Sub shall not incur, create, issue, assume, Guarantee or
otherwise become liable for or with respect to, or become responsible for, the
payment or performance of, contingently or otherwise, whether present or future
(in any such case, to "Incur"), Indebtedness or other similar monetary
obligations; provided, however, that Royalty Sub may Incur Indebtedness in
respect of the Loans issued on the Closing Date, any Indebtedness used to
refinance such Loans that is permitted by the Intercreditor Agreement pursuant
to the definition of "Refinancing" therein, the Original Class A Notes issued on
the Closing Date, and any Class B Notes (provided that the net proceeds from any
Class B Issuance are deposited in the Repayment/Redemption Account to the extent
required to voluntarily prepay the Loans (or any portion thereof) and the other
Obligations (as defined in the Credit Agreement) pursuant to the Credit
Agreement and distributed as provided in the Intercreditor Agreement) and
Refinancing Notes (provided that any such Refinancing Notes are permitted by the
definition of "Refinancing" set forth in the Intercreditor Agreement prior to
the Discharge of First Lien Obligations) issued in accordance with this
Indenture.
(e) Royalty Sub shall not liquidate or dissolve, consolidate with,
merge with or into, or sell, convey, transfer, lease or otherwise dispose of the
Royalty Sub Rights or all or any material portion of its other property and
assets to, or purchase or otherwise acquire all or substantially all of the
assets of, any other Person, or permit any other Person to merge with or into,
or consolidate or otherwise combine with, Royalty Sub.
(f) Royalty Sub shall not, directly or indirectly, issue, deliver or
sell, or consent to issue, deliver or sell, any actual, contingent, future or
executory membership interests, beneficial interests, share capital or other
equity or ownership interests (however designated, whether voting or
non-voting), except for any additional Capital Securities of Royalty Sub issued
to the Pledgor, provided that such additional Capital Securities are pledged to
the Trustee pursuant to the Second Lien Pledge and Security Agreement and to the
Administrative Agent pursuant to the First Lien Pledge and Security Agreement
and provided further that Royalty Sub shall not accept any capital contributions
from Quintiles or the Pledgor after the Closing Date except for contributions of
funds deposited into the Capital Account, which may be used only as provided in
Section 3.1(h) of the Intercreditor Agreement.
(g) Except as otherwise provided in the Memorandum of Association and
the Articles of Association of Royalty Sub, as amended, restated, supplemented
or otherwise modified from time to time, Royalty Sub shall not engage in any
business or activity other than purchasing, holding and pledging the Royalty Sub
Rights, collecting the Royalty Sub Payments, incurring the Indebtedness and
other obligations under the First Lien Documents, issuing the Notes, entering
into the Hedge Agreement and remaining a party to the Transaction Documents.
(h) Royalty Sub shall not, directly or indirectly, enter into, renew
or extend any transaction (including the purchase, sale, lease or exchange of
property or assets, or the rendering
42
of any service) with any Affiliate of Royalty Sub, except for the Transaction
Documents as in effect on the date hereof.
(i) Royalty Sub shall not take any action to become subject to a
Voluntary Bankruptcy or an Involuntary Bankruptcy. Royalty Sub shall provide
promptly the Trustee with written notice of the institution of any proceeding by
or against Royalty Sub seeking to adjudicate it a bankrupt or insolvent, or
seeking liquidation, winding-up, reorganization, arrangement, adjustment,
protection, relief or composition of its debts under any law relating to
bankruptcy, insolvency or reorganization or relief of debtors, or seeking the
entry of an order for relief or the appointment of a receiver, trustee or other
similar official for it or for any substantial part of its property. Royalty Sub
shall not take any action to waive, repeal, amend, vary, supplement or otherwise
modify its organizational documents in a manner that would adversely affect (x)
the rights, remedies, privileges or preferences of any Noteholder or (y) the
Collateral (including the Royalty Sub Rights).
(j) Royalty Sub shall duly and punctually pay the principal, Premium,
if any, and interest on the Notes in accordance with the terms of this Indenture
and the Notes; provided, that, except in the case of the Final Maturity Date and
any Redemption Date, Royalty Sub shall be in compliance with this covenant if it
pays in full by the next succeeding Payment Date any interest on the Original
Class A Notes that became due and was not paid on any Payment Date (including
Additional Interest thereon).
(k) Royalty Sub shall not employ any employees other than as required
by any provisions of local law; provided, that the Service Providers and the
directors and officers of Royalty Sub shall not be deemed to be employees for
purposes of this Section 5.1(k).
(l) During any period in which Royalty Sub is not subject to Section
13 or 15(d) of the Exchange Act, Royalty Sub shall make available to any
Noteholder or Beneficial Holder in connection with any sale of any or all of its
Notes and any prospective purchaser of such Notes from such Noteholder or
Beneficial Holder the information required by Rule 144A(d)(4) under the
Securities Act.
(m) Royalty Sub shall at all times enforce its rights and remedies
under the Purchase and Sale Agreement and the Servicing Agreement in a
commercially reasonable manner.
(n) Royalty Sub shall record any charge created by it in its register
of mortgages and charges pursuant to Section 56 Companies Law (2004 Revision)
and make such register open to inspection by its members and creditors.
(o) Royalty Sub shall maintain its existence separate and distinct
from any other Person in all material respects, including taking the following
actions, as appropriate:
(i) maintaining in full effect its existence, rights and
franchises as an exempted company incorporated with limited liability under
the laws of the Cayman Islands and obtaining and preserving its
qualification to do business in each jurisdiction
43
in which such qualification is or will be necessary to protect the validity
and enforceability of this Indenture and each other instrument or agreement
necessary or appropriate to properly administer this Indenture and permit
and effectuate the transactions contemplated hereby and thereby;
(ii) maintaining its own deposit accounts, separate from those of
the Pledgor, Quintiles, any of its directors or officers and their
respective Affiliates;
(iii) conducting no material transactions between Royalty Sub and
any of its Affiliates, other than entering into the Transaction Documents
to which it is party;
(iv) allocating fairly and reasonably the cost of any shared
overhead expenses, including office space, with the Pledgor, Quintiles, any
of its directors or officers or any of their respective Affiliates;
(v) conducting its affairs separately from those of the Pledgor,
Quintiles, any of its directors or officers or any of their respective
Affiliates (other than Royalty Sub) and maintaining accurate and separate
books, records and accounts and financial statements, including in
connection with the purchase of the Royalty Sub Rights from the Pledgor; it
being agreed that performance under the Transaction Documents will not
result in Royalty Sub's contravening this Section 5.1(o)(v);
(vi) acting solely in its own name and not that of any other
Person, including the Pledgor, Quintiles, any of its directors or officers
or any of their respective Affiliates, and at all times use its own
stationery, invoices and checks separate from those of the Pledgor,
Quintiles, any of its directors or officers or any of their respective
Affiliates;
(vii) not holding itself out as having agreed to pay or
guarantee, or as otherwise being liable for, the obligations of the
Pledgor, Quintiles, any of its directors or officers or any of their
respective Affiliates;
(viii) insuring that any financial reports prepared by Royalty
Sub disclose the effects of the true sale of the Royalty Sub Rights by the
Pledgor and any of its Affiliates in compliance with GAAP;
(ix) maintaining all of its assets in its own name and not
commingling its assets with those of any other Person except as required
under the Transaction Documents;
(x) paying its own operating expenses and other liabilities out
of its own funds;
(xi) holding regular meetings of its directors, as appropriate,
and observing all formalities required by the organizational documents of
Royalty Sub;
44
(xii) maintaining adequate capital for the normal obligations
reasonably foreseeable in light of its contemplated business operations;
(xiii) not acquiring obligations of its shareholders, the
Pledgor, Quintiles, any of its directors or officers or any of their
respective Affiliates;
(xiv) holding itself out to the public as a legal entity separate
and distinct from any other Person, including Quintiles or the Pledgor or
any Affiliate of Quintiles or the Pledgor (other than Royalty Sub);
(xv) correcting any known misunderstanding regarding its separate
identity;
(xvi) not forming, acquiring or holding any subsidiaries; and
(xvii) not sharing any common logo with or identifying itself as
a department or division of the Pledgor, Quintiles, any of its directors or
officers or any of their respective Affiliates.
(p) Royalty Sub shall maintain its register of shareholders at all
times in the Cayman Islands.
(q) Royalty Sub will not enter into any agreement prohibiting (i) the
creation or assumption of any Lien upon its properties, revenues or assets,
whether now owned or hereafter acquired, or (ii) the ability of the Trustee or
any Noteholder to amend or otherwise modify any Transaction Document; provided,
that the foregoing prohibitions shall not apply to restrictions contained in any
Transaction Document.
Section 5.2 Reports and Other Deliverables by Royalty Sub.
(a) Royalty Sub shall furnish to the Trustee, within 60 days after the
end of each fiscal year, a certificate, in form and substance satisfactory to
the Trustee, from a Responsible Officer of Royalty Sub as to his or her
knowledge of Royalty Sub's compliance with all of its obligations under this
Indenture (it being understood that, for purposes of this Section 5.2, such
compliance shall be determined without regard to any period of grace or
requirement of notice provided under this Indenture but shall reflect any
interest paid on the Original Class A Notes by the next succeeding Payment Date
as contemplated by the proviso to Section 5.1(j)).
(b) Royalty Sub shall deliver written notice to the Trustee of the
occurrence of (i) any Default or Event of Default under this Indenture and (ii)
any of the events described in Section 6.4(e) of the Purchase and Sale Agreement
promptly and in any event within five Business Days of a Responsible Officer
becoming aware of such Default, Event of Default, event or situation.
(c) (i) To the extent not prohibited by obligations of confidentiality
between Quintiles and Lilly, Royalty Sub shall promptly (but in no event more
than five Business Days
45
following its receipt thereof) provide to Servicer and the Trustee copies of any
correspondence and (ii) Royalty Sub shall promptly (but in no event more than
five Business Days following its receipt thereof) provide to Servicer and the
Trustee copies of any notices, (A) in the case of each of clause (i) and clause
(ii) between Quintiles and Lilly with respect to the Co-Promotion Agreement,
including quarterly net sales reports under Section 5.10 of the Co-Promotion
Agreement, if such correspondence or notices relate to or could reasonably be
expected to affect the Royalty Sub Rights, or (B) from Quintiles or the Pledgor
pursuant to Section 6.1(j), 6.1(m) or 6.4 of the Purchase and Sale Agreement.
(d) Within 30 days after the beginning of each fiscal year, Royalty
Sub shall furnish to the Trustee (with a copy to the Administrative Agent prior
to the Discharge of First Lien Obligations) an opinion of its legal counsel,
which opinion shall state whether there are any actions to be taken, including
any financing statements to be filed in any office, within the period of 12 full
consecutive calendar months following the date of such opinion in order to
continue the perfection of the security interests granted under the Transaction
Documents.
Section 5.3 Payment of Additional Amounts. All payments made by or on
behalf of Royalty Sub on, under or with respect to the Notes will be made free
and clear of, and without withholding or deduction for or on account of, any
present or future tax, duty, levy, impost, assessment or other governmental
charge (including penalties, interest and other liabilities related thereto)
("Special Taxes") imposed or levied by or on behalf of the government of the
countries in which Royalty Sub and any successor thereof (each, a "Payor") is
organized or any political subdivision or any authority or agency therein or
thereof having power to tax, or any other jurisdiction in which the relevant
Payor is organized or is otherwise resident for tax purposes, or any
jurisdiction from or through which payment is made (each, a "Relevant Taxing
Jurisdiction"), unless the relevant Payor is then required to withhold or deduct
Special Taxes by law or by the interpretation or administration thereof by the
Relevant Taxing Jurisdiction.
If a Payor is so required to withhold or deduct any amount for or on
account of Special Taxes imposed by a Relevant Taxing Jurisdiction from any
payment made under or with respect to the Notes, such Payor will be required to
pay such additional amounts ("Additional Amounts") as may be necessary so that
the net amount received by any Noteholder (including Additional Amounts) after
such withholding or deduction will not be less than the amount the Noteholder
would have received if such Special Taxes had not been withheld or deducted;
provided, however, that the foregoing obligation to pay Additional Amounts does
not apply to:
(a) any Special Taxes that would not have been so imposed but for the
existence of any present or former connection between the relevant Noteholder or
Beneficial Holder (or between a fiduciary, settlor, member, partner or
shareholder of, or possessor of power over, the relevant Noteholder, if the
relevant Noteholder is an estate, nominee, trust, partnership or corporation)
and the Relevant Taxing Jurisdiction, including such Noteholder or Beneficial
Holder being or having been a domiciliary, national or resident thereof, or
being or having been present or engaged in a trade or business therein or having
had a permanent establishment or fixed base therein (other than the mere receipt
of such payment or the ownership or holding of such Note); or
46
(b) any Special Taxes that are imposed, deducted or withheld by reason
of the failure to comply by the Noteholder or the Beneficial Holder of a Note
with a written request from Royalty Sub, after reasonable notice, (i) to provide
information concerning the nationality, residence, identity or connection to the
Relevant Taxing Jurisdiction of such Noteholder or Beneficial Holder or (ii) to
make any certification, identification, declaration or other similar claim or
satisfy any information or reporting requirement, which, in the case of clause
(i) or (ii), is required as a precondition to exemption from or refund of all or
part of such Special Tax.
The Payor will (i) make any required withholding or deduction and (ii)
remit the full amount deducted or withheld to the Relevant Taxing Jurisdiction
in accordance with applicable law. The Payor will use reasonable efforts to
obtain certified copies of tax receipts evidencing the payment of any Special
Taxes so deducted or withheld from each Relevant Taxing Jurisdiction imposing
such Special Taxes and will provide such certified copies to the Trustee within
30 days after the date the payment of such Special Taxes is due. Such copies
shall be made available to the Noteholders upon request. The Payor will attach
to each certified copy a certificate stating (x) that the amount of withholding
Special Taxes evidenced by the certified copy was paid in connection with
payments in respect of the then Outstanding Principal Balance of Notes and (y)
the amount of such withholding Special Taxes paid per $1,000 principal amount of
the Notes.
If any Payor will be obligated to pay Additional Amounts under or with
respect to any payment made on the Notes, at least 30 days prior to the date of
such payment, the Payor will deliver to the Trustee an Officer's Certificate
stating the fact that Additional Amounts will be payable and the amount so
payable and such other information necessary to enable the Trustee to pay
Additional Amounts to Noteholders on the relevant Payment Date (unless such
obligation to pay Additional Amounts arises less than 30 days prior to the
relevant Payment Date, in which case the Payor may deliver such Officer's
Certificate as promptly as practicable after the date that is 30 days prior to
the Payment Date). Whenever in this Indenture there is mentioned, in any
context, the payment of:
(i) principal;
(ii) Redemption Prices or purchase prices in connection with a
Redemption or purchase of Notes, as applicable;
(iii) interest; or
(iv) any other amount payable on or with respect to any of the
Notes,
such reference shall be deemed to include payment of Additional Amounts as
described in this Section 5.3 to the extent that, in such context, Additional
Amounts are, were or would be payable in respect thereof.
Royalty Sub will pay any present or future stamp, court or documentary
taxes or any other excise taxes, charges or similar levies that arise in any
jurisdiction from the execution, delivery, enforcement or original registration
of the Notes, this Indenture or any other related
47
document or instrument, excluding such taxes, charges or similar levies imposed
by any jurisdiction that is not a Relevant Taxing Jurisdiction, and Royalty Sub
will agree to indemnify the Noteholders for any such taxes paid by such
Noteholders.
The obligations described under this Section 5.3 will survive any
termination, defeasance or discharge of this Indenture and will apply mutatis
mutandis to any jurisdiction in which any successor Person to Royalty Sub is
organized or any political subdivision or taxing authority or agency thereof or
therein.
ARTICLE VI
THE TRUSTEE
Section 6.1 Acceptance of Trusts and Duties. Except during the continuance
of an Event of Default, the Trustee undertakes to perform such duties and only
such duties as are specifically set forth in this Indenture, and no implied
covenants or obligations shall be read into this Indenture against the Trustee;
provided, that, to the extent those duties are qualified, limited or otherwise
affected by the provisions of the Intercreditor Agreement or any other
Transaction Document, the Trustee shall be required to perform those duties only
as so qualified, limited or otherwise affected. The duties and responsibilities
of the Trustee shall be as provided by the Trust Indenture Act (as if the Trust
Indenture Act applied to this Indenture) and as set forth herein. The Trustee
accepts the trusts hereby created and applicable to it and agrees to perform the
same but only upon the terms of this Indenture and the Trust Indenture Act (as
if the Trust Indenture Act applied to this Indenture) and agrees to receive and
disburse all moneys received by it in accordance with the terms hereof and of
the Intercreditor Agreement. The Trustee, in its individual capacity and as
Trustee, acknowledges and agrees that the Confidential Information includes
confidential information of Lilly and is subject to the confidentiality
provisions of this Indenture, including the limitations on transfers of the
Notes and Beneficial Interests and on sales of the Collateral, and that Lilly is
an express third party beneficiary of such confidentiality provisions. The
Trustee in its individual capacity shall not be answerable or accountable under
any circumstances except for its own willful misconduct or negligence or breach
of any of its representations or warranties set forth herein, and the Trustee
shall not be liable for any action or inaction of Royalty Sub or any other
parties to any of the Transaction Documents. Any amounts received by or due to
the Trustee under this Indenture, including the fees, out-of-pocket expenses and
indemnities of the Trustee, shall be Expenses of Royalty Sub.
Section 6.2 Copies of Documents and Other Notices.
(a) The Trustee, upon written request, shall furnish to each
requesting Noteholder or Beneficial Holder included on the Approved Holder List,
promptly upon receipt thereof, duplicates or copies of all reports, Notices,
requests, demands, certificates, financial statements and other instruments
furnished to the Trustee under this Indenture.
(b) The Trustee shall furnish to Noteholders and Beneficial Holders
included on the Approved Holder List promptly after receipt thereof any report
or notices received from Quintiles or Lilly, including (i) the report of any
audit contemplated by Section 6.1(j) of the Purchase and Sale Agreement, (ii)
notice of any dispute between Quintiles and Lilly in respect of
48
the Co-Promotion Agreement as contemplated by Section 6.1(f) of the Purchase and
Sale Agreement, (iii) notice of Quintiles' intent to terminate the Co-Promotion
Agreement pursuant to Section 6.2(e)(ii) of the Purchase and Sale Agreement and
(iv) notice of a Lilly Shortfall received from the Collection Agent pursuant to
Section 3.10 of the Intercreditor Agreement, and any other notice of a Lilly
Shortfall received from the Collection Agent pursuant to Section 3.10 of the
Intercreditor Agreement from any Person other than Quintiles or Lilly.
Section 6.3 Representations and Warranties. The Trustee does not make and
shall not be deemed to have made any representation or warranty as to the
validity, legality or enforceability of this Indenture, the Notes or any other
document or instrument or as to the correctness of any statement contained in
any thereof, except that the Trustee in its individual capacity hereby
represents and warrants (a) that each such specified document to which it is a
party has been or will be duly executed and delivered by one of its officers who
is and will be duly authorized to execute and deliver such document on its
behalf and (b) this Indenture is the legal, valid and binding obligation of U.S.
Bank National Association, enforceable against U.S. Bank National Association in
accordance with its terms, subject to the effect of any applicable bankruptcy,
insolvency, reorganization, moratorium or similar law affecting creditors'
rights generally. The Trustee also represents and warrants that it is not in the
business of developing, manufacturing or marketing pharmaceutical or diagnostic
products and that it is not an Affiliate of any Person who is in such business.
Section 6.4 Reliance; Agents; Advice of Counsel. The Trustee shall incur no
liability to anyone acting upon any signature, instrument, notice, resolution,
request, consent, order, certificate, report, opinion, bond or other document or
paper believed by it to be genuine and believed by it to be signed by the proper
party or parties. The Trustee may accept a copy of a resolution of, in the case
of Royalty Sub, its board of directors and, in the case of any other party to
any Transaction Document, the governing body of such Person, certified in an
accompanying Officer's Certificate as duly adopted and in full force and effect,
as conclusive evidence that such resolution has been duly adopted and that the
same is in full force and effect. As to any fact or matter the manner of
ascertainment of which is not specifically described herein, the Trustee shall
be entitled to receive and may for all purposes hereof conclusively rely on a
certificate, signed by an officer of any duly authorized Person, as to such fact
or matter, and such certificate shall constitute full protection to the Trustee
for any action taken or omitted to be taken by it in good faith in reliance
thereon. To the extent not otherwise specifically provided herein, the Trustee
shall assume, and shall be fully protected in assuming, that Royalty Sub is
authorized by its constitutional documents to enter into this Indenture and to
take all action permitted to be taken by it pursuant to the provisions hereof
and shall not be required to inquire into the authorization of Royalty Sub with
respect thereto. To the extent not otherwise specifically provided herein, the
Trustee shall furnish to Servicer upon written request such information and
copies of such documents as the Trustee may have and as are necessary for
Servicer to perform its duties under Article II, the Intercreditor Agreement or
otherwise.
The Trustee shall not be liable for any action it takes or omits to take in
good faith that it believes to be authorized or within its rights or powers or
for any action it takes or omits to take in accordance with the Direction of the
Noteholders in accordance with Section 4.11 relating to
49
the time, method and place of conducting any proceeding for any remedy available
to the Trustee, or exercising any trust, right or power conferred upon the
Trustee, under any Transaction Document.
The Trustee may execute any of the trusts or powers hereunder or perform
any duties hereunder or under any other Transaction Document either directly or
by or through agents or attorneys or a custodian or nominee, and the Trustee
shall not be responsible for any misconduct or negligence on the part of, or for
the supervision of, any such agent, attorney, custodian or nominee appointed
with due care by it hereunder.
The Trustee may consult with counsel as to any matter relating to this
Indenture or any other Transaction Document and any Opinion of Counsel or any
advice of such counsel shall be full and complete authorization and protection
in respect of any action taken or suffered or omitted by it hereunder in good
faith and in accordance with such advice or Opinion of Counsel.
The Trustee shall be under no obligation to exercise any of the rights or
powers vested in it by this Indenture or any other Transaction Document, or to
institute, conduct or defend any litigation hereunder or in relation hereto, at
the request, order or Direction of any of the Noteholders, pursuant to the
provisions of this Indenture or any other Transaction Document, unless such
Noteholders shall have offered to the Trustee security or indemnity reasonably
satisfactory to it against the costs, expenses and liabilities which may be
incurred therein or thereby.
The Trustee shall not be required to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its duties
hereunder or under any other Transaction Document, or in the exercise of any of
its rights or powers, if there is reasonable ground for believing that the
repayment of such funds or indemnity satisfactory to it against such risk or
liability is not reasonably assured to it, and none of the provisions contained
in this Indenture or any other Transaction Document shall in any event require
the Trustee to perform, or be responsible or liable for the manner of
performance of, any obligations of Royalty Sub or Servicer under this Indenture
or any of the other Transaction Documents.
The Trustee shall not be liable for any Losses or Taxes (except for Taxes
relating to any compensation, fees or commissions of any entity acting in its
capacity as Trustee hereunder) or in connection with the selection of Eligible
Investments or for any investment losses resulting from Eligible Investments.
When the Trustee incurs expenses or renders services in connection with an
Event of Default specified in Section 4.1(e), such expenses (including the fees
and expenses of its counsel) and the compensation for such services are intended
to constitute expenses of administration under any bankruptcy law or law
relating to creditors' rights generally.
The Trustee shall not be charged with knowledge of an Event of Default
unless a Responsible Officer of the Trustee obtains actual knowledge of such
event or has received written notice of such event from Royalty Sub, Servicer or
Noteholders of not less than 10% of the Outstanding Principal Balance of the
Notes.
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The Trustee shall have no duty to monitor the performance of Royalty Sub,
Servicer or any other party to the Transaction Documents, nor shall it have any
liability in connection with the malfeasance or nonfeasance by such parties.
Whenever in the administration of the provisions of this Indenture the
Trustee shall deem it necessary or desirable that a matter be proved or
established prior to taking or suffering any action to be taken hereunder or
under any other Transaction Document, such matter (unless other evidence in
respect thereof be herein specifically prescribed) may, in the absence of gross
negligence or bad faith on the part of the Trustee, be deemed to be conclusively
proved and established by a certificate signed by a Responsible Officer of
Royalty Sub and delivered to the Trustee, and such certificate, in the absence
of gross negligence or bad faith on the part of the Trustee, shall be full
warrant to the Trustee for any action taken, suffered or omitted by it under the
provisions of this Indenture or any other Transaction Document upon the faith
thereof.
Except as provided expressly hereunder, the Trustee shall have no
obligation to invest and reinvest any cash held in the Accounts in the absence
of timely and specific written investment direction by or on behalf of Royalty
Sub. In no event shall the Trustee be liable for the selection of investments or
for investment losses incurred thereon. The Trustee shall have no liability in
respect of losses incurred as a result of the liquidation of any investment
prior to its stated maturity or the failure of Royalty Sub to provide timely
written investment direction.
Any corporation into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to the business of the Trustee, shall be the successor of
the Trustee hereunder without the execution or filing of any paper with any
party hereto or any further act on the part of any of the parties hereto, except
where an instrument of transfer or assignment is required by law to effect such
succession, anything herein to the contrary notwithstanding.
Section 6.5 Not Acting in Individual Capacity. The Trustee acts hereunder
solely as trustee unless otherwise expressly provided, and all Persons, other
than the Noteholders to the extent expressly provided in this Indenture, having
any claim against the Trustee by reason of the transactions contemplated hereby
shall look, subject to the lien and priorities of payment as provided herein or
in any other Transaction Document, only to the property of Royalty Sub for
payment or satisfaction thereof.
Section 6.6 Compensation of Trustee. The Trustee agrees that it shall have
no right against the Noteholders or, except as provided in Section 3.7 of the
Intercreditor Agreement, the property of Royalty Sub, for any fee as
compensation for its services hereunder. Royalty Sub shall pay to the Trustee
from time to time such compensation as is agreed between the two parties. The
compensation shall be paid to the Trustee as provided in Section 3.7 of the
Intercreditor Agreement.
Section 6.7 Notice of Defaults. As promptly as practicable after, and in
any event within 90 days after, the occurrence and continuation of any Default
hereunder, the Trustee shall transmit by mail to Royalty Sub and the Noteholders
of the related class, in accordance with
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Section 313(c) of the Trust Indenture Act (as if the Trust Indenture Act applied
to this Indenture), notice of such Default hereunder actually known to a
Responsible Officer of the Trustee, unless such Default shall have been cured or
waived; provided, however, that, except in the case of a Default on the payment
of the interest, principal or Premium, if any, on any Note, the Trustee shall be
fully protected in withholding such notice if and so long as a trust committee
of Responsible Officers of the Trustee in good faith determines that the
withholding of such notice is in the interests of the Noteholders of the related
class.
Section 6.8 May Hold Notes. The Trustee, any Paying Agent, the Registrar or
any of their Affiliates or any other agent in their respective individual or any
other capacity may become the owner or pledgee of the Notes and, subject to
Sections 310(b) and 311 of the Trust Indenture Act (as if the Trust Indenture
Act applied to this Indenture), may otherwise deal with Royalty Sub with the
same rights it would have if it were not the Trustee, Paying Agent, Registrar or
such other agent.
Section 6.9 Corporate Trustee Required; Eligibility. There shall at all
times be a Trustee which shall be eligible to act as a trustee under Section
310(a) of the Trust Indenture Act (as if the Trust Indenture Act applied to this
Indenture) and shall meet the Eligibility Requirements. If such corporation
publishes reports of conditions at least annually, pursuant to law or to the
requirements of any federal, state, foreign, territorial or District of Columbia
supervising or examining authority, then, for the purposes of this Section 6.9,
the combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of
conditions so published.
In case at any time the Trustee shall cease to be eligible in accordance
with the provisions of this Section 6.9 to act as Trustee, the Trustee shall
resign immediately as Trustee in the manner and with the effect specified in
Section 7.1.
Section 6.10 Reports by the Trustee. Within 60 days after May 15 of each
year commencing with the first full calendar year following the issuance of any
class of Notes, the Trustee shall, if required by Section 313(a) of the Trust
Indenture Act (as if the Trust Indenture Act applied to this Indenture),
transmit to the Noteholders of each class, as provided in Section 313(c) of the
Trust Indenture Act (as if the Trust Indenture Act applied to this Indenture), a
brief report describing, among other things, any changes in eligibility and
qualifications of the Trustee and any issuance of Class B Notes.
Section 6.11 Calculation Agent. The Trustee shall act as the Calculation
Agent hereunder. Subject to the approval of Royalty Sub and Noteholders of a
majority of the Outstanding Principal Balance of the Notes, another Person may
become the Calculation Agent on such terms as shall be approved by them. To the
extent not otherwise specifically provided herein, the Trustee shall furnish to
the Calculation Agent, and the Calculation Agent shall furnish to the Trustee,
upon written request such information and copies of such documents as the
Trustee or the Calculation Agent may have and as are necessary for the
Calculation Agent and the Trustee to perform their respective duties under the
Intercreditor Agreement or otherwise.
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Section 6.12 Second Lien Pledge and Security Agreement. The Trustee shall
enter into the Second Lien Pledge and Security Agreement with the Pledgor on the
Closing Date and shall hold, or shall cause the Collection Agent or
Administrative Agent as perfection agent for the Trustee to hold, the collateral
pledged thereunder as part of the Collateral and the Indenture Estate for
purposes of this Indenture. The provisions of this Article VI shall apply to the
Trustee's exercise of rights and remedies under the Second Lien Pledge and
Security Agreement, mutatis mutandis.
Section 6.13 Custody of the Collateral. The Trustee, or the Collection
Agent or Administrative Agent as perfection agent for the Trustee, shall hold
such of the Indenture Estate as consists of instruments, deposit accounts,
negotiable documents, money, goods, letters of credit and advices of credit in
the State of New York. The Trustee, or the Collection Agent or Administrative
Agent as perfection agent for the Trustee, shall hold such of the Indenture
Estate as constitutes investment property through a securities intermediary,
which securities intermediary shall agree with the Trustee or such perfection
agent that (a) such investment property shall at all times be credited to a
securities account of the Trustee or such perfection agent, (b) such securities
intermediary shall treat the Trustee or such perfection agent as entitled to
exercise the rights that comprise each financial asset credited to such
securities account, (c) all property credited to such securities account shall
be treated as a financial asset, (d) such securities intermediary shall comply
with entitlement orders originated by the Trustee or such perfection agent
without the further consent of any other Person, (e) such securities
intermediary will not agree with any Person other than the Trustee or such
perfection agent to comply with entitlement orders originated by such other
Person, (f) such securities account and the property credited thereto shall not
be subject to any lien, security interest or right of set-off in favor of such
securities intermediary or anyone claiming through it (other than the Trustee or
such perfection agent) and (g) such agreement shall be governed by the laws of
the State of New York. Except as permitted by this Section 6.13, the Trustee
shall not hold any part of the Indenture Estate through an agent or a nominee.
Section 6.14 Preservation and Disclosure of Noteholder Lists. The Registrar
shall preserve, in as current a form as is reasonably practicable, all
information as to the names and addresses of the Noteholders received by it,
including the Approved Holder List. At any time when a default or an Event of
Default has occurred and is continuing, in case either (a) three or more
Noteholders that have executed and delivered to the Registrar a Confidentiality
Agreement or (b) one or more Noteholders of at least 25% of the Outstanding
Principal Balance of the Senior Class of Notes that have executed and delivered
to the Registrar a Confidentiality Agreement (in each case, "Applicants") apply
in writing to the Registrar and furnish to the Registrar reasonable proof that
each such Applicant has owned a Note for a period of at least three months
preceding the date of such application, and such application states that the
Applicants desire to communicate with other Noteholders with respect to their
rights under this Indenture or under the Notes and such application is
accompanied by a copy of the form of proxy or other communication which such
Applicants propose to transmit, then the Registrar shall, within five Business
Days after the receipt of such application, inform such Applicants as to the
approximate number of Noteholders whose names and addresses appear in such
information and as to the approximate cost of mailing to such Noteholders the
form of proxy or other
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communication, if any, specified in such application. The Registrar shall, upon
the written request of such Applicants, mail to each Noteholder whose name and
address appears in such information a copy of the form of proxy or other
communication which is specified in such request, with reasonable promptness
after a tender to the Registrar of the material to be mailed and of payment, or
provision for the payment, of the reasonable expenses of mailing. Each and every
Noteholder, by receiving and holding the same, agrees with Royalty Sub and the
Registrar that neither the Registrar nor any agent of Royalty Sub or the
Registrar shall be held accountable by reason of mailing any material pursuant
to a request made under this Section 6.14.
Section 6.15 Intercreditor Agreement. The Trustee shall enter into the
Intercreditor Agreement and shall take such actions and make such
acknowledgments as are set forth therein.
Section 6.16 Intercreditor Agreement Purchase Option. Upon receipt by the
Trustee of a Trigger Notice pursuant to Section 6.1 of the Intercreditor
Agreement, the Trustee shall promptly furnish such Trigger Notice to the
Noteholders and Beneficial Holders included on the Approved Holder List. Such
Noteholders and Beneficial Holders who desire to participate in the purchase of
First Lien Obligations pursuant to Section 6.1 of the Intercreditor Agreement
("Participating Holders") shall notify the Trustee of such desire in a timely
manner to facilitate the delivery of a Purchase Notice by the Trustee under
Section 6.1 of the Intercreditor Agreement. Unless otherwise agreed by the
Participating Holders, each Participating Holder shall participate in such
purchase of First Lien Obligations pro rata in proportion to the respective
Outstanding Principal Balance of Notes then held by each such Participating
Holder. To facilitate the payment of the purchase price for the First Lien
Obligations as set forth in Section 6.3 of the Intercreditor Agreement, by 10:00
a.m. New York City time on the date of purchase and sale of the First Lien
Obligations, each Participating Holder shall wire transfer immediately available
funds to an account designated by the Trustee in an amount sufficient to
purchase such First Lien Obligations pursuant to Section 6.3 of the
Intercreditor Agreement. Upon receipt of the First Lien Obligations by the
Trustee pursuant to Section 6.2 of the Intercreditor Agreement, the Trustee
shall use commercially reasonable efforts to ensure that each Participating
Holder receives such First Lien Obligations.
ARTICLE VII
SUCCESSOR TRUSTEES
Section 7.1 Resignation and Removal of Trustee. The Trustee may resign as
to all or any of the classes of Notes at any time without cause by giving at
least 30 days' prior written notice to Royalty Sub, Servicer and the
Noteholders. Noteholders of a majority of the Outstanding Principal Balance of
any class of Notes may at any time remove the Trustee as to such class without
cause, with the consent of Royalty Sub (such consent not to be unreasonably
withheld) if no Event of Default shall have occurred and be continuing, by an
instrument in writing delivered to Royalty Sub, Servicer and the Trustee being
removed. In addition, Royalty Sub may remove the Trustee as to any class of
Notes if (a) such Trustee fails to comply with Section 310 of the Trust
Indenture Act (as if the Trust Indenture Act applied to this Indenture) after
written request therefor by Royalty Sub or the Noteholders of the related class
who have been bona fide Noteholders for at least six months, (b) such Trustee
fails to comply with Section
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7.2(d) or any other provision hereof, (c) such Trustee is adjudged a bankrupt or
an insolvent, (d) a receiver or public officer takes charge of such Trustee or
its property or (e) such Trustee becomes incapable of acting. References to the
Trustee in this Indenture include any successor Trustee as to all or any of the
classes of Notes appointed in accordance with this Article VII. Any resignation
or removal of the Trustee pursuant to this Section 7.1 shall not be effective
until a successor Trustee shall have been duly appointed and vested as Trustee
pursuant to Section 7.2.
Section 7.2 Appointment of Successor.
(a) In the case of the resignation or removal of the Trustee as to any
class of Notes under Section 7.1, Royalty Sub shall promptly appoint a successor
Trustee as to such class; provided, that the Noteholders of a majority of the
Outstanding Principal Balance of such class of Notes may appoint, within one
year after such resignation or removal, a successor Trustee as to such class
which may be other than the successor Trustee appointed by Royalty Sub, and such
successor Trustee appointed by Royalty Sub shall be superseded by the successor
Trustee so appointed by the Noteholders. If a successor Trustee as to any class
of Notes shall not have been appointed and accepted its appointment hereunder
within 60 days after the Trustee gives notice of resignation as to such class,
the retiring Trustee, Royalty Sub, Servicer or a majority of the Outstanding
Principal Balance of such class of Notes may petition any court of competent
jurisdiction for the appointment of a successor Trustee as to such class. Any
successor Trustee so appointed by such court shall immediately and without
further act be superseded by any successor Trustee appointed as provided in the
first sentence of this paragraph within one year from the date of the
appointment by such court.
(b) Any successor Trustee as to any class of Notes, however appointed,
shall execute and deliver to Royalty Sub, Servicer and the predecessor Trustee
as to such class an instrument accepting such appointment, and thereupon such
successor Trustee, without further act, shall become vested with all the
estates, properties, rights, powers, duties and trusts of such predecessor
Trustee hereunder in the trusts hereunder applicable to it with like effect as
if originally named the Trustee as to such class herein; provided, that, upon
the written request of such successor Trustee, such predecessor Trustee shall,
upon payment of all amounts due and owing to it, execute and deliver an
instrument transferring to such successor Trustee, upon the trusts herein
expressed applicable to it, all the estates, properties, rights, powers and
trusts of such predecessor Trustee, and such predecessor Trustee shall duly
assign, transfer, deliver and pay over to such successor Trustee all moneys or
other property then held by such predecessor Trustee hereunder solely for the
benefit of such class of Notes.
(c) If a successor Trustee is appointed with respect to one or more
(but not all) classes of the Notes, Royalty Sub, the predecessor Trustee and
each successor Trustee with respect to each class of Notes shall execute and
deliver an indenture supplemental hereto which shall contain such provisions as
shall be deemed necessary or desirable to confirm that all the rights, powers,
trusts and duties of the predecessor Trustee with respect to the classes of
Notes as to which the predecessor Trustee is not retiring shall continue to be
vested in the predecessor Trustee, and shall add to or change any of the
provisions of this Indenture as shall be necessary to provide for or facilitate
the administration of the Notes hereunder by more than one Trustee.
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(d) Each Trustee shall be an Eligible Institution and shall meet the
Eligibility Requirements, if there be such an institution willing, able and
legally qualified to perform the duties of a Trustee hereunder.
(e) Any Person into which the Trustee may be merged or converted or
with which it may be consolidated, or any Person resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any Person
to which all or substantially all of the corporate trust business of the Trustee
(including the administration of the trust created by this Indenture) may be
transferred, shall, subject to the terms of Section 7.2(c), be the Trustee under
this Indenture without further act.
ARTICLE VIII
INDEMNITY
Section 8.1 Indemnity. Royalty Sub shall indemnify and defend the Trustee
(and its officers, directors, managers, employees and agents) for, and hold it
harmless from and against, and reimburse the Trustee for, any loss, liability or
expense incurred by it without bad faith, gross negligence or willful misconduct
on its part in connection with the acceptance or administration of this
Indenture and its duties under this Indenture and the Notes or any other
Transaction Document, including the costs and expenses of defending itself
against any claim or liability and of complying with any process served upon it
or any of its officers in connection with the exercise or performance of any of
its powers or duties, and hold it harmless against any loss, liability or
reasonable expense incurred without bad faith, gross negligence or willful
misconduct on its part, arising out of or in connection with actions taken or
omitted to be taken in reliance on any Officer's Certificate furnished
hereunder, or the failure to furnish any such Officer's Certificate required to
be furnished hereunder. The Trustee shall notify Royalty Sub promptly of any
claim asserted against the Trustee for which it may seek indemnity; provided,
however, that failure to provide such notice shall not invalidate any right to
indemnity hereunder. Royalty Sub shall defend any such claim and the Trustee
shall cooperate in the defense thereof. The Trustee may have separate counsel
and Royalty Sub shall pay the reasonable fees and expenses of one separate
outside counsel for the Trustee. Royalty Sub need not pay for any settlements
made without its consent; provided, that such consent shall not be unreasonably
withheld or delayed. Royalty Sub need not reimburse any expense or provide any
indemnity against any loss, liability or expense incurred by the Trustee through
bad faith, gross negligence or willful misconduct.
Section 8.2 Noteholders' Indemnity. The Trustee shall be entitled, subject
to such Trustee's duty during a Default to act with the required standard of
care, to be indemnified by the Noteholders of any class of Notes before
proceeding to exercise any right or power under this Indenture or any other
Transaction Document at the request or Direction of such Noteholders.
Section 8.3 Survival. The provisions of Section 8.1 and Section 8.2 shall
survive the termination of this Indenture or the earlier resignation or removal
of the Trustee.
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ARTICLE IX
MODIFICATION
Section 9.1 Modification with Consent of Noteholders. Subject to the
provisions of the Intercreditor Agreement, with the consent of Noteholders of a
majority of the Outstanding Principal Balance of the Notes on the date of any
vote or act of such Noteholders (voting or acting as a single class), Royalty
Sub may amend or modify this Indenture or the Notes. However, no amendment or
modification of this Indenture or the Notes may, without the consent of
Noteholders of 100% of the Outstanding Principal Balance of the class of Notes
affected thereby, and subject to the provisions of the Intercreditor Agreement:
(a) reduce the percentage of Noteholders of any such class of Notes
required to take or approve any action hereunder;
(b) reduce the amount or change the time of payment of any amount
owing or payable with respect to any such class of Notes or change the rate of
interest or change the manner of calculation of interest payable with respect to
any such class of Notes;
(c) alter or modify the provisions with respect to the Collateral for
the Notes or the Second Lien Pledge and Security Agreement or the manner of
payment or the order of priorities in which payments or distributions hereunder
will be made as between the Noteholders of such Notes and Royalty Sub or as
among the Noteholders; or
(d) consent to any assignment of Royalty Sub's rights to a party other
than the Trustee for the benefit of the Noteholders;
provided, that the Noteholders of a majority of the Outstanding Principal
Balance of the Senior Class of Notes, by written notice to the Trustee, may
waive (i) any Default or Event of Default pursuant to Section 4.4 and (ii) the
effect and consequences under this Indenture of the Patent Extension Event not
occurring by June 15, 2008.
It shall not be necessary for the consent of the Noteholders under this
Section 9.1 to approve the particular form of any proposed amendment or waiver,
but it shall be sufficient if such consent approves the substance thereof. Any
such modification approved by the required Noteholders of any class of Notes
will be binding on the Noteholders of the relevant class of Notes and each party
to this Indenture.
After an amendment under this Section 9.1 becomes effective, Royalty Sub
or, at the direction of Royalty Sub, the Trustee shall mail to the Noteholders a
notice briefly describing such amendment. Any failure of Royalty Sub or the
Trustee to mail such notice, or any defect therein, shall not, however, in any
way impair or affect the validity of any such amendment.
After an amendment under this Section 9.1 becomes effective, it shall bind
every Noteholder, whether or not notation thereof is made on any Note held by
such Noteholder.
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Section 9.2 Modification Without Consent of Noteholders. Subject to the
provisions of the Intercreditor Agreement, the Trustee may agree, without the
consent of any Noteholder:
(a) to evidence the succession of a successor to the Trustee, the
removal of the Trustee or the appointment of any separate or additional trustee
or trustees and to define the rights, powers, duties and obligations conferred
upon any such separate trustee or trustees or co-trustees;
(b) to correct, confirm or amplify the description of any property at
any time subject to the lien of this Indenture or to convey, transfer, assign,
mortgage or pledge any property to or with the Trustee;
(c) to cure any ambiguity in, correct or supplement any defective or
inconsistent provision of, or add to or modify any other provisions and
agreements in, this Indenture, the Notes, the Purchase and Sale Agreement, the
Xxxx of Sale, the Servicing Agreement, the Second Lien Pledge and Security
Agreement or the Intercreditor Agreement, in any manner that will not, in the
judgment of the Trustee, adversely affect the interests of the Noteholders in
any material respect;
(d) to grant or confer upon the Trustee for the benefit of the
Noteholders any additional rights, remedies, powers, authority or security which
may be lawfully granted or conferred and which are not contrary or inconsistent
with this Indenture or the Intercreditor Agreement;
(e) to add to or modify the covenants or agreements to be observed by
Royalty Sub, which are not contrary to this Indenture or the Intercreditor
Agreement, or to add Events of Default for the benefit of the Noteholders;
(f) to comply with the requirements of the SEC or any regulatory body
or any Applicable Law; or
(g) to effect any indenture supplemental hereto or any other
amendment, modification, supplement, waiver or consent with respect to this
Indenture, the Notes, the Purchase and Sale Agreement, the Xxxx of Sale, the
Servicing Agreement, the Second Lien Pledge and Security Agreement or the
Intercreditor Agreement; provided, that such indenture supplemental hereto,
amendment, modification, supplement, waiver or consent will not adversely affect
the interests of the Noteholders in any material respect as confirmed in an
Officer's Certificate of Royalty Sub.
After an amendment under this Section 9.2 becomes effective, Royalty Sub
or, at the direction of Royalty Sub, the Trustee shall mail to the Noteholders a
notice briefly describing such amendment. Any failure of Royalty Sub or the
Trustee to mail such notice, or any defect therein, shall not, however, in any
way impair or affect the validity of any such amendment.
After an amendment under this Section 9.2 becomes effective, it shall bind
every Noteholder, whether or not notation thereof is made on any Note held by
such Noteholder.
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Section 9.3 Amendment of Intercreditor Agreement. If the Intercreditor
Agreement is proposed to be amended in such a manner as would adversely affect
the interests of the Noteholders in any material respect, the Trustee shall
notify Noteholders of the proposed amendment and may consent thereto with the
consent of a majority of the Outstanding Principal Balance of the Notes which
would be affected by the action proposed to be taken; provided, that the Trustee
shall not, without the consent of 100% of the Outstanding Principal Balance of
the Notes, consent to any amendment that would modify Section 3 of the
Intercreditor Agreement.
Section 9.4 Subordination; Priority of Payments. The subordination
provisions contained in Article X may not be amended or modified without the
consent of Noteholders of 100% of the Outstanding Principal Balance of the class
of Notes affected thereby. In no event shall the provisions set forth in Section
3.7 of the Intercreditor Agreement relating to the priority of payment of
Expenses be amended or modified.
Section 9.5 Execution of Amendments by Trustee. In executing, or accepting
the additional trusts created by, any amendment or modification to this
Indenture permitted by this Article IX or the modifications thereby of the
trusts created by this Indenture, the Trustee shall be entitled to receive, and
shall be fully protected in relying upon, an Officer's Certificate and an
Opinion of Counsel stating that the execution of such amendment is authorized or
permitted by this Indenture. The Trustee may, but shall not be obligated to,
enter into any such amendment which affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise.
Section 9.6 Conformity with Trust Indenture Act. Every indenture
supplemental hereto pursuant to this Article IX shall conform to the
requirements of the Trust Indenture Act as then in effect (as if the Trust
Indenture Act applied to this Indenture).
ARTICLE X
SUBORDINATION
Section 10.1 Subordination of the Notes.
(a) Each of Royalty Sub and the Trustee (on behalf of the Noteholders)
covenants and agrees, and each Noteholder, by its acceptance of a Note,
covenants and agrees, that the Notes of each class will be issued subject to the
provisions of this Article X. Each Noteholder, by its acceptance of a Note,
further agrees that all amounts payable on any Note will, to the extent and in
the manner set forth in this Article X and Section 3.7 of the Intercreditor
Agreement, be subordinated in right of payment to the prior payment in full of
all Expenses payable to the Service Providers pursuant to this Indenture and the
other Transaction Documents. Each Noteholder of a Class B Note, by its
acceptance of a Class B Note, further agrees that all amounts payable on any
Class B Note will, to the extent and in the manner set forth in this Article X
and Section 3.7 of the Intercreditor Agreement, be subordinated in right of
payment to the payment in full of the Class A Notes. Any claim to payment so
stated to be subordinated is referred to as a "Subordinated Claim"; each claim
to payment to which another claim to payment is a Subordinated Claim is referred
to as a "Senior Claim" with respect to such Subordinated Claim.
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(b) If, prior to the payment in full of all Senior Claims then due and
payable, the Trustee or any Noteholder of a Subordinated Claim shall have
received any payment or distribution in respect of such Subordinated Claim in
excess of the amount to which such Noteholder was then entitled under Section
3.7 of the Intercreditor Agreement, then such payment or distribution shall be
received and held in trust by such Person and paid over or delivered to the
Trustee for application as provided in Section 3.7 of the Intercreditor
Agreement.
(c) If any Service Provider, the Trustee or any Noteholder of any
Senior Claim receives any payment in respect of any Senior Claim which is
subsequently invalidated, declared preferential, set aside and/or required to be
repaid to a trustee, receiver or other party, then, to the extent such payment
is so invalidated, declared preferential, set aside and/or required to be
repaid, such Senior Claim shall be revived and continue in full force and effect
and shall be entitled to the benefits of this Article X, all as if such payment
had not been received.
(d) The Trustee (on its own behalf and on behalf of the Noteholders)
and Royalty Sub each confirm that the payment priorities specified in Section
3.7 of the Intercreditor Agreement shall apply in all circumstances.
(e) Each Noteholder, by its acceptance of a Note, authorizes and
expressly directs the Trustee on its behalf to take such action as may be
necessary or appropriate to effectuate the subordination provided in this
Article X, and appoints the Trustee its attorney-in-fact for such purposes,
including, in the event of any dissolution, winding-up, liquidation or
reorganization of Royalty Sub (whether in bankruptcy, insolvency, receivership,
reorganization or similar proceedings or upon an assignment for the benefit of
creditors or otherwise), any actions tending towards liquidation of the property
and assets of Royalty Sub or the filing of a claim for the unpaid balance of its
Notes in the form required in those proceedings.
(f) After all Senior Claims are paid in full and until the
Subordinated Claims are paid in full, and to the extent that such Senior Claims
shall have been paid with funds that would, but for the subordination pursuant
to this Article X, have been paid to and retained by such holders of
Subordinated Claims, the holders of Subordinated Claims shall be subrogated to
the rights of holders of Senior Claims to receive payments applicable to Senior
Claims. A payment made under this Article X to holders of Senior Claims which
otherwise would have been made to the holders of Subordinated Claims is not, as
between Royalty Sub and the holders of Subordinated Claims, a payment by Royalty
Sub.
(g) No right of any holder of any Senior Claim to enforce the
subordination of any Subordinated Claim shall be impaired by an act or failure
to act by Royalty Sub or the Trustee or by any failure by either Royalty Sub or
the Trustee to comply with this Indenture.
(h) Each Noteholder by accepting a Note acknowledges and agrees that
the foregoing subordination provisions are, and are intended to be, an
inducement and a consideration to each holder of any Senior Claim, whether such
Senior Claim was created or acquired before or after the issuance of such
Noteholder's claim, to acquire and continue to hold such Senior Claim, and such
holder of any Senior Claim shall be deemed conclusively to have
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relied on such subordination provisions in acquiring and continuing to hold such
Senior Claim. Each holder of a Subordinated Claim agrees to comply with the
provisions of Article IV.
ARTICLE XI
DISCHARGE OF INDENTURE
Section 11.1 Discharge of Indenture.
(a) When (i) Royalty Sub delivers to the Trustee all Outstanding Notes
(other than Notes replaced pursuant to Section 2.8) for cancellation or (ii) all
Outstanding Notes have become due and payable, whether at maturity or as a
result of the mailing of a notice of an Optional Redemption pursuant to Section
3.1(a), a Mandatory Redemption pursuant to Section 3.1(c), a Special Tax
Redemption pursuant to Section 3.1(d) or any other Redemption pursuant to
Section 3.1(b) and Royalty Sub irrevocably deposits in the Repayment/Redemption
Account funds sufficient to pay at maturity or upon redemption all Outstanding
Notes, including interest and any Premium thereon to maturity or the Redemption
Date (other than Notes replaced pursuant to Section 2.8), and if in either case
Royalty Sub pays all other sums payable hereunder by Royalty Sub, then this
Indenture shall, subject to Section 11.1(b), cease to be of further effect and
the security interest granted to the Trustee hereunder in the Collateral and the
Indenture Estate shall terminate. The Trustee shall acknowledge satisfaction and
discharge of this Indenture, and file all UCC termination statements and similar
documents prepared by Royalty Sub, on demand of Royalty Sub accompanied by an
Officer's Certificate and an Opinion of Counsel, at the cost and expense of
Royalty Sub, to the effect that any conditions precedent to a discharge of this
Indenture have been met.
(b) Notwithstanding Section 11.1(a), Royalty Sub's obligations in
Section 8.1 and the Trustee's obligations in Section 12.13 shall survive the
satisfaction and discharge of this Indenture.
ARTICLE XII
MISCELLANEOUS
Section 12.1 Right of Trustee to Perform. If Royalty Sub for any reason
fails to observe or punctually to perform any of its obligations to the Trustee,
whether under this Indenture, under any of the other Transaction Documents or
otherwise, the Trustee shall have the power (but shall have no obligation), on
behalf of or in the name of Royalty Sub or otherwise, to perform such
obligations and to take any steps which the Trustee may, in its absolute
discretion, consider appropriate with a view to remedying, or mitigating the
consequences of, such failure by Royalty Sub; provided, that no exercise or
failure to exercise this power by the Trustee shall in any way prejudice the
Trustee's other rights under this Indenture or any of the other Transaction
Documents.
Section 12.2 Waiver. Any waiver by any party of any provision of this
Indenture or any right, remedy or option hereunder shall only prevent and estop
such party from thereafter enforcing such provision, right, remedy or option if
such waiver is given in writing and only as to the specific instance and for the
specific purpose for which such waiver was given. The
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failure or refusal of any party hereto to insist in any one or more instances,
or in a course of dealing, upon the strict performance of any of the terms or
provisions of this Indenture by any party hereto or the partial exercise of any
right, remedy or option hereunder shall not be construed as a waiver or
relinquishment of any such term or provision, but the same shall continue in
full force and effect. No failure on the part of the Trustee to exercise, and no
delay on its part in exercising, any right or remedy under this Indenture 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. The rights and remedies provided in this Indenture
are cumulative and not exclusive of any rights or remedies provided by law.
Section 12.3 Severability. In the event that any provision of this
Indenture or the application thereof to any party hereto or to any circumstance
or in any jurisdiction governing this Indenture shall, to any extent, be invalid
or unenforceable under any applicable statute, regulation or rule of law, then
such provision shall be deemed inoperative to the extent that it is invalid or
unenforceable, and the remainder of this Indenture, and the application of any
such invalid or unenforceable provision to the parties, jurisdictions or
circumstances other than to whom or to which it is held invalid or
unenforceable, shall not be affected thereby nor shall the same affect the
validity or enforceability of this Indenture. The parties hereto further agree
that the holding by any court of competent jurisdiction that any remedy pursued
by the Trustee hereunder is unavailable or unenforceable shall not affect in any
way the ability of the Trustee to pursue any other remedy available to it.
Section 12.4 Restrictions on Exercise of Certain Rights. The Trustee and,
during the continuance of a payment Default with respect to the Senior Class of
Notes, the Senior Trustee, except as otherwise provided in Section 4.3, may xxx
for recovery or take any other steps for the purpose of recovering any of the
obligations hereunder or any other debts or liabilities whatsoever owing to it
by Royalty Sub. Each of the Noteholders shall at all times be deemed to have
agreed by virtue of the acceptance of the Notes that only the Trustee and,
during the continuance of a payment Default with respect to the Senior Class of
Notes, the Senior Trustee, except as provided in Section 4.3, may take any steps
for the purpose of procuring the appointment of an administrative receiver,
examiner, receiver or similar officer or the making of an administration order
or for instituting any bankruptcy, reorganization, arrangement, insolvency,
winding-up, liquidation, composition, examination or any like proceedings under
Applicable Law.
Section 12.5 Notices. All Notices shall be in writing and shall be
effective (a) upon receipt when sent through the mails, registered or certified
mail, return receipt requested, postage prepaid, with such receipt to be
effective the date of delivery indicated on the return receipt, (b) upon receipt
when sent by an overnight courier, (c) on the date personally delivered to an
authorized officer of the party to which sent, (d) on the date transmitted by
legible telecopier transmission with a confirmation of receipt or (e) in the
case of reports under the Intercreditor Agreement and any other report which is
of a routine nature, on the date sent by first class mail or overnight courier
or transmitted by legible telecopier transmission, in all cases addressed to the
recipient as follows:
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if to Royalty Sub, to:
Duloxetine Royalty Sub
c/o Walkers SPV Limited
P.O. Box 908GT, Xxxxxx House
Xxxx Street, Xxxxxx Town, Grand Cayman
Cayman Islands
Attention: The Director
Telephone: 000-000-0000
Facsimile: 000-000-0000
if to the Pledgor, to:
Duloxetine Holdco Royalty Sub
c/o Walkers SPV Limited
P.O. Box 908GT, Xxxxxx House
Xxxx Street, Xxxxxx Town, Grand Cayman
Cayman Islands
Attention: The Director
Telephone: 000-000-0000
Facsimile: 000-000-0000
if to Servicer or Quintiles, to:
Quintiles Transnational Corp.
0000 Xxxxxxxxxx Xxxxx, Xxxxx 000
Xxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Xxxx X. Xxxxxxx, General Counsel
Telephone: 000-000-0000
Facsimile: 000-000-0000
if to Lilly, to:
Xxx Xxxxx and Company
Lilly Xxxxxxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxx 00000
Attention: General Counsel
Telephone: 000-000-0000
Facsimile: 000-000-0000
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if to the Trustee, the Registrar, the Paying Agent or the Calculation
Agent, to:
U.S. Bank National Association
Xxx Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Corporate Trust Services (Duloxetine Royalty Sub)
Telephone: 000-000-0000
Facsimile: 000-000-0000
A copy of each notice given hereunder to any party hereto shall also be given to
each of the other parties hereto. Each party hereto may, by notice given in
accordance herewith to each of the other parties hereto, designate any further
or different address to which subsequent Notices shall be sent; provided,
however, in the case of Lilly, such notice may be given by Servicer.
Section 12.6 Assignments. This Indenture shall be a continuing obligation
of Royalty Sub and shall (a) be binding upon Royalty Sub and its successors and
assigns and (b) inure to the benefit of and be enforceable by the Trustee and by
its successors, transferees and assigns. Royalty Sub may not assign any of its
obligations under this Indenture or delegate any of its duties hereunder.
Section 12.7 Application to Court. The Trustee may at any time after the
occurrence and continuation of an Event of Default apply to any court of
competent jurisdiction for an order that the terms of this Indenture be carried
into execution under the direction of such court and for the appointment of a
Receiver of the Collateral or any part thereof and for any other order in
relation to the administration of this Indenture as the Trustee shall deem fit,
and it may assent to or approve any application to any court of competent
jurisdiction made at the instigation of any of the Noteholders and shall be
indemnified by Royalty Sub against all costs, charges and expenses incurred by
it in relation to any such application or proceedings.
Section 12.8 GOVERNING LAW. THIS INDENTURE SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE INTERNAL SUBSTANTIVE LAWS OF THE STATE OF NEW
YORK WITHOUT REFERENCE TO THE RULES THEREOF RELATING TO CONFLICTS OF LAW OTHER
THAN SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK, AND
THE OBLIGATIONS, RIGHTS AND REMEDIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE
WITH SUCH LAWS.
Section 12.9 Jurisdiction.
(a) Each of the parties hereto agrees that the U.S. federal and State
of New York courts located in the Borough of Manhattan, The City of New York
shall have jurisdiction to hear and determine any suit, action or proceeding,
and to settle any disputes, which may arise out of or in connection with this
Indenture and, for such purposes, submits to the jurisdiction of such courts.
Each of the parties hereto waives any objection which it might now or hereafter
have to the U.S. federal or State of New York courts located in the Borough of
Manhattan, The City of New York being nominated as the forum to hear and
determine any suit, action or proceeding,
64
and to settle any disputes, which may arise out of or in connection with this
Indenture and agrees not to claim that any such court is not a convenient or
appropriate forum. Each of the parties hereto has irrevocably designated,
appointed and empowered the respective Persons named in Exhibit C as its
designee, appointee and agent to receive, accept and acknowledge for and on its
behalf, and its properties, assets and revenues, service of any and all legal
process, summons, notices and documents that may be served in any suit, action
or proceeding brought against such party in any United States or state court
arising out of or relating to this Indenture or the Notes. If for any reason any
such designee, appointee and agent hereunder shall cease to be available to act
as such, such party agrees to designate a new designee, appointee and agent in
the Borough of Manhattan, The City of New York on the terms and for the purposes
of this Section 12.9 satisfactory to such other party. Each party further hereby
irrevocably consents and agrees to the service of any and all legal process,
summons, notices and documents in any suit, action or proceeding against such
party by serving a copy thereof upon the relevant agent for service of process
referred to in this Section 12.9 (whether or not the appointment of such agent
shall for any reason prove to be ineffective or such agent shall accept or
acknowledge such service) or by mailing copies thereof by registered or
certified mail, postage prepaid, to such party at its address specified in or
designated pursuant to this Indenture. Each party agrees that the failure of any
such designee, appointee and agent to give any notice of such service to it
shall not impair or affect in any way the validity of such service or any
judgment rendered in any action or proceeding based thereon. Nothing herein
shall in any way be deemed to limit the ability of Royalty Sub or the Trustee
and the Noteholders, as the case may be, to serve any such legal process,
summons, notices and documents in any other manner permitted by Applicable Law
or to obtain jurisdiction over such party or bring suits, actions or proceedings
against such party in such other jurisdictions, and in such manner, as may be
permitted by Applicable Law.
(b) The submission to the jurisdiction of the courts referred to in
Section 12.9(a) shall not (and shall not be construed so as to) limit the right
of the Trustee to take proceedings against Royalty Sub in any other court of
competent jurisdiction, nor shall the taking of proceedings in any one or more
jurisdictions preclude the taking of proceedings in any other jurisdiction,
whether concurrently or not.
(c) Each of the parties hereto hereby consents generally in respect of
any legal action or proceeding arising out of or in connection with this
Indenture to the giving of any relief or the issue of any process in connection
with such action or proceeding, including the making, enforcement or execution
against any property whatsoever (irrespective of its use or intended use) of any
order or judgment which may be made or given in such action or proceeding.
(d) To the extent that Royalty Sub may in any jurisdiction claim for
itself or its assets immunity (to the extent such immunity may now or hereafter
exist, whether on the grounds of sovereign immunity or otherwise) from suit,
execution, attachment (whether in aid of execution, before judgment or
otherwise) or other legal process (whether through service or notice or
otherwise), and to the extent that in any such jurisdiction there may be
attributed to itself or its assets such immunity (whether or not claimed),
Royalty Sub irrevocably agrees with respect to any matter arising under this
Indenture for the benefit of the Noteholders not to claim,
65
and irrevocably waives, such immunity to the full extent permitted by the laws
of such jurisdiction.
(e) If, for the purpose of obtaining a judgment or order in any court,
it is necessary to convert a sum due hereunder to any Noteholder from U.S.
dollars into another currency, Royalty Sub has agreed, and each Noteholder by
holding a Note will be deemed to have agreed, to the fullest extent that they
may effectively do so, that the rate of exchange used shall be that at which, in
accordance with normal banking procedures, such Noteholder could purchase U.S.
dollars with such other currency in the Borough of Manhattan, The City of New
York on the Business Day preceding the day on which final judgment is given.
(f) The obligation of Royalty Sub in respect of any sum payable by it
to a Noteholder shall, notwithstanding any judgment or order in a currency other
than U.S. dollars (the "Judgment Currency"), be discharged only to the extent
that, on the Business Day following receipt by such Noteholder of such security
of any sum adjudged to be so due in the Judgment Currency, such Noteholder may
in accordance with normal banking procedures purchase U.S. dollars with the
Judgment Currency. If the amount of U.S. dollars so purchased is less than the
sum originally due to such Noteholder in the Judgment Currency (determined in
the manner set forth in Section 12.9(e)), Royalty Sub agrees, as a separate
obligation and notwithstanding any such judgment, to indemnify such Noteholder
against such loss, and, if the amount of the U.S. dollars so purchased exceeds
the sum originally due to such Noteholder, such Noteholder agrees to remit to
Royalty Sub such excess, provided that such Noteholder shall have no obligation
to remit any such excess as long as Royalty Sub shall have failed to pay such
Noteholder any obligations due and payable under the Notes of such Noteholder,
in which case such excess may be applied to such obligations of Royalty Sub
under such Notes in accordance with the terms thereof. The foregoing indemnity
shall constitute a separate and independent obligation of Royalty Sub and shall
continue in full force and effect notwithstanding any such judgment or order as
aforesaid.
(g) EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES ALL RIGHT OF TRIAL
BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR IN
CONNECTION WITH THIS INDENTURE OR ANY MATTER ARISING HEREUNDER.
Section 12.10 Counterparts. This Indenture may be executed in one or more
counterparts by the parties hereto, and each such counterpart shall be
considered an original and all such counterparts shall constitute one and the
same instrument.
Section 12.11 Table of Contents and Headings. The Table of Contents and
headings of the Articles and Sections of this Indenture have been inserted for
convenience of reference only, are not to be considered a part hereof and shall
in no way modify or restrict any of the terms or provisions hereof.
Section 12.12 Trust Indenture Act. This Indenture shall not be qualified
under the Trust Indenture Act and shall not be subject to the provisions of the
Trust Indenture Act, although it shall incorporate such provisions for ease of
reference.
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Section 12.13 Confidential Information. The Trustee, in its individual
capacity and as Trustee, agrees and acknowledges that all Confidential
Information provided to the Trustee by Quintiles or Lilly is considered to be
proprietary and confidential information of Quintiles or Lilly, as applicable.
The Trustee agrees to take all reasonable precautions necessary to keep the
Confidential Information confidential, which precautions shall be no less
stringent than those which the Trustee employs to protect its own confidential
information. The Trustee shall not disclose to any third party other than as set
forth herein, and shall not use for any purpose other than the exercise of the
Trustee's rights and the performance of its obligations under this Indenture,
any Confidential Information without the prior written consent of Quintiles or
Lilly, as the case may be. The Trustee shall limit access to Confidential
Information received hereunder to (a) its directors, officers, managers and
employees and (b) its legal advisors, to each of whom disclosure of Confidential
Information is necessary for the purposes described above; provided, however,
that in each case such party has expressly agreed to maintain such Confidential
Information in confidence under terms and conditions substantially identical to
the terms of this Section 12.13.
The Trustee agrees that Lilly has no responsibility whatsoever for any
reliance on Confidential Information by the Trustee or by any Person to whom the
Confidential Information is disclosed in connection with this Indenture, whether
related to the purposes described above or otherwise. Without limiting the
generality of the foregoing, the Trustee agrees that Lilly makes no
representation or warranty whatsoever to it with respect to Confidential
Information or its suitability for such purposes. The Trustee further agrees
that it shall not acquire any rights against Lilly or any employee, officer,
director, manager, representative or agent of Lilly (together with Lilly, "Lilly
Parties") as a result of the disclosure of Confidential Information to the
Trustee or to any Noteholder or Beneficial Holder and that no Lilly Party has
any duty, responsibility, liability or obligation to any Person as a result of
any such disclosure.
In the event the Trustee is required to disclose any Confidential
Information received hereunder in order to comply with any laws, regulations or
court orders, it may disclose such Confidential Information only to the extent
necessary for such compliance; provided, however, that it shall give Quintiles
or Lilly, as the case may be, and Royalty Sub reasonable advance written notice
of any such court proceeding in which such disclosure may be required pursuant
to a court order so as to afford Quintiles or Lilly, as the case may be, a full
and fair opportunity to oppose the issuance of such order and to appeal
therefrom and shall cooperate reasonably with Quintiles or Lilly, as the case
may be, in opposing such order and in securing confidential treatment of any
Confidential Information to be disclosed and/or obtaining a protective order
narrowing the scope of such disclosure.
The Trustee agrees that each of Quintiles and Lilly is an express
third-party beneficiary of the provisions of this Section 12.13.
Each of the Calculation Agent, the Paying Agent and the Registrar agrees to
be bound by this Section 12.13 to the same extent as the Trustee.
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Section 12.14 Intercreditor Agreement. Notwithstanding anything herein to
the contrary, the Lien and Security Interest granted to the Trustee pursuant to
this Indenture and the exercise of any right or remedy by the Trustee hereunder
are subject to the provisions of the Intercreditor Agreement. Each Noteholder,
by accepting a Note, shall be deemed to have agreed to and accepted the terms of
the Intercreditor Agreement and, on behalf of such Noteholder, authorizes the
Trustee to enter into the Intercreditor Agreement, perform its obligations
thereunder, exercise its rights thereunder and, subject to Section 9.2 and
Section 9.3, make necessary amendments and modifications thereto. In the event
of any conflict between the terms of the Intercreditor Agreement and this
Indenture, the terms of the Intercreditor Agreement shall govern and control.
Section 12.15 Limited Recourse. Each of the parties hereto accepts that the
enforceability against Royalty Sub of the obligations of Royalty Sub hereunder
shall be limited to the assets of Royalty Sub, whether tangible or intangible,
real or personal (including the Collateral) and the proceeds thereof. Once all
such assets have been realized upon and such assets (and proceeds thereof) have
been applied in accordance with Section 3 of the Intercreditor Agreement, any
outstanding obligations of Royalty Sub shall be extinguished. Each of the
parties hereto further agrees that it shall take no action against any employee,
director, principal, agent, officer or administrator of Royalty Sub or the
Trustee in relation to this Indenture; provided, that nothing herein shall limit
Royalty Sub (or its permitted successors or assigns, including any party hereto
that becomes such a successor or assign) from pursuing claims, if any, against
any such person. The provisions of this Section 12.15 shall survive termination
of this Indenture; provided, further, that the foregoing shall not in any way
limit, impair or otherwise affect any rights of the Trustee or the Noteholders
to proceed against any Person (a) for intentional and willful fraud or
intentional and willful misrepresentations on the part of or by such Person or
(b) for the receipt of any distributions or payments to which Royalty Sub or any
successor in interest is entitled, other than distributions expressly permitted
pursuant to this Indenture and the other Transaction Documents.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties hereto have executed this Indenture to be
duly executed, all as of the date first written above.
Executed as a Deed by:
DULOXETINE ROYALTY SUB,
as Issuer
By: /s/ Xxxxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxxxx X. Xxxxxxx
Title: Vice President and Secretary
Witness: /s/ Xxxxxxxx Xxxxxx
-------------------------------
Name: Xxxxxxxx Xxxxxx
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By: /s/ Alison D, B, Xxxxxx
------------------------------------
Name: Alison X.X. Xxxxxx
Title: Vice President
ANNEX A
DEFINED TERMS
Unless the context otherwise requires, in this Annex A:
(a) A term has the meaning assigned to it and an accounting term not otherwise
defined has the meaning assigned to it in accordance with GAAP.
(b) Words of the masculine, feminine or neuter gender shall mean and include
the correlative words of other genders, and words in the singular shall
include the plural, and vice versa.
(c) The terms "include", "including" and similar terms shall be construed as if
followed by the phrase "without limitation".
(d) References to an agreement or other document include references to such
agreement or document as amended, restated, supplemented or otherwise
modified in accordance with the terms thereof, and the provisions thereof
apply to successive events and transactions.
(e) References to any statute or other legislative provision shall include any
statutory or legislative modification or re enactment thereof, or any
substitution therefor.
(f) References to any Person shall be construed to include such Person's
successors and permitted assigns.
(g) The word "will" shall be construed to have the same meaning and effect as
the word "shall".
"Accounts" means the Collection Account, the Holding Account, any
Repayment/Redemption Account, any Escrow Account, any Capital Account and any
other account established pursuant to the Intercreditor Agreement.
"Act" has the meaning set forth in Section 1.4(a) of the Indenture.
"Actual Beneficial Holder List" has the meaning set forth in Section 2.5(d)
of the Indenture.
"Additional Amounts" has the meaning set forth in Section 5.3 of the
Indenture.
"Additional Interest" means, with respect to the Notes, interest accrued on
the amount of any interest and Premium, if any, in respect of such Notes that is
not paid when due at the Stated Rate of Interest of such Notes for each Interest
Accrual Period until any such unpaid interest or Premium is paid in full,
compounded quarterly on each Payment Date, to the fullest extent permitted by
Applicable Law.
"Administrative Agent" means Xxxxxx Xxxxxxx Senior Funding, Inc., or any
successor appointed pursuant to the terms of the Credit Agreement.
"Affiliate" means, with respect to any Person, any other Person that,
directly or indirectly, controls, is controlled by or is under common control
with such Person or is a director, officer or manager of such Person. For
purposes of this definition, "control" of a Person means the possession,
directly or indirectly, of the power (a) to vote 10% or more of the Capital
Securities (on a fully diluted basis) of such Person having ordinary voting
power for the election of directors, managing members or general partners (as
applicable) or (b) to direct or cause the direction of the management and
policies of such Person, whether through the ownership of Voting Securities, by
contract or otherwise.
"Agent Members" has the meaning set forth in Section 2.10(a) of the
Indenture.
"Applicable Law" means, with respect to any Person, all laws, rules,
regulations and orders of Governmental Authorities applicable to such Person or
any of its properties or assets.
"Applicable Treasury Rate" for any Redemption Date means the interest rate
(expressed as a semiannual decimal and, in the case of United States Treasury
bills, converted to a bond equivalent yield) determined on the fourth Business
Day prior to such Redemption Date to be the per annum rate equal to the
semiannual yield to maturity for United States Treasury securities maturing on
the Average Life Date of the Original Class A Notes as of such Redemption Date
and trading in the public securities markets either (a) as determined by
interpolation between the most recent weekly average yield to maturity for two
series of United States Treasury securities trading in the public securities
markets, (i) one maturing as close as possible to, but earlier than, the Average
Life Date of the Original Class A Notes and (ii) the other maturing as close as
possible to, but later than, the Average Life Date of the Original Class A
Notes, in each case as published in the most recent H.15 (519) or (b) if a
weekly average yield to maturity for United States Treasury securities maturing
on the Average Life Date of the Original Class A Notes is reported in the most
recent H.15 (519), such weekly average yield to maturity as published in such
H.15 (519).
A-2
"Applicants" has the meaning set forth in Section 6.14 of the Indenture.
"Approved Holder List" has the meaning set forth in Section 2.5(d) of the
Indenture.
"Authorized Agent" means, with respect to the Notes, any authorized
Calculation Agent, Paying Agent or Registrar acting as such for the Notes.
"Available Collections Amount" means, as of any Payment Date, the sum of
(a) the amount on deposit in the Collection Account as of the Calculation Date
immediately preceding such Payment Date, (b) the amount of any net investment
income on amounts in the Accounts as of such Calculation Date, (c) the amount of
any Hedge Receipts due on such Payment Date and (d) with respect to periods
following the Discharge of First Lien Obligations, the amount in the Holding
Account as of such Calculation Date to be transferred to the Collection Account
on such Payment Date if (i) an Event of Default under the Indenture has occurred
and is continuing, (ii) the Interest Coverage Ratio for such Payment Date is not
equal to or greater than the specified ratio for such Payment Date as set forth
in Section 3.11 of the Intercreditor Agreement (as determined pursuant to
Section 3.5 of the Intercreditor Agreement), (iii) on or after June 15, 2008,
the Patent Extension Event has not occurred or (iv)(x) the Trustee has received
written notice from Noteholders of at least 25% of the Outstanding Principal
Balance of the Class A Notes that a Material Adverse Development has occurred
and (y) the Trustee has not received further written notice from Noteholders of
a majority of the Outstanding Principal Balance of the Class A Notes that such
Material Adverse Development has ended or is no longer applicable.
"Average Life Date" of the Original Class A Notes means the date that
follows the applicable Redemption Date by a period equal to the Remaining
Weighted Average Life of the Original Class A Notes.
"Beneficial Holder" means any Person that holds a Beneficial Interest in
any Global Note through an Agent Member.
"Beneficial Interest" means any beneficial interest in any Global Note,
whether held directly by an Agent Member or held indirectly through an Agent
Member's beneficial interest in such Global Note.
"Xxxx of Sale" means, collectively, the Pledgor Xxxx of Sale and the
Royalty Sub Xxxx of Sale.
"Board Resolution" means a copy of a resolution certified by an officer of
Royalty Sub as having been duly adopted by the board of directors of Royalty Sub
and being in full force and effect on the date of such certification.
"Business" means the business of Quintiles, the Pledgor or Royalty Sub
relating to the Royalty Sub Rights or the Co-Promotion Agreement.
"Business Day" means (a) any day that is not a Saturday, Sunday or legal
holiday on which commercial banks are authorized or required to be closed in New
York, New York and (b) for purposes of calculating amounts at the London
interbank offered rate and related calculations relative to the making,
continuing, prepaying or repaying of Indebtedness in respect thereof, any
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day that is a Business Day described in clause (a) that is also a day on which
dealings in U.S. dollars are carried on in the London interbank market.
"Calculation Agent" means U.S. Bank National Association and any successor
appointed pursuant to Section 6.11 of the Indenture.
"Calculation Date" means, for any Payment Date, the fifth Business Day
immediately preceding such Payment Date.
"Capital Account" has the meaning set forth in Section 3.1(a) of the
Intercreditor Agreement.
"Capital Securities" means, with respect to any Person, all shares,
interests, participations or other equivalents (however designated, whether
voting or non-voting) of such Person's capital, whether now outstanding or
issued after the Closing Date, including common shares, ordinary shares,
preferred shares, membership interests or share capital in a limited liability
company or other Person, limited or general partnership interests in a
partnership, beneficial interests in trusts or any other equivalent of such
ownership interest or any options, warrants and other rights to acquire such
shares or interests, including rights to allocations and distributions,
dividends, redemption payments and liquidation payments.
"Cash Purchase Price" means U.S.$239,890,387.91.
"Change of Control" means that (i) the power to direct or cause the
direction of Quintiles' management and policies, whether possessed through
ownership or control of the stock of Quintiles or of a parent entity of
Quintiles, by contract or otherwise, is, after July 18, 2002, transferred to, or
acquired by, a person or entity (or related persons or entities) who did not
possess such power prior to July 18, 2002 or (ii) Quintiles is a party to a
merger or similar transaction and is not the surviving entity of such
transaction, unless the person or entity (or related persons or entities)
possessing, as of July 18, 2002, the power to direct or cause the direction of
the management and policies of Quintiles possess such power, immediately after
such transaction, with regard to the entity surviving such transaction.
"Class A Notes" means the Original Class A Notes and any Refinancing Notes
issued to refinance the foregoing.
"Class A Principal Payment Schedule" means the schedule of Scheduled
Remaining Notes Balances as of a particular Payment Date set forth in Schedule 1
to the Indenture, as it may be adjusted pursuant to Section 2.17 of the
Indenture.
"Class B Issuance" has the meaning set forth in Section 2.16(a) of the
Indenture.
"Class B Notes" means the Class B Notes, if any, issued in such form as
shall be authorized by a Board Resolution and any indenture supplemental to the
Indenture in respect thereof pursuant to Section 2.16 of the Indenture and any
Refinancing Notes issued to refinance the foregoing.
"Clearstream" means Clearstream Banking, a French societe anonyme.
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"Closing Date" means the date on which the conditions set forth in Section
4.1 of the Purchase and Sale Agreement are satisfied, the sale, transfer,
conveyance, assignment, contribution and granting of the Royalty Sub Rights to
Royalty Sub pursuant to Article II of the Purchase and Sale Agreement are
effective, the Loans are borrowed and the Original Class A Notes are issued,
which date shall be October 18, 2005.
"Code" means the Internal Revenue Code of 1986 and the regulations
thereunder, in each case as amended, reformed or otherwise modified from time to
time.
"Collateral" has the meaning set forth in the Granting Clause of the
Indenture.
"Collection Account" has the meaning set forth in Section 3.1(a) of the
Intercreditor Agreement.
"Collection Agent" has the meaning set forth in the Intercreditor
Agreement.
"Collections" means, without duplication, (a) Royalty Sub Payments, (b) any
Hedge Receipts, (c) any investment income on amounts on deposit in the Accounts
and (d) any other amounts received by Royalty Sub (other than the proceeds of
any Loans or Notes and capital contributions from the Pledgor or Quintiles).
"Confidential Information" means any and all information provided by Lilly
or Quintiles that is Quintiles Confidential Information or Lilly Confidential
Information, respectively, each as defined in the Co-Promotion Agreement.
"Confidentiality Agreement" means, with respect to any Lender or any of its
Affiliates with respect to the Loans or with respect to Noteholders or
Beneficial Holders at the Closing Date with respect to the Original Class A
Notes (or, with respect to Class B Notes or any Refinancing Notes, the date of
issuance of such Class B Notes or Refinancing Notes), a confidentiality
agreement for the benefit of Royalty Sub provided to the Administrative Agent or
the Registrar, as the case may be, on or prior to the Closing Date (or such date
of issuance), and otherwise means a resale confidentiality agreement for the
benefit of Royalty Sub substantially in the form of Exhibit H to the Credit
Agreement or Exhibit B to the Indenture, as the case may be.
"Co-Promotion Agreement" means that certain Duloxetine-Depression U.S.
Co-Promotion Agreement, effective as of July 18, 2002, between Quintiles and
Lilly, as amended by the First Amendment thereto dated as of December 1, 2003
and the Second Amendment thereto dated as of August 18, 2005, and as amended,
restated, supplemented or otherwise modified from time to time in accordance
with the terms of the Credit Agreement and the Indenture, if applicable.
"Corporate Trust Office" means the office of the Trustee in the city at
which at any particular time the Trustee's duties under the Transaction
Documents shall be principally administered and, on the Closing Date, shall be
Xxx Xxxxxxx Xxxxxx, 0xx Xxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000.
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"Credit Agreement" means that certain credit agreement, dated as of the
Closing Date, among Royalty Sub, the Pledgor, Quintiles (with respect to only
certain sections set forth therein), the Lenders and the Administrative Agent,
including the Annex, Schedule and Exhibits attached thereto, as amended,
restated, supplemented or otherwise modified from time to time.
"Default" means a condition, event or act that, with the giving of notice
or the lapse of time or both, would constitute an Event of Default; provided,
that a failure to pay interest on the Loans or the Class A Notes when such
amount becomes due on any Payment Date other than the Final Maturity Date or any
Redemption Date does not constitute a Default; provided, further, that a failure
to pay any such interest not so paid on any such Payment Date in full with
Additional Interest thereon by the next succeeding Payment Date shall be an
immediate Event of Default.
"Definitive Notes" has the meaning set forth in Section 2.1(b) of the
Indenture.
"Direction" has the meaning set forth in Section 1.4(c) of the Indenture.
"Discharge of First Lien Obligations" has the meaning set forth in the
Intercreditor Agreement.
"Distribution Report" with respect to the Loans has the meaning set forth
in Section 3.14 of the Intercreditor Agreement and with respect to the Notes has
the meaning set forth in Section 2.13(a) of the Indenture.
"Dollar" or the sign "$" means lawful money of the United States.
"DTC" means The Depository Trust Company, its nominees and their respective
successors.
"DTC List" has the meaning set forth in Section 2.5(d) of the Indenture.
"Eligibility Requirements" has the meaning set forth in Section 2.3(b) of
the Indenture.
"Eligible Account" means a trust account maintained on the books and
records of an Eligible Institution in the name of the Collection Agent.
"Eligible Institution" means any bank organized under the laws of the U.S.
or any state thereof or the District of Columbia (or any domestic branch of a
foreign bank), which at all times has either (a) a long-term unsecured debt
rating of at least A2 by Xxxxx'x and A by S&P and Fitch or (b) a certificate of
deposit rating of at least P-1 by Xxxxx'x, A-1 by S&P and F1 by Fitch.
"Eligible Investments" means, in each case, book-entry securities,
negotiable instruments or securities represented by instruments in bearer or
registered form that evidence:
(a) direct obligations of, and obligations fully Guaranteed as to
timely payment of principal and interest by, the U.S. or any agency or
instrumentality thereof the obligations of which are backed by the full
faith and credit of the U.S. (having
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original maturities of no more than 365 days or such lesser time as is
required for the distribution of funds);
(b) demand deposits, time deposits or certificates of deposit of the
Operating Bank or of depositary institutions or trust companies organized
under the laws of the U.S. or any state thereof or the District of Columbia
(or any domestic branch of a foreign bank) (i) having original maturities
of no more than 365 days or such lesser time as is required for the
distribution of funds; provided, that, at the time of investment or
contractual commitment to invest therein, the short-term debt rating of
such depositary institution or trust company shall be at least P-1 by
Xxxxx'x, A-1 by S&P and F1 by Fitch or (ii) having maturities of more than
365 days and, at the time of the investment or contractual commitment to
invest therein, a rating of at least A2 by Xxxxx'x and A by S&P and Fitch;
(c) corporate or municipal debt obligations (i) having remaining
maturities of no more than 365 days or such lesser time as is required for
the distribution of funds and having, at the time of the investment or
contractual commitment to invest therein, a rating of at least P-1 or A2 by
Xxxxx'x, A-1 or A by S&P and F1 or A by Fitch or (ii) having maturities of
more than 365 days and, at the time of the investment or contractual
commitment to invest therein, a rating of at least A2 by Xxxxx'x and A by
S&P and Fitch;
(d) investments in money market funds (including funds in respect of
which the Administrative Agent, the Trustee or any of their respective
Affiliates is investment manager or otherwise) having a rating of at least
A2 by Xxxxx'x, Am by S&P and A by Fitch; or
(e) notes or bankers' acceptances (having original maturities of no
more than 365 days or such lesser time as is required for the distribution
of funds) issued by any depositary institution or trust company referred to
in clause (b) above;
provided, however, that no investment shall be made in any obligations of any
depositary institution or trust company that is identified in a written notice
to the Administrative Agent or, after the Discharge of First Lien Obligations,
the Trustee from Royalty Sub or Servicer as having a contractual right to set
off and apply any deposits held, and other indebtedness owing, by Royalty Sub to
or for the credit or the account of such depositary institution or trust
company, unless such contractual right by its terms expressly excludes all
Eligible Investments.
"Equity Interests" means, with respect to any Person, all shares,
interests, participations or other equivalents (however designated, whether
voting or non-voting) of such Person's capital, whether now outstanding or
issued after the Closing Date, including common shares, ordinary shares,
preferred shares, membership interests or share capital in a limited liability
company or other Person, limited or general partnership interests in a
partnership, beneficial interests in trusts or any other equivalent of such
ownership interest or any options, warrants and other rights to acquire such
shares or interests, including rights to allocations and distributions,
dividends, redemption payments and liquidation payments.
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"ERISA" means the U.S. Employee Retirement Income Security Act of 1974, as
amended.
"ERISA Affiliate" means any trade or business that is treated as a single
employer with Royalty Sub, the Pledgor or Quintiles under Section 414 of the
Code.
"Escrow Account" has the meaning set forth in Section 3.1(a) of the
Intercreditor Agreement.
"Escrow List" has the meaning set forth in Section 2.5(d) of the Indenture.
"Euroclear" means Euroclear Bank S.A./N.V., as operator of the Euroclear
System.
"Event of Default" has the meaning set forth in Section 8.1 of the Credit
Agreement and Section 4.1 of the Indenture and, unless the context otherwise
indicates, shall mean any Event of Default under both the Credit Agreement and
the Indenture.
"Exchange Act" means the U.S. Securities Exchange Act of 1934, as amended.
"Expenses" means any reasonable out-of-pocket fees, costs or expenses of
Royalty Sub, including the fees, expenses and indemnities of the Service
Providers, the fees and out-of-pocket expenses of counsel to the Administrative
Agent, the Trustee and Royalty Sub incurred after the Closing Date in connection
with the transactions contemplated by the Transaction Documents, the fees and
expenses of any nationally recognized independent public accounting firm engaged
as auditors of Royalty Sub and any payments under indemnity obligations of
Royalty Sub to any Person other than Quintiles; provided, however, that, except
as expressly provided in the Intercreditor Agreement, the Credit Agreement or
the Indenture, Expenses shall not include any Transaction Expenses, any amounts
payable on the Loans or the Notes, any Hedge Payment, the fees, costs or
expenses relating to the Class B Notes or any other amounts ranking pari passu
with or junior to interest payable on the Loans or the Notes in the priority of
payments set forth in the Intercreditor Agreement.
"Final Maturity Date" means, with respect to (a) the Original Class A
Notes, October 15, 2013, (b) with respect to any Class B Notes or Refinancing
Notes, the date specified in the indenture supplemental to the Indenture
providing for their issuance; provided, that the Final Maturity Date with
respect to any Class B Notes or Refinancing Notes shall be no earlier than
October 15, 2013, and (c) the Loans, the same meaning as "Stated Maturity Date"
as defined in the Credit Agreement.
"First Lien Documents" has the meaning set forth in the Intercreditor
Agreement.
"First Lien Obligations" has the meaning set forth in the Intercreditor
Agreement.
"First Lien Pledge and Security Agreement" means that certain first lien
pledge and security agreement dated as of the Closing Date made by the Pledgor
to the Administrative Agent, including the Exhibits attached thereto, as
amended, restated, supplemented or otherwise modified from time to time.
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"Fitch" means Fitch, Inc. and any successor thereto or, if such corporation
or its successor shall for any reason no longer perform the functions of a
securities rating agency, "Fitch" shall be deemed to refer to any other
nationally recognized statistical rating organization (within the meaning
ascribed thereto by the Exchange Act) designated by Royalty Sub.
"Fixed Rate Notes" means the Original Class A Notes and any Class B Notes
or Refinancing Notes issued with a fixed rate of interest.
"Floating Rate Notes" means any Class B Notes or Refinancing Notes issued
with a floating or variable rate of interest.
"GAAP" means generally accepted accounting principles in effect in the U.S.
from time to time.
"Global Notes" means any Permanent Global Notes and Regulation S Global
Notes.
"Governmental Authority" means the government of the United States, any
other nation or any political subdivision thereof, whether state or local, and
any agency, authority, instrumentality, regulatory body, court, central bank or
other Person exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government.
"Guarantee" means any obligation, contingent or otherwise, of any Person
directly or indirectly guaranteeing any Indebtedness or other obligation of any
other Person and, without limiting the generality of the foregoing, any
obligation, direct or indirect, contingent or otherwise, of such Person (a) to
purchase or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other obligation of such other Person or (b) entered into for
purposes of assuring in any other manner the obligee of such Indebtedness or
other obligation of the payment thereof or to protect such obligee against loss
in respect thereof (in whole or in part); provided, that the term "Guarantee"
shall not include endorsements for collection or deposit in the ordinary course
of business. The term "Guarantee" when used as a verb has a corresponding
meaning.
"H.15 (519)" means the weekly statistical release designated as such, or
any successor publication, published by the Board of Governors of the Federal
Reserve System, and the most recent H.15 (519) is the H.15 (519) published prior
to the close of business on the fourth Business Day prior to the applicable
Redemption Date.
"Hedge Agreement" means the interest rate cap agreement between Royalty Sub
and the Hedge Provider having an effective date of the Closing Date.
"Hedge Payment" means a net payment to the Hedge Provider by Royalty Sub on
the Closing Date.
"Hedge Provider" means Xxxxxx Xxxxxxx Capital Services Inc., the
counterparty of Royalty Sub under the Hedge Agreement.
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"Hedge Receipt" means a net payment to be made by the Hedge Provider into
the Collection Account under the Hedge Agreement and includes any termination
payment received from the Hedge Provider.
"Holding Account" has the meaning set forth in Section 3.1(a) of the
Intercreditor Agreement.
"Incur" has the meaning set forth in Section 5.1(d) of the Indenture.
"Indebtedness" means, with respect to any Person at any date of
determination (without duplication), (a) all indebtedness of such Person for
borrowed money, (b) all obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments, (c) all obligations of such
Person as an account party in respect of letters of credit or other similar
instruments (including reimbursement obligations with respect thereto), (d) all
the obligations of such Person to pay the deferred and unpaid purchase price of
property or services, which purchase price is due more than 90 days after the
date of purchasing such property or service or taking delivery and title thereto
or the completion of such services, and payment deferrals arranged primarily as
a method of raising funds to acquire such property or service, (e) all monetary
obligations of such Person and its Subsidiaries under any leasing or similar
arrangement which have been (or, in accordance with GAAP, should be) classified
as capitalized leases, (f) all Guarantees of such Person in respect of any of
the foregoing, (g) all monetary obligations of such Person with respect to any
interest rate hedge, cap, floor, swap, option or other interest rate hedge
agreement entered into after the Closing Date, (h) all Indebtedness (as defined
in clauses (a) through (g) of this definition) of other Persons secured by a
lien on any asset of such Person, whether or not such Indebtedness is assumed by
such Person, and (i) all Indebtedness (as defined in clauses (a) through (g) of
this definition) of other Persons Guaranteed by such Person.
"Independent Consultant" means L.E.K. Consulting LLC.
"Independent Consultant's Report" means the report of the Independent
Consultant included in the Private Placement Memorandum as Appendix A.
"Indemnified Amounts" has the meaning set forth in Section 8.1 of the
Purchase and Sale Agreement.
"Indemnified Party" has the meaning set forth in Section 8.1 of the
Purchase and Sale Agreement.
"Indemnitee" has the meaning set forth in Section 19.1 of the Second Lien
Pledge and Security Agreement.
"Indemnitees" has the meaning set forth in Section 19.1 of the Second Lien
Pledge and Security Agreement.
"Indenture" means that certain indenture, dated as of the Closing Date,
between Royalty Sub and the Trustee, including the Annex, Schedule and Exhibits
attached thereto, as amended, restated, supplemented or otherwise modified from
time to time.
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"Indenture Estate" has the meaning set forth in the Granting Clause of the
Indenture.
"Initial Capital Amount Account" means an account established by or on
behalf of Royalty Sub in the Cayman Islands in connection with the initial
subscription for 1,000 ordinary shares of Royalty Sub in the amount of
U.S.$1,000 and the payment of a transaction fee in the amount of U.S.$1,000.
"Institutional Accredited Investor" means a Person that is an accredited
investor as that term is defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act.
"Intercreditor Agreement" means that certain Intercreditor Agreement, dated
as of the Closing Date, among the Administrative Agent, the Trustee, the
Collection Agent, Royalty Sub and the Pledgor, including the Annexes attached
thereto, as amended, restated, supplemented or otherwise modified from time to
time.
"Interest Accrual Period" means the period beginning on (and including) the
Closing Date (or, with respect to any Class B Notes or Refinancing Notes, the
date of issuance of such Class B Notes or Refinancing Notes) and ending on (but
excluding) the first Payment Date thereafter and each successive period
beginning on (and including) a Payment Date and ending on (but excluding) the
next succeeding Payment Date; provided, however, that the final Interest Accrual
Period shall end on but exclude the Final Maturity Date (or, if earlier, with
respect to any class of Notes repaid in full, the date such class of Notes is
repaid in full).
"Interest Amount" means, with respect to any class of Notes, on any Payment
Date, the amount of accrued and unpaid interest at the Stated Rate of Interest
with respect to such class of Notes on such Payment Date (including any
Additional Interest, if any, or Additional Amounts, if any), determined in
accordance with the terms thereof (including interest accruing after the
commencement of a proceeding in bankruptcy, insolvency or similar law, whether
or not permitted as a claim under such law).
"Interest Coverage Ratio" means, for the Notes on each Payment Date, the
ratio, as calculated by the Servicer pursuant to Section 4.1(c)(i) of the
Servicing Agreement, of (a) the Royalty Sub Payments received during the
quarterly period ending on the Calculation Date related to such Payment Date to
(b) the sum of (i) interest at the Stated Rate of Interest on the Outstanding
Principal Balance of the Notes during the Interest Accrual Period ending on such
Payment Date and (ii) the amount of Expenses payable pursuant to Section 3.7 of
the Intercreditor Agreement on such Payment Date.
"Involuntary Bankruptcy" means, with respect to Royalty Sub or the Pledgor,
without the consent or acquiescence of Royalty Sub or the Pledgor, respectively,
the entering of an order for relief or approving a petition for relief or
reorganization or any other petition seeking any reorganization, arrangement,
composition, readjustment, liquidation, dissolution or other similar relief
under any present or future bankruptcy, insolvency or similar statute, law or
regulation, or the filing of any such petition against Royalty Sub or the
Pledgor, respectively, which petition shall not be dismissed within 60 days, or,
without the consent or acquiescence of Royalty Sub or the Pledgor, respectively,
the entering of an order appointing a trustee, custodian, receiver or liquidator
of Royalty Sub or the Pledgor, respectively, or of all or any substantial part
of the
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property of Royalty Sub or the Pledgor, respectively, which order shall not be
dismissed within 60 days.
"Judgment Currency" has the meaning set forth in Section 12.9(f) of the
Indenture.
"Lenders" means the various financial institutions and other Persons from
time to time parties to the Credit Agreement and each other Secured Party, as
applicable.
"LIBOR" means, with respect to each Interest Accrual Period, unless
otherwise specified, the London interbank offered rate for deposits in U.S.
dollars having a term of three months for a period commencing on the second
Business Day immediately following the Reference Date for such Interest Accrual
Period in amounts of not less than U.S.$1,000,000, as such rate appears on
Telerate Page 3750 at approximately 11:00 a.m. (London time) on such Reference
Date therefor; provided, that, if three-month LIBOR cannot be determined from
Telerate Page 3750, the Collection Agent or Calculation Agent, as the case may
be, shall request the principal London offices of each of four major banks in
the London interbank market selected by the Collection Agent or Calculation
Agent, as the case may be, to provide a Rate Quotation, and, if at least two
Rate Quotations are provided, three-month LIBOR will be the arithmetic mean of
the Rate Quotations obtained by the Collection Agent or Calculation Agent, as
the case may be; provided, further, that, in the event three-month LIBOR cannot
be determined from Telerate Page 3750 as described in the Credit Agreement or
the Indenture, as the case may be, and fewer than two Rate Quotations are
available, three-month LIBOR will be the arithmetic mean of the rates quoted at
approximately 11:00 a.m. New York City time on such Reference Date by three
major banks in New York City selected by the Collection Agent or Calculation
Agent, as the case may be, for loans representative of single transactions at
such time in U.S. dollars to leading European banks, having a term of three
months for a period commencing on the second Business Day immediately following
such Reference Date; provided, further, that, if fewer than three such banks
selected by the Collection Agent or Calculation Agent, as the case may be, are
quoting such rates, three-month LIBOR for the applicable Interest Accrual Period
will be deemed to be the same as three-month LIBOR in effect for the immediately
preceding Interest Accrual Period.
"Lien" means any security interest, mortgage, pledge, hypothecation,
assignment, deposit arrangement, encumbrance, lien (statutory or otherwise),
charge against or interest in property or other priority or preferential
arrangement of any kind or nature whatsoever, in each case to secure payment of
a debt or performance of an obligation, including any conditional sale, any sale
with recourse against Royalty Sub or any agreement to give any security
interest.
"Lilly" means Xxx Xxxxx and Company, an Indiana corporation.
"Lilly Parties" has the meaning set forth in Section 12.13 of the
Indenture.
"Lilly Payment" means any payment made by the Collection Agent in respect
of any Lilly Shortfall.
"Lilly Shortfall" means the amount, if any, payable by Quintiles to Lilly
pursuant to the Co-Promotion Agreement that is due and payable but that has not
been paid by Quintiles.
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"Liquidated Damages Amount" has the meaning set forth in Section 8.2(a) of
the Purchase and Sale Agreement.
"Liquidated Damages Event" means that Quintiles has breached (i) Section
6.2(c), Section 6.2(d) or Section 6.2(e) of the Purchase and Sale Agreement or
(ii) any other covenant in the Purchase and Sale Agreement, but only to the
extent for purposes of this clause (ii) that the actions or inactions giving
rise to such breach result in (x) a termination of the Co-Promotion Agreement
pursuant to the terms of the Co-Promotion Agreement or (y) the failure of Lilly
to make any Royalty Sub Payments required by the Co-Promotion Agreement pursuant
to the terms of the Co-Promotion Agreement for a period of at least six months,
unless Quintiles is in good faith taking appropriate action to contest Lilly's
failure to make such payments under the Co-Promotion Agreement.
"Loan Security Agreement" means that certain security agreement dated as of
the Closing Date made by Royalty Sub to the Administrative Agent, as amended,
restated, supplemented or otherwise modified from time to time.
"Loans" has the meaning set forth in Section 2.1 of the Credit Agreement.
"Loss" means any loss, cost, charge, expense, interest, fee, payment,
demand, liability, claim, action, proceeding, penalty, fine, damages, judgment,
order or other sanction, other than Taxes.
"Mandatory Redemption" has the meaning set forth in Section 3.1(c) of the
Indenture.
"Material Adverse Development" means (i) any legal or regulatory
development affecting the Product that results in the suspension, withdrawal or
revocation of approvals to sell the Product in the Territory, (ii) any shutdown
for any period in excess of three consecutive months of Lilly's primary and
secondary manufacturing facilities for the production of the Product or any
publicly-announced reduction in manufacturing output of the Product for a period
in excess of three months, (iii) any material adverse re-labeling requirement or
(iv) any voluntary action by Lilly that results in a suspension or cessation of
sales of the Product, the occurrence of any of such items (i) through (iv) which
has, or would reasonably be expected to have, a material adverse effect on the
net sales of the Product on which the Royalty Sub Payments are based.
"Material Adverse Effect" means a material adverse effect on (i) the
ability of Quintiles, the Pledgor or Servicer, as the case may be, to perform
its obligations under any of the Transaction Documents or the Co-Promotion
Agreement, in each case to which it is a party, (ii) the validity or
enforceability of the Co-Promotion Agreement or the rights or remedies of
Royalty Sub under the Co-Promotion Agreement or (iii) the Royalty Sub Rights or
the ability of Royalty Sub to perform any of its obligations under the Notes,
the Credit Agreement, the Loan Security Agreement and the Indenture.
"Moody's" means Xxxxx'x Investors Service, Inc. and any successor thereto
or, if such corporation or its successor shall for any reason no longer perform
the functions of a securities rating agency, "Moody's" shall be deemed to refer
to any other nationally recognized statistical rating organization (within the
meaning ascribed thereto by the Exchange Act) designated by Royalty Sub.
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"Non-U.S. Person" means a person who is not a U.S. person within the
meaning of Regulation S.
"Note Purchase Agreement" means that certain note purchase agreement dated
the Closing Date among Royalty Sub, the Pledgor, Quintiles and the Purchaser
party thereto, including the Annex, Schedule and Exhibits thereto, as amended,
restated, supplemented or otherwise modified from time to time.
"Note Purchase Agreements" means, collectively, each Note Purchase
Agreement and Other Agreements.
"Note Purchasers" has the meaning set forth in Section 1.1 of the Note
Purchase Agreement.
"Noteholder" means any Person in whose name a Note is registered from time
to time in the Register for such Note.
"Notes" means the Original Class A Notes, any Class B Notes and any
Refinancing Notes.
"Notices" means notices, demands, certificates, requests, directions,
instructions and communications.
"Officer's Certificate" means a certificate signed by, with respect to
Royalty Sub, a Responsible Officer of Royalty Sub and, with respect to any other
Person, any officer, director, manager, trustee or equivalent representative of
such Person.
"Operating Bank" means U.S. Bank National Association or any other Eligible
Institution consented to by the Collection Agent at which the Accounts are held;
provided, that if at any time the Operating Bank ceases to be an Eligible
Institution, a successor shall be appointed by Servicer on behalf of the
Collection Agent and all Accounts shall thereafter be transferred to and be
maintained at such successor in the name of the Collection Agent and such
successor shall thereafter be the "Operating Bank".
"Opinion of Counsel" means a written opinion signed by legal counsel, who
may be an employee of or counsel to Royalty Sub or Quintiles, that meets the
requirements of Section 1.3 of the Indenture.
"Optional Redemption" has the meaning set forth in Section 3.1(a) of the
Indenture.
"Original Class A Notes" means the Duloxetine PhaRMA(SM) Second Lien 13%
Notes due 2013 of Royalty Sub in the initial Outstanding Principal Balance of
U.S.$125,000,000, substantially in the form of Exhibit A to the Indenture.
"Other Agreements" has the meaning set forth in Section 3.1 of the Note
Purchase Agreement.
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"Other Note Purchasers" has the meaning set forth in Section 3.1 of the
Note Purchase Agreement.
"Other Prices" has the meaning set forth in Section 3.1 of the Note
Purchase Agreement.
"Outstanding" means (a) with respect to the Notes of any class at any time,
all Notes of such class theretofore authenticated and delivered by the Trustee
except (i) any such Notes cancelled by, or delivered for cancellation to, the
Trustee, (ii) any such Notes, or portions thereof, for the payment of principal
of and accrued and unpaid interest on which moneys have been distributed to
Noteholders by the Trustee and any such Notes, or portions thereof, for the
payment or redemption of which moneys in the necessary amount have been
deposited in the Repayment/Redemption Account for such Notes; provided, that, if
such Notes are to be redeemed prior to the maturity thereof in accordance with
the requirements of Section 3.1 of the Indenture, written notice of such
Redemption shall have been given as provided in Section 3.2 of the Indenture, or
provision satisfactory to the Trustee shall have been made for giving such
written notice, and (iii) any such Notes in exchange or substitution for which
other Notes, as the case may be, have been authenticated and delivered, or which
have been paid pursuant to the terms of the Indenture (unless proof satisfactory
to the Trustee is presented that any of such Notes is held by a Person in whose
hands such Note is a legal, valid and binding obligation of Royalty Sub), and
(b) when used with respect to the Loans or any other evidence of Indebtedness,
at any time, any principal amount thereof then unpaid and outstanding (whether
or not due or payable).
"Outstanding Principal Balance" means, with respect to any Note or other
evidence of Indebtedness Outstanding, the total principal amount of such Note or
other evidence of Indebtedness unpaid and Outstanding at any time, as determined
in the case of the Notes in the information to be provided to Servicer, the
Administrative Agent and the Trustee by the Collection Agent pursuant to Section
3.5 of the Intercreditor Agreement.
"Participating Holders" has the meaning set forth in Section 6.16 of the
Indenture.
"Patent Extension Event" means that the Trustee has received written notice
from Servicer that Lilly has received an extension from the United States Patent
and Trademark Office of its compound patent relating to the Product (No.
5,023,269) until at least January 15, 2013.
"Paying Agent" has the meaning set forth in Section 2.3(a) of the
Indenture.
"Payment Date" means each January 15, April 15, July 15 and October 15,
commencing on January 15, 2006 and including the Final Maturity Date; provided,
that, if any such date would otherwise fall on a day that is not a Business Day,
the Payment Date falling on such date shall be the first following day that is a
Business Day; provided, further, that, if any such following Business Day would
occur in the succeeding month, then the Payment Date shall be the first Business
Day preceding such date.
"Payor" has the meaning set forth in Section 5.3 of the Indenture.
"Permanent Global Note" has the meaning set forth in Section 2.1(b) of the
Indenture.
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"Permanent Regulation S Global Note" has the meaning set forth in Section
2.1(b) of the Indenture.
"Permitted Holder" means (a) Quintiles, (b) Lilly, (c) Royalty Sub and (d)
any Person that (i) has executed a Confidentiality Agreement and delivered such
Confidentiality Agreement to the Administrative Agent or the Registrar, as the
case may be, in accordance with the terms of the Credit Agreement or the
Indenture, respectively, and (ii) so long as the Co-Promotion Agreement has not
been terminated, is not in the business of developing, manufacturing or
marketing pharmaceutical or diagnostic products and is not an Affiliate of any
such Person in such business.
"Permitted Lien" means (a) any lien for Taxes, assessments and governmental
charges or levies not yet due and payable or which are being contested in good
faith by appropriate proceedings, (b) any Lien created in favor of the
Administrative Agent or the Trustee and (c) any other Lien expressly permitted
under the Transaction Documents.
"Person" means any natural person, firm, corporation, limited liability
company, partnership, joint venture, association, joint-stock company, trust,
unincorporated organization, Governmental Authority or any other legal entity,
including public bodies, whether acting in an individual, fiduciary or other
capacity.
"Placement Agent" means Xxxxxx Xxxxxxx & Co. Incorporated.
"Plan" means any employee benefit plan (within the meaning of Section 3(3)
of ERISA) or other retirement plan or arrangement (including an individual
retirement account or annuity) that is subject to ERISA and/or the Code, and any
entity that may be deemed to hold the assets of any such plan.
"Pledged Collateral" has the meaning set forth in Section 2.1 of the Second
Lien Pledge and Security Agreement.
"Pledged Equity" has the meaning set forth in Section 2.1(a) of the Second
Lien Pledge and Security Agreement.
"Pledgor" means Duloxetine Holdco Royalty Sub, an exempted company
incorporated with limited liability under the laws of the Cayman Islands that is
a direct wholly-owned Subsidiary of Quintiles.
"Pledgor Xxxx of Sale" means the Xxxx of Sale, dated as of the Closing
Date, executed by Quintiles and the Pledgor, substantially in the form of
Exhibit A to the Purchase and Sale Agreement.
"Premium" means, with respect to any Note on any Redemption Date, any
Redemption Premium, if applicable, or, with respect to any Redemption Date, the
portion of the Redemption Price of the Notes being redeemed in excess of the
Outstanding Principal Balance of the Notes being redeemed.
"Price" has the meaning set forth in Section 3.1 of the Note Purchase
Agreement.
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"Private Placement Legend" has the meaning set forth in Section 2.2 of the
Indenture.
"Private Placement Memorandum" means the private placement memorandum of
Royalty Sub for the Original Class A Notes dated October 14, 2005.
"Proceeds" shall have the meaning assigned to such term under the UCC and,
in any event, shall include (a) any and all proceeds of any guarantee, insurance
or indemnity payable from time to time to the Pledgor with respect to any of the
Pledged Collateral, (b) any and all payments (in any form whatsoever) made or
due and payable from time to time to the Pledgor in connection with any
requisition, confiscation, condemnation, seizure or forfeiture of all or any
part of the Pledged Collateral by any Governmental Authority (or any Person
acting under color of Governmental Authority) and (c) any and all other amounts
from time to time paid or payable with respect to or in connection with any of
the Pledged Collateral.
"Product" means a pharmaceutical product for humans, owned or controlled by
Lilly, containing duloxetine hydrochloride (also known as, according to Chemical
Abstracts' registry #136434-34-9,
(S)-(+)-N-methyl-y-(1-naphthalenyloxy)-2-thiophenepropanamine hydrochloride) as
the active pharmaceutical ingredient, United States patent numbers 5,023,269 and
5,508,276.
"Purchase and Sale Agreement" means that certain purchase and sale
agreement dated as of the Closing Date among Quintiles, the Pledgor and Royalty
Sub, including the Annex and Exhibits attached thereto, as amended, restated,
supplemented or otherwise modified from time to time.
"Purchase Notice" has the meaning set forth in the Intercreditor Agreement.
"Purchase Price" has the meaning set forth in Section 3.1 of the Note
Purchase Agreement.
"Purchaser" has the meaning set forth in Section 1.1 of the Note Purchase
Agreement.
"QIB" means a qualified institutional buyer within the meaning of Rule
144A.
"Quintiles" means Quintiles Transnational Corp., a North Carolina
corporation.
"Rate Quotation" means a quotation of the rate at which three-month
deposits in amounts of not less than U.S.$1,000,000 are offered by the Person
quoting such rate to prime banks in the London interbank market, at
approximately 11:00 a.m. London time on the applicable Reference Date, that is
representative of single transactions at such time.
"Receiver" means any Person or Persons appointed as (and any additional
Person or Persons appointed or substituted as) administrative receiver,
receiver, manager or receiver and manager.
"Record Date" means, with respect to each Payment Date, the close of
business on the fifteenth day preceding such Payment Date and, with respect to
the date on which any Direction is to be given by the Lenders or the
Noteholders, as applicable, the close of business on the last Business Day prior
to the solicitation of such Direction.
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"Redemption" means any Optional Redemption, any Mandatory Redemption, any
Special Tax Redemption and any other redemption of Notes described in Section
3.1(b) of the Indenture.
"Redemption Date" means the date, which shall in each case be a Payment
Date, on which Notes are redeemed pursuant to a Redemption.
"Redemption Premium" means, in the case of any Class B Notes or Refinancing
Notes, the amount, if any, specified in the Board Resolution or indenture
supplemental to the Indenture to be paid in the event of a Redemption of such
Class B Notes or Refinancing Notes separately from the Redemption Price.
"Redemption Price" means (a) in respect of a Mandatory Redemption or an
Optional Redemption of the Original Class A Notes (i) on any Payment Date on or
prior to April 15, 2008, the greater of (x) the Outstanding Principal Balance of
the Original Class A Notes being redeemed and (y) the present value, discounted
at the Applicable Treasury Rate plus 1.0%, of the scheduled principal payment
amounts not then paid on the Original Class A Notes (assuming the Scheduled
Remaining Notes Balances are achieved as provided in the Class A Principal
Payment Schedule) and interest at the Stated Rate of Interest on the Outstanding
Principal Balance of the Original Class A Notes through January 15, 2011
(assuming the Scheduled Remaining Notes Balances are achieved as provided in the
Class A Principal Payment Schedule) plus, in each case, the accrued and unpaid
interest to the Redemption Date on the Original Class A Notes that are being
redeemed and (ii) on any Payment Date after April 15, 2008, an amount equal to
the product of (x) the applicable Class A Redemption Percentage as set forth
below and (y) the Outstanding Principal Balance of the Original Class A Notes
that are being redeemed on such Payment Date, plus the accrued and unpaid
interest to the Redemption Date on the Original Class A Notes that are being
redeemed:
PAYMENT DATES BETWEEN INDICATED PAYMENT DATES CLASS A REDEMPTION PERCENTAGE
-------------------------------------------------- -----------------------------
From July 15, 2008 to and including April 15, 2009 106.50%
From July 15, 2009 to and including April 15, 2010 103.25%
From July 15, 2010 and thereafter 100.00%
(b) in respect of any Class B Notes or Refinancing Notes, the redemption price,
if any, plus the accrued and unpaid interest to the Redemption Date on the Class
B Notes or Refinancing Notes, as the case may be, established by or pursuant to
a Board Resolution or in any indenture supplemental to the Indenture providing
for the issuance of such Notes or designated as such in the form of such Notes
(any such Redemption Price in respect of any Class B Notes or Refinancing Notes
may include a Redemption Premium, and such Board Resolution or indenture
supplemental to the Indenture may specify a separate Redemption Premium), and
(c) in respect of a Special Tax Redemption of the Original Class A Notes, 100%
of the Outstanding Principal Balance of the Original Class A Notes plus the
accrued and unpaid interest to the Redemption Date on the Original Class A
Notes.
"Reference Date" means, with respect to each Interest Accrual Period, the
day that is two Business Days prior to the Payment Date on which such Interest
Accrual Period commences; provided, however, that the Reference Date with
respect to the initial Interest Accrual Period
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means the date that is two Business Days before the Closing Date (or, with
respect to any Class B Notes or Refinancing Notes, the date that is two Business
Days before the date of issuance of such Class B Notes or Refinancing Notes).
"Refinancing" has the meaning set forth in Section 2.15(a) of the
Indenture.
"Refinancing Date" means the date, which shall in each case be a Payment
Date, on which the Original Class A Notes or the Notes of any other class are
redeemed in whole, in each case with the proceeds of Refinancing Notes as
provided in Section 2.15 of the Indenture.
"Refinancing Expenses" means all Transaction Expenses incurred in
connection with an offering and issuance of Refinancing Notes.
"Refinancing Notes" means any class of Notes issued by Royalty Sub under
the Indenture at any time and from time to time after the Closing Date pursuant
to Section 2.15 of the Indenture, the proceeds of which are used to repay all of
the Outstanding Principal Balance of a class of Notes.
"Register" has the meaning set forth in Section 2.3(a) of the Indenture.
"Registrar" has the meaning set forth in Section 2.3(a) of the Indenture.
"Regulation S" means Regulation S under the Securities Act.
"Regulation S Global Note Exchange Date" means the date of exchange of any
Temporary Regulation S Global Note for any Permanent Regulation S Global Note,
which date shall be 40 days after the Closing Date (or, with respect to any
Class B Notes or Refinancing Notes, 40 days after the date of issuance of such
Class B Notes or Refinancing Notes).
"Regulation S Global Notes" has the meaning set forth in Section 2.1(b) of
the Indenture.
"Relevant Information" means any information provided to the Administrative
Agent, the Trustee, the Collection Agent, the Calculation Agent or the Paying
Agent in writing by any Service Provider retained from time to time by Royalty
Sub pursuant to the Transaction Documents.
"Relevant Taxing Jurisdiction" has the meaning set forth in Section 5.3 of
the Indenture.
"Remaining Weighted Average Life" means, with respect to the Original Class
A Notes on any Redemption Date, (a) the sum of the products of (i) each
principal payment amount on the Original Class A Notes payable on each
subsequent Payment Date (assuming the Scheduled Remaining Notes Balances are
achieved as provided in the Class A Principal Payment Schedule) in accordance
with the Class A Principal Payment Schedule multiplied by (ii) the number of
days remaining from the applicable Redemption Date until such subsequent Payment
Date divided by (b) the Outstanding Principal Balance of the Original Class A
Notes on such Redemption Date.
"Repayment/Redemption Account" has the meaning set forth in Section 3.1(a)
of the Intercreditor Agreement.
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"Required Lenders" means Lenders holding more than 50% of the outstanding
principal amount of all Loans on any date of determination (and without
duplication).
"Resale Restriction Termination Date" has the meaning set forth in the
Private Placement Legend.
"Responsible Officer" means (a) with respect to the Administrative Agent,
any officer of the Administrative Agent, (b) with respect to the Trustee, any
officer within the Corporate Trust Office, and also, with respect to a
particular matter, any other officer to whom such matter is referred because of
such officer's knowledge and familiarity with the particular subject, (c) with
respect to Royalty Sub, an officer of Royalty Sub, (d) with respect to the
Pledgor, an officer of the Pledgor and (e) with respect to Quintiles, (i) any
officer of Quintiles and (ii) in respect of the matters described in Section
6.4(d) and Section 6.4(e) of the Purchase and Sale Agreement relating to the
Co-Promotion Agreement, any officer of Quintiles with management
responsibilities in respect of the relationship with Lilly under the
Co-Promotion Agreement.
"Royalty Sub" means Duloxetine Royalty Sub, an exempted company
incorporated with limited liability under the laws of the Cayman Islands.
"Royalty Sub Xxxx of Sale" means the Xxxx of Sale, dated as of the Closing
Date, executed by the Pledgor and Royalty Sub, substantially in the form of
Exhibit B to the Purchase and Sale Agreement.
"Royalty Sub Payments" means all royalties and other compensation, payments
and reimbursements paid, owed, accrued or otherwise required to be paid by Lilly
to Quintiles pursuant to the Co-Promotion Agreement, including (i) all payments
that may be required by (A) Sections 5.6, 5.7, 5.8, 5.13 and 5.14 of the
Co-Promotion Agreement with respect to royalty and other payments, (B) Article
10 of the Co-Promotion Agreement with respect to payments upon certain events of
termination of the Co-Promotion Agreement and (C) Section 11.3 of the
Co-Promotion Agreement with respect to Lilly's continuing responsibility for
paying Quintiles the payments required by Section 5.7 of the Co-Promotion
Agreement in the event of Lilly's license, sale or assignment of its
intellectual property relating to the Product as set forth in such Section 11.3
and (ii) additional payments or consideration paid to Quintiles in connection
with any amendment, restatement, supplement, modification or waiver of the
Co-Promotion Agreement.
"Royalty Sub Rights" means the assets sold, transferred, conveyed,
assigned, contributed and granted by Quintiles to the Pledgor, and by the
Pledgor to Royalty Sub, pursuant to the Purchase and Sale Agreement and the
respective Xxxx of Sale, which shall consist of (i) the rights of Quintiles
under the Co-Promotion Agreement (A) to receive all Royalty Sub Payments and (B)
to receive quarterly net sales reports under Section 5.10 of the Co-Promotion
Agreement from Lilly showing net sales for such quarter and (ii) the proceeds of
and the rights to enforce each of the foregoing.
"Rule 144A" means Rule 144A under the Securities Act.
"S&P" means Standard & Poor's Ratings Services, a division of The
XxXxxx-Xxxx Companies, Inc., and any successor thereto or, if such division or
its successor shall for any reason no longer perform the functions of a
securities rating agency, "S&P" shall be deemed to
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refer to any other nationally recognized statistical rating organization (within
the meaning ascribed thereto by the Exchange Act) designated by Royalty Sub.
"Sale Price" has the meaning set forth in Section 2.2(b) of the Purchase
and Sale Agreement.
"Scheduled Final Payment Date" means, for any Class B Notes or Refinancing
Notes, if applicable, the relevant date specified in the indenture supplemental
to the Indenture and/or the Board Resolution providing for their issuance.
"Scheduled Remaining Notes Balance" means for any Payment Date the
remaining Outstanding Principal Balance of the Original Class A Notes for such
Payment Date as set forth on the Class A Principal Payment Schedule.
"SEC" means the U.S. Securities and Exchange Commission.
"Second Lien Pledge and Security Agreement" means that certain second lien
pledge and security agreement dated as of the Closing Date made by the Pledgor
to the Trustee, including the Annex and Exhibits attached thereto, as amended,
restated, supplemented or otherwise modified from time to time.
"Secured Obligations" has the meaning set forth in the Granting Clause of
the Indenture.
"Secured Party" has the meaning set forth in the Credit Agreement.
"Securities Act" means the U.S. Securities Act of 1933, as amended.
"Security Interest" means the security interest granted or expressed to be
granted in the Collateral pursuant to the Granting Clause of the Indenture and
in the Pledged Equity pursuant to the Second Lien Pledge and Security Agreement.
"Senior Claim" has the meaning set forth in Section 10.1(a) of the
Indenture.
"Senior Class" means (a) so long as any Class A Notes are Outstanding, the
Class A Notes, or (b) if no Class A Notes are Outstanding, the Class B Notes.
"Senior Trustee" means the trustee of the Senior Class, which shall be (a)
so long as any Class A Notes are Outstanding, the Trustee acting at the
Direction of the Noteholders of a majority of the Outstanding Principal Balance
of the Class A Notes, and (b) after the Class A Notes have been repaid in full,
and so long as any Class B Notes are Outstanding, the Trustee acting at the
Direction of the Noteholders of a majority of the Outstanding Principal Balance
of the Class B Notes.
"Service Providers" means Servicer, the Administrative Agent, the Trustee,
the Collection Agent, the Calculation Agent, the Paying Agent, the Registrar,
the Operating Bank and any Person that becomes Servicer, the Administrative
Agent, the Trustee, the Collection Agent, the Calculation Agent, the Paying
Agent, the Registrar or the Operating Bank in accordance with the terms of the
applicable agreement and, subject to the written approval of the
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Administrative Agent or, after the Discharge of First Lien Obligations, the
Noteholders of a majority of the Outstanding Principal Balance of the Senior
Class of Notes, any other Person designated as a Service Provider by Royalty
Sub.
"Servicer" means Quintiles, acting in its capacity as servicer pursuant to
the Servicing Agreement (or any other Person appointed by Royalty Sub to succeed
Quintiles as such or any successor thereto).
"Servicer Information" means, with respect to any Calculation Date, the
written information provided by Servicer under Section 4.1(c) of the Servicing
Agreement with respect to such Calculation Date.
"Servicer Termination Event" means any one of the following events:
(i) Servicer shall fail to pay any amount when due under the Servicing
Agreement and such failure shall continue unremedied for five Business
Days;
(ii) Servicer shall fail to deliver the Distribution Report and the
other required accompanying materials with respect to any Payment Date in
accordance with the provisions of Section 4.1(c)(ii) of the Servicing
Agreement within five Business Days of the date such Distribution Report
and the other required accompanying materials are required to be delivered
under Section 4.1(c)(ii) of the Servicing Agreement;
(iii) Servicer shall fail to carry out its obligations under Section
4.1(c)(iii) of the Servicing Agreement that shall have or reasonably be
expected to have a material adverse effect on the Lenders or the
Noteholders;
(iv) Servicer shall fail to carry out its obligations under Section
4.1(c)(viii) or Section 4.1(c)(ix) of the Servicing Agreement;
(v) Servicer shall fail to observe or perform in any material respect
any of the other covenants or agreements on the part of Servicer contained
in the Servicing Agreement and such failure shall continue unremedied for a
period of 30 days;
(vi) a court having jurisdiction in the premises enters a decree or
order for (i) relief in respect of Servicer under any Applicable Law
relating to bankruptcy, insolvency, receivership, winding-up, liquidation,
reorganization, examination, relief of debtors or other similar law in
effect now or after the Closing Date, (ii) appointment of a receiver,
liquidator, examiner, assignee, custodian, trustee, sequestrator or similar
official of Servicer or (iii) the winding-up or liquidation of the affairs
of Servicer and, in each case, such decree or order shall remain unstayed
or such writ or other process shall not have been stayed or dismissed
within 90 days from entry thereof;
(vii) Servicer (i) commences a voluntary case under any Applicable Law
relating to bankruptcy, insolvency, receivership, winding-up, liquidation,
reorganization, examination, relief of debtors or other similar law in
effect now or after the Closing Date, or consents to the entry of an order
for relief in any involuntary case under any such law, (ii) consents to the
appointment of or taking possession by a receiver, liquidator,
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examiner, assignee, custodian, trustee, sequestrator or similar official of
Servicer or for all or substantially all of the property and assets of
Servicer or (iii) effects any general assignment for the benefit of
creditors;
(viii) Servicer's business activities are terminated by any
Governmental Authority;
(ix) a material adverse change occurs in the financial condition or
operations of Servicer that is reasonably likely to have a Material Adverse
Effect; or
(x) an Event of Default shall have occurred, other than an Event of
Default solely caused by the Administrative Agent, the Trustee, the
Collection Agent, the Calculation Agent, the Paying Agent or the Registrar
failing to perform any of its respective obligations under the Credit
Agreement, the Indenture or any other Transaction Document.
"Services" means the services to be performed by Servicer pursuant to the
Servicing Agreement.
"Servicing Agreement" means the servicing agreement dated as of the Closing
Date between Royalty Sub and Quintiles, including the Annex attached thereto, as
amended, restated, supplemented or otherwise modified from time to time in
accordance with the terms of the Credit Agreement and the Indenture, if
applicable.
"Servicing Fee" has the meaning set forth in Section 2.1 of the Servicing
Agreement.
"Shortfall" has the meaning set forth in Section 3.5(a) of the
Intercreditor Agreement.
"Special Tax Redemption" has the meaning set forth in Section 3.1(d) of the
Indenture.
"Special Taxes" has the meaning set forth in Section 5.3 of the Indenture.
"Stated Rate of Interest" means, with respect to any class of the Notes for
any Interest Accrual Period, the interest rate set forth in such class of Notes
for such Interest Accrual Period.
"Subordinated Claim" has the meaning set forth in Section 10.1(a) of the
Indenture.
"Subsidiary" means, with respect to any Person, any other Person of which
more than 50% of the outstanding Voting Securities of such other Person
(irrespective of whether at the time Capital Securities of any other class or
classes of such other Person shall or might have voting power upon the
occurrence of any contingency) is at the time directly or indirectly owned or
controlled by such Person, by such Person and one or more other Subsidiaries of
such Person or by one or more other Subsidiaries of such Person.
"Synthetic Lease" means, as applied to any Person, any lease (including
leases that may be terminated by the lessee at any time) of any property
(whether real, personal or mixed) (a) that is not a capital lease in accordance
with GAAP and (b) in respect of which the lessee retains or
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obtains ownership of the property so leased for federal income tax purposes,
other than any such lease under which that Person is the lessor.
"Taxes" means any and all taxes, fees, levies, duties, tariffs, imposts and
other charges of any kind (together with any and all interest, penalties, loss,
damage, liability, expense, additions to tax and additional amounts or costs
incurred or imposed with respect thereto) now or hereafter imposed, levied,
collected, withheld or otherwise assessed by the U.S. or by any state, local,
foreign or other Governmental Authority (or any subdivision or agency thereof)
or other taxing authority, including taxes or other charges on or with respect
to income, franchises, windfall or other profits, gross receipts, property,
sales, use, capital stock, payroll, employment, social security, workers'
compensation, unemployment compensation or net worth and similar charges and
taxes or other charges in the nature of excise, deduction, withholding, ad
valorem, stamp, transfer, value added, taxes on goods and services, gains taxes,
license, registration and documentation fees, customs duties, tariffs and
similar charges.
"Telerate Page 3750" means Page 3750 on Moneyline Telerate or such other
page as may replace Page 3750 on that service or such other service as may be
nominated by the British Bankers' Association for the purpose of displaying
London interbank offered rates for U.S. dollar deposits.
"Temporary Regulation S Global Note" has the meaning set forth in Section
2.1(b) of the Indenture.
"Territory" means the 00 xxxxxx xx xxx Xxxxxx Xxxxxx xx Xxxxxxx and the
District of Columbia, but does not include the Commonwealth of Puerto Rico or
any other territory, possession or protectorate of the United States of America.
"Transaction Documents" means the Credit Agreement, the Indenture, the
Notes, the Purchase and Sale Agreement, the Xxxx of Sale, the Servicing
Agreement, the First Lien Pledge and Security Agreement, the Second Lien Pledge
and Security Agreement, the Loan Security Agreement, the Intercreditor
Agreement, the Note Purchase Agreements, the account control agreement dated as
of October 18, 2005 among Royalty Sub, Servicer, the Administrative Agent, the
Trustee and U.S. Bank National Association, as custodian thereunder, and each
other agreement pursuant to which the Administrative Agent or the Trustee (or
its respective agents) is granted a Lien to secure the obligations under the
Credit Agreement, the Indenture or the Notes, respectively.
"Transaction Expenses" means the out-of-pocket expenses payable by Royalty
Sub in connection with (a) the issuance of the Loans and the Original Class A
Notes, including placement fees, any initial fees payable to Service Providers
and the fees and expenses of Mayer, Brown, Xxxx & Maw LLP and Pillsbury Xxxxxxxx
Xxxx Xxxxxxx LLP, counsel to the Administrative Agent and the Noteholders,
respectively, in connection with the making of the Loans and the offering and
issuance of the Original Class A Notes, as set forth in the Credit Agreement and
the Note Purchase Agreements, respectively, and (b) the offering and issuance of
any Class B Notes or Refinancing Notes, to the extent specified in the Board
Resolution authorizing such offering and issuance.
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"Trigger Notice" has the meaning set forth in the Intercreditor Agreement.
"Trust Indenture Act" means the U.S. Trust Indenture Act of 1939, as
amended.
"Trustee" means U.S. Bank National Association, a national banking
association, as initial trustee of the Notes under the Indenture, and any
successor appointed in accordance with the terms of the Indenture.
"Trustee Closing Account" means the account of Royalty Sub maintained with
the Trustee at U.S. Bank, ABA No. 000000000, Account No. 173103321092, Ref.
Duloxetine Royalty (Acct. # 173103321092), Attention: Corporate Trust (Xxxxxx
Xxxxx/Xxxxx Xxxxxxx).
"UCC" means the Uniform Commercial Code as in effect from time to time in
the State of New York; provided, that, if, with respect to any financing
statement or by reason of any provisions of law, the perfection or the effect of
perfection or non-perfection of the Liens granted to the Administrative Agent or
the Trustee pursuant to the applicable Transaction Document is governed by the
Uniform Commercial Code as in effect in a jurisdiction of the United States
other than the State of New York, then "UCC" means the Uniform Commercial Code
as in effect from time to time in such other jurisdiction for purposes of the
provisions of each Transaction Document and any financing statement relating to
such perfection or effect of perfection or non-perfection.
"U.S." or "United States" means the United States of America, its 50
states, each territory thereof and the District of Columbia.
"U.S. Person" means a U.S. person within the meaning of Regulation S under
the Securities Act.
"U.S. Treasury" means the U.S. Department of the Treasury.
"Voluntary Bankruptcy" means, with respect to Royalty Sub or the Pledgor,
(i) the inability of Royalty Sub or the Pledgor, respectively, generally to pay
its debts as such debts become due, or an admission in writing by Royalty Sub or
the Pledgor, respectively, of its inability to pay its debts generally or a
general assignment by Royalty Sub or the Pledgor, respectively, for the benefit
of creditors, (ii) the filing of any petition or answer by Royalty Sub or the
Pledgor, respectively, seeking to adjudicate itself as bankrupt or insolvent, or
seeking for itself any liquidation, winding-up, reorganization, arrangement,
adjustment, protection, relief or composition of Royalty Sub or the Pledgor,
respectively, or its debts under any law relating to bankruptcy, insolvency,
receivership, winding-up, liquidation, reorganization, examination, relief of
debtors or other similar law now or hereafter in effect, or seeking, consenting
to or acquiescing in the entry of an order for relief in any case under any such
law, or the appointment of or taking possession by a receiver, trustee,
custodian, liquidator, examiner, assignee, sequestrator or other similar
official for Royalty Sub or the Pledgor, respectively, or for any substantial
part of its property, or (iii) corporate or other entity action taken by Royalty
Sub or the Pledgor, respectively, to authorize any of the actions set forth
above.
A-25
"Voting Securities" means, with respect to any Person, Capital Securities
of any class or kind ordinarily having the power to vote for the election of
directors, managers or other voting members of the governing body of such
Person.
A-26
SCHEDULE 1
CLASS A PRINCIPAL PAYMENT SCHEDULE
Scheduled Remaining
Payment Date Notes Balance
------------ -------------------
January 15, 2006 $125,000,000
April 15, 2006 $125,000,000
July 15, 2006 $125,000,000
October 15, 2006 $125,000,000
January 15, 2007 $125,000,000
April 15, 2007 $125,000,000
July 15, 2007 $125,000,000
October 15, 2007 $125,000,000
January 15, 2008 $125,000,000
April 15, 2008 $125,000,000
July 15, 2008 $125,000,000
October 15, 2008 $110,000,000
January 15, 2009 $ 95,000,000
April 15, 2009 $ 80,000,000
July 15, 2009 $ 65,000,000
October 15, 2009 $ 50,000,000
January 15, 2010 $ 35,000,000
April 15, 2010 $ 25,000,000
July 15, 2010 $ 15,000,000
October 15, 2010 $ 7,500,000
January 15, 2011 $ 0
I-1
EXHIBIT A
FORM OF ORIGINAL CLASS A NOTE
[INSERT THE APPLICABLE LEGEND(S) SET FORTH IN SECTION 2.2]
DULOXETINE ROYALTY SUB
DULOXETINE PHARMA(SM) SECOND LIEN 13% NOTES DUE 2013
CLASS A
No. __________ CUSIP: __________
U.S.$125,000,000
DULOXETINE ROYALTY SUB, an exempted company incorporated with limited
liability under the laws of the Cayman Islands (herein referred to as "Royalty
Sub"), for value received, hereby promises to pay to CEDE & CO., or registered
assigns, the principal amount set forth on Schedule I hereto on or before
October 15, 2013 (the "Final Maturity Date") and to pay interest quarterly in
arrears on the Outstanding Principal Balance hereof at a rate per annum equal to
13% (the "Stated Rate of Interest"), from the date hereof until the Outstanding
Principal Balance hereof is paid or duly provided for, which interest shall be
due on each Payment Date and payable not later than the immediately succeeding
Payment Date (together with Additional Interest on the amount of unpaid interest
from the Payment Date on which it was due until the date on which it is paid,
compounded quarterly on each Payment Date). Interest on this Note in each
Interest Accrual Period shall be calculated on the basis of a 360-day year
consisting of twelve 30-day months.
This Note is a duly authorized issue of Notes of Royalty Sub, designated as
its "Duloxetine PhaRMA(SM) Second Lien 13% Notes Due 2013", issued under the
Indenture dated as of October 18, 2005 (as amended, restated, supplemented or
otherwise modified from time to time in accordance with the terms thereof, the
"Indenture"), between Royalty Sub and U.S. Bank National Association, as trustee
(including any successor appointed in accordance with the terms of the
Indenture, the "Trustee"). The Indenture also provides for the issuance of Class
B Notes. All capitalized terms used in this Note and not defined herein shall
have the respective meanings assigned to such terms in the Indenture. Reference
is made to the Indenture and all indentures supplemental thereto for a statement
of the respective rights and obligations thereunder of Royalty Sub, the Trustee
and the Noteholders. This Note is subject to all terms of the Indenture.
Royalty Sub will pay the Outstanding Principal Balance of this Note on or
prior to the Final Maturity Date on the Payment Dates and in the amounts
specified in the Indenture, subject to the availability of the Available
Collections Amount therefor after making payments entitled to priority under
Section 3.7 of the Intercreditor Agreement.
The indebtedness evidenced by the Original Class A Notes is, to the extent
and in the manner provided in the Indenture, senior in right of payment to the
right of payment of the Class B Notes, and this Note is issued subject to such
provisions.
A-1
Royalty Sub may redeem all or part of the Outstanding Principal Balance of
this Note prior to the Final Maturity Date on the Payment Dates, in the amounts
and under the circumstances specified in the Indenture.
Any amount of Premium or interest on this Note that is not paid when due
shall, to the fullest extent permitted by Applicable Law, bear interest
("Additional Interest") at an interest rate per annum equal to the Stated Rate
of Interest from the date when due until such amount is paid or duly provided
for, compounded quarterly and payable on the next succeeding Payment Date,
subject to the availability of the Available Collections Amount therefor after
making payments entitled to priority under Section 3.7 of the Intercreditor
Agreement.
This Note is and will be secured by the Collateral pledged as security
therefor as provided in the Indenture, but subject to the provisions of the
Intercreditor Agreement.
Subject to and in accordance with the terms of the Indenture and the
Intercreditor Agreement, there will be distributed quarterly from the Collection
Account on each Payment Date commencing on January 15, 2006, to the Person in
whose name this Note is registered at the close of business on the Record Date
with respect to such Payment Date, in the manner specified in Section 3.7 of the
Intercreditor Agreement, such Person's pro rata share (based on the aggregate
percentage of the Outstanding Principal Balance of the Original Class A Notes
held by such Person) of the aggregate amount distributable to all Noteholders of
Original Class A Notes on such Payment Date.
All amounts payable in respect of this Note shall be payable in U.S.
dollars in the manner provided in the Indenture to the Noteholder hereof on the
Record Date relating to such payment. The final payment with respect to this
Note, however, shall be made only upon presentation and surrender of this Note
by the Noteholder or its agent at the Corporate Trust Office or agency of the
Trustee or Paying Agent. At such time, if any, as this Note is issued in the
form of one or more Definitive Notes, payments on a Payment Date shall be made
by check mailed to each Noteholder of such a Definitive Note on the applicable
Record Date at its address appearing on the Register maintained with respect to
the Original Class A Notes. Alternatively, upon application in writing to the
Trustee or other Paying Agent, not later than the applicable Record Date, by a
Noteholder, any such payments shall be made by wire transfer to an account
designated by such Noteholder at a financial institution in New York City. The
final payment with respect to any such Definitive Note, however, shall be made
only upon presentation and surrender of such Definitive Note by the Noteholder
or its agent at the Corporate Trust Office or agency of the Trustee or Paying
Agent. Notwithstanding the foregoing, payments in respect of this Note issued in
the form of a Global Note (including principal, Premium, if any, and interest)
shall be made by wire transfer of immediately available funds to the account
specified by DTC. Any reduction in the Outstanding Principal Balance of this
Note (or any one or more predecessor Original Class A Notes) effected by any
payments made on any Payment Date shall be binding upon all future Noteholders
of this Note and of any Original Class A Note issued upon the registration of
transfer of, in exchange or in lieu of or upon the refinancing of this Note,
whether or not noted hereon.
The Noteholder of this Note agrees, by acceptance hereof, to pay over to
the Trustee or other Paying Agent any money (including principal, Premium, if
any, and interest) paid to it in
A-2
respect of this Note in the event that the Trustee or other Paying Agent, acting
in good faith, determines subsequently that such monies were not paid in
accordance with the priority of payment provisions of the Intercreditor
Agreement or as a result of any other mistake of fact or law on the part of the
Trustee or other Paying Agent in making such payment.
This Note is issuable only in registered form. A Noteholder or Beneficial
Holder may transfer this Note or a Beneficial Interest herein only by delivery
of a written application to the Registrar stating the name of the proposed
transferee, a Confidentiality Agreement duly executed and delivered to the
Registrar by such transferee and otherwise complying with the terms of the
Indenture. No such transfer shall be effected until, and such transferee shall
succeed to the rights of a Noteholder only upon, final acceptance and
registration of the transfer by the Registrar in the Register. When this Note is
presented to the Registrar with a request to register the transfer or to
exchange it for an equal principal amount of Original Class A Notes of other
authorized denominations, the Registrar shall register the transfer or make the
exchange as requested if its requirements for such transactions are met
(including, in the case of a transfer, that such Note is duly endorsed or
accompanied by a written instrument of transfer in form satisfactory to the
Trustee and Registrar duly executed by the Noteholder thereof or by an attorney
who is authorized in writing to act on behalf of the Noteholder and that the
transferee has executed and delivered to the Registrar a Confidentiality
Agreement). No service charge shall be made for any registration of transfer or
exchange of this Note, but the party requesting such new Original Class A Note
or Original Class A Notes may be required to pay a sum sufficient to cover any
transfer tax or similar governmental charge payable in connection therewith.
This Note may not be transferred to any Person engaged in the business of
developing, manufacturing or marketing pharmaceutical or diagnostic products, or
any Affiliate of such a Person.
Prior to the registration of transfer of this Note, Royalty Sub and the
Trustee may deem and treat the Person in whose name this Note (as of the day of
determination or as of such other date as may be specified in the Indenture) is
registered as the absolute owner and Noteholder hereof for the purpose of
receiving payment of all amounts payable with respect to this Note and for all
other purposes, and neither Royalty Sub nor the Trustee shall be affected by
notice to the contrary.
Subject to the provisions of the Intercreditor Agreement, the Indenture
permits the amendment or modification of the Indenture and the Original Class A
Notes by Royalty Sub with the consent of the Noteholders of a majority of the
Outstanding Principal Balance of all Notes on the date of any vote or act of
such Noteholders (voting or acting as a single class). However, no amendment or
modification of the Indenture or the Original Class A Notes may, without the
consent of Noteholders of 100% of the Outstanding Principal Balance of the class
of Notes affected thereby, (i) reduce the percentage of Noteholders of any such
class of Notes required to take or approve any action under the Indenture, (ii)
reduce the amount or change the time of payment of any amount owing or payable
with respect to any such class of Notes or change the rate of interest or change
the manner of calculation of interest payable with respect to any such class of
Notes, (iii) alter or modify the provisions with respect to the Collateral for
the Notes or the manner of payment or the order of priorities in which payments
or distributions under the Indenture will be made as between the Noteholders of
such Notes and Royalty Sub or as among the Noteholders or (iv) consent to any
assignment of Royalty Sub's rights to a party other than
A-3
the Trustee for the benefit of the Noteholders. Any such amendment or
modification shall be binding on every Noteholder hereof, whether or not
notation thereof is made upon this Note.
The subordination provisions contained in Article X of the Indenture may
not be amended or modified without the consent of Noteholders of 100% of the
Outstanding Principal Balance of the class of Notes affected thereby.
The Indenture also contains provisions permitting the Noteholders of a
majority of the Outstanding Principal Balance of the Senior Class of Notes, on
behalf of the Noteholders of all of the Original Class A Notes, to waive
compliance by Royalty Sub with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver shall be conclusive and binding upon all present and future Noteholders
of this Note and of any Original Class A Note issued upon the registration of
transfer of, in exchange or in lieu of or upon the refinancing of this Note,
whether or not notation of such consent or waiver is made upon this Note.
Royalty Sub is permitted by the Indenture, under certain circumstances, to
merge or consolidate, subject to the rights of the Trustee and the Noteholders
of Original Class A Notes under the Indenture.
The Original Class A Notes are issuable only in registered form in
denominations as provided in the Indenture, subject to certain limitations
therein set forth.
THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
INTERNAL SUBSTANTIVE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO THE
RULES THEREOF RELATING TO CONFLICTS OF LAW OTHER THAN SECTION 5-1401 OF THE
GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK, AND THE OBLIGATIONS, RIGHTS
AND REMEDIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Unless the certificate of authentication hereon has been executed by the
Trustee whose name appears below by manual or facsimile signature, this Note
shall not be entitled to any benefit under the Indenture, or be valid or
obligatory for any purpose.
A-4
IN WITNESS WHEREOF, Royalty Sub has caused this Note to be signed manually
or by facsimile by its duly authorized Responsible Officer.
Date: October 18, 2005 DULOXETINE ROYALTY SUB
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This Note is one of the Duloxetine PhaRMA(SM) Second Lien 13% Notes Due
2013 designated above and referred to in the within-mentioned indenture.
Date: October 18, 2005 U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:
------------------------------------
Authorized Signatory
A-5
FORM OF TRANSFER NOTICE
FOR VALUE RECEIVED the undersigned registered holder hereby sell(s),
assign(s) and transfer(s) unto
Insert Taxpayer Identification No. _____________________
________________________________________________________________________________
(Please print or typewrite name and address including zip code of assignee)
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing _________________________________________ attorney to transfer said
Note on the books of Royalty Sub with full power of substitution in the
premises.
-------------------------- ----------------------------------------
Date Signature of Transferor
NOTE: The signature to this assignment must correspond with the name as written
upon the face of the within-mentioned instrument in every particular, without
alteration or any change whatsoever.
[THE FOLLOWING PROVISIONS TO BE INCLUDED ON ALL NOTES]
In connection with any transfer of the within-mentioned Note occurring
prior to the date that is the end of the period referred to in Rule 144(k) under
the Securities Act, the undersigned confirms without utilizing any general
solicitation or general advertising that:
[Check One]
__ (a) the within-mentioned Note is being transferred in compliance with the
exemption from registration under the Securities Act provided by Rule 144A
thereunder
__ (b) the within-mentioned Note is being transferred other than in accordance
with clause (a) above and documents are being furnished which comply with the
conditions of transfer set forth in the within-mentioned Note and the Indenture
If neither of the foregoing boxes is checked, the Trustee or other Registrar
shall not be obligated to register the within-mentioned Note in the name of any
Person other than the Noteholder hereof unless and until the conditions to any
such transfer of registration set forth herein and in Section 2.11 of the
Indenture shall have been satisfied.
-------------------------- ----------------------------------------
Date NOTICE: The signature to this assignment
must correspond with the name as written
upon the face of the within-mentioned
instrument in every particular, without
alteration or any change whatsoever.
TO BE COMPLETED BY PURCHASER IF CLAUSE (a) ABOVE IS CHECKED.
A-6
The undersigned represents and warrants that it is purchasing the
within-mentioned Note for its own account or an account with respect to which it
exercises sole investment discretion and that each of it and any such account is
a "qualified institutional buyer" within the meaning of Rule 144A and is aware
that the sale to it is being made in reliance on Rule 144A and acknowledges that
it has received such information regarding Royalty Sub as the undersigned has
requested pursuant to Rule 144A or has determined not to request such
information and that it is aware that the transferor is relying upon the
undersigned's foregoing representations in order to claim the exemption from
registration provided by Rule 144A and has executed and delivered to the
Registrar a Confidentiality Agreement.
Dated:
------------------------------
----------------------------------------
Executive Officer
A-7
SCHEDULE I
DULOXETINE ROYALTY SUB
Duloxetine PhaRMA(SM) Second Lien 13% Notes Due 2013
No. ____
Notation Explaining Authorized Signature
Principal Amount of Trustee or
Date Principal Amount Recorded Custodian
---- ---------------- ------------------- --------------------
A-8
EXHIBIT B
FORM OF RESALE CONFIDENTIALITY AGREEMENT
No. ____
DULOXETINE ROYALTY SUB
c/o Walkers SPV Limited
X.X. Xxx 000 GT, Xxxxxx House
Xxxx Street, Xxxxxx Town, Grand Cayman
Cayman Islands, British West Indies
__________, 20__
RESALE CONFIDENTIALITY AGREEMENT
In connection with our possible interest in the purchase of the fixed rate
Duloxetine Pharmaceutical Royalty Monetization Asset(SM) (PhaRMA(SM)) Second
Lien 13% Notes due 2013 (the "Notes") issued by Duloxetine Royalty Sub, an
exempted company incorporated with limited liability under the laws of the
Cayman Islands (the "Company") (the "Transaction"), we have requested a copy of
the Private Placement Memorandum, dated October 14, 2005, relating to the Notes
(the "Private Placement Memorandum"). In addition to receiving the Private
Placement Memorandum, we may also request that you or your representatives
furnish us or our representatives with certain information relating to the
Company, the Transaction and the rights acquired by the Company from Quintiles
Transnational Corp. All such information (whether written or oral, and whether
tangible or electronic) furnished on or after the date hereof by you or your
directors, officers, managers, members, partners, employees, affiliates,
representatives (including, without limitation, financial advisors, attorneys
and accountants) or agents (collectively, "Your Representatives") to us or our
directors, officers, managers, members, partners, employees, affiliates,
representatives (including, without limitation, financial advisors, attorneys
and accountants) or agents (collectively, "Our Representatives"), including,
without limitation, the Private Placement Memorandum, and all analyses,
compilations, forecasts, studies or other documents prepared by us or Our
Representatives in connection with our or Our Representatives' review of, or our
interest in, the Transaction which contain or reflect any such information is
hereinafter referred to as the "Information". The term Information will not,
however, include information that (i) is or becomes publicly available other
than as a result of a disclosure by us or Our Representatives, (ii) is or
becomes available to us on a non-confidential basis from a source (other than
you or Your Representatives) that, to the best of our knowledge after due
inquiry, is not prohibited from disclosing such information to us by a legal,
contractual or fiduciary obligation to you, (iii) was already known to us and to
our knowledge is not subject to other confidentiality restrictions prohibiting
disclosure of such information or (iv) was independently developed by Our
Representatives who have not had access to such Information.
As a condition to receiving the Information, we hereby agree as follows:
1. We and Our Representatives (i) agree to keep the Information
confidential and agree not to (except as required by applicable law, regulation
or legal process, and only after compliance with paragraph 3 below), without
your prior written consent, disclose any
B-1
Information in any manner whatsoever, and (ii) agree not to use any Information
for any purpose other than in connection with the Transaction; provided,
however, that we may reveal the Information to Our Representatives (a) who need
to know the Information for the purpose of evaluating the Transaction and (b)
who receive a copy of this Resale Confidentiality Agreement executed by us and
agree to be bound by its terms. We will be responsible for any breach of the
terms of this Resale Confidentiality Agreement by any of Our Representatives.
Notwithstanding and without limitation of the foregoing, we and Our
Representatives agree not to reveal Information to advisors who are principally
engaged in the business of investment banking, capital markets or securitization
of financial assets without prior written notice to you.
2. We and Our Representatives agree, whether or not the Transaction is
consummated, not to (except as required by applicable law, regulation or legal
process, and only after compliance with paragraph 3 below), without your prior
written consent, disclose to any person the fact that the Information or the
Transaction exists or has been made available, that we are considering the
Transaction, or that discussions or negotiations are taking or have taken place
concerning the Transaction or any term, condition or other fact relating to the
Transaction or such discussions or negotiations, including, without limitation,
the status thereof.
3. In the event that we or any of Our Representatives are required by
applicable law, regulation or legal process to disclose any of the Information,
we agree to use commercially reasonable efforts to notify you promptly (unless
such notice is not permitted by applicable law or regulation) so that you may
seek, at your own expense, a protective order or other appropriate remedy or, in
your sole discretion, waive compliance with the terms of this Resale
Confidentiality Agreement. In the event that no such protective order or other
remedy is obtained, or that you do not waive compliance with the terms of this
Resale Confidentiality Agreement, we agree to furnish only that portion of the
Information which we are advised by counsel (which may be internal counsel) is
legally required and will exercise all commercially reasonable efforts to obtain
reliable assurance that confidential treatment will be accorded the Information.
4. If we determine not to proceed with the Transaction, we will promptly
inform Your Representative, Xxxxxx Xxxxxxx & Co. Incorporated ("Xxxxxx
Xxxxxxx"), or you of that decision and, in that case, and at any time upon the
request of you or the request of any of Your Representatives, we will (i)
promptly deliver to you all copies of the Information in our possession (except
as described in the following proviso) and (ii) promptly destroy all copies of
any written Information (whether in tangible or electronic form, or otherwise)
that we have created, including, without limitation, any notes we have taken on
any discussions with you or Your Representatives (provided in each case that an
appropriate person within our organization may retain one copy of the
Information, subject to the provisions of this Resale Confidentiality Agreement,
if required to comply with regulatory considerations, in which case, regardless
of paragraph 13 below, the confidentiality provisions of this Resale
Confidentiality Agreement will continue to apply to such Information for so long
as it is retained by such person or any of Our Representatives). Any oral
Information will continue to be subject to the terms of this Resale
Confidentiality Agreement.
5. We acknowledge that the Private Placement Memorandum is dated October
14, 2005, and that you have not updated, and have no obligation to update, the
Private Placement
B-2
Memorandum in any respect for events, developments or circumstances (including,
without limitation, the level of royalty payments for Cymbalta or the sales of
Cymbalta compared to the projections contained in the Independent Consultant's
Report included as Appendix A to the Private Placement Memorandum). We further
acknowledge that neither you nor any of Your Representatives, nor any of your or
their respective officers, directors, managers, members, partners, employees,
agents or controlling persons within the meaning of Section 20 of the Securities
Exchange Act of 1934, as amended, makes any express or implied representation or
warranty as to the accuracy or completeness of the Information, and we agree
that no such person will have any liability relating to the Information or for
any errors therein or omissions therefrom. We further agree that we are not
entitled to rely on the accuracy or completeness of the Information.
6. We acknowledge that we are aware of the restrictions imposed by the
United States securities laws on the purchase or sale of securities of an issuer
or an affiliate or controlling person of Duloxetine Royalty Sub by any person
who has received material, non-public information from Duloxetine Royalty Sub or
an affiliate or controlling person of Duloxetine Royalty Sub or from a person
owing a duty to any of the foregoing, and on the communication of such
information to any other person when it is reasonably foreseeable that such
other person is likely to purchase or sell such securities in reliance upon such
information.
7. We represent that we maintain effective internal procedures with respect
to maintaining the confidentiality and use of the Information. We further
represent and warrant that (i) we are an institution and (ii) we are not and
will not be so long as we hold any Notes, and are not an affiliate of an entity
that is or will be so long as we hold any Notes, in the business of developing,
manufacturing or marketing pharmaceutical or diagnostic products.
8. We acknowledge that remedies at law may be inadequate to protect you
against any actual or threatened breach of this Resale Confidentiality Agreement
by us or Our Representatives, and, without prejudice to any other rights and
remedies otherwise available to you, we agree to permit you to seek the granting
of injunctive relief in your favor without proof of actual damages.
9. You acknowledge and agree that Quintiles Transnational Corp.
("Quintiles") is a third party beneficiary of this Resale Confidentiality
Agreement and that Quintiles may, on its own or on our behalf, assert a breach
and pursue all remedies at law or in equity (as described in the previous
paragraph) with respect hereto.
10. We agree that no failure or delay by you in exercising any right, power
or privilege hereunder will operate as a waiver thereof, nor will any single or
partial exercise thereof preclude any other or further exercise thereof or the
exercise of any right, power or privilege hereunder.
11. This Resale Confidentiality Agreement will be governed by and construed
in accordance with the laws of the State of New York applicable to contracts
between residents of that State and executed in and to be performed in that
State.
B-3
12. This Resale Confidentiality Agreement contains the entire agreement
between you and us concerning the confidentiality of the Information, and no
modifications of this Resale Confidentiality Agreement or waiver of the terms
and conditions hereof will be binding upon you or us, unless approved in writing
by each of you and us.
13. This Resale Confidentiality Agreement will terminate (a) if we do not
proceed with the Transaction, eighteen (18) months after the date hereof, (b) if
we do proceed with the Transaction, eighteen (18) months after the date we sell
all of the Notes we own that are the subject of the Transaction or (c) if we do
proceed with the Transaction and clause (b) does not apply, on the later of
eighteen (18) months after the final maturity of such Notes and the date such
Notes are paid in full.
14. If we propose to purchase, transfer, sell or otherwise dispose of any
Notes at any time, we agree to (i) abide by the transfer restrictions described
in the Private Placement Memorandum, (ii) inform any proposed transferee of the
Notes of such transfer restrictions, including the requirement that such
proposed transferee enter into a resale confidentiality agreement with you, and
(iii) not furnish any Information to such proposed transferee, or transfer, sell
or dispose of any Note to such proposed transferee, without receiving evidence
that such proposed transferee has entered into a resale confidentiality
agreement with you.
Please confirm your agreement with the foregoing by signing and returning
to the undersigned the duplicate copy of this letter enclosed herewith. IN
ACCORDANCE WITH SECTION 2.11(J) OF THE INDENTURE DATED AS OF OCTOBER 18, 2005
(THE "INDENTURE"), MADE BY AND BETWEEN YOU AND U.S. BANK NATIONAL ASSOCIATION,
AS TRUSTEE, WE WILL PROVIDE A FULLY EXECUTED COPY OF THIS RESALE CONFIDENTIALITY
AGREEMENT TO THE REGISTRAR (AS DEFINED IN THE INDENTURE) PROMPTLY AFTER RECEIPT
THEREOF FROM YOU.
Very truly yours,
----------------------------------------
[Please insert prospective purchaser's
name]
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
Address:
-------------------------------
Accepted and agreed as of the date first written above:
DULOXETINE ROYALTY SUB
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
B-4
EXHIBIT C
AGENTS FOR SERVICE OF PROCESS
Party Jurisdiction Appointed Agent
----- ------------ ---------------
Duloxetine Royalty Sub Cayman Islands Walkers SPV Limited
Duloxetine Royalty Sub New York CT Corporation System
U.S. Bank National Association, New York U.S. Bank Trust National Association
as Trustee
C-1
EXHIBIT D
COVERAGE OF DISTRIBUTION REPORT
(i) With respect to the current Payment Date, (A) the balances on deposit in
the Collection Account and any other Account established under the
Intercreditor Agreement on the Calculation Date immediately preceding the
prior Payment Date (or, with respect to the first Payment Date, on the
Closing Date) (the "Preceding Calculation Date"), (B) the aggregate amounts
of deposits into and withdrawals from the Collection Account and any other
Account established under the Intercreditor Agreement from but excluding
the Preceding Calculation Date to and including the Calculation Date
immediately preceding the Payment Date (the "Current Calculation Date") and
(C) the balances on deposit in the Collection Account and any other Account
established under the Intercreditor Agreement on the Current Calculation
Date.
(ii) Analysis of Collection Account activity from the Preceding Calculation Date
to the Current Calculation Date
Balance on the Preceding Calculation Date
Collections from but excluding the Preceding Calculation Date to and
including the Current Calculation Date ("Current Collections")
Aggregate Loan and other First Lien Document payments from but excluding
the Preceding Calculation Date to and including the Current Calculation
Date
Aggregate Note payments from but excluding the Preceding Calculation Date
to and including the Current Calculation Date
Expense payments payable on the Current Calculation Date ("Current
Expenses")
Balance on the Current Calculation Date
(iii) Interest Coverage Ratio
Current Collections
Interest due on the Outstanding Principal Balance of the Notes for the
current Payment Date plus Current Expenses
Interest Coverage Ratio for the current Payment Date
Required Interest Coverage Ratio for the current Payment Date
(iv) Amount, if any, to be transferred from the Holding Account to the
Collection Account with respect to the current Payment Date
(v) Payments on the current Payment Date
Current Expenses
Interest Amount of Loans
Interest Amount of Notes
Additional interest on Loans, if any
Additional Interest, if any
Principal payments of Loans and other obligations under First Lien
Documents
Principal payments of Notes, if any
D-1
Amounts transferred to the Holding Account, if any
(vi) Aggregate principal amount of Loans
Opening balance
Principal payments made on the current Payment Date
Closing balance
(vii) Outstanding Principal Balance of Notes
Opening Outstanding Principal Balance
Principal payments, if any, made on the current Payment Date
Closing Outstanding Principal Balance
(viii) Amount distributed to Royalty Sub from the Collection Account, if any,
with respect to the current Payment Date
(ix) Amount distributed to Royalty Sub from the Holding Account, if any, with
respect to the current Payment Date
(x) A comparison of the actual Outstanding Principal Balance of the Notes to
the Scheduled Remaining Notes Balance as of the current Payment Date
(xi) A withholding obligation may be included
(xii) Appropriate modifications will be made to contemplate any Refinancing
Notes and/or Class B Notes
D-2
EXHIBIT E
FORM OF CERTIFICATE OF EUROCLEAR OR CLEARSTREAM FOR
PERMANENT REGULATION S GLOBAL NOTE
__________, 20__
U.S. Bank National Association,
as Trustee
Xxx Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Corporate Trust Services (Duloxetine Royalty Sub)
Duloxetine Royalty Sub
c/o Walkers SPV Limited
P.O. Box 908GT, Xxxxxx House
Xxxx Street, Xxxxxx Town, Grand Cayman
Cayman Islands
Attention: The Director
Re: Duloxetine Royalty Sub ("Royalty Sub")
Ladies and Gentlemen:
This letter relates to U.S.$__________ principal amount of Duloxetine
PhaRMA(SM) Second Lien 13% Notes Due 2013 of Royalty Sub (the "Notes")
represented by a Note which bears a legend (the "Legended Note") outlining
restrictions upon transfer of such Legended Note. Pursuant to Section 2.1 of the
Indenture dated as of October 18, 2005 (the "Indenture") relating to the Notes
and certain other classes of notes of Royalty Sub, we hereby certify that we are
(or we will hold such securities on behalf of) an institution outside the United
States to whom the Notes may be transferred in accordance with Rule 904 of
Regulation S promulgated under the U.S. Securities Act of 1933, as amended
("Regulation S"). Accordingly, you are hereby requested to exchange the Legended
Note for a Permanent Regulation S Global Note (as defined in the Indenture)
representing an identical principal amount of Notes, all in the manner provided
for in the Indenture.
Each of you is entitled to rely upon this letter and is irrevocably
authorized to produce this letter or a copy hereof to any interested party in
any administrative or legal proceeding or official inquiry with respect to the
matters covered hereby. Certain terms used in this certificate have the meanings
set forth in Regulation S.
Very truly yours,
[Euroclear Bank S.A./N.V.]
[Clearstream Banking]
By:
------------------------------------
Authorized Signatory
E-1
EXHIBIT F
FORM OF CERTIFICATE OF BENEFICIAL OWNER OF TEMPORARY
REGULATION S GLOBAL NOTE
Euroclear Bank S.A./N.V.
[Address]
AND/OR
Clearstream Banking
[Address]
Re: Duloxetine Royalty Sub ("Royalty Sub")
Reference is hereby made to the Indenture, dated as of October 18, 2005
(the "Indenture"), made by and between Royalty Sub and U.S. Bank National
Association, as trustee (the "Trustee"). Capitalized terms used but not defined
herein shall have the meanings given to them in the Indenture.
This letter relates to U.S.$__________ principal amount of Duloxetine
PhaRMA(SM) Second Lien 13% Notes Due 2013 that are held in the form of a
Beneficial Interest in the Temporary Regulation S Global Note (CUSIP No.
__________) through DTC by the undersigned (the "Holder") in the name of
__________. The Holder of such Temporary Regulation S Global Note hereby
requests the receipt of payments due and payable [on the applicable Payment
Date] pursuant to Section 2.5 of the Indenture.
The Holder hereby represents and warrants that it (i) is not a U.S. Person,
(ii) does not hold the above-referenced Temporary Regulation S Global Note for
the account or benefit of a U.S. Person (other than a distributor) and (iii) has
executed and delivered to the Registrar a Confidentiality Agreement. Certain
terms in this certificate not otherwise defined in the Indenture have the
meanings given to them in Regulation S.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Paying Agent.
[Name of Holder]
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
F-1
EXHIBIT G
FORM OF CERTIFICATE OF EUROCLEAR OR CLEARSTREAM FOR PAYMENTS
U.S. Bank National Association,
as Paying Agent
Xxx Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Corporate Trust Services (Duloxetine Royalty Sub)
Re: Duloxetine Royalty Sub ("Royalty Sub")
Reference is hereby made to the Indenture, dated as of October 18, 2005
(the "Indenture"), made by and between Royalty Sub and U.S. Bank National
Association, as trustee (the "Trustee"). Capitalized terms used but not defined
herein shall have the meanings given to them in the Indenture.
This letter relates to U.S.$__________ principal amount of Duloxetine
PhaRMA(SM) Second Lien 13% Notes Due 2013 that are held in the form of a
Beneficial Interest in the Temporary Regulation S Global Note (CUSIP No.
__________) through DTC by the undersigned (the "Holder") in the name of
__________. Certain Holders of the Beneficial Interests in such Temporary
Regulation S Global Note have requested the receipt of payments due and payable
[on the applicable Payment Date] pursuant to Section 2.5 of the Indenture.
We have received from such Holders certifications to the effect that they
(i) are not U.S. Persons, (ii) do not hold the above-referenced Temporary
Regulation S Global Note for the account or benefit of U.S. Persons (other than
distributors) and (iii) have executed and delivered to the Registrar a
Confidentiality Agreement. Certain terms in this certificate not otherwise
defined in the Indenture have the meanings given to them in Regulation S.
Accordingly, the Holders of the Beneficial Interests in the Temporary
Regulation S Global Note are entitled to receive interest, principal and
premium, if any, in accordance with the terms of the Indenture in the amount of
U.S.$__________.
[Clearstream Banking]
[Euroclear Bank S.A./N.V.]
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
G-1
EXHIBIT H
FORM OF CERTIFICATE OF PROPOSED TRANSFEROR
__________, 20__
U.S. Bank National Association,
as Registrar
Xxx Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Corporate Trust Services (Duloxetine Royalty Sub)
Duloxetine Royalty Sub
c/o Walkers SPV Limited
P.O. Box 908GT, Xxxxxx House
Xxxx Street, Xxxxxx Town, Grand Cayman
Cayman Islands
Attention: The Director
Re: Duloxetine Royalty Sub ("Royalty Sub")
Ladies and Gentlemen:
In connection with our proposed sale of U.S.$__________ aggregate principal
amount of Duloxetine PhaRMA(SM) Second Lien 13% Notes Due 2013 of Royalty Sub
(the "Notes"), we confirm that such sale has been effected pursuant to and in
accordance with Regulation S under the U.S. Securities Act of 1933, as amended
("Regulation S") and, accordingly, we represent that:
(1) the offer of the Notes was not made to a person in the U.S.;
(2) at the time the buy order was originated, the transferee was an
institution outside the U.S. or we and any person acting on our behalf
reasonably believed that the transferee was an institution outside the U.S.;
(3) no directed selling efforts have been made by us in the U.S. in
contravention of the requirements of Rule 903(b) or Rule 904(b) of Regulation S,
as applicable;
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the U.S. Securities Act of 1933; and
(5) the transferee has entered into the confidentiality agreement required
in connection with the purchase of the Notes.
Each of you is entitled to rely upon this letter and is irrevocably
authorized to produce this letter or a copy hereof to any interested party in
any administrative or legal proceeding or official inquiry with respect to the
matters covered hereby. Certain terms used in this certificate have the meanings
set forth in Regulation S.
H-1
Very truly yours,
[Name of Transferor]
By:
------------------------------------
Authorized Signatory
H-2
EXHIBIT I
FORM OF CERTIFICATE OF PROPOSED INSTITUTIONAL ACCREDITED
INVESTOR TRANSFEREE
__________, 20__
U.S. Bank National Association,
as Registrar
Xxx Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Corporate Trust Services (Duloxetine Royalty Sub)
Duloxetine Royalty Sub
c/o Walkers SPV Limited
P.O. Box 908GT, Xxxxxx House
Xxxx Street, Xxxxxx Town, Grand Cayman
Cayman Islands
Attention: The Director
Ladies and Gentlemen:
In connection with our proposed purchase of Notes (the "Notes") of
Duloxetine Royalty Sub ("Royalty Sub"), we confirm that:
1. We have duly executed and delivered to the Registrar (as defined in that
certain Indenture dated as of October 18, 2005 (the "Indenture") between Royalty
Sub and U.S. Bank National Association, as trustee, as amended, restated,
supplemented or otherwise modified from time to time in accordance with the
terms thereof) a Resale Confidentiality Agreement and have subsequently received
a copy of the Private Placement Memorandum dated October 14, 2005 (the "Private
Placement Memorandum") relating to the Notes and such other information as we
deem necessary in order to make our investment decision. We acknowledge that we
have read and agreed to the matters stated in the section entitled "Transfer
Restrictions" of such Private Placement Memorandum and the restrictions on
duplication and circulation of such Private Placement Memorandum.
2. We understand that any subsequent transfer of the Notes is subject to
certain restrictions and conditions set forth in the Private Placement
Memorandum under "Transfer Restrictions" and the undersigned agrees to be bound
by, and not to resell, pledge or otherwise transfer the Notes except in
compliance with, such restrictions and conditions and the U.S. Securities Act of
1933, as amended (the "Securities Act").
3. We understand that the offer and sale of the Notes have not been
registered under the Securities Act, that the Notes will only be in the form of
definitive physical certificates and that the Notes may not be offered or sold
except as permitted in the following sentence. We agree, on our own behalf and
on behalf of any accounts for which we are acting as hereinafter stated, that,
if we should sell any Notes in the future, we will do so only (1) (A) to Royalty
Sub or any subsidiary thereof, (B) in accordance with Rule 144A under the
Securities Act to a
I-1
qualified institutional buyer (as defined therein), (C) to an institutional
accredited investor (as defined in Rule 501(a)(1), (2), (3) or (7) of Regulation
D under the Securities Act) that, prior to such transfer, furnishes to the
Trustee (as defined in the Indenture) a signed letter containing certain
representations and agreements relating to the restrictions on transfer of the
Notes (the form of which letter can be obtained from the Trustee) and an opinion
of counsel acceptable to Royalty Sub that such transfer is in compliance with
the Securities Act, (D) to an institution in an offshore transaction in
compliance with Rule 904 of Regulation S under the Securities Act or (E) to an
institution after the time period referred to in Rule 144(k) under the
Securities Act expires, and we further agree to provide to any person or entity
purchasing any of the Notes from us a notice advising such purchaser that
resales of the Notes are restricted as stated herein and (2) in each case, in
accordance with any applicable securities laws of any state in the U.S. or any
other applicable jurisdiction and in accordance with the legend to be set forth
in the Notes, which will reflect the substance of this paragraph.
4. We understand that, on any proposed resale of any Notes, we will be
required to furnish to Royalty Sub and the Trustee such certifications, legal
opinions and other information as Royalty Sub and the Trustee may reasonably
require to confirm that the proposed sale complies with the foregoing
restrictions. We further understand that a resale confidentiality agreement is
required under the Indenture to be executed and delivered by any proposed
transferee to whom we wish to sell any Notes.
5. We are an institutional accredited investor and have such knowledge and
experience in financial and business matters as to be capable of evaluating the
merits and risks of our investment in the Notes, and we and any accounts for
which we are acting are able to bear the economic risks of our or their
investment.
6. We are acquiring the Notes purchased by us for our own account or for
one or more accounts (each of which is an institutional accredited investor) as
to each of which we exercise sole investment discretion.
7. We are not acquiring the Notes with a view to distribution thereof or
with any present intention of offering or selling the Notes, except as permitted
above, provided that the disposition of our property and property of any
accounts for which we are acting as fiduciary shall remain at all times within
our control.
You, Royalty Sub and the Trustee are entitled to rely upon this letter and
are irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceeding or official inquiry
with respect to the matters covered hereby.
Very truly yours,
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
I-2
EXHIBIT J
UCC FINANCING STATEMENTS
1. A Form UCC-1 Financing Statement will be filed with the Recorder of Deeds
of Washington, D.C. naming Royalty Sub as debtor and the Trustee as secured
party.
J-1
