Exhibit 4.1
EXECUTION COPY
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INDENTURE
dated as of February 1, 2005
by and between
RC ROYALTY SUB LLC,
a Delaware limited liability company,
as issuer of the Notes,
and
U.S. BANK NATIONAL ASSOCIATION,
as initial trustee of the Notes
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Table of Contents
Page
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Article I DEFINITIONS....................................................................................... 3
Section 1.01 Definitions...................................................................... 3
Section 1.02 Rules of Construction............................................................ 20
Section 1.03 Compliance Certificates and Opinions............................................. 21
Section 1.04 Acts of Noteholders.............................................................. 21
Article II THE NOTES........................................................................................ 22
Section 2.01 Amount Not to Exceed the Initial Outstanding Principal Balance; Terms; Form;
Execution and Delivery........................................................... 22
Section 2.02 Restrictive Legends.............................................................. 24
Section 2.03 Registrar and Paying Agent....................................................... 27
Section 2.04 Paying Agent to Hold Money in Trust.............................................. 28
Section 2.05 Method of Payment................................................................ 28
Section 2.06 Minimum Denomination............................................................. 29
Section 2.07 Transfer and Exchange; Cancellation.............................................. 29
Section 2.08 Mutilated, Destroyed, Lost or Stolen Notes....................................... 30
Section 2.09 Payments of Transfer Taxes....................................................... 30
Section 2.10 Book-Entry Provisions............................................................ 30
Section 2.11 Special Transfer Provisions...................................................... 32
Section 2.12 Temporary Definitive Notes....................................................... 35
Section 2.13 Statements to Noteholders........................................................ 35
Section 2.14 CUSIP, CINS AND ISIN Numbers..................................................... 37
Section 2.15 Refinancing Notes................................................................ 37
Section 2.16 Class B Notes.................................................................... 38
Section 2.17 Class A Notes.................................................................... 39
Article III ACCOUNTS; PRIORITY OF PAYMENTS.................................................................. 40
Section 3.01 Establishment of Accounts........................................................ 40
Section 3.02 Investments of Cash.............................................................. 41
Section 3.03 Closing Date Deposits, Withdrawals and Transfers................................. 42
Section 3.04 Special Distribution Dates; True-up Payments..................................... 42
Section 3.05 Calculation Date Calculations.................................................... 43
Section 3.06 Payment Date or Special Distribution Date First Step Transfers................... 46
Section 3.07 Payment Date or Special Distribution Date Second Step Withdrawals................ 47
Section 3.08 Redemptions...................................................................... 48
Section 3.09 Procedure for Redemptions........................................................ 49
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Article IV DEFAULT AND REMEDIES............................................................................. 50
Section 4.01 Events of Default................................................................ 50
Section 4.02 Acceleration, Rescission and Annulment........................................... 51
Section 4.03 Other Remedies................................................................... 52
Section 4.04 Limitation on Suits.............................................................. 53
Section 4.05 Waiver of Existing Defaults...................................................... 54
Section 4.06 Restoration of Rights and Remedies............................................... 54
Section 4.07 Remedies Cumulative.............................................................. 54
Section 4.08 Authority of Courts Not Required................................................. 55
Section 4.09 Rights of Noteholders to Receive Payment......................................... 55
Section 4.10 Trustee May File Proofs of Claim................................................. 55
Section 4.11 Undertaking for Costs............................................................ 55
Section 4.12 Control by Noteholders........................................................... 55
Section 4.13 Controlling Party................................................................ 55
Section 4.14 Application of Proceeds.......................................................... 56
Section 4.15 Waivers of Rights Inhibiting Enforcement......................................... 56
Article V REPRESENTATIONS, WARRANTIES AND COVENANTS......................................................... 56
Section 5.01 Representations and Warranties................................................... 56
Section 5.02 Covenants........................................................................ 58
Section 5.03 Reports by the Issuer............................................................ 60
Article VI THE TRUSTEE...................................................................................... 60
Section 6.01 Acceptance of Trusts and Duties.................................................. 60
Section 6.02 Absence of Duties................................................................ 61
Section 6.03 Representations or Warranties.................................................... 61
Section 6.04 Reliance; Agents; Advice of Counsel.............................................. 61
Section 6.05 Not Acting in Individual Capacity................................................ 62
Section 6.06 Compensation of Trustee.......................................................... 62
Section 6.07 Notice of Defaults............................................................... 62
Section 6.08 May Hold Notes................................................................... 63
Section 6.09 Corporate Trustee Required; Eligibility.......................................... 63
Section 6.10 Reports by the Trustee........................................................... 63
Section 6.11 Calculation Agent................................................................ 63
Section 6.12 Pledge Agreement................................................................. 63
Article VII SUCCESSOR TRUSTEES.............................................................................. 63
Section 7.01 Resignation and Removal of Trustee............................................... 63
Section 7.02 Appointment of Successor......................................................... 64
Article VIII INDEMNITY...................................................................................... 65
Section 8.01 Indemnity........................................................................ 65
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Section 8.02 Noteholders' Indemnity........................................................... 65
Section 8.03 Survival......................................................................... 65
Article IX MODIFICATION..................................................................................... 65
Section 9.01 Modification with Consent of Holders............................................. 65
Section 9.02 Modification Without Consent of Holder........................................... 66
Section 9.03 Subordination and Priority of Payments........................................... 66
Section 9.04 Execution of Amendments by Trustee............................................... 67
Section 9.05 Conformity with Trust Indenture Act.............................................. 67
Article X SUBORDINATION..................................................................................... 67
Section 10.01 Subordination of the Notes....................................................... 67
Article XI DISCHARGE OF INDENTURE........................................................................... 68
Section 11.01 Discharge of Liability on the Notes.............................................. 68
Article XII MISCELLANEOUS................................................................................... 69
Section 12.01 Right of Trustee to Perform...................................................... 69
Section 12.02 Waiver........................................................................... 69
Section 12.03 Severability..................................................................... 69
Section 12.04 Restrictions on Exercise of Certain Rights....................................... 69
Section 12.05 Notices.......................................................................... 70
Section 12.06 Assignments...................................................................... 70
Section 12.07 Reserved......................................................................... 71
Section 12.08 Governing Law.................................................................... 71
Section 12.09 Jurisdiction; WAIVER OF JURY TRIAL............................................... 71
Section 12.10 Counterparts..................................................................... 71
Section 12.11 Table of Contents, Headings, Etc................................................. 71
Section 12.12 Trust Indenture Act.............................................................. 71
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Schedules
Schedule 1 - Class A Principal Payment Schedule
Exhibits
Exhibit A - Form of Class A Note
Exhibit B - [Reserved]
Exhibit C - Form of Distribution Report
Exhibit D - Form of Certificate
Exhibit E - Form of Certificate to be Delivered in Connection with
Transfers Pursuant to Regulation S
Exhibit F - Form of Certificate to be Delivered in Connection with
Transfers to Non-QIB Accredited Investors
Exhibit G-1 - Form of Certificate to DTC Regarding Interest
Exhibit G-2 - Form of DTC Certificate Regarding Interest
Exhibit H - Form of Confidentiality Agreement
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INDENTURE
This INDENTURE, dated as of February 1, 2005 (this "Indenture"), is
entered into by and between RC ROYALTY SUB LLC, a Delaware limited liability
company, as issuer of the Notes (the "Issuer"), and U.S. BANK NATIONAL
ASSOCIATION, a national banking association, as initial trustee of the Notes
(the "Trustee").
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, without limitation, any break funding
costs; (ii) payment of any fees, expenses or other amounts that the Issuer is
obligated to pay under or in respect of the Notes, this Indenture or any Related
Document to which the Issuer is a party; (iii) the payment and performance of
all the obligations of the Issuer in respect of any amendment, modification,
extension, renewal or refinancing of the Notes; and (iv) the performance and
observance by the Issuer 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, the Issuer 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 first priority security interest
in all right, title and interest of the Issuer 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 Rights;
(2) The Contingent License;
(3) The Purchase and Sale Agreement, Servicing Agreement and all other
agreements to which the Issuer is a party relating to the rights of the Issuer
in respect of the, sale, contribution, transfer and servicing of the Royalty
Rights;
(4) All Hedge Agreements to which the Issuer is a party;
(5) (A) All Accounts established under the Indenture at any time
established, (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, (D) all interest, principal
payments, 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;
(6) all of the Issuer's rents, issues, profits, revenues and other
income of the property subjected or required to be subjected to the lien of this
Indenture;
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(7) all other general intangibles, instruments, investment property, and
documents of the Issuer;
(8) all rights of the Issuer (contractual and otherwise and whether
constituting accounts, general intangibles or investment property or financial
assets) constituting, arising under, connected with, or in any way related to,
any or all of the foregoing property;
(9) all books, records, ledger cards, files, correspondence, computer
programs, tapes, disks and related data processing software (owned by the
Issuer) 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;
(10) 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 the Issuer; and
(11) all proceeds and products of any and all of the foregoing property;
SUBJECT TO all of the terms and conditions of this Indenture:
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, the Issuer shall have the right, to the exclusion of
the Trustee and the Noteholders, to exercise in the Issuer's name all rights and
powers of the Issuer with respect to the Collateral, SUBJECT TO all of the terms
and conditions of this Indenture;
It is expressly agreed that anything herein contained to the contrary
notwithstanding, the Issuer shall remain liable under the contracts and
agreements included in the Collateral to the extent set forth therein to perform
all of the obligations of the Issuer thereunder in accordance with and pursuant
to the terms and provisions thereof, and, prior to the foreclosure of the lien
under Section 4.03 of this Indenture, the Trustee and the Holders of the Notes
shall have no obligation or liability under any thereof by reason of or arising
out of the collateral assignment hereunder, nor shall the Trustee or the Holders
of the Notes be required or obligated in any manner to perform or fulfill any
obligations of the Issuer under or pursuant to any contracts and agreements
included in the Collateral or, except as herein expressly provided, to make any
payment, or to make any inquiry as to the nature or sufficiency of any payment
received by it, or present or file any claim, or take any action to collect or
enforce the payment of any amounts which may have been assigned to it or to
which it may be entitled at any time or times; provided, however, that in
exercising any right of the Issuer under any contracts and agreements included
in the Collateral, the Trustee and the Holders of the Notes shall be bound by,
and comply with, the provisions thereof applicable to the Issuer.
The Issuer does hereby irrevocably appoint the Trustee as its true and
lawful attorney-in-fact, granted for good and valuable consideration and coupled
with an interest and with full power of
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substitution, and with full power (in the name of the Issuer 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 Related Document and
all other property which now or hereafter constitutes part of the Collateral, 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 to accomplish the purposes hereof;
provided that the Trustee shall not exercise any such rights except in
accordance with Section 4.03 hereof.
The Issuer agrees that at any time and from time to time, upon written
request of the Trustee, the Issuer will promptly and duly execute and deliver or
cause to be duly executed and delivered any and all such further instruments and
documents as the Trustee may reasonably deem necessary or advisable in obtaining
the full benefits of the collateral assignment granted hereunder and of the
rights and powers herein granted.
It is hereby further agreed that any and all property described or
referred to in the granting clauses hereof which is hereafter acquired by the
Issuer shall ipso facto, and without any other conveyance, assignment or act on
the part of the Issuer 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 the Issuer 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 are used in this Granting 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 this Granting Clause,
including the terms "account" and "security interest", when capitalized, shall
have the meanings specified in Section 1.01 below.
The Issuer is subject to the other terms of this Indenture and to the
terms of the Related Documents and 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 collateral 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 1.01 Definitions. For purposes of this Indenture, the following
terms shall have the meanings indicated below:
"Acceleration Default" means any Event of Default of the type described in
Section 4.01(e) or Section 4.01(f) hereof.
"Acceleration Notice" means a written notice given after the occurrence
and continuation of an Event of Default to the Issuer by the Senior Trustee at
the instruction of the Noteholders representing a majority of the aggregate
Outstanding Principal Balance of the Senior Class of Notes, declaring all
Outstanding principal of and accrued and unpaid interest on the Notes to be
immediately due and payable.
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"Accounts" means the Collection Account, the Capital Account, the IO
Period Account, any Redemption Account and any other account established
pursuant to Section 3.01.
"Act" has the meaning, with respect to any Noteholder, given to such term
in Section 1.04 hereof.
"ACT II" means Alkermes Controlled Therapeutics Inc. II, a Pennsylvania
corporation.
"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 Yield of such Notes for each Interest Accrual
Period until any such unpaid interest or Premium is paid in full, to the fullest
extent permitted by Applicable Law.
"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 or officer of such Person; "control" of a
Person means the possession, directly or indirectly, of the power to direct or
cause the direction of the management and policies of such Person, whether
through the ownership of voting Stock, by contract or otherwise.
"Agent Members" has the meaning given to such term in Section 2.10 hereof.
"Annual Report" has the meaning given to such term in Section 2.13(a)
hereof.
"Applicable Law" means, with respect to any Person, all laws, rules,
regulations and orders of governmental regulatory authorities applicable to such
Person or any of its properties or assets.
"Authorized Agent" means, with respect to the Notes, any authorized Paying
Agent or Registrar for such Notes.
"Available Collections Amount" means, as of any Payment Date or Special
Distribution Date, the sum of (a) the amount on deposit in the Collection
Account as of the Calculation Date immediately preceding such Payment Date or
Special Distribution Date, (b) the amount of any Hedge Receipts due on such
Payment Date or Special Distribution Date and (c) the amount of the investment
earnings on amounts in the IO Period Account and the Capital Account determined
in accordance with Section 3.05(a)(i) and to be transferred to the Collection
Account on such Payment Date or Special Distribution Date.
"Basic Terms Modification" has the meaning given to such term in Section
9.01 hereof.
"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.
"Board" means the Managers of the Issuer, including the Independent
Manager.
"Board Resolution" means a copy of a resolution certified by a Manager
(other than the Independent Manager) as having been duly adopted by the Board
and being in full force and effect on the date of such certification.
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"Business Day" means any day except a Saturday, Sunday or other day on
which commercial banks in New York, New York or Boston, Massachusetts are
authorized or required by law or executive order to remain closed or a day on
which the Corporate Trust Office of the Trustee is closed for business and, for
purposes of calculating LIBOR, a day on which dealings in deposits in U.S.
dollars are transacted, or with respect to any future date, are expected to be
transacted in the London interbank market.
"Calculation Agent" means U.S. Bank and any successor appointed as
Calculation Agent pursuant to Section 6.11.
"Calculation Date" means, for any Payment Date or Special Distribution
Date, the fifth Business Day immediately preceding such Payment Date or Special
Distribution Date.
"Capital Account" has the meaning set forth in Section 3.01(a) hereof.
"Class B Issuance" has the meaning given to such term in Section 2.16(a)
hereof.
"Class A Notes" means the Risperdal Consta(R) PhaRMA(SM) Secured 7% Notes,
due January 1, 2018, Class A of the Issuer in the initial aggregate principal
amount of $170,000,000, substantially in the form of Exhibit A hereto, and any
Refinancing Notes issued to refinance the Class A Notes.
"Class A Principal Payment Schedule" means the schedule of Schedule
Principal Payment Amounts set forth in Schedule 1 to this Indenture, as adjusted
pursuant to Section 2.17.
"Class B Notes" means the Class B Notes, if any, issued in such form as
shall be authorized by a Board Resolution and any supplemental indenture in
respect thereof and any Refinancing Notes issued to refinance the Class B Notes.
"Clearstream" means Clearstream Banking, a French societe anonyme.
"Closing Date" means the date of issuance of the Class A Notes.
"Code" means the Internal Revenue Code of 1986, as amended.
"Collateral" has the meaning given to such term in the Granting Clause
herein.
"Collection Account" has the meaning given to such term in Section 3.01(a)
hereof.
"Collections" means, without duplication, (i) Royalty Payments received by
the Issuer; (ii) investment income, if any, on all amounts on deposit in the
Accounts, (iii) Minimum Revenue Payments received by the Issuer, (iv) Hedge
Receipts and (v) any other amounts received by the Issuer (other than the
proceeds of the Class A Notes, any Class B Notes, any Refinancing Notes and
capital contributions from ACT II).
"Compound" means the active ingredient risperidone.
"Confidentiality Agreement" means a Confidentiality Agreement
substantially in the form of Exhibit H attached hereto.
"Contingent License" means the Contingent License and Right to Use
Agreement, dated as of February 1, 2005, between the Issuer and ACT II as
amended, restated or supplemented from time to time.
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"control" has the meaning given to such term in the definition of
"Affiliate," and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
"Controlling Party" means the Person entitled to act as such pursuant to
the terms of Section 4.13 hereof.
"Corporate Obligations" means obligations of corporate issuers.
"Corporate Trust Office" means, with respect to the Trustee, the office of
the Trustee in the city at which at any particular time the trust created by
this Indenture shall be principally administered and, with respect to the
Trustee on the date hereof, shall be U.S. Bank National Association, Xxx Xxxxxxx
Xxxxxx, 0xx Xxxxx, Xxxxxx, XX 00000, Attention: Corporate Trust Services (ref:
RC Royalty Sub LLC 2005 Indenture), Facsimile No: (000) 000-0000.
"Default" means a condition, event or act which, 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 Class A Notes when such amount becomes due
on any Payment Date other than the Final Maturity 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, unless waived as
provided in Section 4.05.
"Deferred Excess IO Period Distribution Test" means, for any Payment Date
during the Interest Only Period, satisfaction of the Distribution Conditions on
such Payment Date and on the immediately preceding three consecutive Payment
Dates.
"Definitive Notes" has the meaning given to such term in Section 2.01(b)
hereof.
"Direction" has the meaning given to such term in Section 1.04(c) hereof.
"Distribution Conditions" has the meaning set forth in Section 3.05(c).
"Distribution Report" has the meaning given to such term in Section
2.13(a) hereof.
"Drug" means the polylactide glycolic acid depot formulation of
risperidone known as Risperdal Consta, as specified in NDA #21-346, as such NDA
may be amended from time to time.
"DTC" means The Depository Trust Company, its nominees and their
respective successors.
"Eligibility Requirements" has the meaning given to such term in Section
2.03(b) hereof.
"Eligible Account" means a trust account maintained on the books and
records of an Eligible Institution in the name of the Trustee under and as
defined herein.
"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 A2 or better by Moody's and A or better by Fitch and S&P or (B) a
certificate of deposit rating of P-1 by Moody's, 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 which evidence:
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(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 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 depository institution or trust company shall be at least "F1" by
Fitch, "P-1" by Moody's and "A-1" by S&P 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 xxxxx "X0" from Moody's and "A" from
Fitch and S&P;
(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 "F1" or "A"
by Fitch, "P-1" or "A2" by Moody's and "A-1" or "A" by S&P 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 xxxxx "X0" from
Moody's and "A" from Fitch and S&P;
(d) investments in money market funds (including funds in respect
of which the Trustee or any of its Affiliates is investment manager or
otherwise) or U.S. Bank's Insured Money Market Account ("IMMA"), in each
case having a rating of at least "A" by Fitch and "A2" by Moody's; 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 (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 Trustee from the Issuer as having a contractual right to set off and
apply any deposits held, and other indebtedness owing, by the Issuer to or for
the credit or the account of such depository institution or trust company.
"Encumbrance" means any mortgage, pledge, lien, charge, security interest
or other encumbrance, including, without limitation, any conditional sale, any
sale with recourse against the Issuer, or any agreement to give any security
interest.
"Escrow Account" has the meaning set forth in Section 3.01(a).
"Euroclear" means Euroclear Bank S.N./N.V., as operator of the Euroclear
System.
"Event of Default," with respect to a class of Notes, has the meaning
given to such term in Section 4.01 hereof.
"Excess IO Period Payment Amount" means, for any Payment Date during the
Interest Only Period, the amount, if any, by which (a) the Available Collection
Amount for such Payment Date (minus any lump sum payment of Minimum Revenue
Payments received by the Issuer in the Collections on
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deposit in the Collection Account on the related Calculation Date) exceeds (b)
the sum of (i) the Interest Amount for such Payment Date and (ii) the Expenses
due and payable on such Payment Date.
"Exchange Act" means the U.S. Securities Exchange Act of 1934, as amended.
"Expenses" means, with respect to the Issuer, any fees, costs or expenses
of the Issuer, including, without limitation, the fees and expenses of the
Trustee and the Service Providers, reasonable fees and out-of-pocket
disbursements of counsel to the Trustee and the Issuer incurred in connection
with the transactions contemplated by the Related Documents, any commitment fee
payable to a Hedge Provider, any reimbursement to ACT II of a refund of a
manufacturing fee and of any payment for Compound pursuant to Section 2.7 or
Section 4.2 of the Manufacturing and Supply Agreement, and any payments under
indemnity obligations of the Issuer to any Person other than ACT II; provided,
however, that, except as expressly provided herein, Expenses shall not include
any Transaction Expenses, any amount payable on the Notes, any Hedge Payments or
Hedge Breakage Costs or any other amounts ranking pari passu with or junior to
interest payable on the Class A Notes in the priority of payments set forth
under Section 3.07 of this Indenture.
"Field" means the treatment of psychosis in humans. For purposes of this
definition, "psychosis" shall include, but not be limited to, schizophrenia and
related disorders, manic-depressive disorders, behavioral disturbances in
dementia including for the avoidance of doubt behavioral disturbances related to
Alzheimer's disease.
"Final Maturity Date" means, with respect to, (i) the Class A Notes,
January 1, 2018, and (ii) with respect to any Class B Notes or any Refinancing
Notes, the date specified in the Indenture Supplement providing for their
issuance.
"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 rating agency designated by the Issuer and meeting
the definition of "nationally recognized statistical rating organization," as
set forth in the rules promulgated under the Exchange Act.
"Fixed Rate Notes" means the Class A Notes and any Class B Notes or
Refinancing Notes issued with a fixed rate of interest.
"Floating Rate Bonds" means any Class B Notes and Refinancing Notes issued
with a floating or variable rate of interest.
"Fourth Amendment" means the Fourth Amendment to Manufacturing and Supply
Agreement, dated as of January 10, 2005, between ACT II and Xxxxxxx.
"Global Notes" means any Permanent Global Notes and Regulation S Global
Notes.
"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 (i) 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 (ii) 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
-8-
collection or deposit in the ordinary course of business. The term "guarantee"
when used as a verb has a corresponding meaning.
"Hedge Agreement" means any interest rate hedge, cap, floor, swap option,
or other interest rate hedging agreement among the Issuer and any Hedge Provider
existing on the Closing Date or entered into in accordance with Section 5.02(g)
of this Indenture.
"Hedge Breakage Costs" means any amounts payable by the Issuer to a Hedge
Provider as a result of any early termination (however described or defined
therein) of any Hedge Agreement.
"Hedge Payment" means, on the funding date for any Notes or on any Payment
Date, a net payment to a Hedge Provider by the Issuer, but not including Hedge
Breakage Costs.
"Hedge Provider" means the counterparty of the Issuer under any Hedge
Agreement.
"Hedge Receipt" means a net payment to be made by a Hedge Provider into
the Collection Account under a Hedge Agreement and includes any termination
payment received from any counterparty to a Hedge Agreement.
"Holder" has the meaning specified in the definition of "Noteholders."
"Improvements" means any improvements or developments in and to or of the
Patents and Technical Information in the Field which ACT II may acquire,
discover, invent, originate, make, conceive or have a right to, in whole or in
part, during the term of the License Agreements, whether or not such improvement
or development is patentable.
"incur" has the meaning given to such term in Section 5.02(d) hereof.
"Indebtedness" means, with respect to any Person at any date of
determination (without duplication), (i) all indebtedness of such Person for
borrowed money, (ii) all obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments, (iii) 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), (iv) 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 six months 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, (v) all
obligations of such Person under a lease of (or other agreement conveying the
right to use) any property (whether real, personal or mixed) that is required to
be classified and accounted for as a capital lease obligation under U.S. GAAP,
(vi) all Indebtedness (as defined in clauses (i) through (v) of this paragraph)
of others secured by a lien on any asset of such Person, whether or not such
Indebtedness is assumed by such Person, and (vii) all Indebtedness (as defined
in clauses (i) through (v) of this paragraph) of others guaranteed by such
Person.
"Indenture" has the meaning set forth in the preamble hereof.
"Indenture Estate" has the meaning given to such term in the Granting
Clause of this Indenture.
"Independent Manager" means a Manager of the Issuer who is not at the time
of such person's appointment as a Manager and who is not, and who has not been
at any time during the preceding five (5) years: (i) a director, manager,
officer or employee of the Issuer (other than in the capacity of Independent
Manager) or any Affiliate of the Issuer (other than in the capacity of
Independent Manager),
-9-
(ii) a person related to any officer, director, manager or employee of the
Issuer (other than in the capacity of Independent Manager) or any Affiliate of
the Issuer(other than in the capacity of Independent Manager), (iii) a holder
(directly or indirectly) of any voting securities of the Issuer or any Affiliate
of the Issuer, (iv) a person related to a holder (directly or indirectly) of any
voting securities of the Issuer or any Affiliate of the Issuer, (v) a purchaser,
customer or any other Person who derives any of its revenues from interactions
with the Issuer or any Affiliate of the Issuer or a family member of such
purchaser, customer of other Person; (vi) a trustee in bankruptcy or other
insolvency proceedings for, or a reorganization of, ACT II or any subsidiary or
Affiliate of ACT II.
"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.
"Interest Accrual Period" means the period beginning on (and including)
the relevant Closing Date 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), provided that if there
is a Special Distribution Date during any Interest Accrual Period, such Interest
Accrual Period shall be divided into two Interest Accrual Periods for purposes
of calculating the Interest Amount on such Special Distribution Date and the
Payment Date at the end of such Interest Accrual Period, one Interest Accrual
Period for such Special Distribution date beginning on (and including) the
preceding Payment Date and ending on (but excluding) the Special Distribution
Date and a second Interest Accrual Period beginning on (and including) such
Special Distribution Date and ending on (but excluding) the next succeeding
Payment Date.
"Interest Amount" means, with respect to each class of Notes, on any
Payment Date or Special Distribution 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 or Special Distribution Date (including Additional Interest,
if any, and Supplemental Interest, if any), determined in accordance with the
terms thereof.
"Interest Only Period" means the period beginning on the Closing Date and
ending on January 1, 2009.
"Interest Shortfall" has the meaning given to such term in Section
3.05(e).
"investment" has the meaning given to such term in Section 5.02(b) hereof.
"IO Account Redemption" has the meaning given to such term in Section
3.08(b) hereof.
"IO Period Account" has the meaning given to such term in Section 3.01(a)
hereof.
"IO Period Account Balance" has the meaning given to such term in Section
3.05(a) hereof.
"Issuer" has the meaning set forth in the preamble hereof.
"Xxxxxxx" collectively, Xxxxxxx Pharmaceutica Inc., a New Jersey
corporation, JPI Pharmaceutica International, a division of a Swiss corporation,
and their respective successors and permitted assigns.
"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
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Accrual Period in amounts of not less than $1,000,000, as such rate appears on
Page 3750 on Moneyline Telerate (or such other page as may replace the 3750 page
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, "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 Calculation Agent shall
request the principal London offices of each of four major banks in the London
interbank market selected by the Calculation Agent to provide a quotation of the
rate (the "Rate Quotation") at which three-month deposits in amounts of not less
than $1,000,000 are offered by it to prime banks in the London interbank market,
at approximately 11:00 a.m. London time on such Reference Date, that is
representative of single transactions at such time (the "Representative
Amounts"), and if at least two Rate Quotations are provided, three-month LIBOR
will be the arithmetic mean of the Rate Quotations obtained by the Calculation
Agent; provided, further, that in the event three-month LIBOR cannot be
determined from Telerate Page 3750 as described herein 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 Calculation Agent,
for loans in Representative Amounts 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; and provided, further, that if fewer
than three banks selected by the Calculation Agent 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.
"License Agreements" means, collectively, the License Agreement, dated
February 13, 1996, between ACT II and Xxxxxxx Pharmaceutica Inc. and the License
Agreement, dated February 21, 1996, between ACT II and JPI Pharmaceutica
International, both as amended, restated or supplemented from time to time.
"Licensed Technology" means the Patents and Technical Information, and
Improvements thereto incorporated into the License Agreements by Xxxxxxx, in
accordance with the terms thereof, owned or controlled by ACT II.
"LLC Operating Agreement" means the limited liability company agreement of
the Issuer, effective as of February 1, 2005.
"Losses" 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.
"Managers" means the managers of the Issuer.
"Manufacturing and Supply Agreement" means the Manufacturing and Supply
Agreement, dated as of August 6, 1997, among ACT II, Xxxxxxx Pharmaceutica Inc.
and JPI Pharmaceutica International, as amended, restated or supplemented from
time to time.
"Manufacturing Facility" means the manufacturing lines located in
Wilmington, Ohio, owned or leased by ACT II and used to manufacture the Drug.
"Material Adverse Development" means (i) any legal or regulatory
development affecting the Drug which results in the suspension, withdrawal, or
revocation of approvals to sell the Drug in the market, (ii) any "other than
temporary" suspension of manufacture or reduction in manufacturing output of the
Drug, (iii) any material re-labeling requirement, or (iv) any voluntary action
by Xxxxxxx that results
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in a suspension or cessation of sales of the Drug, in each case, the occurrence
of which has or would have a material adverse effect on the net sales of the
Drug on which the Royalty Payments are based.
"Minimum Revenue Payments" means the payments made by Xxxxxxx to ACT II of
specified minimum amounts of revenue pursuant to Section 3.04 of the Addendum to
the Manufacturing and Supply Agreement, whether made in installments or in a
lump sum as provided in said Section 3.04.
"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 rating agency designated by the Issuer and
meeting the definition of "nationally recognized statistical rating
organization," as set forth in the rules promulgated under the Exchange Act.
"Net Available Revenues" means, for any Payment Date after the Interest
Only Period, the amount, if any, by which (a) the Available Collection Amount
for such Payment Date exceeds (b) the sum of (i) the Interest Amount for such
Payment Date, (ii) the Expenses due and payable on such Payment Date and (iii)
the principal payments paid on such Payment Date pursuant to Section
3.07(a)(iii).
"Non-U.S. Person" means a person who is not a U.S. person, as defined in
Regulation S.
"Noteholder" or "Holder" means any Person in whose name a Note is
registered from time to time in the Register for such Notes.
"Note Purchase Agreements" means the Note Purchase Agreements, dated
February 1, 2005, among the Issuer and the initial purchasers of the Class A
Notes.
"Notes" means the Class A Notes, any Class B Notes and any Refinancing
Notes.
"Notices" has the meaning given to such term in Section 12.05 hereof.
"Officer's Certificate" means a certificate signed by, with respect to the
Issuer, a Manager (other than the Independent Manager) and, with respect to any
other Person, any officer, director, trustee or equivalent representative.
"Operating Bank" means U.S. Bank or any other Eligible Institution at
which the Accounts are held; provided that (i) upon the resignation or removal
and the replacement of the Trustee pursuant to the terms of this Indenture, the
successor trustee appointed thereunder shall be the Operating Bank; and (ii) if
at any time the Operating Bank ceases to be an Eligible Institution, a successor
operating bank shall be appointed by the Servicer on behalf of the Trustee and
all Accounts shall thereafter be transferred to and be maintained at such
successor operating bank in the name of the Trustee and such successor operating
bank 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 the Issuer or ACT II, that meets the
requirements of Section 1.03 hereof.
"Optional Redemption" has the meaning given to such term in Section
3.09(a) hereof.
"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
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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 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 3.08 hereof,
notice of such redemption shall have been given as provided in Section 3.09
hereof, or provision satisfactory to the Trustee shall have been made for giving
such 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 this 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 the
Issuer); and (b) when used with respect to any other evidence of indebtedness
shall mean, 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
evidence of indebtedness unpaid and outstanding at any time as determined in the
case of the Notes in the information to be provided to the Servicer by the
Trustee pursuant to Section 3.05(g) hereof.
"Patents" means (i) any and all issued patents and patent applications or
parts thereof existing as of the date of each of the License Agreements which
describe and claim a depot formulation of risperidone, or any chemical analogues
of risperidone with similar physiological activity, based on polymers of lactic
and glycolic acids and the production and use thereof; (ii) any other patents
and patent applications filed by or on behalf of ACT II, or under which ACT II
has the rights to grant licenses, which are needed to practice the inventions;
and (iii) any reissues, extensions, substitutions, confirmations, registrations,
revalidations, additions, continuations, continuations-in-part, or divisions of
or to any of the foregoing which are granted hereafter or any additional
protection certificate granted with respect thereto.
"Paying Agent" has the meaning given to such term in Section 2.03 hereof
and initially will be the Trustee. The term "Paying Agent" includes any
additional Paying Agent.
"Payment Date" means each January 1, April 1, July 1 and October 1,
commencing on April 1, 2005; provided that if any such date would otherwise fall
on a day which is not a Business Day, the Payment Date falling on such date
shall be the first following day which is a Business Day.
"Permanent Global Note" has the meaning given to such term in Section 2.01
hereof.
"Permanent Regulation S Global Note" has the meaning given to such term in
Section 2.01 hereof.
"Permitted Encumbrance" means (i) 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; (ii) any lien created in
favor of the Issuer or the Trustee and; (iii) any lien permitted under Section
6.2(a) of the Purchase and Sale Agreement or specified in Section 5.1(k) or (1)
thereof.
"Permitted Holder" means any Person that has executed a Confidentiality
Agreement.
"Person" means any natural person, firm, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization,
government or any political subdivision thereof or any other legal entity,
including public bodies.
"Pledge Agreement" means the Pledge and Security Agreement, dated as of
February 1, 2005, between ACT II and the Trustee, as amended, restated or
supplemented from time to time.
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"Pledged Equity" has the meaning given to such term in the Pledge
Agreement.
"Post-Termination Shortfalls" has the meaning given to such term in
Section 3.05(f) hereof.
"Premium" means, with respect to any Note on any Redemption Date or
Payment Date, any Redemption Premium, if applicable or, in the case of 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.
"Prior Ranking Amounts" has the meaning assigned to such term in Section
3.07 hereof.
"Private Placement Legend" means the legend initially set forth on the
Notes in the form set forth in Section 2.02 hereof.
"Private Placement Memorandum" means the Private Placement Memorandum of
the Issuer for the Class A Notes, dated January 21, 2005.
"Products" means any and all depot formulations of Risperidone (R 64766),
or analogues of risperidone with similar physiological activity, based on
polymers of lactic and glycolic acids which are designed to deliver Risperidone
(R 64766), or any of its chemical analogues, over an extended period.
"Purchase and Sale Agreement" means the Purchase and Sale Agreement, dated
as of February 1, 2005, between ACT II and the Issuer, as amended, restated or
supplemented from time to time.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Record Date" means with respect to each Payment Date or Special
Distribution Date, the close of business on the fifteenth (15th) day preceding
such Payment Date or Special Distribution Date and, with respect to the date on
which any Direction is to be given by the Noteholders, the close of business on
the last Business Day prior to the solicitation of such Direction.
"Redemption" means any Optional Redemption, an IO Account Redemption, any
Termination Redemption and any other redemption of Notes described in Section
3.08(d) hereof.
"Redemption Account" has the meaning given to such term in Section 3.01(a)
hereof.
"Redemption Date" means the date, which shall in each case be a Payment
Date, on which Notes are redeemed pursuant to a Redemption, other than a
Refinancing Date.
"Redemption Premium" means the amount, if any, specified in the Board
Resolution or indenture supplement to be paid in the event of a Redemption of
any Refinancing Notes or Class B Notes separately from the Redemption Price.
"Redemption Price" means, (a) in respect of a redemption of the Class A
Notes pursuant to Section 3.08(b) on any Payment Date after the Interest Only
Period, the Outstanding Principal Balance of the Class A Notes being redeemed;
(b) in respect of an Optional Redemption of the Class A Notes (i) on any Payment
Date during the Interest Only Period, the greater of (x) the Outstanding
Principal Balance of the Class A Notes being redeemed and (y) the present value,
discounted at the Applicable Treasury Rate plus 1.00%, of the Scheduled
Principal Payment Amounts (assuming they are paid as provided in the Class A
Principal Payment Schedule) and interest at the Stated Rate of Interest on the
unpaid principal balance of the Class A Notes through January 1, 2012 (assuming
the Scheduled Principal Payment
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Amounts are paid as provided in the Class A Principal Payment Schedule) and (ii)
on any Payment Date after the Interest Only Period, an amount equal to the
product of (x) the applicable Redemption Percentage set out below and (y) the
Outstanding Principal Balance of the Class A Notes that are being redeemed as
set forth below, plus in each case the accrued and unpaid interest to the
Redemption Date on the Class A Notes that are being redeemed:
QUARTERLY PAYMENT DATES BETWEEN INDICATED CLASS A REDEMPTION
PAYMENT DATES PERCENTAGE
------------- ----------
April 1, 2009 to January 1, 2010 103.50%
April 1, 2010 to January 1, 2011 101.75%
April 1, 2011 to January 1, 2018 100.00%
; (c) in respect of a redemption of the Class A Notes pursuant to Section
3.08(c), the Outstanding Principal Balance of the Class A Notes being redeemed;
and (d) in respect of any Class B Notes or any Refinancing Notes, the Redemption
Price, if any, established by or pursuant to a Board Resolution or in any
indenture supplemental hereto providing for the issuance of such Notes or
designated as such in the form of such Notes. Any such Redemption Price may
include a Premium or such Board Resolution or indenture supplement may specify a
separate Redemption Premium.
For purposes of clause (a)(i) above, the "Applicable Treasury Rate" for
any Redemption Date is 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 Class A Notes as of
such Redemption Date and trading in the public securities markets either (x) 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, (A) one maturing as close as possible to, but earlier
than, the Average Life Date of such subclass and (B) the other maturing as close
as possible to, but later than, the Average Life Date of such subclass in each
case as published in the most recent H.15 (519) or (y) if a weekly average yield
to maturity for United States Treasury securities maturing on the Average Life
Date of such subclass is reported in the most recent H.15 (519), such weekly
average yield to maturity as published in such H.15 (519).
For the purposes of this definition,
"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.
"Average Life Date" of the Class A Notes shall be the date which
follows the applicable Redemption Date by a period equal to the Remaining
Weighted Average Life of the Class A Notes.
"Remaining Weighted Average Life" means, with respect to the Class A
Notes on any Redemption Date, (i) the sum of the products of (A) the
Scheduled Principal Payment Amounts payable on each subsequent Payment
Date (each, a "Subsequent Date") in accordance with the
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Class A Principal Payment Schedule and (B) the number of days remaining
until such Subsequent Date divided by (ii) the Outstanding Principal
Balance of the Class A Notes on such Redemption Date.
"Reference Date" means, with respect to each Interest Accrual Period, the
day that is two Business Days prior to the Payment Date or Special Distribution
Date on which such Interest Accrual Period commences; provided, however, that
the Reference Date with respect to the initial Interest Accrual Period means the
date that is two Business Days before the Closing Date.
"Refinancing" has the meaning given to such term in Section 2.15 hereof.
"Refinancing Date" means the date, which shall in each case be a Payment
Date, on which the 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 hereof.
"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 the Issuer under
this Indenture at any time and from time to time after the date hereof pursuant
to Section 2.15, the proceeds of which are used to repay all of the Outstanding
Principal Balance of a class of Notes and ranking pari passu in right of payment
with such class of Notes.
"Register" has the meaning given to such term in Section 2.03(a) hereof.
"Registrar" has the meaning given to such term in Section 2.03(a) hereof
and includes any additional Registrar.
"Regulation S" means Regulation S under the Securities Act.
"Regulation S Global Note" has the meaning given to such term in Section
2.01(b) hereof.
"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 forty days after the Closing Date.
"Related Documents" means the Purchase and Sale Agreement, the Servicing
Agreement, the Contingent License, this Indenture, and the Notes, copies of all
of which shall be furnished to the Trustee and its counsel.
"Relevant Information" means any information provided to the Trustee by
any Service Provider retained from time to time by the Issuer pursuant to the
Related Documents.
"Responsible Officer" means, (i) with respect to the Trustee, any officer
within the Corporate Trust Office or any other officer of the Trustee
customarily performing functions similar to those performed by any such officer
and also, with respect to a particular matter, any other officer of the Trustee
to whom such matter is referred because of such officer's knowledge and
familiarity with the particular subject and (ii) with respect to the Issuer, a
Manager (other than the Independent Manager).
"Royalty Payments" means the payments, fees, royalties and similar
payments to which the Issuer is entitled under the Royalty Rights, consisting of
(i) all royalty payments payable to ACT II under each
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License Agreement, (ii) all manufacturing payments payable to ACT II under the
Manufacturing and Supply Agreement (but excluding any payments pursuant to
Section 5 or Section 6 of the Fourth Amendment), (iii) any manufacturing fees
paid by Xxxxxxx to ACT II for any Product in the Field under the License
Agreements made by ACT II for Xxxxxxx under a manufacturing agreement other than
the Manufacturing and Supply Agreement, and (iv) any royalties and other similar
payments payable to ACT II under any license (other than the License Agreements
and the Contingent License) of the Licensed Technology to make, have made, use,
have used, sell and have sold Products in the Field, provided that (a) "Royalty
Payments" shall not include any development or other payments from Xxxxxxx to
ACT II that constitute payments or reimbursements of expenses incurred by ACT II
(i) in the development of Products or (ii) in connection with the type of
design, engineering and construction activities of ACT II described in the
Fourth Amendment for the Third Line (as defined in the Fourth Amendment) or for
any future expansion of the manufacturing facilities of ACT II, (b) the
exclusion in the preceding clause (a) shall not apply to any Minimum Revenue
Payments under Section 3.04 of the Addendum or any similar payments under any
amendment of or future addendum or supplement to the Manufacturing and Supply
Agreement, and (c) the amount of the Royalty Payments due to the Issuer shall be
reduced (i) for any amount that ACT II is obligated to pay to Xxxxxxx pursuant
to the Section 6.1.2 of the Manufacturing and Supply Agreement to reflect the
actual amount of Royalty Payments paid in the preceding year, (ii) any amount
that ACT II is obligated to pay or credit to Xxxxxxx as a refund of
manufacturing fees for rejected batches of Product and as a payment for Compound
pursuant to Section 2.7 or 4.2 of the Manufacturing and Supply Agreement, and
(iii) any "Depreciation Credits" (as defined in the Fourth Amendment) that
Xxxxxxx is entitled to offset against its obligation to pay manufacturing fees
as provided in section 12 of the Fourth Amendment.
"Royalty Rights" means all right, title and interest of the Issuer in, to
and under the "Royalty Rights" (as defined in the Purchase and Sale Agreement)
sold, contributed and otherwise conveyed to the Issuer pursuant to the Purchase
and Sale Agreement.
"Rule 144A" means Rule 144A under the Securities Act.
"Scheduled Final Payment Date" means for any Refinancing Notes or Class B
Notes, if applicable, the date specified in the indenture supplement and/or
Board Resolution providing for their issuance.
"Scheduled Principal Payment Amount" means for any Payment Date or Special
Distribution Date, the amount required to reduce the Outstanding Principal
Balance of the Class A Notes to the balance specified for such Payment Date or
the immediately preceding Payment Date, in the case of a Special Distribution
Date, in the Class A Principal Payment Schedule for such Payment Date or Special
Distribution Date.
"Secured Obligations" has the meaning given to such term in the Granting
Clause herein.
"Secured Party" has the meaning given to such term in the Pledge
Agreement.
"Securities Act" means the Securities Act of 1933, as amended.
"Security Interests" means the security interests granted or expressed to
be granted in the Collateral pursuant to the Granting Clause herein and in the
Pledged Equity pursuant to the Pledge Agreement.
"Senior Claim" has the meaning given to such term in Section 10.01 hereof.
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"Senior Class" means, (i) so long as any Class A Notes are Outstanding,
the Class A Notes, and (ii) if no Class A Notes are Outstanding, the Class B
Notes.
"Senior Trustee" means the Trustee of the Senior Class of the Notes.
"Service Providers" means only the Servicer, the Trustee, the Independent
Manager of the Issuer, the Calculation Agent, the Operating Bank, and any Person
that becomes the Servicer, the Trustee, the Independent Manager of the Issuer,
the Calculation Agent or the Operating Bank in accordance with the terms of the
applicable agreement.
"Servicer" means ACT II, in its capacity as collection agent under the
Servicing Agreement, including its successors in interest and permitted assigns,
until a successor Person shall have become the Servicer under such agreement,
and thereafter "Servicer" shall mean such successor Person.
"Servicing Agreement" means the Servicing Agreement between the Company
and Seller, dated as of February 1, 2005, as amended, restated, supplemented or
otherwise modified from time to time.
"Shortfalls" has the meaning given to such term in Section 3.05(e) hereof.
"S&P" means Standard & Poor's Ratings Services, a division of The
XxXxxx-Xxxx Companies, 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, "S&P" shall be deemed to refer to any other nationally
recognized rating agency designated by the Issuer and meeting the definition of
"nationally recognized statistical rating organization," as set forth in the
rules promulgated under the Exchange Act.
"Special Distribution Date" has the meaning given to such term in Section
3.04 hereof.
"Stated Rate of Interest" means, in the case of the Class A Notes, 7.00%,
and in the case of any Refinancing Notes or Class B Notes, the Stated Rate of
Interest established by the Board Resolution or indenture supplemental hereto
providing for the issuance of such Refinancing Notes or Class B Notes.
"Stated Yield" means, in the case of the Class A Notes, 9.75%, and in the
case of any Refinancing Notes or Class B Notes, the Stated Yield, if any,
established by the Board Resolution or indenture supplemental hereto providing
for the issuance of such Refinancing Notes or Class B Notes.
"Stock" means all shares of capital stock, all beneficial interests in
trusts, all membership interests in limited liability companies, all ordinary
shares and preferred shares and any options, warrants and other rights to
acquire such shares or interests.
"Subordinated Claim" has the meaning given to such term in Section 10.01
hereof.
"Subsidiary" means, as to any Person, a corporation, partnership, limited
liability company or other entity of which shares of stock or other ownership
interests having ordinary voting power (other than stock or such other ownership
interests having such power only by reason of the happening of a contingency) to
elect a majority of the board of directors or other managers of such
corporation, partnership, limited liability company or other entity are at the
time owned, or the management of which is otherwise controlled, directly or
indirectly through one or more intermediaries, or both, by such Person.
"Supplemental Interest" means, with respect to the Class A Notes, interest
accrued during any Interest Accrual Period at the Supplemental Interest Rate on
the excess, if any, of the Outstanding Principal Balance of the Class A Notes
over the balance specified in the Class A Principal Payment
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Schedule for the immediately preceding Payment Date, at the Supplemental
Interest Rate for each such Interest Accrual Period.
"Supplemental Interest Rate" means, in the case of the Class A Notes,
2.75% per annum, compounded quarterly, and in the case of any Refinancing Notes
or Class B Notes, the Supplemental Interest Rate, if any, established by the
Board Resolution or indenture supplemental hereto providing for the issuance of
such Refinancing Notes or Class B Notes.
"Tax" and "Taxes" mean 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) imposed or otherwise
assessed by the U.S. or by any state, local or foreign government (or any
subdivision or agency thereof) or other taxing authority, including, without
limitation: 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; taxes or other charges in the
nature of excise, 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.
"Technical Information" means all unpatented information, know-how,
practical experience, procedures, methodology, specifications, formulae and data
whether or not the same shall be patentable which have been heretofore developed
or acquired by ACT II prior to the date of each of the License Agreements, and
which are necessary in order to use, manufacture or sell Products in the Field.
"Temporary Regulation S Global Note" has the meaning given to such term in
Section 2.01 hereof.
"Termination Date" means the date on which both of the License Agreements
and the Manufacturing and Supply Agreement have been terminated for any reason.
"Termination Redemption" has the meaning given to such term in Section
3.08(c).
"Transaction Expenses" means the out-of-pocket expenses payable by the
Issuer in connection with (i) the issuance of the Class A Notes, including
placement fees, any initial fees payable to Servicer Providers and the fees and
expenses of Pillsbury Winthrop LLP, as counsel to the Note holders in connection
with the offering and issuance of the Class A Notes, as set forth in the Note
Purchase Agreements and (ii) the offering and issuance of any Refinancing Notes
or Class B Notes, to the extent specified in the Board Resolutions authorizing
such offering and issuance.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended.
"Trustee" has the meaning given to such term in the preamble hereof, and
any successor Trustee appointed in accordance with the terms hereof.
"UCC" means the Uniform Commercial Code as in effect from time to time in
the State of New York.
"U.S." means the United States of America.
"U.S. Bank" means U.S. Bank National Association, a national banking
association.
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"U.S. GAAP" means generally accepted accounting principles in effect in
the U.S. from time to time.
"U.S. Government Obligations" means obligations of, and supported by the
full faith and credit of, the U.S. government.
"U.S. Treasury" means the U.S. Department of the Treasury.
"Yield Coverage Ratio" means, for the Class A Notes on any Payment Date,
the percentage ratio of (a) the Available Collections Amount for such Payment
Date (minus the amount of any reimbursement to ACT II of a refund of a
manufacturing fee and of any payment for Compound pursuant to Section 2.7 or
Section 4.2 of the Manufacturing and Supply Agreement included in the Expenses
paid on such Payment Date) to (b) the sum of (i) interest at the Stated Yield on
88.395% of the outstanding principal balance of the Notes during the Interest
Period ending on such Payment Date and (ii) the amount of Expenses payable
pursuant to Section 3.07(a)(i) on such Payment Date.
Section 1.02 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 U.S. 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, Appendices, Exhibits or Annexes refer to an Article or
Section of, or an Appendix, Exhibit or Annex 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.
(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 Class A Notes and 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, replaced 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 the Issuer under this Indenture in respect of the
Notes.
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(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, funds applied or any
calculation is to be made hereunder on a day which is not a Business Day, unless
any Related Document otherwise provides, such payment shall be made, funds
applied and calculation made on the next succeeding Business Day, and payments
shall be adjusted accordingly, including interest unless otherwise specified.
Section 1.03 Compliance Certificates and Opinions. Upon any application or
request by the Issuer to the Trustee to take any action under any provision of
this Indenture, the Issuer shall furnish to the Trustee an Officer's Certificate
stating that, in the opinion of the signers thereof in their 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.
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 5.03 hereof) or any indenture supplemental hereto shall
include:
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions in this
Indenture relating thereto;
(2) 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;
(3) a statement that, in the opinion of each such individual in its
capacity as such, he has made such examination or investigation as is
necessary to enable him to express an informed opinion as to whether or
not such covenant or condition has been complied with; and
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
Section 1.04 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 the Issuer. 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 the
Issuer, if made in the manner provided in this Section.
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(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
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
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 which the Trustee deems sufficient.
(c) In determining whether the Holders of Notes have given any
direction, consent, request, demand, authorization, notice, waiver or other Act
(a "Direction"), under this Indenture, Notes owned by the Issuer, ACT II 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 which
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
the Issuer, ACT II or any Affiliate of any such Person.
(d) The Issuer 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. Notwithstanding Section 316(c) of the
Trust Indenture Act, 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 record 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 or 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 Holder of any Note shall
bind the Holder of every Note issued upon the transfer thereof or in exchange
therefor or in lieu thereof, whether or not notation of such action is made upon
such Note.
ARTICLE II
THE NOTES
Section 2.01 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 Class A
Notes, the initial Outstanding Principal Balance for the Class A Notes set forth
in the definition thereof or, with respect to any Class B Notes or any class of
Refinancing Notes, the initial Outstanding Principal Balance authorized in the
Board Resolutions establishing such Class B Notes or Refinancing
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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
Transaction Expenses relating thereto, and that any Refinancing Notes shall be
issued in accordance with Section 2.15 hereof.
(b) There shall be issued, authenticated and delivered on the
Closing Date and on the date of issuance of any Refinancing Notes or Class B
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 Class A Notes, substantially in the form set forth in Exhibit A to this
Indenture 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 and make Notes
available for delivery only upon the written order of the Issuer signed by an
officer of the Issuer. 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.
The Class A Notes and 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 the Issuer 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 records of the Trustee, as custodian for DTC or its
nominee, in accordance with the instructions given by the Holder thereof, as
hereinafter provided.
Any Notes offered and sold 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 the DTC, duly
executed by the Issuer 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 the Issuer of a certificate substantially in the
form of Exhibit D hereto, executed by Euroclear or Clearstream, as the case may
be, together with copies of certificates from Euroclear and Clearstream
certifying that they have 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 the
Issuer and authenticated by the Trustee as hereinafter provided shall be
deposited with the Trustee, as custodian for the 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 the beneficial interest in such Temporary Regulation S
Global Note exchanged. Until the Regulation S Global Note Exchange Date with
respect to any Temporary Regulation S Global Note, interests in such Temporary
Regulation S Global Note may be held only through Agent Members acting for and
on behalf of Euroclear and Clearstream.
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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 the definitive, fully registered Notes issued pursuant to
Section 2.10(b) hereof, the "Definitive Notes").
Interest shall accrue on any class of Floating Rate Notes from the
relevant Closing Date 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 Class A Notes and on any other class of Fixed Rate
Notes from the relevant Closing Date and shall be computed for each Interest
Accrual Period on the basis of a 360-day year consisting of twelve 30-day
months.
(c) On the date of any Refinancing, the Issuer shall issue and
deliver as provided in Section 2.15 hereof 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 such Section 2.15.
(d) On the date of the issuance, if any, of any Class B Notes, the
Issuer shall issue and deliver, as provided in Section 2.16 hereof, 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 such
Section 2.16.
(e) The Notes shall be executed on behalf of the Issuer by the
manual or facsimile signature of a Manager of the Issuer other than the
Independent Manager.
(f) Each Note bearing the manual or facsimile signatures of any
individual who was at the time such Note was executed a Manager of the Issuer
other than the Independent Manager shall bind the Issuer, notwithstanding that
any such individual has ceased to hold such office prior to the authentication
and delivery of such Notes or any payment thereon.
(g) At any time and from time to time after the execution of any
Notes, the Issuer may deliver such Notes to the Trustee for authentication and,
subject to the provisions of clause (h) below, the Trustee shall authenticate
such Notes by manual or facsimile signature upon receipt by it of written orders
of the Issuer. The Notes shall be authenticated on behalf of the Trustee by any
Responsible Officer of the Trustee.
(h) 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 the Issuer as provided in clause (e) above and authenticated by or on
behalf of the Trustee as provided in clause (g) above. 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 2.02 Restrictive Legends. Each Permanent Global Note, each
Regulation S Global Note and each Definitive Note issued in reliance on Section
4(2) of the Securities Act (and all Notes issued in exchange therefor or upon
registration of transfer or substitution thereof) shall bear the following
legend on the face thereof:
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), THE SECURITIES LAWS OF
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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), (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") OR (C) IT IS NOT A U.S. PERSON AND IS
ACQUIRING THIS SECURITY IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE
904 OF REGULATION S UNDER THE SECURITIES ACT, (2) AGREES THAT IT WILL NOT
PRIOR TO (X) THE DATE WHICH IS TWO YEARS (OR SUCH SHORTER PERIOD OF TIME
AS PERMITTED BY RULE 144(k) 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 LAWS (THE "RESALE RESTRICTION TERMINATION DATE")
OFFER, SELL OR OTHERWISE TRANSFER THIS NOTE OR AN INTEREST HEREIN, EXCEPT
(A) TO THE ISSUER 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, (D) OUTSIDE THE
UNITED STATES IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 904 OF
REGULATION S UNDER THE SECURITIES ACT (IF AVAILABLE) OR (E) PURSUANT TO
ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND (3) 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 THE ISSUER AND THE TRUSTEE SHALL
HAVE THE RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO
CLAUSE (2)(C), (D) OR (E) OF THIS PARAGRAPH, TO REQUIRE THE DELIVERY OF AN
OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO
EACH OF THEM. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER
AFTER THE RESALE RESTRICTION TERMINATION DATE. AS USED HEREIN, THE TERMS
"OFFSHORE TRANSACTION" "UNITED STATES" AND "U.S. PERSON" HAVE
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THE MEANING GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT.
BY ITS PURCHASE AND ACCEPTANCE OF A NOTE, EACH PURCHASER WILL BE DEEMED TO
HAVE REPRESENTED AND WARRANTED THAT EITHER (I) NO PLAN ASSETS HAVE BEEN
USED TO PURCHASE SUCH NOTES, OR (II) (X) ONE OR MORE PROHIBITED
TRANSACTION STATUTORY OR ADMINISTRATIVE EXEMPTIONS APPLIES SUCH THAT THE
USE OF SUCH PLAN ASSETS TO PURCHASE AND HOLD SUCH NOTES WILL NOT
CONSTITUTE A NON-EXEMPT PROHIBITED TRANSACTION; (Y) THE PLAN FIDUCIARY
AUTHORIZING THE INVESTMENT IN THE NOTES HAS DETERMINED THAT SUCH
INVESTMENT IS PRUDENT AND OTHERWISE CONSISTENT WITH THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR OTHER
APPLICABLE LAW; AND (Z) THE INDIVIDUAL EXECUTING THE NOTE PURCHASE
AGREEMENT IS DULY AUTHORIZED UNDER THE APPLICABLE PLAN DOCUMENTS AND/OR
APPLICABLE LAW TO SO BIND THE PLAN. "PLAN" IS DEFINED TO INCLUDE CERTAIN
GOVERNMENTAL PLANS, CERTAIN CHURCH PLANS, EMPLOYEE BENEFIT PLANS AND
CERTAIN OTHER RETIREMENT PLANS AND ARRANGEMENTS, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, THAT ARE SUBJECT TO ERISA AND/OR THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED AND ANY ENTITY THAT MAY BE
DEEMED TO HOLD THE ASSETS OF ANY SUCH PLANS.
THE NOTES MAY NOT BE RESOLD OR TRANSFERRED EXCEPT AS DESCRIBED IN THE
FOREGOING, AND ANY PROPOSED TRANSFEREE SHALL EXECUTE A CONFIDENTIALITY
AGREEMENT IN THE FORM ATTACHED AS EXHIBIT N TO THE INDENTURE.
Each Class A Note shall also bear the following legend on the face
thereof:
THIS NOTE WAS ISSUED WITH "ORIGINAL ISSUE DISCOUNT." THE TOTAL AMOUNT OF
ORIGINAL ISSUE DISCOUNT IS 11.605% OF ITS PRINCIPAL AMOUNT, THE ISSUE DATE
IS FEBRUARY 1, 2005, AND THE YIELD TO MATURITY ON THE ISSUE DATE IS 9.75%
COMPOUNDED QUARTERLY
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 THE ISSUER 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.
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TRANSFERS OF THIS GLOBAL 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 GLOBAL NOTE SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN
SECTION 2.11 OF THE INDENTURE.
Each Temporary Regulation S Global Note shall 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.
Section 2.03 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 12.05 hereof where the Notes of such class may be
presented or surrendered for registration of transfer or for exchange (each, a
"Registrar"), and for payment thereof (each, a "Paying Agent") and where notices
and demands to or upon the Issuer in respect of such Notes may be served. The
Trustee shall be the initial Paying Agent, and the Issuer shall not be permitted
to act as a Paying Agent. The Issuer 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 the Issuer and the Holders 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 of the Trustee.
(b) Each Authorized Agent in the location set forth in Section 12.05
shall be a bank or trust company, shall be a corporation organized and doing
business under the laws of the U.S. or any state or territory thereof or of the
District of Columbia, with a combined capital and surplus of at least
$75,000,000 (or having a combined capital and surplus in excess of $5,000,000
and the obligations of which, whether now in existence or hereafter incurred,
are fully and unconditionally guaranteed by a 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
$75,000,000) and shall be authorized under the laws of the U.S. or any state or
territory thereof to exercise corporate trust powers, subject to supervision by
Federal or state authorities (such requirements, the "Eligibility
Requirements"). The Trustee shall initially be a Paying Agent and Registrar
hereunder with respect to the Notes. Each Registrar other than the Trustee shall
furnish to the Trustee, at least five (5) Business Days prior to each Payment
Date or Special Distribution Date, and at such other times as the Trustee may
request in writing, a copy of the Register maintained by such Registrar.
(c) Any corporation into which any Authorized Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, consolidation or conversion to which any Authorized Agent shall
be a party, or any corporation 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, 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 corporation.
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(d) Any Authorized Agent may at any time resign by giving written
notice of resignation to the Trustee and the Issuer. The Issuer 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 this Section
(when, in either case, no other Authorized Agent performing the functions of
such Authorized Agent shall have been appointed by the Trustee), the Issuer
shall promptly appoint one or more qualified successor Authorized Agents,
reasonably satisfactory to the Trustee, to perform the functions of the
Authorized Agent which has resigned or whose agency has been terminated or who
shall have ceased to be eligible under this Section. The Issuer 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 Holders of the
related class of Notes as their names and addresses appear on the Register for
such class of Notes.
(e) The Issuer 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 2.04 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 Holders
entitled to such payment, subject to the provisions of this Section. Moneys so
deposited and held in trust shall constitute a separate trust fund for the
benefit of the Holders with respect to which such money was deposited.
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 2.05 Method of Payment. (a) On each Payment Date or Special
Distribution Date, the Trustee shall, or shall instruct a Paying Agent to, pay,
to the extent of the Available Collections Amount for such Payment Date or
Special Distribution Date, to the Noteholders all interest, principal and
Premium, if any, on each class of Notes in the amounts determined by the Trustee
pursuant to Section 3.05; provided, that payment on a Temporary Regulation S
Global Note shall be made to the Holder thereof only in conformity with Section
2.05(c) hereof. Each payment on any Payment Date or Special Distribution Date
other than the Final Payment Date 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 or Special Distribution Date. The final payment with respect
to any Note, 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 specified in the notice given by the Trustee or
Paying Agent with respect to such final payment.
(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 or Special Distribution
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 each 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 specified
in the notice of such
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final payment given by the Trustee or Paying Agent. The Trustee or Paying Agent
shall mail such notice of the final payment of such class of Notes to each
Noteholder of such class, specifying the date and amount of such final payment.
(c) The beneficial owner of a Temporary Regulation S Global Note may
arrange to receive interest installments 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 G-1 hereto, and upon delivery
of Euroclear or Clearstream, as the case may be, to the Paying Agent of a
certification or certifications substantially in the form of Exhibit G-2 hereto.
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.
Section 2.06 Minimum Denomination. Each class of Notes shall be issued in
minimum denominations of $250,000 and integral multiples of $1,000 in
excess thereof.
Section 2.07 Transfer and Exchange; Cancellation. The Notes are issuable
only in registered form. A Holder may transfer a Note 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 delivery of a Confidentiality Agreement as set forth in Section 2.11. No
such transfer shall be effected until, and such transferee shall succeed to the
rights of a Holder only upon, final acceptance and registration of the transfer
by the Registrar in the Register and confirmation by the Issuer that such Holder
is a Permitted Holder.
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, the Issuer 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 and the Trustee shall promptly notify the Issuer of each request for
a registration of transfer of a Note by furnishing the Issuer a copy of such
request.
Furthermore, any Holder of a Global Note shall, by acceptance of such
Global Note, agree that, subject to Section 2.10(b) hereof, transfers of
beneficial interests in such Global Note may be effected only through a
book-entry system maintained by the Holder of such Global Note (or its agent)
and that ownership of a beneficial interest in such Note shall be required to be
reflected in a book-entry. 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 Holder thereof or
by an attorney who is authorized in writing to act on behalf of the Holder). To
permit registrations of transfers and exchanges, the Issuer shall execute and
the Trustee shall authenticate Notes at the Registrar's request. Except as set
forth in Section 2.08 and Section 2.09 hereof, no service charge shall be made
for any registration of transfer or exchange or redemption of the Notes.
The Issuer 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 Issuer shall not be required to exchange or register the
transfer of any Notes
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that have been selected, called or are being called for Redemption or
Refinancing except, in the case of any Notes where notice has been given that
such Notes are to be redeemed in part, the portion thereof not so to be
redeemed.
The Issuer 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. The Issuer
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 2.08 Mutilated, Destroyed, Lost or Stolen Notes. If any Note shall
become mutilated, destroyed, lost or stolen, the Issuer shall, upon the written
request of the Holder 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 Issuer to the Trustee that such Holder has delivered a
Confidentiality Agreement to the Issuer, 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 Holder 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
a Registrar and forwarded to the Issuer by the Trustee or such Registrar. If the
Note being replaced has been destroyed, lost or stolen, the Holder thereof shall
furnish to the Issuer, the Trustee or a Registrar (i) such security or indemnity
as may be required by them to save the Issuer, the Trustee and such Registrar
harmless (an unsecured indemnity from any QIB being acceptable security) and
(ii) evidence satisfactory to the Issuer, the Trustee and such Registrar of the
destruction, loss or theft of such Note and of the ownership 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 any Registrar) connected therewith.
Section 2.09 Payments of Transfer Taxes. Upon the transfer of any Note or
Notes pursuant to Section 2.07 hereof, the Issuer or the Trustee may require
from the party requesting such new Note or Notes payment of a sum to reimburse
the Issuer 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 for such Notes or in the name of the nominee of
DTC, (ii) be delivered to the Trustee as custodian for DTC and (iii) bear the
Private Placement Legend as set forth in Section 2.02 hereof.
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 the Issuer, the Trustee and any agent of the Issuer 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) below, 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 2.11.
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Notwithstanding the foregoing, nothing herein shall prevent the Issuer,
the Trustee or any agent of the Issuer 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 Holder of any Global Note. Neither the
Issuer nor the Trustee shall be liable for any delay by DTC in identifying the
Agent Members in respect of the Global Notes, and the Issuer 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 hereof. Definitive Notes shall be issued to the
individual Agent Members or Beneficial Holders or their nominees in exchange
for their Beneficial Interests in the Permanent Global Note or the Regulation
S Global Note, respectively, with respect to any class of Notes only if (i)
the Issuer advises the Trustee in writing that DTC is no longer willing or
able to properly discharge its responsibilities as depositary with respect to
the Notes and the Trustee or the Issuer is unable to appoint a qualified
successor within 90 days of such notice, (ii) the Issuer, at its option,
elects to terminate the book-entry system through DTC or (iii) during the
occurrence of an Event of Default with respect to any class of Notes,
Noteholders of such class representing an aggregate of not less than 51% of
the aggregate Outstanding Principal Balance of such class of Notes advise the
Issuer, 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 the Issuer of any certificates determined by it to be required pursuant to
Rule 903 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 in the names of
the Noteholders of such class, the Issuer 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 the Issuer, 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 the Issuer nor the Trustee shall
be liable if the Trustee or the Issuer 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 a 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
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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
Permanent Global Note pursuant to paragraph (b) of this Section shall, except
as otherwise provided by paragraph (f) of Section 2.11, bear the Private
Placement Legend applicable to a Permanent Global Note set forth in Section
2.02 hereof.
(e) Any Definitive Note delivered in exchange for an interest in a
Regulation S Global Note pursuant to paragraph (b) of this Section shall,
except as otherwise provided by paragraph (f) of Section 2.11, bear the
Private Placement Legend applicable to a Regulation S Global Note set forth
in Section 2.02 hereof.
Section 2.11 Special Transfer Provisions. (a) Transfers to Non-QIB
Institutional Accredited Investors. The following provisions shall apply with
respect to the registration of any proposed transfer of a Note (other than a
Temporary Regulation S Global Note) to any Institutional Accredited Investor
which is not a QIB (excluding Non-U.S. Persons):
(i) The Registrar shall register the transfer of any Note,
whether or not such Note bears the Private Placement Legend, if the
proposed transferee has delivered to the Registrar (A) a certificate
substantially in the form of Exhibit F hereto, (B) an Opinion of Counsel
acceptable to the Issuer 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 the Permanent Global Note, upon receipt by the
Registrar of (x) the documents, if any, required by paragraph (i),
including the Confidentiality Agreement, and (y) 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 Global Note in an amount equal to the principal
amount of the beneficial interest in the Permanent Global Note to be
transferred, and the Issuer shall execute, and the Trustee shall
authenticate and deliver, one or more Definitive Notes of like tenor and
amount.
(b) Transfers to QIBs. The following provisions shall apply with
respect to the registration of any proposed transfer of an interest in a
Permanent Global Note or a Definitive Note issued in exchange for an interest in
such Permanent Global Note in accordance with Section 2.10(b) hereof to a QIB
(excluding Non-U.S. Persons):
(i) If the Note to be transferred consists of (x) Definitive
Notes, the Registrar shall register the transfer 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 the Issuer 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 the
Issuer and the Registrar in writing, that (A) 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, (B) it is or such QIBs are aware that the sale to it
is being made in reliance on Rule 144A and acknowledge that it has
received such information regarding the Issuer as it has requested
pursuant to Rule 144A or has determined not to request such information,
(C) it is or such QIBs are aware that the transferor is relying upon its
foregoing representations in order to claim the exemption from
registration provided by Rule 144A, and (D) it and all such QIBs have duly
executed and delivered to the
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Issuer a Confidentiality Agreement or (y) an interest in a Permanent
Global Note, the transfer of such Beneficial 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 and QIB has
delivered to the Registrar a Confidentiality Agreement duly executed by
such transferee and QIB, respectively.
(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 clause (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).
(c) Transfers of Interests in a Temporary Regulation S Global Note.
The following provisions shall apply with respect to registration of any
proposed transfer of interests in a Temporary Regulation S Global Note:
(i) The Registrar shall register the transfer of any
Beneficial Interest in a Temporary Regulation S Global Note (x) if the
proposed transferee is a Non-U.S. Person and the proposed transferor has
delivered to the Registrar a certificate substantially in the form of
Exhibit E hereto and has delivered to the Issuer a duly executed
Confidentiality Agreement or (y) 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 the Issuer 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 the Issuer and the
Registrar in writing, that (A) 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, (B) it is or such QIBs are aware that the sale to them is being
made in reliance on Rule 144A and acknowledge that they have received such
information regarding the Issuer as they have requested pursuant to Rule
144A or have determined not to request such information, (C) it is or such
QIBs are aware that the transferor is relying upon their foregoing
representations in order to claim the exemption from registration provided
by Rule 144A, and (D) it and all such QIBs have duly executed and
delivered to the Issuer a Confidentiality Agreement.
(ii)If the proposed transferee is an Agent Member that
provides the documents referred to in clause (i)(y) above, including the
Confidentiality Agreement, upon receipt by the Registrar of such documents
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 of the Permanent Global Note of
the relevant class, in an amount equal to the principal amount of the
Temporary Regulation S Global Note of such class to be transferred, and
the Trustee shall decrease the amount of the Temporary or Permanent
Regulation S Global Note of such class (upon written direction from the
Registrar if different from the Trustee).
(d) Transfers to Non-U.S. Persons at any Time. The following
provisions shall apply with respect to any transfer of a Note to a Non-U.S.
Person:
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(i) Prior to the applicable Regulation S Global Notes Exchange
Date, the Registrar shall not register any proposed transfer of a Note to
a Non-U.S. Person pursuant to Rule 904 of Regulation S.
(ii)The Registrar shall register any proposed transfer of a
Note to any Non-U.S. Person if the Note to be transferred is a Definitive
Note or an interest in a Permanent Global Note, upon receipt of a
certificate substantially in the form of Exhibit E from the proposed
transferor and a Confidentiality Agreement duly executed 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 paragraph (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 a 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 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 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) Private Placement Legend. 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 unless there
is delivered to the Registrar an Opinion of Counsel reasonably satisfactory
to the Issuer and the Trustee to the effect that neither such legend nor the
related restrictions on transfer are required in order to maintain compliance
with the provisions of the Securities Act or any other obligations of the
Issuer, including the obligation in respect of the Royalty Rights to have any
Noteholder execute a Confidentiality Agreement.
(f) General. By its acceptance of any Note bearing the Private
Placement Legend, each Holder 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 only as provided
in this Indenture. The Registrar shall not register a transfer of any Note
unless such transfer complies with the restrictions on transfer of such Note
set forth in this Indenture. In connection with any transfer of Notes, each
Holder 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 the Issuer with respect to) the sufficiency of any such
legal opinions. Each Holder also agrees that it will not take any action to
transfer any Note to a transferee without causing such transferee to execute
and deliver a Confidentiality Agreement. The Trustee shall promptly deliver
to the Issuer the executed version of each executed Confidentiality Agreement
that it receives, provided that the Trustee shall retain a copy of each such
Confidentiality Agreement in its records relating to the Notes.
(g) No Listing. The Notes shall be issued pursuant to an exemption
from registration under the Securities Act. The Issuer 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
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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 subclause (w); (y) a regional or local exchange; or (z) an
over-the-counter market, as the term "established securities market" and the
terms in subclauses (w), (x), (y) and (z) are defined for purposes of Section
7704 of the Code.
The Trustee shall retain copies of all letters, notices and other written
communications received pursuant to Section 2.10 hereof or this Section 2.11.
The Issuer 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.
Section 2.12 Temporary Definitive Notes. Pending the preparation of
Definitive Notes of any class, the Issuer may execute and the Trustee may
authenticate and deliver temporary Definitive Notes of such class which 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 hereto or in any indenture supplemental hereto, except for
such appropriate insertions, omissions, substitutions and other variations
relating to their temporary nature as the Manager of the Issuer executing such
temporary Definitive Notes may determine, as evidenced by his execution of such
temporary Definitive Notes.
If temporary Definitive Notes of any class are issued, the Issuer will
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 of the Trustee,
without charge to the Holder thereof. Upon surrender for cancellation of any one
or more temporary Definitive Notes of any class, the Issuer 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) (i) Not later than five
Business Days prior to each Payment Date, Special Distribution Date or any other
date on which a Distribution Report is to be distributed pursuant to Section
2.13(a) to Agent Members and Beneficial Holders, the Servicer shall provide a
list to the Trustee of the Agent Members, Beneficial Holders and Noteholders
(other than DTC or its nominee or any other depositary) that have provided
Confidentiality Agreements to the Issuer. On each Payment Date, Special
Distribution 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, substantially in the form attached as Exhibit C hereto and prepared by
the Servicer, giving effect to such payments (each, a "Distribution Report"), to
each Agent Member, Beneficial Holder and Noteholder included on the list
provided by the Servicer pursuant to the first sentence of this Section
2.13(a)(i) and to the Issuer and NPS and to no other Person. The Trustee shall
not distribute the Distribution Report to DTC, and each other Noteholder, Agent
Member and Beneficial Holder shall be entitled to receive the Distribution
Report only if such Noteholder, Agent Member or Beneficial Holder has executed
and delivered a Confidentiality Agreement to the Issuer.
(ii) Each Distribution Report provided to each Agent Member and Beneficial
Holder for each Payment Date or Special Distribution Date, commencing April 1,
2005, shall be accompanied by (i) a statement prepared by the Trustee setting
forth an analysis of the Collection Account activity for the Interest Accrual
Period ending on the related Calculation Date, (ii) such information, if any,
regarding the Manufacturing and Supply Agreement, the License Agreements and the
Licensed Technology as ACT II
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will have provided to the Servicer on behalf of the Trustee pursuant to the
Purchase and Sale Agreement during the Interest Accrual Period then ended and
(iii) the information included in all reports that the Issuer shall have
provided to the Servicer on behalf of the Trustee pursuant to Section 5.03
hereof during the Interest Accrual Period then ended. Each annual Distribution
Report provided to each Noteholder for each April 1, commencing April 1, 2006,
shall include the information described in the preceding sentence and also be
accompanied by (x) a statement, prepared by the Servicer, setting forth an
analysis of the Collection Account activity for the calendar year ended the
preceding December 31 and (y) a comparison, prepared by the Servicer, of the
actual cumulative amortization of the Class A Notes through such December 31
against the Class A Principal Payment Schedule on the Class A Notes through such
December 31.
(b) 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 record 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 Exhibit C hereto with respect to
the class of Notes for such calendar year or, in the event such Person was a
Noteholder of record 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 or
holder's, as applicable, 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 owners 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. For the avoidance of doubt, the Trustee shall not be obligated to
provide any statements, reports or other items under this Section 2.13(b) to
any Agent Member or Beneficial Holders on the list of Agent Members,
Beneficial Holders and Noteholders included on the list provided by the
Servicer pursuant to Section 2.13(a)(i) that is not a Noteholder.
(c) 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(b) to each Holder of record of a
Definitive Note of such class for the relevant period of beneficial ownership
of such Definitive Note as appears on the records of the Trustee, subject to
the Issuer having confirmed in writing that each such Holder has executed and
delivered to the Issuer a Confidentiality Agreement.
(d) 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.
(e) Not later than 1:00 p.m., New York City time, on the last
Business Day preceding each Payment Date or Special Distribution Date, the
Servicer on behalf of the Issuer shall provide the Trustee with a statement
regarding the amounts of principal, interest and Premium included in the
amounts being distributed to Noteholders pursuant to Section 3.07 on such
Payment Date or Special Distribution Date, and the Trustee shall include a
copy of such statement with each distribution to a Noteholder (including DTC)
made pursuant to Section 3.07. Each such statement shall include a notice
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to the effect that the tax treatment of any Premium payment may differ from
the interest payment, and may include a withholding obligation.
Section 2.14 CUSIP, CINS AND ISIN Numbers. The Issuer in issuing the Notes
may use "CUSIP", "CINS", "ISIN" or other identification numbers (if then
generally in use), and if so, the Trustee shall use CUSIP numbers, CINS numbers,
ISIN numbers or other identification numbers, as the case may be, in notices of
redemption or exchange as a convenience to Holders; 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" or other identification numbers in any notice of
redemption or exchange shall not affect the validity or sufficiency of such
notice.
Section 2.15 Refinancing Notes. (a) Subject to paragraphs (b) and (c)
below and Section 5.02(d) hereof, the Issuer 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
Resolutions 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
3.09.
(b) A Refinancing of any class of Notes shall be effected as a
Redemption pursuant to Section 3.08 hereof, provided that a Refinancing of the
Class A Notes shall be effected as an Optional Redemption pursuant to Section
3.08(a) hereof. On the date of any Refinancing, the Issuer 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 plus
any amount to be deposited in an Interest Reserve Account for such Refinancing
Notes. The proceeds of each sale of Refinancing Notes shall be used to make
the deposit required by Section 3.09(b) hereof, to pay such Refinancing
Expenses, to fund such Interest Reserve Account and/or deposit and for such
other purposes, if any, as shall be specified in the Board Resolution
authorizing the issuance such Refinancing Notes. Once a notice of a Redemption
in respect of any Refinancing is published in accordance with Section 3.09(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 Resolutions (subject to
Section 2.01 hereof) 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, and shall have the same ranking pursuant to Section 3.07 with
respect to all other Outstanding Notes as the Notes being refinanced thereby.
No less than seven (7) 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 the Issuer and set
forth in such Board Resolutions 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:
(1) the class of Notes to be refinanced by such Refinancing Notes;
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(2) the aggregate principal amount of each class of Refinancing
Notes which may be issued in respect of such Refinancing;
(3) the proposed date of such Refinancing;
(4) if applicable, the Scheduled Final Payment Date and the Final
Maturity Date of each class of such Refinancing Notes;
(5) the rate at which such Refinancing Notes shall bear interest or
the method by which such rate shall be determined;
(6) the denomination or denominations in which any class of such
Refinancing Notes shall be issuable;
(7) 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 2.07 hereof, and the circumstances under which and the place or
places where any such exchanges may be made and the identity of any
initial depository therefor; and
(8) 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 paragraph (b) below and Section
5.02(d) hereof, the Issuer may issue Class B Notes pursuant to this Indenture (a
"Class B Issuance"), including 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 Resolutions 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 Redemption in whole of the Class A Notes
being refinanced is to occur as provided in Section 3.09.
(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 3.08 hereof. On the date of any such Optional Redemption,
the Issuer 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 plus any amount to be deposited in an Interest Reserve
Account for the Class B Notes. The proceeds of each sale of Class B Notes
shall be used to make the deposit required by Section 3.09(b) hereof, if
applicable, to pay such Transaction Expenses, to fund any Interest Reserve
Account and/or deposit and for such other purposes, if any, as shall be
specified in the Board Resolution authorizing the issuance such Class B Notes.
Once a notice of Redemption in respect of any Class B Issuance is published in
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accordance with Section 3.09(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 Resolutions (subject to Section 2.01
hereof) 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, and shall be subordinate to the Class A Notes to the extent provided in
this Indenture. No less than seven (7) 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 the Issuer and set
forth in such Board Resolutions 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:
(1) the aggregate principal amount of any such Class B Notes which
may be issued;
(2) the proposed date of such Class B Issuance;
(3) if applicable, the Scheduled Final Payment Date and the Final
Maturity Date of any such Class B Notes;
(4) whether any such Class B Notes are to have the benefit of any
reserve account and, if so, the amount and terms thereof;
(5) the rate at which such Class B Notes shall bear interest or the
method by which such rate shall be determined;
(6) the denomination or denominations in which such Class B Notes
shall be issuable;
(7) 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 2.07 hereof, and
the circumstances under which and the place or places where any such
exchanges may be made and the identity of any initial depository therefor;
and
(8) 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
5.02(d) and Section 12.13 hereof).
(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 Class A Notes. The principal of the Class A Notes shall not
be prepayable except as expressly provided in this Indenture in a prepayment in
any IO Account Redemption, Optional Redemption or Termination Redemption and the
payment of principal pursuant to clauses (A), (B) and (C) of Section
3.07(a)(iii). If any part of the principal of the Class A Notes is so prepaid
during the Interest Only Period, the amount of such prepayment shall be
allocated pro rata to reduce the Scheduled Principal Payment Amounts in the
Class A Principal Payment Schedule. If any part of the principal on the Class A
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Notes is so prepaid on any Payment Date or Special Distribution Date after the
Interest Only Period, the amount of such prepayment shall be allocated pro rata
to reduce the Scheduled Principal Payment Amounts on the remaining Payment Dates
in the Class A Principal Payment Schedule. For the avoidance of doubt, except as
expressly provided in the foregoing provisions of the Indenture, the amount of
principal payable on the Class A Notes on any Payment Date or Special
Distribution Date shall not exceed the amount needed to reduce the Outstanding
Principal Balance of the Class A Notes to the balance specified in the Class A
Principal Payment Schedule for such Payment Date or for the immediately
preceding Payment Date, in the case of a Special Distribution Date.
ARTICLE III
ACCOUNTS; PRIORITY OF PAYMENTS
Section 3.01 Establishment of Accounts. (a) The Issuer shall establish and
maintain with the Operating Bank on its books and records in the name of the
Issuer, subject to the lien in favor of the Trustee established by this
Indenture, (i) a Collection Account (the "Collection Account"), (ii) if
applicable, a redemption account (the "Redemption Account"), (iii) if
applicable, a capital contribution account (the "Capital Account"), (iv) an "IO
Period Account," and (iv) any additional accounts the establishment of which is
set forth in a Board Resolution delivered to the Trustee, in each case at such
time as is set forth in this Section 3.01 or in such Board Resolution. Each
Account shall be established and maintained as an Eligible Account so as to
create, perfect and establish the priority of the security interest of the
Trustee in such Account and all cash, Eligible Investments and other property
from time to time deposited therein and otherwise to effectuate the lien of the
Indenture Estate.
(b) Withdrawals and Transfers. The Trustee shall have sole dominion
and control over the Accounts (including, inter alia, the sole power to direct
withdrawals or transfers from the Accounts and to direct the investment and
reinvestment of funds in the Accounts, subject to Section 3.02). The Trustee
shall make withdrawals and transfers from the Accounts in accordance with the
terms of this Indenture based on the Relevant Information and as calculated by
it pursuant to this Indenture. The Issuer, and the Trustee acknowledge that
the Accounts are "deposit accounts" or "investment property" within the
meaning of Section 9-102 of the UCC and that the Trustee has "control," for
purposes of Section 9-314 of the UCC, of Accounts that are maintained with the
Trustee as the Operating Bank. The Issuer agrees that, if any Account is
established or maintained with any Operating Bank other than the Trustee, the
Issuer shall cause such Operating Bank to enter into an agreement with the
Trustee and the Issuer pursuant to which such Operating Bank agrees to comply
with instructions originated by the Trustee directing the disposition,
investment and reinvestment of funds in all Accounts maintained with such
Operating Bank without the further consent of the Issuer and shall take such
other actions as are reasonably required by the Trustee to establish its
"control," for purposes of Section 9-314 of the UCC, over any such Accounts.
(c) Eligible Accounts. If, at any time, any Account ceases to be an
Eligible Account, the Issuer shall, within 10 Business Days, establish a new
account meeting the conditions set forth in this Section 3.01 in respect of
such Account and transfer any cash or investments in the existing Account to
such new account; and from the date such new collection account is
established, it shall have the same designation as the existing Account. If
the Operating Bank should change at any time, then the Issuer shall thereupon
promptly establish replacement accounts as necessary at the successor
Operating Bank and transfer the balance of funds in each Account then
maintained at the former Operating Bank to such successor Operating Bank.
(d) Collection Account. The Issuer shall establish and maintain the
Collection Account not later than the Closing Date, and the Collection Account
shall bear a designation clearly
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indicating that the funds deposited therein are held for the benefit of the
Secured Parties. Except as expressly provided herein, all Collections shall be
deposited in the Collection Account and transferred therefrom in accordance
with the terms of this Indenture. No funds shall be deposited in the
Collection Account that do not constitute Collections except as expressly
provided in this Indenture without the prior written consent of the Trustee.
(e) Redemption Account. Upon receipt of notice of a Redemption of
any class of Notes, the Servicer shall establish and maintain a Redemption
Account at the Operating Bank in the name of the Issuer for the benefit of the
Holders of Notes that are the subject of such Redemption. All amounts received
for the purpose of any such Redemption shall be deposited in such Redemption
Account and shall be held in such Account until such amounts are applied to
pay the Redemption Price of such Notes and such Notes are cancelled by the
Trustee.
(f) Capital Account. Upon the receipt of any capital contribution
from ACT II to the Issuer, the Issuer shall establish and maintain the Capital
Account at the Operating Bank in the name of the Issuer for the benefit of the
Secured Parties and shall deposit all such capital contributions from ACT II
in the Capital Account. The Issuer also may direct the Trustee in writing to
deposit in the Capital Account all or any portion of any Excess IO Period
Payment Amount and any Net Available Revenues otherwise distributable to the
Issuer pursuant to Section 3.07(a)(vii). The Trustee shall maintain a record
of the portion of the funds on deposit in the Capital Account allocable to
capital contributions and the portion allocable to such deposits. All such
capital contributions and other deposits shall be held in such Account and
transferred to the Collection Account only to the extent permitted by Section
3.06(c) and (ii) to the Redemption Account only to the extent specifically
provided for in any notice of an Optional Redemption or Termination Redemption
delivered to the Trustee pursuant to Section 3.09(a).
(g) IO Period Account. The Issuer shall establish and maintain the
IO Period Account not later than the first Payment Date after the Closing
Date, and the IO Period Account shall bear a designation clearly indicating
that the funds deposited therein are held for the benefit of the Secured
Parties. The Trustee shall transfer to the IO Period Account from the
Collection Account all Excess IO Period Payment Amounts that are to be so
transferred pursuant to Section 3.07(a)(iv), and shall make distributions from
the IO Period Account as provided in Section 3.07(a)(vii).
Section 3.02 Investments of Cash. For so long as any Notes remain
Outstanding, the Trustee, at the direction of the Servicer, shall, or shall
direct the Eligible Institution holding each Account in writing, to invest and
reinvest the funds on deposit in the Accounts in Eligible Investments; provided,
however, that so long as an Event of Default has occurred and is continuing, the
Trustee shall invest such amount in Eligible Investments described in clause (d)
of the definition thereof from the time of receipt thereof until such time as
such amounts are required to be distributed pursuant to the terms of this
Indenture. In the absence of written direction delivered to the Trustee from the
Servicer, the Trustee shall invest any funds in Eligible Investments described
in clause (d) of the definition thereof. The Trustee shall make such investments
and reinvestments in accordance with the terms of the following provisions:
(i) the Eligible Investments shall have maturities and other
terms such that sufficient funds shall be available to make required
payments pursuant to this Indenture on the Business Day immediately
preceding the first Payment Date after which such investment is made, in
the case of investments of funds on deposit in the Collection Account; and
(ii) if any funds to be invested are not received in the
Accounts by 1:00 p.m., New York City time, on any Business Day, such funds
shall, if possible, be invested in overnight Eligible Investments.
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The Issuer acknowledges that regulations of the U.S. Comptroller of the
Currency grant the Issuer the right to receive confirmations of security
transactions as they occur. The Issuer specifically waives receipt of such
confirmations to the extent permitted by law and acknowledges that the Trustee
will furnish periodic cash transaction statements which will detail all
investment transactions.
Section 3.03 Closing Date Deposits, Withdrawals and Transfers. (a) On the
Closing Date, the Trustee shall, subject to the receipt of written direction
from the Issuer upon receipt of the proceeds of the sale by the Issuer of the
Notes, make the following payments and transfers to the Accounts from such
proceeds:
(i)pay to such Persons as shall be specified by the Issuer such
Transaction Expenses as shall be due and payable in connection with the
issuance and sale of the Notes; and
(ii) remit to ACT II an amount described in such written direction
as being equal to the cash portion of the Sale Price as specified and
defined in the Purchase and Sale Agreement.
(b) On the date of issuance of any additional Class A Notes,
Refinancing Notes or Class B Notes, the Trustee shall, subject to the receipt
of written direction from the Issuer upon receipt of the proceeds of the sale
by the Issuer of such Notes, make such payments and transfers as shall be
specified in the related Board Resolution and any supplemental indenture in
respect of such Notes, copies of which Board Resolution and supplemental
indenture shall be attached to such written direction.
Section 3.04 Special Distribution Dates; True-up Payments. (a) If, (i)
after any Payment Date on which the Available Collections Amount was not
sufficient to pay in full the Interest Amount on the Class A Notes on such
Payment Date or to reduce the Outstanding Principal Balance of the Class A Notes
to the balance specified in the Class A Principal Payment Schedule for such
Payment Date, and (ii) more than thirty (30) days prior to the next succeeding
Payment Date, the Issuer receives additional Royalty Payments (including any
lump sum prepayment of the Minimum Revenue Obligations) in an amount sufficient
to pay the shortfall in the Interest Amount or to make a principal payment on
the Class A Notes that would reduce the Outstanding Principal Balance to such
specified balance, then (iii) the Issuer may request the Trustee in writing to
make a special distribution of such additional Royalty Payments in payment of
any such interest shortfall or principal. Any such special distribution shall be
made on a Business Day (a "Special Distribution Date") specified by the Issuer
in its request, which shall be not less than seven (7) Business Days after the
date of such request and not less than twenty (20) days prior to the next
succeeding Payment Date.
(b) If ACT II is obligated, pursuant to Section 6.1.2 of the Manufacturing
and Supply Agreement, to make any corrective payment to Xxxxxxx based on a
reconciliation of the estimated weighted average price of the Product and the
Licensed Net Selling Price of the Final Product (as defined in that agreement),
ACT II shall deliver written notice to the Issuer, the Servicer and the Trustee
of the amount of such payment and the date by which it is to be paid (which is
45 days after the date of such reconciliation). If any such payment is due after
the next succeeding Payment Date, the Trustee shall disburse the amount of such
payment on such Payment Date as an Expense payable to Xxxxxxx at such account as
shall be specified in such written direction. If such payment is due prior to
the next succeeding Payment Date, the Trustee, upon receipt of a joint written
direction by ACT II and the Issuer, shall withdraw the amount of such payment
from the Collection Account by the date on which such payment is due and remit
such payment to Xxxxxxx at such account as shall be specified in such written
direction. Any payment due from Xxxxxxx under Section 6.1.2 of the Manufacturing
and Supply Agreement will be included in Collections when received.
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Section 3.05 Calculation Date Calculations. (a) Calculation of Certain
Amounts. As soon as reasonably practicable after each Calculation Date, but in
no event later than 12:00 noon (New York, New York time) on the second Business
Day prior to the immediately succeeding Payment Date or Special Distribution
Date, the Trustee shall, based on information known to it or Relevant
Information provided to it, determine the amount of Collections received during
the period commencing on the day next following the preceding Calculation Date
and ending on such Calculation Date (including the amount of any investment
earnings on the balances in the Collection Account and the IO Period Account, if
any, as of such Calculation Date and any amount to be transferred pursuant to
Section 3.06 in respect of the immediately succeeding Payment Date or Special
Distribution Date) and shall calculate the following amounts:
(i) (A) the balance of funds on deposit in the Collection Account,
the Capital Account and the IO Period Account on such Calculation Date,
(B) the amount of investment earnings (net of losses and investment
expenses), if any, on investments of funds on deposit therein during the
current Interest Accrual Period, and (C) the balance net of such
investment earnings in the Capital Account (the "Capital Account Balance")
and in the IO Period Account (the "IO Period Account Balance");
(ii) the Expenses payable on the Payment Date or Special
Distribution Date immediately succeeding such Calculation Date, consisting
of all Expenses incurred by the Trustee and not previously reimbursed and
the amounts shown on all invoices received from the Servicer for the
reimbursement or payment of Expenses not previously paid or reimbursed;
(iii) the Available Collections Amount for such Payment Date or
Special Distribution Date; and
(iv) any other information, determinations and calculations
reasonably required in order to give effect to the terms of this Indenture
and the Related Documents.
(b) Calculation of Interest Amounts. Not later than 12:00 noon (New
York, New York time) on the second Business Day prior to each Payment Date or
Special Distribution Date, the following calculations or determinations with
respect to Interest Amounts due on such Payment Date or Special Distribution
Date shall be performed or made by the Calculation Agent:
(i) the applicable interest rate on each class of Floating Rate
Notes based on LIBOR determined on the Reference Date for the Interest
Accrual Period beginning on such Payment Date;
(ii) the Interest Amount (including any Additional Interest and
Supplemental Interest) on each class of Floating Rate Notes for such
Payment Date; and
(iii) the Interest Amount (including any Additional Interest and
Supplemental Interest) on each class of Fixed Rate Notes for such Payment
Date or Special Distribution Date.
(c) Distribution Conditions. Not later than 12:00 noon (New York, New
York time) on the second Business Day prior to each Payment Date (but not any
Special Distribution Date), the Calculation Agent shall determine if the
following two conditions (the "Distribution Conditions" have been satisfied:
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(i) whether the Available Collections Amount for such Payment Date
is in an amount sufficient to pay the Interest Amount on the Class A Notes
and the Expenses due and payable on such Payment Date; and
(ii) whether the Yield Coverage Ratio for the Interest Accrual
Period ending on such Payment Date is equal to or greater than the Yield
Coverage Ratio specified in the following table for such Payment Date:
Payment Dates Interest Coverage Ratio
April 1, 2005 to January 1, 2006 2.0
April 1, 2006 to January 1, 2007 3.0
April 1, 2007 to January 1, 2018 5.0
(d) Calculation of Principal Payments and Distributions to the Issuer.
Not later than 12:00 noon (New York, New York time) on the second Business Day
prior to each Payment Date or Special Distribution Date, the Calculation Agent
shall calculate or determine the following with respect to principal payments
due on such Payment Date or Special Distribution Date and the amounts
distributable to the Issuer on such Payment Date or Special Distribution Date:
(i) the Outstanding Principal Balance of each class of Notes on such
Payment Date or Special Distribution Date immediately prior to any
principal payment on such date;
(ii) the amount of the principal payment, if any, to be made in
respect of each class of Notes on such Payment Date or Special
Distribution Date, including:
(A) on any Payment Date during the Interest Only Period for
which the Calculation Agent has received written notice from the
Issuer, the Servicer or any Holder to the effect that a Material
Adverse Development has occurred and is continuing, the Excess IO
Period Payment Amount to be paid on the Class A Notes;
(B) on any Payment Date or Special Distribution Date during
the Interest Only Period for which the Calculation Agent has received
written notice from the Issuer, the Servicer or any Holder that the
Available Collections Amount for such Payment Date or Special
Distribution Date includes a lump sum prepayment of the Minimum Revenue
Obligations and the amount thereof, the portion of such lump sum
prepayment in excess of the Expenses and Interest Amount payable on
such Payment Date to be paid on the Class A Notes;
(C) on any Payment Date or Special Distribution Date after the
Interest Only Period for which the Calculation Agent has received
written notice from the Issuer, the Servicer or any Holder that the
Available Collections Amount includes a lump sum prepayment of the
Minimum Revenue Obligations, the amount of such lump sum prepayment
reduced by the excess of the Available Collections Amount (calculated
without regard to such lump sum prepayment) over the principal payment
determined pursuant to clause (D) or (E) below, as applicable;
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(D) on any Payment Date after the Interest Only Period, the
principal payment required to be paid on the Class A Notes on such
Payment Date that would reduce the Outstanding Principal Balance of
the Class A Notes to the balance specified for such Payment Date in
the Class A Principal Payment Schedule; and
(E) on any Special Distribution Date after the Interest Only
Period, the principal payment required to be paid on the Class A
Notes on such Special Distribution Date that would reduce the
Outstanding Principal Balance of the Class A Notes to the balance
specified for the immediately preceding Payment Date in the Class A
Principal Payment Schedule;
(iii) the amounts, if any, distributable to the Issuer on such
Payment Date, including:
(A) for each Payment Date during the Interest Only Period on
which the Distribution Conditions are satisfied, the Excess IO
Period Payment Amount, if any;
(B) for each Payment Date during the Interest Only Period on
which the Deferred Excess IO Distribution Test has been satisfied,
the balance in the IO Period Account; and
(C) for each Payment Date after the Interest Only Period on
which the Distribution Conditions have been satisfied, the Net
Available Revenues, if any, distributable to the Issuer.
(e) Calculation of Redemption Amounts. Not later than 12:00 noon
(New York, New York time) on the second Business Day prior to the Redemption
Date on which a Redemption of the Notes is scheduled to occur, the Calculation
Agent shall perform the calculations necessary to determine the Redemption
Price of the Notes to be repaid on such Redemption Date, the Redemption
Premium, if any, to be paid in addition to such Redemption Price and the
amount of accrued and unpaid interest on the Outstanding Principal Balance of
the Notes being redeemed through the Redemption Date.
(f) Calculation of Shortfalls. Not later than 12:00 noon (New York,
New York time) on the second Business Day prior to each Payment Date or
Special Distribution Date, the Calculation Agent shall perform the
calculations necessary to determine the following:
(i) the shortfall, if any, of the Available Collections Amount
for such Payment Date or Special Distribution Date in respect of the
Interest Amount due to the Class A Noteholders pursuant to clause (ii) of
Section 3.07(a) (an "Interest Shortfall"), taking into account the payment
of Expenses payable on such Payment Date;
(ii) on each Payment Date or Special Distribution Date after the
Termination Date, the shortfall, if any, of the Available Collections
Amount for such Payment Date or Special Distribution Date in respect of
the principal payment on the Class A Notes required to reduce the
Outstanding Principal Balance of the Class A Notes to the balance
specified for such Payment Date in the Class A Principal Payment Schedule
(a "Post-Termination Shortfall" and, together with Interest Shortfalls,
the "Shortfalls"), taking into account the payment of Expenses and the
Interest Amount payable on such Payment Date or Special Distribution Date;
and
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(iii) with respect to each Shortfall, the amount, if any, to be
withdrawn from the IO Period Account, to the extent authorized by Section
3.06(b), and the amount, if any, to be withdrawn from the Capital Account,
to the extent authorized by Section 3.06(c).
(g) Application of the Available Collections Amount. Not later than
1:00 p.m., New York City time, two Business Days prior to each Payment Date or
Special Distribution Date, the Trustee shall determine the amounts of the
Available Collections Amount to be applied on such Payment Date or Special
Distribution Date to make each of the payments, transfers and deposits
contemplated by Section 3.07(a) or Section 3.07(b), as applicable, setting
forth separately, in the case of payments in respect of each class of Notes,
the amount to be applied on such Payment Date or Special Distribution Date to
pay all Expenses due and payable on such date, and interest, principal and
Premium, if any, on such class of Notes, all in accordance with Section 3.07.
(h) Reports. The Trustee shall provide to the Servicer and the
Issuer the information described in Section 3.05(a), Section 3.05(b), Section
3.05(c), Section 3.05(d), Section 3.05(e), Section 3.05(f) and Section 3.05(g)
to the Servicer and the Issuer, no later than 1:00 p.m., New York City time,
two Business Days immediately preceding each Payment Date or Special
Distribution Date, as applicable. The Calculation Agent shall provide a copy
to the Trustee of any written notice received by it that is described in
Section 3.05(d)(ii).
(i) Redeposits. Not later than the Business Day immediately
preceding each Payment Date after the Interest Only Period, subject to the
Issuer receiving the report from the Trustee described in Section 3.05(h), the
Issuer shall advise the Trustee as to the portion of Net Available Revenues,
if any, distributable to the Issuer on such Payment Date to be redeposited in
the Collection Account or the Capital Account on such Payment Date.
Section 3.06 Payment Date or Special Distribution Date First Step
Transfers. On each Payment Date or Special Distribution Date, the Trustee shall
make the following transfers:
(a) Investment Earnings. From any Account (other than the Collection
Account) to the Collection Account the amount of earnings (net of losses and
investment expenses), if any, on investments of funds on deposit therein
during the preceding Interest Accrual Period;
(b) IO Period Account. On any Payment Date or Special Distribution
Date, if there is a positive IO Period Account Balance and if, on any Payment
Date or Special Distribution Date after the Interest Only Period, the Issuer
has not elected to make an IO Account Redemption on such Payment Date, from
the IO Period Account to the Collection Account the lesser of the Shortfalls
on such Payment Date or Special Distribution Date and the IO Period Account
Balance; and
(c) Capital Account. If there is a positive Capital Account Balance,
from the Capital Account to the Collection Account the lesser of (x) the
Interest Shortfalls on such Payment Date or Special Distribution Date in
excess of the amount, if any, withdrawn pursuant to clause (b) and allocable
to such Interest Shortfalls and (y) the Capital Account Balance, provided,
that the Trustee shall make such a transfer from the Capital Account in
respect of not more than eight (8) Payment Dates in total prior to the Final
Maturity Date of the Notes and in respect of not more than any four (4)
consecutive Payment Dates, provided further, however, that on and after the
Termination Date, there shall be no limitation on the number of transfer of
Interest Shortfalls from the Capital Account to the Collection Account, and
that, if there is a Post-Termination Shortfall on any Payment Date after a
Termination Date in excess of the amount, if any, withdrawn pursuant to clause
(b) and allocable to such Post-Termination Shortfall, then the Trustee shall
transfer from the Capital Account to the Collection Account the lesser of the
remaining Post-Termination Shortfall and the Capital Account
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Balance remaining after any transfer of Interest Shortfalls and distribute it
to the Class A Noteholders in payment of the Scheduled Principal Payment
Amount payable on the Class A Notes;
Section 3.07 Payment Date or Special Distribution Date Second Step
Withdrawals. (a) On each Payment Date or Special Distribution Date, after the
transfers provided for in Section 3.06 have been made and after making the
distributions, if any, pursuant to Section 3.07(b), the Trustee shall distribute
from the Collection Account the amounts set forth below in the order of priority
set forth below but, in each case, only to the extent that all amounts then
required to be paid ranking prior thereto ("Prior Ranking Amounts") have been
paid in full:
(i) First, on each Payment Date or Special Distribution Date, to the
payment of all Expenses due and payable on such Payment Date;
(ii) Second, on each Payment Date or Special Distribution Date, to
the Holders of the Class A Notes, the Interest Amount on the Class A
Notes;
(iii) Third, to the Holders of the Class A Notes, to the payment of
principal on the Notes in the following amounts:
(A) on each Payment Date during the Interest Only Period for
which the Trustee has received a copy of the written notice described
in Section 3.05(d)(ii)(A) to the effect that a Material Adverse
Development has occurred and is continuing, the Excess IO Period
Payment Amount for such Payment Date;
(B) on any Payment Date or Special Distribution Date during
the Interest Only Period for which the Trustee has received a copy of
the written notice described in Section 3.05(d)(ii)(B) to the effect
that the Available Collections Amount includes a lump sum prepayment
of the Minimum Revenue Obligations and the amount thereof, the portion
of such lump sum prepayment in excess of the Expenses and the Interest
Amount for the Class A Notes on such Payment Date or Special
Distribution Date;
(C) on any Payment Date or Special Distribution Date after the
Interest Only Period for which the Trustee has received a copy of the
written notice described in Section 3.05(d)(ii)(C) to the effect that
the Available Collections Amount includes a lump sum prepayment of the
Minimum Revenue Obligations and the amount thereof, the amount of such
lump sum prepayment reduced by the excess of the Available Collections
Amount (calculated without regard to such lump sum prepayment) over
the principal payment to be made pursuant to clause (D) or (E) below,
as applicable;
(D) on any Payment Date after the Interest Only Period, the
principal payment required to be paid on the Class A Notes on such
Payment Date that would reduce the Outstanding Principal Balance of
the Class A Notes to the balance specified for such Payment Date in
the Class A Principal Payment Schedule;
(E) on any Special Distribution Date after the Interest Only
Period, the principal payment required to be paid on the Class A Notes
on such Special Distribution Date that would reduce the Outstanding
Principal Balance of the Class A Notes to the balance specified for
the immediately preceding Payment Date in the Class A Principal
Payment Schedule; and
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(F) on any Payment Date or Special Distribution Date after the
delivery of an Acceleration Notice (unless and until such Acceleration
Notice has been annulled as provided in Section 4.02(a)) or the
occurrence of an Acceleration Default, to principal payments on the
Class A Notes until they are paid in full;.
(iv) Fourth, (A) on each Payment Date on which the Distribution
Conditions for such Payment Date have not been satisfied, (1) during the
Interest Only Period, the remaining amount of the Available Collections
Amount for such Payment Date shall be transferred to the IO Period Account
and (2) after the Interest Only Period, the remaining amount of the
Available Collections Amount for such Payment Date shall be re-deposited
in the Collection Account and (B) on each Special Distribution Date, the
remaining amount of the Available Collections Amount for such Special
Distribution Date shall be re-deposited in the Collection Account;
(v) Fifth, on each Payment Date after the Class A Notes have been
paid in full, to the Holders of the Class B Notes, if any, the Interest
Amount on the Class B Notes ;
(vi) Sixth, on each Payment Date after the Class A Notes have been
paid in full, to the Holders of the Class B Notes, if any, payment of the
principal amount on the Class B Notes in accordance with their terms until
the Class B Notes have been paid in full; and
(vii) Seventh, to the Issuer, (A) on each Payment Date during the
Interest Only Period, the Excess IO Payment Amount for such Payment Date,
if the Distribution Conditions for such Payment Date have been satisfied
and the Trustee has not received a copy of the written notice described in
Section 3.05(d)(ii)(A) to the effect a Material Adverse Development has
occurred and is continuing, and (B) on each Payment Date after the
Interest Only Period, the Net Available Revenues, if the Distribution
Conditions for such Payment Date have been satisfied, to the extent the
Issuer has not directed the Trustee to re-deposit all or a portion of such
Net Available Revenues in the Collection Account.
(b) Redemption. On any Payment Date on which any class of Notes is to
be the subject of a Redemption, in whole or in part, the Trustee shall
distribute the amounts in the applicable Redemption Account as provided
herein and in the applicable Board Resolutions, including the following:
(i) pay to such Persons as shall be specified by the Issuer such
Transaction Expenses as shall be due and payable in connection with the
issuance and sale of the applicable Refinancing Notes or Class B Notes;
(ii) remit to the Holders of such class of Notes, in accordance with
the Board Resolutions authorizing the Redemption, an amount equal to
Redemption Price plus Premium, if any; and
(iii) make such other distributions and payments as shall be
authorized and directed by the Board Resolutions and indenture supplements
executed in connection with such Redemption.
Section 3.08 Redemptions. (a) Optional Redemption. Subject to the
provisions of Section 3.09 hereof, on any Payment Date the Issuer may elect to
redeem any class of Notes (i) in whole but not in part out of the proceeds of
Refinancing Notes, in the case of a Refinancing of such class of Notes, or (ii)
in whole or in part with the proceeds of any Class B Notes or other funds that
may become available to the Issuer (including the portion of the Capital Account
Balance on any Payment Date
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allocable to deposits of Excess IO Period Payment Amounts and Net Available
Revenues described in Section 3.01(f) but excluding the portion allocable to
capital contributions from ACT II), in each case, at the Redemption Price plus
the Redemption Premium, if any, plus accrued and unpaid interest through the
Redemption Date (any such redemption, an "Optional Redemption"). The Issuer
shall give notice of any such Optional Redemption to the Trustee not later than
seven (7) Business Days prior to the date on which notice is to be given in
accordance with Section 3.09(a). Such 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 3.09(a).
(b) IO Account Redemption. If there is a balance in the IO Period
Account on any Payment Date after the Interest Only Period, the Issuer shall
have the right to redeem a portion of the Outstanding Principal Balance of the
Class A Notes equal to the IO Period Account Balance on such Payment Date, at
the Redemption Price plus accrued and unpaid interest through the Redemption
Date (any such redemption, an "IO Account Redemption"). The Issuer shall give
notice of any such IO Account Redemption to the Trustee not later than seven
(7) Business Days prior to the date on which notice is to be given in
accordance with Section 3.09(a). Such notice to the Trustee shall include a
copy of the Board Resolution authorizing such IO Account Redemption and shall
set forth the relevant information regarding such IO Account Redemption,
including the information to be included in the notice given pursuant to
Section 3.09(a).
(c) Termination Redemption. If a termination of both of the License
Agreements and the Manufacturing and Supply Agreement occurs, in each case
without the approval of ACT II, the Issuer shall have the right to redeem the
Class A Notes, in whole but not in part, with the proceeds of any Class B
Notes or other funds that may become available to the Issuer (including the
amounts on deposit in all of the Accounts) on the last Business Day during the
six-month period beginning on the Termination Date, at the Redemption Price
plus accrued and unpaid interest through the Redemption Date (any such
redemption, a "Termination Redemption").
(d) Other Redemptions. A supplemental indenture providing for the
issuance of any Refinancing Notes or Class B Notes may authorize one or more
redemptions, in whole or in part, of such Notes, on such terms and conditions
as shall be specified in such supplemental indenture.
Section 3.09 Procedure for Redemptions. (a) Method of Redemption. The
Trustee (or the Servicer acting as its agent) shall give written notice in
respect of any Redemption of any class of Notes under Section 3.08 hereof to
each Holder of such Notes at least thirty (30) days but not more than sixty (60)
days before such Redemption Date (and within four months after the Termination
Date, in the case of a Termination Redemption). The Trustee shall not be
permitted to deliver any notice under this Section 3.09(a) unless and until it
shall have received evidence reasonably satisfactory to it that amounts
sufficient to pay (A) the Redemption Price for such class of Notes plus the
Redemption Premium, if any, (B) all accrued and unpaid interest, including
Additional Interest, in respect of each class of Notes ranking pari passu
therewith or prior thereto and (C) the Transaction Expenses relating to such
Redemption are deposited, or will be deposited on or before the Redemption Date,
in the Redemption Account established in respect of such Redemption. Each notice
in respect of a Redemption given pursuant to this Section 3.09(a) shall state
(i) the applicable Redemption Date, (ii) the Trustee's arrangements for making
payments in respect of such Redemption, (iii) the Redemption Price of the Notes
to be redeemed and the Redemption Premium, if any, (iv) 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; (v) that Notes to be
redeemed in a Redemption in whole must be surrendered (which action may be taken
by any Holder of the Notes or its authorized agent) to the Trustee to collect
the Redemption Price on such Notes, and (vi) that, unless the Issuer defaults in
the payment of the Redemption Price, interest on Notes called for
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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 Holder receives such notice. Failure to
give notice or any defect in the notice shall not affect the validity of the
notice.
(b) Deposit of Redemption Amount. On or before any Redemption Date
in respect of a Redemption under Section 3.08, the Issuer shall, to the extent
an amount equal to the Redemption Price of the Notes to be redeemed and any
Transaction Expenses as of the Redemption Date is not then held by the Issuer
or on deposit in the Redemption Account, deposit or cause to be deposited in
the Redemption Account an amount in immediately available funds equal to such
amount.
(c) Notes Payable on Redemption Date. After notice has been given
under Section 3.09(a) hereof 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 of the Trustee, and from and after such Redemption Date (unless there
shall be a default by the Issuer in the payment of the Redemption Price) such
principal amount shall cease to bear interest. Upon surrender of any Note for
redemption in accordance with such notice, the Redemption Price of such Note
shall be paid as provided for in Section 3.07(b). 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.
ARTICLE IV
DEFAULT AND REMEDIES
Section 4.01 Events of Default. Each of the following events 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 Class A Notes, failure to pay the interest
on the Class A Notes due on any Payment Date other than the Final Maturity
Date in full on such Payment Date or 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, (ii) failure to pay in full on the Final
Maturity Date all accrued and unpaid interest due on the Class A Notes, and
(iii) in the case of any class of Notes other than the Class A Notes, failure
to pay the interest on any Notes of such class on any Payment Date;
(b) failure (i) to pay when due principal and Premium, if any, on
any Notes of such class on or prior to the applicable Final Maturity Date,
(ii) to pay the Redemption Price and the Redemption Premium, if any, when due
on any Redemption Date or Refinancing Date for such class and (iii) in the
case of the Class A Notes, to make a principal payment on each Payment Date
after the Termination Date in an amount sufficient to reduce the Outstanding
Principal Balance of the Class A Notes to the balance specified for such
Payment Date in the Class A Principal Payment Schedule;
(c) failure to pay any other amount due and payable under the
Indenture (other than principal, premium and interest on the Notes) within ten
Business Days after written notice to the Issuer is given of such non-payment
by the Trustee;
(d) failure by the Issuer to comply with the restrictions on
distributions set forth in Section 5.02(b) hereof;
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(e) failure by the Issuer to comply with any of the covenants,
obligations, conditions or provisions binding on it under the Indenture or the
Notes (other than a payment default for which provision is made in clause (a)
or (b) above), if such failure materially adversely affects the Holders of the
Notes and continues for a period of 60 days or more after written notice
thereof has been given to the Issuer by the Trustee or by Holders of at least
a majority of the aggregate outstanding principal balance of the Notes;
(f) except to the extent expressly permitted under this Indenture
and the Related Documents, any transfer or encumbrance by ACT II of its
interests in the Issuer, the License Agreements, the Manufacturing and Supply
Agreement or the Licensed Technology for Products in the Field without the
valid consent of the Issuer, including (to the extent required under the
Indenture) the consent of the Trustee to such Issuer consent;
(g) except to the extent expressly permitted under this Indenture
and the Related Documents, any amendment or other modification of the License
Agreements or the Manufacturing and Supply Agreement that would, materially
and adversely affect the ability of the Issuer to perform its obligations
without the valid consent of the Issuer, including (to the extent required
under the Indenture) the consent of the Trustee to such Issuer consent;
(h) a court having jurisdiction in the premises enters a decree or
order for (i) relief in respect of the Issuer under any applicable law
relating to bankruptcy, insolvency, receivership, winding-up, liquidation,
reorganization, examination, relief of debtors or other similar law now or
hereafter in effect, (ii) appointment of a receiver, liquidator, custodian,
trustee or similar official of the Issuer, or (iii) the winding-up or
liquidation of the affairs of the Issuer 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;
(i) the Issuer (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 now or
hereafter in effect, 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, examiner, assignee, custodian,
trustee, sequestrator or similar official of the Issuer or for all or
substantially all of the property and assets of the Issuer; or (iii) effects
any general assignment for the benefit of creditors;
(j) any judgment or order for the payment of money in excess of
$1,000,000, shall be rendered against the Issuer and either (i) enforcement
proceedings have been commenced by any creditor upon such judgment or order or
(ii) there is any period of 10 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; or
(k) the constitutional documents creating the Issuer cease to be in
full force and effect without replacement documents having the same terms
being in full force and effect.
Section 4.02 Acceleration, Rescission and Annulment. (a) If an Event of
Default with respect to the Notes (other than an Event of Default under clause
(h) or (i) of Section 4.01) occurs and is continuing, the Trustee may, and, upon
the direction of Holders (not affiliated with the Issuer) of a majority of the
aggregate Outstanding Principal Balance of the Senior Class of Notes, shall,
give an Acceleration Notice to the Issuer declaring the Outstanding Principal
Balance of such Notes and all accrued and unpaid interest thereon to be due and
payable. Upon delivery of an Acceleration Notice, such Outstanding Principal
Balance and all accrued and unpaid interest thereon shall be due and payable.
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At any time after the Trustee has declared the Outstanding Principal Balance of
the Notes to be due and payable and prior to the exercise of any other remedies
pursuant to this Article IV, the Trustee, upon the direction of Holders (not
affiliated with the Issuer) of a majority of the aggregate Outstanding Principal
Balance of the Senior Class of Notes, shall, subject to Section 4.05(a), by
written notice to the Issuer and the Trustee, rescind and annul such declaration
and thereby annul its consequences if: (i) there has been paid to or deposited
with the Trustee an amount sufficient to pay all overdue installments of
interest on the Notes, and the principal of, and Premium, if any, on the Notes
that would have become due otherwise than by such declaration of acceleration,
(ii) the rescission would not conflict with any judgment or decree and (iii) all
other Defaults and Events of Default, other than nonpayment of interest on and
principal of the Notes that have become due solely because of such acceleration
have been cured or waived. If an Event of Default under clause (h) or (i) of
Section 4.01 occurs, the Outstanding Principal Balance of the Notes and all
accrued and unpaid interest thereon shall automatically become due and payable
without any further action by any party.
(b) Notwithstanding Section 4.02, Section 4.03 and Section 4.12
hereof, after the occurrence and during the continuation of an Event of
Default, no Holders of any class of Notes other than the Senior Class of Notes
shall be permitted to give or direct the giving of an Acceleration Notice, or
to exercise any remedy in respect of such Event of Default, and no Person
other than the Controlling Party, at the direction of a majority of the
aggregate Outstanding Principal Balance of the Senior Class of Notes, may give
an Acceleration Notice or exercise any such remedy.
(c) Within 30 days after the occurrence of an Event of Default in
respect of any class of Notes, the Trustee shall give to the Noteholders of
such class of Notes notice, transmitted by mail, of all uncured or unwaived
Defaults known to it on such date; provided that the Trustee may withhold such
notice with respect to a Default (other than a payment default with respect to
interest, principal or Premium, if any) if it determines in good faith that
withholding such notice is in the interest of the affected Noteholders.
Section 4.03 Other Remedies. Upon the delivery of an Acceleration Notice
in accordance with Section 4.02 hereof or if any Acceleration Default shall have
occurred and be continuing, the Senior Trustee may at all times, but only at the
direction of Holders 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 or the Pledge 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 12.08 hereof and to the extent
permitted by law the Issuer consents to and waives any right to notice of such
appointment.
(b) The Senior Trustee may, without notice to the Issuer and at such
time as the Senior Trustee in its sole discretion may determine, exercise any
or all of the Issuer's rights in, to and under or in any way connected with or
related to, any or all of the Indenture Estate, including, (A) demanding and
enforcing payment and performance of, and exercising any or all of the
Issuer's rights and remedies with respect to the collection, enforcement or
prosecution of, any or all of the Indenture Estate (including the Royalty
Rights), in each case by legal proceedings or otherwise, (B) 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 Rights and under the Related Documents, and (C) preparing, filing
and signing the name of the Issuer on (1) any proof of claim or similar
document to be filed in any bankruptcy or similar proceeding involving the
Indenture
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Estate (including the Royalty Rights) and (2) any notice of lien, assignment
or satisfaction of lien, or similar document in connection with the Indenture
Estate (including the Royalty Rights).
(c) The Senior Trustee may, without notice except as specified
below, 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 License Agreements and the Manufacturing and
Supply Agreement have not been terminated, the Senior Trustee shall make any
such sale only to a Person that is a Permitted Holder. The Issuer agrees that,
to the extent notice of sale shall be required by law, at least ten (10)
business days' written notice to the Issuer 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, with prior written
notice to the Issuer, adjourn any public or private sale from time to time by
announcement at the time and place fixed therefor, and such sale may, with
prior written notice to the Issuer but 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 4.03(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 License
Agreements and the Manufacturing and Supply Agreement have not been
terminated, the Senior Trustee shall make any such sale only to a Person that
is a Permitted Holder.
(e) The Senior Trustee may require the Issuer to, and the Issuer
hereby agrees that it shall at its expense and upon written 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 License Agreements and the Manufacturing and Supply Agreement have not
been terminated, the Senior Trustee shall make any such sale 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 4.04 Limitation on Suits. Without limiting the provisions of
Section 4.09 and the final sentence of Section 12.04, no Holder shall have any
right to institute any proceeding, judicial or otherwise, with respect to this
Indenture, the Pledge Agreement or the Notes, or for the appointment of a
receiver or trustee, or for any other remedy hereunder, unless:
(a) such Holder is a holder of the Senior Class of Notes and has
previously given written notice to the Trustee of a continuing Event of
Default;
(b) the Holders (not affiliated with the Issuer) of a majority of
the aggregate Outstanding Principal Balance of the Senior Class of Notes make
a written request to the Trustee to pursue a remedy hereunder;
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(c) such Holder or Holders offer to the Trustee an indemnity
reasonably satisfactory to the Trustee against any costs, expenses and
liabilities to be incurred in complying with such request;
(d) the 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, Holders of a majority of the
Outstanding Principal Balance of the Senior Class of Notes do not give the
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 Holder 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 Holder or to enforce any right under this Indenture,
except in the manner herein provided.
Section 4.05 Waiver of Existing Defaults. (a) The Trustee or the Holders
of a majority of the aggregate Outstanding Principal Balance of the Senior Class
of Notes by notice to the 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
hereof cannot be modified or amended without the consent of the Holder 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
Holders of the Notes to the Trustee and the Issuer in accordance with the
terms of this Indenture shall be binding upon the 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 4.06 Restoration of Rights and Remedies. If the 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 reason, or has been determined adversely to
the Trustee or such Holder, then in every such case the Issuer, the 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 Trustee and the Noteholders shall
continue as though no such proceeding has been instituted.
Section 4.07 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 the Issuer or to be an acquiescence.
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Section 4.08 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 4.09 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 its 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 4.10 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 4.11 Undertaking for Costs. All parties to this Indenture agree,
and each Noteholder by its acceptance thereof 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
4.11 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 his Note on or after the respective due dates expressed in
such Note, or a suit by a Noteholder or Noteholders of more than 10% of the
Outstanding Principal Balance of the Notes.
Section 4.12 Control by Noteholders. Subject to Section 4.02 and Section
4.04 hereof and to the rights of the Trustee hereunder, Noteholders of any class
of Notes with at least a majority of the Outstanding Principal Balance of such
class of 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 or power conferred on the Trustee under this Indenture; provided that:
(1) 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;
(2) the Trustee shall not determine that the action so directed
would be unjustly prejudicial to the Noteholders of such class not taking
part in such direction; and
(3) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction.
Section 4.13 Controlling Party. The "Controlling Party" with respect to
this Indenture shall be the Senior Trustee, which shall be (A) so long as any
Class A Notes are outstanding, the Trustee acting at the direction of the
Noteholders of the Class A Notes evidencing 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 the Class B Notes
evidencing a majority of the Outstanding Principal Balance of the Class B Notes.
For purposes of giving effect to the foregoing, the Trustee irrevocably agrees
(and the Noteholders (other than the Noteholders
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represented by the Controlling Party) shall be deemed to agree by virtue of
their purchase of the Notes) that the Controlling Party, as determined in
accordance with this Section 4.13, 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 Controlling Party.
Section 4.14 Application of Proceeds. All cash proceeds received by the
Senior Trustee 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 Article III. Any surplus of
such cash proceeds held by the Senior Trustee and remaining after payment in
full of all the Secured Obligations shall be paid over to the Issuer (or as
directed in writing by the Issuer) as provided in Section 3.07 hereof. Any
amount received for any sale or sales conducted in accordance with the terms of
Section 4.03 shall to the extent permitted by Applicable Law be deemed
conclusive and binding on the Issuer and the Noteholders.
Section 4.15 Waivers of Rights Inhibiting Enforcement. The Issuer waives
(a) any claim that, as to any part of the Indenture Estate, a 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 Related 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 THE ISSUER 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 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 Related 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 the Issuer, for
itself and all who may claim under it, insofar as it or they now or hereafter
lawfully may, hereby waive the benefit of all such laws and rights.
ARTICLE V
REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 5.01 Representations and Warranties. The Issuer represents and
warrants to the Trustee as of the Closing Date as follows:
(a) Due Organization. The Issuer is a limited liability company
formed under the laws of Delaware, with all requisite limited liability company
authority to conduct its business; and the Issuer is not in liquidation or
bankruptcy and has not taken any of the actions described in Section 4.01(f).
(b) Special Purpose Status. The Issuer has not engaged in any
activities since its organization other than those incidental to its
organization and permitted by its organizational documents, the execution of the
Related Documents to which it is a party and the activities referred to,
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in or contemplated by such agreements, and the Issuer has not paid any dividends
or made any similar distributions since its organization.
(c) Non-Contravention. The issuance of the Notes and the execution
and delivery of, and the compliance by the Issuer with the terms of the Notes
and each of the other Related Documents to which it is a party:
(i) do not at the Closing Date conflict with, or result in a
breach of any of the terms or provisions of, or constitute a default under, the
organizational documents of the Issuer or with any existing law, rule or
regulation applying to or affecting the Issuer or any judgment, order or decree
of any government, governmental body or court having jurisdiction over the
Issuer; and
(ii) do not at the Closing Date violate, or constitute a
default under, any deed, indenture, agreement or other instrument or obligation
to which the Issuer is a party or by which it or any part of its assets,
property or revenues are bound.
(d) Due Authorization. The execution and delivery of the Notes by
the Issuer and of the Related Documents executed by the Issuer, and the
performance by the Issuer of its obligations thereunder, have been duly
authorized, executed and delivered by it.
(e) Validity and Enforceability. This Indenture constitutes, and the
Related Documents to which it is a party, when executed and delivered and, in
the case of the Notes, when issued, executed, delivered for value and
authenticated, will constitute valid, legally binding and (subject to general
equitable principles, and laws relating to insolvency, liquidation,
reorganization and other laws of general application relating to creditors'
rights or claims or to laws of prescription or the concepts of materiality,
reasonableness, good faith and fair dealing) enforceable obligations of the
Issuer.
(f) No Defaults. On the Closing Date, there exists no event or
condition which constitutes, or would constitute, a Default or an Event of
Default.
(g) No Encumbrances. On the Closing Date, subject to the Security
Interests created in favor of the Trustee and except for Permitted Encumbrances,
there exists no Encumbrance over the assets of the Issuer.
(h) No Consents. All consents, approvals, authorizations or other
orders of all regulatory authorities required (excluding any required to be
obtained by the other parties to the Related Documents) for or in connection
with the execution, delivery and performance of the Related Documents by the
Issuer and the issuance and performance of the Notes and the offering of the
Notes by the Issuer have been obtained and are in full force and effect and are
not contingent upon fulfillment of any condition.
(i) No Litigation. There is no action, suit, investigation or
proceeding pending against, or to the knowledge of the Issuer, threatened
against, the Issuer before any court or arbitrator or any governmental body,
agency or official which in any manner challenges or seeks to prevent, enjoin,
alter or materially delay the transactions contemplated by this Indenture
(including the Exhibits and Schedules attached hereto) and the Related Documents
to which the Issuer is a party.
(j) Subsidiaries. The Issuer has no subsidiaries.
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(k) Ownership. The Issuer is the beneficial owner of the Royalty
Rights, free and clear of any Encumbrances other than Permitted Encumbrances.
(l) No Filings. Under the laws of Delaware and New York (including
U.S. federal law) in force at the date hereof, it is not necessary or desirable
that this Indenture or any Related Document (other than evidences and perfection
of the Security Interests) be filed, recorded or enrolled by the Issuer with any
court or other governmental authority in any such jurisdictions or that any
stamp, registration or similar tax be paid by the Issuer on or in relation to
this Indenture or any of the other Related Documents (other than (i) the filing
of the Indenture and any of the Related Documents with the Securities and
Exchange Commission by ACT II or its parent in order to comply with its
obligations under federal securities laws, (ii) filings of Uniform Commercial
Code financing statements and the various consents and agreements pursuant
hereto and (iii) such other filings as shall have been made prior to the date
hereof and such filings required to be made after the date hereof under
applicable federal and state securities laws, such as Form D and applicable
state blue sky filings).
(m) Other Representations. The representations and warranties made
by the Issuer in each of the other Related Documents to which it is a party are
true and accurate as of the date made.
Section 5.02 Covenants. The Issuer covenants with the Trustee that, so
long as any Notes are Outstanding, it will perform or 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 (given at the direction of the
Holders of the Notes representing a majority of the Outstanding Principal
Balance of the Notes) authorizing the Issuer 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) No Release of Obligations. Except as expressly permitted by this
Indenture, the Issuer 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
Pledge Agreement, the Purchase and Sale Agreement, the Contingent License or the
Servicing Agreement or permit any party to any such document to be released from
such obligations.
(b) Restrictions on Dividends. The Issuer shall not, directly or
indirectly (i) make any distribution (by reduction of capital or otherwise),
whether in cash, property, securities or a combination thereof, to ACT II or any
owner of a beneficial interest in the Issuer or otherwise with respect to any
ownership of or equity interest or security in the Issuer, except that the
Issuer may distribute to ACT II all or any portion of any Excess IO Period
Payment Amount or Net Available Revenues distributed to the Issuer pursuant to
Section 3.07(a)(vii); (ii) purchase, redeem, retire or otherwise acquire for
value any shares of Stock of the Issuer; (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 Indebtedness of the Issuer other than in accordance with the Notes and this
Indenture; or (iv) make any investments (other than Eligible Investments and
investments permitted under Section 5.02(f) hereof). The term "investment" for
purposes of the above restriction shall mean any loan or advance to a Person,
any purchase or other acquisition of any beneficial interest, capital stock,
warrants, rights, options, obligations or other securities of such Person, any
capital contribution to such Person or any other investment in such Person.
(c) Encumbrances. The Issuer shall not (and shall not consent to ACT
II taking any action that would) create, incur, assume or suffer to exist any
Encumbrance over or with respect to any of the Issuer's assets, other than (i)
any Permitted Encumbrance, or (ii) any security interest created or
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required to be created hereunder, including in connection with the issuance of
any Refinancing Notes and Class B Notes.
(d) Limitation on Indebtedness. The Issuer shall not incur, create,
issue, assume, guarantee or otherwise become liable for or with respect to, or
become responsible for, the payment of, contingently or otherwise, whether
present or future (in any such case, to "incur"), Indebtedness, (other than the
Notes) provided, however, that the Issuer may incur Indebtedness in respect of
the Class A Notes issued on the Closing Date and of any Class B Notes and
Refinancing Notes issued in accordance with this Indenture; provided further,
however, that this limitation shall not apply to (i) the obligation of the
Issuer to reimburse the Servicer for any amounts advanced on behalf of the
Issuer and (ii) the subordinated obligation of the Issuer to pay royalties and
manufacturing fees to ACT II under the Contingent License.
(e) Limitation on Consolidation, Merger and Transfer of Assets.
Except as expressly permitted by this Indenture, the Issuer shall not
consolidate with, merge with or into, or sell, convey, transfer, lease or
otherwise dispose of the Royalty Rights or all or any material portion of its
other property and assets to, any other Person, or permit any other Person to
merge with or into the Issuer.
(f) Limitation on the Issuance, Delivery and Sale of Capital Stock.
The Issuer shall not, directly or indirectly, issue, deliver or sell, or consent
to issue, deliver or sell any actual, contingent, future or executory membership
interests, limited liability company interests, beneficial interests or other
equity or ownership interests (however designated, whether voting or
non-voting), except for the pledge by ACT II to the Trustee for the benefit of
the Noteholders of its Stock in the Issuer pursuant to the Pledge Agreement and
except for any additional Stock issued to ACT II, provided that such Stock is
pledged to the Trustee pursuant to the Pledge Agreement and provided further
that such capital contributions are deposited by the Issuer in the Capital
Account and that the Issuer may use the consideration received for any such
additional equity ownership interests to make payments of interest and principal
on the Notes to the extent provided in Sections 3.06(c) and 3.08(c).
(g) Limitation on Engaging in Business Activities. Except as
otherwise provided in the LLC Operating Agreement, the Issuer shall not engage
in any business or activity other than purchasing, holding and pledging the
Royalty Rights, collecting the Royalty Payments, issuing the Notes, and the
other activities described or referred to in this Indenture and the Related
Documents.
(h) Limitation on Transactions with Affiliates. The Issuer shall
not, directly or indirectly, enter into, renew or extend any transaction
(including, without limitation, the purchase, sale, lease or exchange of
property or assets, or the rendering of any service) with any Affiliate of the
Issuer, except upon fair and reasonable terms no less favorable to the Issuer
than could be obtained, at the time of such transaction or at the time of the
execution of the agreement providing therefor, in a comparable arm's-length
transaction with a Person that is not such an Affiliate. The parties hereto
expressly agree that each Related Document satisfies the provisions of this
Paragraph (h).
(i) Bankruptcy and Insolvency; Corporate Governance. The Issuer
shall promptly provide the Trustee with written notice of the institution of any
proceeding by or against the Issuer 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. The Issuer shall not take any action to waive, repeal, amend, vary,
supplement or otherwise modify its organizational documents in a manner that
would adversely affect the rights, privileges or preferences of any Holder of
the Notes, as determined by the Trustee. The Issuer shall not, without an
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affirmative written Board Resolution of all of the Managers of the Issuer,
including the Independent Manager, take any action to waive, repeal, amend,
vary, supplement or otherwise modify any provision of the LLC Operating
Agreement that requires unanimous written consent of the Managers, or limits the
actions of ACT II, with respect to voluntary insolvency proceedings or consents
to involuntary insolvency proceedings.
(j) Payment of Principal, Premium, if any, and Interest. The Issuer
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 the Issuer shall be in compliance with this covenant if it pays
in full by the next succeeding Payment Date any interest on the Class A Notes
that became due and was not paid on any Payment Date (including Additional
Interest thereon).
(k) Limitation on Employees. The Issuer shall not employ any
employees other than as required by any provisions of local law or as
contemplated by the LLC Operating Agreement; provided that the members, Managers
and Service Providers shall not be deemed to be employees for purposes of this
Section 5.02(k).
Section 5.03 Reports by the Issuer. (a) The Issuer shall furnish to the
Trustee, within 120 days after the end of each fiscal year, a brief certificate
from the principal executive officer, principal accounting officer or principal
financial officer of the Servicer, as applicable, as to his or her knowledge of
the Issuer's compliance with all of its obligations under this Indenture (it
being understood that for purposes of this Section 5.03, 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 Class A
Notes by the next succeeding Payment Date as contemplated by the proviso to
Section 5.02(j)).
(b) The Issuer shall deliver 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(d) of the Purchase and Sale Agreement promptly and in
any event within five (5) Business Days of a Manager of the Issuer becoming
aware of such Default, Event of Default, event or situation.
(b) The Issuer shall deliver to the Trustee copies of all materials that
the Issuer receives from ACT II pursuant to Section 6.4(a), (b) and (c) of the
Purchase and Sale Agreement promptly and in any event within five (5) Business
Days of the receipt of such materials.
ARTICLE VI
THE TRUSTEE
Section 6.01 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. The duties and responsibilities of the Trustee shall be as provided
by the Trust Indenture Act 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 and agrees to
receive and disburse all moneys received by it in accordance with the terms
hereof. 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 the
Issuer or any other parties to any of the Related Documents. Any amounts
received by or due to the Trustee under this Indenture, including, without
limitation, the fees and out-of-pocket expenses of the Trustee shall be Expenses
of the Issuer.
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Section 6.02 Absence of Duties. The Trustee, upon written request, shall
furnish to any Noteholder, 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.
Section 6.03 Representations or 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 (i) 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 (ii) this Indenture is the legal, valid and binding obligation of
U.S. Bank, enforceable against U.S. Bank in accordance with its terms, subject
to the effect of any applicable bankruptcy, insolvency, reorganization,
moratorium or similar law affecting creditors' rights generally.
Section 6.04 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 the Issuer, a Manager and, in the case of any other party to
any Related 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 the Issuer 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 inquire into the authorization of the Issuer with respect thereto.
To the extent not otherwise specifically provided herein, the Trustee shall
furnish to the Servicer upon written request such information and copies of such
documents as the Trustee may have and as are necessary for the Servicer to
perform its duties under Article II and Article III hereof.
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 Holders in accordance with Section 4.12 hereof relating to the time, method
and place of conducting any proceeding for any remedy available to the Trustee,
or exercising any trust or power conferred upon the Trustee, under this
Indenture.
The Trustee may execute any of the trusts or powers hereunder or perform
any duties hereunder 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 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 to institute, conduct or defend any
litigation hereunder or in relation hereto, at the
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request, order or direction of any of the Holders, pursuant to the provisions of
this Indenture, unless such Holders 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 in the exercise of any of its rights or powers, if there is
reasonable ground for believing that the repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it, and
none of the provisions contained in this Indenture shall in any event require
the Trustee to perform, or be responsible or liable for the manner of
performance of, any obligations of the Issuer or the Servicer under this
Indenture or any of the Related 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 4.01(h) or Section 4.01(i) hereof, 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 the Trustee receives written notice of such event from the Issuer, the
Servicer or Noteholders owning Notes aggregating not less than 10% of the
Outstanding Principal Balance of the Notes.
The Trustee shall have no duty to monitor the performance of the Issuer,
the Servicer or any other party to the Related Documents, nor shall it have any
liability in connection with the malfeasance or nonfeasance by such parties.
Section 6.05 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 herein provided,
only to the property of the Issuer for payment or satisfaction thereof.
Section 6.06 Compensation of Trustee. The Trustee agrees that it shall
have no right against the Noteholders or, except as provided in Section 3.07(a)
hereof, the property of the Issuer, for any fee as compensation for its services
hereunder. The Issuer 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 3.05(a) and Section 3.07(a).
Section 6.07 Notice of Defaults. As promptly as practicable after, and in
any event within 30 days after, the occurrence of any Default hereunder, the
Trustee shall transmit by mail to the Issuer and the Noteholders of the related
class in accordance with Section 313(c) of the Trust Indenture Act, 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
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faith determines that the withholding of such notice is in the interests of the
Noteholders of the related class.
Section 6.08 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, may otherwise deal with the
Issuer with the same rights it would have if it were not the Trustee, Paying
Agent, Registrar or such other agent.
Section 6.09 Corporate Trustee Required; Eligibility. There shall at all
times be an Trustee which shall be eligible to act as a trustee under Section
310(a) of the Trust Indenture Act 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, territorial or District of
Columbia supervising or examining authority, then for the purposes of this
Section 6.09, 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 6.09 to act as Trustee, the Trustee shall
resign immediately as Trustee in the manner and with the effect specified in
Section 7.01 hereof.
Section 6.10 Reports by the Trustee. Within 60 days after May 15 of each
year commencing with the first full year following the issuance of any class of
Notes, the Trustee shall, if required by Section 313(a) of the Trust Indenture
Act, transmit to the Noteholders of each class, as provided in Section 313(c) of
the Trust Indenture Act, 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 the Issuer and Noteholders holding 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.
Section 6.12 Pledge Agreement. The Trustee shall enter into the Pledge
Agreement with ACT II on the Closing Date and shall hold the collateral pledged
thereunder as part of the Indenture Estate. The provisions of this Article VI
shall apply to the Trustee's exercise of rights and remedies under the Pledge
Agreement, mutatis mutandis, without prejudice to the Pledge Agreement.
ARTICLE VII
SUCCESSOR TRUSTEES
Section 7.01 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 the Issuer, the Servicer and the Holders.
Holders 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
prior written consent of the Issuer if no Event of Default shall have occurred
and be continuing, by an instrument in writing delivered to the Issuer, the
Servicer and the Trustee being removed. In addition, the Issuer may remove the
Trustee as to any class of Notes if: (i) such Trustee fails to comply with
Section 310 of the Trust Indenture Act after written request therefor by the
Issuer or the Noteholders of the related class who have been bona fide
Noteholders for at least six months, (ii) such Trustee fails to comply with
Section 7.02(c) or any other provision hereof, (iii) such Trustee is adjudged a
bankrupt or an insolvent, (iv) a receiver or
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public officer takes charge of such Trustee or its property or (v) 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 7.01 shall not be effective until a successor Trustee
shall have been duly appointed and vested as Trustee pursuant to Section 7.02.
Section 7.02 Appointment of Successor. (a) In the case of the resignation
or removal of the Trustee as to any class of Notes under Section 7.01 hereof,
the Issuer shall promptly appoint a successor Trustee as to such class; provided
that the Noteholders holding 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 (with the prior written consent of the Issuer if no
event of Default shall have occurred and be continuing) as to such class which
may be other than the successor Trustee, and such successor Trustee appointed by
the Issuer 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, the
Issuer, the 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 the Issuer, the 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, the Issuer, 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.
(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 an Trustee hereunder.
(e) 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 to which all or substantially all of the business of
the Trustee (including the administration of the trust created by this
Indenture) may
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be transferred, shall, subject to the terms of paragraph (c) of this Section
7.02, be the Trustee under this Indenture without further act.
ARTICLE VIII
INDEMNITY
Section 8.01 Indemnity. The Issuer shall indemnify the Trustee (and its
officers, directors, employees and agents) for, and hold it harmless against,
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, 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 the Issuer 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. The
Issuer shall defend the claim and the Trustee shall cooperate in the defense.
The Trustee may have separate counsel and the Issuer shall pay the reasonable
fees and expenses of such counsel. The Issuer need not pay for any settlements
made without its consent; provided that such consent shall not be unreasonably
withheld or delayed. The Issuer 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 8.02 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 at the
request or direction of such Holders.
Section 8.03 Survival. The provisions of Section 8.01 and Section 8.02
hereof shall survive the termination of this Indenture or the earlier
resignation or removal of the Trustee.
ARTICLE IX
MODIFICATION
Section 9.01 Modification with Consent of Holders. With the consent of
Holders of a majority of the Outstanding Principal Balance of the Notes on the
date of any vote of such Holders (voting as a single class), the Issuer, when
authorized by a Board Resolution, may amend or modify this Indenture or the
Notes; provided that, without the consent of Holders of one hundred percent
(100%) of the Outstanding Principal Balance of the class of Notes affected
thereby, no such amendment may reduce the percentage of Holders of any such
class of Notes required to take or approve any action hereunder; change the
amount or the time of payment of any amount owing or payable with respect to any
such class of Notes or change the rate or manner of calculation of interest
payable with respect to any such class of Notes; 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 hereunder will be made as
between the Holders of such Notes and the Issuer; or consent to any assignment
of the Issuer's rights to a party other than the Trustee for the benefit of the
Noteholders (each, a "Basic Terms Modification"); provided further, that the
Holders of a majority of the Outstanding Principal Balance of the Senior Class
of Notes,
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by written notice to the Trustee, may waive any Default or Event of Default
pursuant to Section 4.05 hereof.
It shall not be necessary for the consent of the Holders under this
Section 9.01 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 Holders of any class of Notes will be
binding on the Holders of the relevant class of Notes and each party to the
Indenture.
After an amendment under this Section 9.01 becomes effective, the Issuer
shall mail to the Holders a notice briefly describing such amendment. Any
failure of the Issuer 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 9.01 becomes effective, it shall
bind every Holder, whether or not notation thereof is made on any Note held by
such Holder.
Section 9.02 Modification Without Consent of Holder. The Trustee may
agree, without the consent of any Noteholder:
(a) To evidence the succession of a successor as 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, the Indenture or any other Related Document, in any manner that
will not, in the judgment of the Trustee, materially adversely affect the
interests of the Holders of the Notes;
(d) To grant or confer upon the Trustee for the benefit of the
Holders of the Notes any additional rights, remedies, powers, authority or
security which may be lawfully granted or conferred and which are not contrary
or inconsistent with the Indenture;
(e) To add to or modify the covenants or agreements to be observed
by the Issuer, which are not contrary to the Indenture, to add Events of Default
for the benefit of the Holders of the Notes;
(f) To comply with the requirements of the SEC or any regulatory
body or any applicable law, rules or regulations; or
(g) To effect any indenture supplemental to the Indenture or any
other amendment, modification, supplement, waiver or consent with respect to the
Indenture or any other Related Document; provided, that such supplemental
indenture, amendment, modification, supplement, waiver or consent will not
adversely affect the interests of the Holders of the Notes in any material
respect as confirmed in an Officer's Certificate of the Issuer.
Section 9.03 Subordination and Priority of Payments. The subordination
provisions contained in Section 3.07 and Article X hereof may not be amended or
modified without the consent of each
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Noteholder of each class affected thereby. In no event shall the provisions set
forth in Section 3.07 relating to the priority and payment of Expenses be
amended or modified.
Section 9.04 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 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 9.05 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.
ARTICLE X
SUBORDINATION
Section 10.01 Subordination of the Notes. (a) Each of the Issuer and the
Trustee (on behalf of the Holders of each class of Notes) covenants and agrees,
and each Holder, 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;
and to the manner and priority in which the Available Collections Amount is to
be applied, as set forth in this Section 3.07 hereof. In addition, each Holder
of a Class B Note, by its acceptance of a Class B Note, 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 3.07 hereof, 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.
(b) If prior to the payment in full of all Senior Claims then due
and payable, the Trustee or any Holder 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 Holder was then entitled under Section 3.07
hereof, 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 such Section 3.07.
(c) If any Service Provider, the Trustee or Holder 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 Holders) and
the Issuer each confirm that the payment priorities specified in Section 3.07
hereof shall apply in all circumstances.
(e) Each Holder, 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 the Issuer (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
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property and assets of the Issuer or the filing of a claim for the unpaid
balance of its Notes in the form required in those proceedings.
(f) If payment on the Notes is accelerated as a result of an Event
of Default, the Issuer shall promptly notify the holders of the Senior Claims of
such acceleration.
(g) 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 the Issuer and the holders of Subordinated Claims, a payment by the
Issuer.
(h) 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 the Issuer or the Trustee or by any failure by either the Issuer or
the Trustee to comply with this Indenture.
(i) Each Holder 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 Holder's
claim, to acquire and continue to hold such Senior Claim and such holder of any
Senior Claim shall be deemed conclusively to have 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 Section 4.12
hereof.
ARTICLE XI
DISCHARGE OF INDENTURE
Section 11.01 Discharge of Liability on the Notes. (a) When (i) the Issuer
delivers to the Trustee all Outstanding Notes (other than Notes replaced
pursuant to Section 2.08 hereof) 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 3.09(a) hereof or any
other Redemption pursuant to Section 3.09(b) hereof and the Issuer irrevocably
deposits in the Redemption Account funds sufficient to pay at maturity or upon
redemption all Outstanding Notes, including interest thereon to maturity or the
Redemption Date (other than Notes replaced pursuant to Section 2.08), and if in
either case the Issuer pays all other sums payable hereunder by the Issuer, then
this Indenture shall, subject to Section 11.01(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 Issuer, on demand of the Issuer accompanied by an
Officer's Certificate and an Opinion of Counsel, at the cost and expense of the
Issuer, to the effect that any conditions precedent to a discharge of this
Indenture have been met.
(b) Notwithstanding clause (a) above, the Issuer's obligations in
Section 8.01 and the Trustee's obligations in Section 12.13 shall survive the
satisfaction and discharge of this Indenture.
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ARTICLE XII
MISCELLANEOUS
Section 12.01 Right of Trustee to Perform. To the extent provided in
Article IV, if the Issuer for any reason fails to observe or punctually to
perform any of its obligations to the Trustee, whether under this Indenture or
any of the other Related Documents or otherwise, the Trustee shall have power
(but shall have no obligation), on behalf of or in the name of the Issuer 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 the Issuer; 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
Related Documents.
Section 12.02 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 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 12.03 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 12.04 Restrictions on Exercise of Certain Rights. To the extent
provided in Article IV, the Trustee and, during the continuance of a payment
event of Default with respect to the Senior Class of Notes, the Senior Trustee,
in its capacity as trustee of such class and except as otherwise provided in
Section 4.04, 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 the Issuer. Each of the Noteholders shall at all times
be deemed to have agreed by virtue of the acceptance of the Notes that, to the
extent provided in Article IV, only the Trustee and, during the continuance of a
payment event of Default with respect to the Senior Class of Notes, the Senior
Trustee, in its capacity as trustee and except as provided in Section 4.04, 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 the laws of Delaware.
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Section 12.05 Notices. All notices, demands, certificates, requests,
directions, instructions and communications hereunder ("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, or (b) one Business Day after delivery to an overnight courier, or (c)
on the date personally delivered to an authorized officer of the party to which
sent, or (d) on the date transmitted by legible telecopier transmission with a
confirmation of receipt, or (e) in the case of reports under Article III hereof
and any other report which is of a routine nature, on the date transmitted by
electronic mail or sent by first class mail or transmitted by legible telecopier
transmission, in all cases addressed to the recipient as follows:
if to the Issuer, to:
RC Royalty Sub LLC
00 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxxxx 00000
Attention: General Counsel
Facsimile: (000) 000-0000
with copies to:
Xxxxxxx Procter LLP
Exchange Place
00 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxxxxx Xxxxx, Esq.
Facsimile: (000) 000-0000
if to the Servicer, to:
Alkermes Controlled Therapeutics Inc. II
00 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxxxx 00000
Attention: General Counsel
Facsimile: (000) 000-0000
if to the Trustee, the Registrar or the Paying Agent, to:
U.S. Bank National Association
Xxx Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Corporate Trust Services (RC Royalty Sub LLC 2005
Indenture)
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.
Section 12.06 Assignments. This Indenture shall be a continuing obligation
of the Issuer and shall (i) be binding upon the Issuer and its successors and
assigns and (ii) inure to the benefit of and be
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enforceable by the Trustee, and by its successors, transferees and assigns. The
Issuer may not assign any of its obligations under the Indenture, or delegate
any of its duties hereunder.
Section 12.07 Reserved.
Section 12.08 Governing Law. THIS INDENTURE SHALL IN ALL RESPECTS BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL SUBSTANTIVE LAW OF
THE STATE OF NEW YORK, WITHOUT REGARD TO THE CONFLICTS OF LAWS PRINCIPLES
THEREOF, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE.
Section 12.09 Jurisdiction; WAIVER OF JURY TRIAL. (a) Each of the parties
hereto agrees that the U.S. federal and New York State courts located in The
City of New York shall have non-exclusive 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. To the fullest extent permitted by law, each of the
parties hereto waives any objection which it might now or hereafter have to the
U.S. federal or New York State courts located in The City of New York being
nominated as the forum 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 agrees not to claim that any such court is not a convenient or
appropriate forum. Each of the parties hereto agrees that the process by which
any suit, action or proceeding is begun may be served on it by being delivered
in connection with any suit, action or proceeding in The City of New York in the
manner provided for notices in Section 12.05.
(b) The submission to the jurisdiction of the courts referred to in
Section 12.10(a) shall not (and shall not be construed so as to) limit the right
of any party hereto to take proceedings against the other party hereto 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 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, Headings, Etc. 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 and 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.
[SIGNATURE PAGE FOLLOWS]
-71-
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, all as of the date first written above.
RC ROYALTY SUB LLC,
as Issuer
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Chief Financial Officer
U.S. BANK NATIONAL ASSOCIATION, not in its
individual capacity but solely as Trustee
By: /s/ Alison X.X. Xxxxxx
-----------------------------------------
Name: Alison X.X. Xxxxxx
Title: Vice President
-1-
SCHEDULE 1
CLASS A PRINCIPAL PAYMENT SCHEDULE
Remaining
Payment Date Principal Payment Notes Balance
--------------- ----------------- ---------------
April 1, 2009 $14,166,666.67 $155,833,333.33
July 1, 2009 14,166,666.67 141,666,666.66
October 1, 2009 14,166,666.67 127,499,999.99
January 1, 2010 14,166,666.67 113,333,333.32
April 1, 2010 14,166,666.67 99,166,666.65
July 1, 2010 14,166,666.67 84,999,999.98
October 1, 2010 14,166,666.67 70,833,333.31
January 1, 2011 14,166,666.67 56,666,666.64
April 1, 2011 14,166,666.67 42,499,999.97
July 1, 2011 14,166,666.67 28,333,333.30
October 1, 2011 14,166,666.67 14,166,666.63
January 1, 2012 14,166,666.63 ---
-1-
EXHIBIT A
FORM OF RISPERDAL CONSTA(R) PHARMA(SM) SECURED 7% NOTE
CLASS A
DUE JANUARY 1, 2018
No. _____________ CUSIP: _______________
$______________
RC ROYALTY SUB LLC, a limited liability company organized under the laws
of the State of Delaware (herein referred to as the "Issuer"), for value
received, hereby promises to pay to CEDE & CO., or registered assigns, the
principal sum set forth on Schedule I on or before January 1, 2018 (the "Final
Maturity Date") and to pay interest quarterly in arrears on the Outstanding
Principal Balance hereof at a rate per annum equal to 7.0% (the "Stated Interest
Rate") 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 and Supplemental Interest on the principal amount of this Note
to the extent set forth below). Interest on this Class A Note in each Interest
Accrual Period shall be calculated on the basis of a 360-day year and the actual
number of days elapsed in such Interest Accrual Period.
This Class A Note is a duly authorized issue of Notes of the Issuer,
designated as its "Risperdal Consta(R) PhaRMA(SM) Secured 7% Notes, due January
1, 2018, Class A", issued under the Indenture dated as of February 1, 2005 (as
amended or supplemented from time to time, the "Indenture"), between the Issuer
and U.S. Bank National Association, as Trustee (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 the Issuer, the Trustee, the Class A Noteholders and
the Class B Noteholders, if any. This Class A Note is subject to all terms of
the Indenture.
The Issuer will pay the Outstanding Principal Balance of this Class A Note
on or prior to the Final Maturity Date on the Payment Dates and Special
Distribution 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 3.07 of the Indenture.
The Issuer may redeem all or part of the Outstanding Principal Balance of
this Class A Note prior to the Final Maturity Date on the Payment Dates and
Special Distribution Dates, in the amounts and under the circumstances specified
in the Indenture.
Any amount of Premium or interest on this Class A Note that is not paid
when due shall, to the fullest extent permitted by applicable law, bear interest
("Additional Interest") at a rate per annum equal to 9.75% (the "Stated Yield")
from the date when due until such amount is paid or duly provided for,
compounded quarterly and payable on the next succeeding Payment Date or Special
Distribution Date, subject to the availability of the Available Collections
Amount therefor after making payments entitled to priority under Section 3.07 of
the Indenture.
A-1
Interest ("Supplemental Interest") shall be payable in arrears on each
Payment Date or Special Distribution Date at a rate of 2.75% per annum,
compounded quarterly (the "Supplemental Interest Rate") on the excess, if any,
of the Outstanding Principal Balance of the Class A Notes over the balance
specified in the Class A Principal Payment Schedule for the immediately
preceding Payment Date on each day during the Interest Accrual Period ending on
such Payment Date or Special Distribution Date.
The indebtedness evidenced by the 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 Class A Note is issued subject to such
provisions. The maturity of this Class A Note is subject to acceleration upon
the occurrence and during the continuance of the Events of Default specified in
the Indenture.
This Class A Note is and will be secured by the collateral pledged as
security therefor as provided in the Indenture.
Subject to and in accordance with the terms of the Indenture, there will
be distributed quarterly on each Payment Date commencing on April 1, 2005, and
on each Special Distribution Date established by the Trustee pursuant to Section
3.04 of the Indenture, to the Person in whose name this Class A Note is
registered at the close of business on the Record Date with respect to such
Payment Date or Special Distribution Date, in the manner specified in Section
3.07 of the Indenture, such Person's pro rata share (based on the aggregate
percentage of the Outstanding Principal Balance of the Class A Notes held by
such Person) of the aggregate amount distributable to all Holders of Class A
Notes on such Payment Date or Special Distribution Date.
All amounts payable in respect of this Class A Note shall be payable in
U.S. dollars in the manner provided in the Indenture to the Holder hereof on the
Record Date relating to such payment. The final payment with respect to this
Class A Note, however, shall be made only upon presentation and surrender of
this Class A Note by the Noteholder or its agent at the Corporate Trust Office
or agency of the Trustee or Paying Agent specified in the notice given by the
Trustee or Paying Agent with respect to such final payment. At such time, if
any, as this Class A Note is issued in the form of one or more Definitive Notes,
payments on a Payment Date or Special Distribution 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
Class A 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. 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 specified in the
notice of such final payment given by the Trustee or Paying Agent. Any reduction
in the principal amount of this Class A Note (or any one or more predecessor
Class A Notes) effected by any payments made on any Payment Date or Special
Distribution Date shall be binding upon all future Holders of this Class A Note
and of any Class A Note issued upon the registration of transfer of, in exchange
or in lieu of or upon the refinancing of this Class A Note, whether or not noted
hereon.
The Holder of this Class A Note agrees, by acceptance hereof, to pay over
to the Trustee any money (including principal, Premium and interest) paid to it
in respect of this Note in the event that the Trustee, acting in good faith,
determines subsequently that such monies were not paid in accordance with the
priority of payment provisions of the Indenture or as a result of any other
mistake of fact or law on the part of the Trustee in making such payment.
This Class A Note is issuable only in registered form. A Holder may
transfer this Note only by delivery of a written application to the Registrar
stating the name of the proposed transferee, a
A-2
Confidentiality Agreement duly executed by such transferee and by 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 Holder only upon,
final acceptance and registration of the transfer by the Registrar in the
Register. When this Class A Note is presented to the Registrar with a request to
register the transfer or to exchange it for an equal principal amount of 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 Holder thereof or
by an attorney who is authorized in writing to act on behalf of the Holder and
that the transferee had executed and delivered a Confidentiality Agreement to
the Issuer). No service charge shall be made for any registration of transfer or
exchange of this Class A Note, but the party requesting such new Note or Notes
may be required to pay a sum sufficient to cover any transfer tax or similar
governmental charge payable in connection therewith.
Prior to the registration of transfer of this Class A Note, the Issuer and
the Trustee may deem and treat the Person in whose name this Class A 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 Holder hereof for the purpose
of receiving payment of all amounts payable with respect to this Class A Note
and for all other purposes, and neither the Issuer nor the Trustee shall be
affected by notice to the contrary.
The Indenture permits the amendment or modification of the Indenture and
the Class A Notes by the Issuer with the consent of the Holders of a majority of
the Outstanding Principal Balance of all Notes on the date of any vote of such
Holders (voting as a single class); provided that, without the consent of
Holders of one hundred percent (100%) of the Outstanding Principal Balance of
the class of Notes affected thereby, no such amendment may (i) reduce the
percentage of Holders of any such class of Notes required to take or approve any
action hereunder; (ii) change the amount or the time of payment of any amount
owing or payable with respect to any such class of Notes or change the rate or
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 hereunder will be made as between the Holders of such Notes and
the Issuer; or (iv) consent to any assignment of the Issuer's rights to a party
other than the Trustee for the benefit of the Noteholders (each, a "Basic Terms
Modification"). Any such amendment or modification shall be binding on every
Holder hereof, whether or not notation thereof is made upon this Class A Note.
The Indenture also permits the Trustee to agree, without the consent of any
Noteholder, (a) to any modification (other than a Basic Terms Modification) of,
or the waiver or authorization of any breach or prospective breach of, any
provision of any Related Document or of the relevant Notes to correct a manifest
error or an error which is of a formal, minor or technical nature or (b) to
modify the provisions of the Indenture or the Purchase and Sale Agreement
relating to the timing of movement of monies received among the Accounts by the
Trustee.
The subordination provisions contained in Section 3.07 and Article X of
the Indenture may not be amended or modified without the consent of each
Noteholder of the class affected thereby and each Noteholder of the class of
Notes ranking senior thereto.
The Indenture also contains provisions permitting the Holders of Notes
representing a majority of the Outstanding Principal Balance of the Senior Class
of Notes, on behalf of the Holders of all of the Class A Notes, to waive
compliance by the Issuer 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 Holders of
this Class A Note and of any Class A Note issued upon the registration of
transfer of, in exchange or in lieu of or upon the refinancing of this Class A
Note, whether or not notation of such consent or waiver is made upon this Class
A Note.
A-3
The term "Issuer" as used in this Class A Note includes any successor to
the Issuer under the Indenture.
The Issuer is permitted by the Indenture, under certain circumstances, to
merge or consolidate, subject to the rights of the Trustee and the Holders of
Class A Notes under the Indenture.
The Class A Notes are issuable only in registered form in denominations as
provided in the Indenture, subject to certain limitations therein set forth.
This Class A Note shall in all respects be governed by, and construed in
accordance with, the laws of the State of New York, including all matters of
construction, validity and performance.
Unless the certificate of authentication hereon has been executed by the
Trustee whose name appears below by manual or facsimile signature, this Class A
Note shall not be entitled to any benefit under the Indenture, or be valid or
obligatory for any purpose.
A-4
IN WITNESS WHEREOF, the Issuer has caused this Class A Note to be signed
manually or by facsimile by its duly authorized Manager.
Date: RC ROYALTY SUB LLC
By: ______________________________________
Name:
Title:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This Class A Notes is one of the Secured Class A 7.0% Notes due January 1,
2018 designated above and referred to in the within-mentioned indenture.
Date: U.S. BANK NATIONAL ASSOCIATION, not in its
individual capacity but solely 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 the Issuer 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 OTHER THAN
PERMANENT REGULATION S GLOBAL NOTES]
In connection with any transfer of this Note occurring prior to the date
which is the end of the period referred to in Rule 144(K) under the Securities
Act, the undersigned confirms that without utilizing any general solicitation or
general advertising that:
[Check One]
[ ] (a) this Note is being transferred in compliance with the exemption from
registration under the Securities Act of 1933 provided by Rule 144A thereunder.
or
[ ] (b) this Note is being transferred other than in accordance with (a) above
and documents are being furnished which comply with the conditions of transfer
set forth in this Note and the Indenture.
If none of the foregoing boxes is checked, the Trustee or other Registrar shall
not be obligated to register this Note in the name of any Person other than the
Holder 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 (a) ABOVE IS CHECKED.
A-6
The undersigned represents and warrants that it is purchasing this Note
for its own account or an account with respect to which it exercises sole
investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act of
1933 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 the Company 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.
Dated:
_______________________________________________
NOTICE: to be executed by an executive officer
A-7
Schedule I
RC ROYALTY SUB LLC
Secured Class A Note Due January 1, 2018
No. ___
Authorized Signature
Notation Explaining Principal of Trustee
Date Principal Amount Amount Recorded or Custodian
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A-8
EXHIBIT B
[RESERVED]
B-1
EXHIBIT C
FORM OF DISTRIBUTION REPORT FOR CLASS A NOTES
(i) With respect to each Payment Date, (A) the balances on deposit on the
Calculation Date immediately preceding the prior Payment Date, (B) the aggregate
amounts of deposits and withdrawals between such Calculation Date and the
Calculation Date immediately preceding the Payment Date and (C) the balances on
deposit in the Collection Account, Interest Reserve Account and any other
Account established under this Indenture on the Calculation Date immediately
preceding such Payment Date.
(ii) Analysis of Collection Account Activity Balance on Preceding Calculation
Date
- Collections during period
- Aggregate Note Payments
Balance on current Calculation Date
Analysis of current Payment Date distributions
(iii) Payments on each class of Notes
- Interest Amount on each class of Notes
- Additional Interest, if any
- Opening Outstanding Principal Balance
- Principal payments
- Closing Outstanding Principal Balance
(iv) Distributions to the Issuer
- Excess IO Period Payment
- Distribution to the Issuer
- Satisfaction of Distribution Conditions
- Satisfaction of the Deferred Excess IO Period Distribution Test
(iv) Payments on each Payment Date per $100,000 Initial Outstanding Principal
Balance of Notes
Opening Outstanding Principal Balance
Total Principal Payments
Closing Outstanding Principal Balance
Total Interest
Total Premium
(vi) On each Distribution Report for each April 1 Payment Date, a comparison of
the actual amortization of the Notes to the Class A Principal Payment Schedule.
C-1
EXHIBIT D
FORM OF CERTIFICATE
____________________, ____
U.S. Bank National Association
Xxx Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Corporate Trust Services
RC Royalty Sub LLC
00 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxxxx 00000
Attention: General Counsel
Re: RC Royalty Sub LLC (the "Issuer")
Notes
Dear Sirs:
This letter relates to U.S. $___________ principal amount of Class __
Notes of the Issuer represented by a Class __ Note which bears a legend (the
"Legended Note") outlining restrictions upon transfer of such Legended Note.
Pursuant to Section 2.01 of the Indenture dated as of February 1, 2005 (the
"Indenture") relating to the Class __ Notes and certain other classes of Notes,
we hereby certify that we are (or we will hold such securities on behalf of) a
person outside the United States to whom the Class __ Notes may be transferred
in accordance with Rule 904 of Regulation S promulgated under the U.S.
Securities Act of 1933, as amended ("Regulation S"). Accordingly, you are hereby
requested to exchange the Legended Note for an unlegended Note representing an
identical principal amount of Class __ Notes, all in the manner provided for in
the Indenture.
Each of you is entitled to rely upon this letter and is irrevocably
authorized to produce this letter or a copy hereof to any interested party in
any administrative or legal proceedings or official inquiry with respect to the
matters covered hereby. Terms used in this certificate have the meanings set
forth in Regulation S.
Very truly yours,
[Euroclear] [Clearstream]
By:
------------------------------------
Authorized Signature
D-1
EXHIBIT E
FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION WITH TRANSFERS
PURSUANT TO REGULATIONS
_________________________, ____
U.S. Bank National Association
Xxx Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Corporate Trust Services
RC Royalty Sub LLC
00 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxxxx 00000
Attention: General Counsel
Re: RC Royalty Sub LLC (the "Issuer")
Notes
Dear Sirs:
In connection with our proposed sale of U.S.$______________ aggregate
principal amount of the Class __ Notes, we confirm that such sale has been
effected pursuant to and in accordance with Regulation S under the Securities
Act of 1933, as amended ("Regulation S") and, accordingly, we represent that:
(1) the offer of the Class __ Notes was not made to a person in the
U.S.;
(2) at the time the buy order was originated, the transferee was outside
the U.S. or we and any person acting on our behalf reasonably believed that the
transferee was 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; and
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the U.S. Securities Act of 1933.
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 proceedings or official inquiry with respect to the
matters covered hereby. Terms used in this certificate have the meanings set
forth in Regulation S.
Very truly yours,
[Name of Transferor]
By:
------------------------
Authorized Signature
E-1
EXHIBIT F
FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION WITH
TRANSFERS TO NON-QIB ACCREDITED INVESTORS
_______________, _______
RC Royalty Sub LLC
00 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxxxx 00000
Attention: General Counsel
[ ]
[ ]
As Purchasers in connection with the
Private Placement Memorandum referred to below
[ ]
[ ]
Ladies and Gentlemen:
In connection with our proposed purchase of Notes (the "Notes") of RC
Royalty Sub LLC (the "Issuer"), we confirm that:
1. We have received a copy of the Private Placement Memorandum dated
January 21, 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 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 the Issuer
or any subsidiary thereof, (B) in accordance with Rule 144A under the Securities
Act to a "qualified institutional buyer" (as defined therein), (C) to an
institutional "accredited investor" (as defined below) 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 the Issuer that such transfer
is in compliance with the Securities Act, (D) in an offshore transaction in
compliance with Rule 904 of Regulation S under the Securities Act, (E) pursuant
to the exemption from registration provided by Rule 144 under the Securities Act
(if available) or pursuant to another available exemption from registration
under the Securities Act, as applicable or (F) pursuant to an effective
registration statement under the Securities Act, and we further
F-1
agree to provide to any person 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 the Issuer and the Trustee such certifications, legal
opinions and other information as the Issuer and the Trustee may reasonably
require to confirm that the proposed sale complies with the foregoing
restrictions.
5. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) 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 each 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, the Issuer 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 proceedings or official inquiry
with respect to the matters covered hereby.
Very truly yours,
By: ________________________
Name:
Title:
F-2
EXHIBIT G-1
FORM OF CERTIFICATE TO DTC REGARDING INTEREST
Euroclear
[Address]
AND/OR
Clearstream
[Address]
Re: RC Royalty Sub LLC
Reference is hereby made to the Indenture, dated as of February 1, 2005
(the "Indenture"), made by and between RC Royalty Sub LLC (the "Issuer") 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 $[ ] principal amount of Class __ Notes that are
held in the form of a beneficial interest in the Temporary Regulation S Global
Note (CUSIP No. __) through [insert name of DTC] by the undersigned (the
"Holder") in the name of [insert name of Participant]. The Holder of such
Temporary Regulation S Global Note hereby requests the receipt of payment of
interest installments due and payable [on the applicable Payment Date] pursuant
to Section 2.05 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 a Confidentiality Agreement to the Issuer.
Terms in this certificate have the meanings given to them in Regulation S under
the Securities Act of 1933, as amended.
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:
G-1-1
EXHIBIT G-2
FORM OF DTC CERTIFICATE REGARDING INTEREST
U.S. Bank National Association, As Paying Agent
Xxx Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Corporate Trust Services
Re: RC Royalty Sub LLC
Reference is hereby made to the Indenture, dated as of February 1, 2005
(the "Indenture"), made by and between RC Royalty Sub LLC (the "Issuer") 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 $[ ] principal amount of Class __ Notes that
are held in the form of a beneficial interest in the Temporary Regulation S
Global Note (CUSIP No.__) through [insert name of DTC] by the undersigned (the
"Holder") in the name of [insert name of Participant]. Certain Holders of the
beneficial interests in such Temporary Regulation S Global Note have requested
the receipt of payment of interests installments due and payable [on the
applicable Payment Date] pursuant to Section 2.05 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) has executed and delivered a Confidentiality Agreement
to the Issuer. Terms in this certificate have the meanings given to them in
Regulation S under the Securities Act of 1933, as amended.
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
$[ ].
[Clearstream] [Euroclear]
By: ___________________
Name:
Title:
G-2-1
EXHIBIT H
FORM OF CONFIDENTIALITY AGREEMENT
___________________, 20___
RC Royalty Sub LLC
00 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxxxx 00000
CONFIDENTIALITY AGREEMENT
In connection with our interest in the potential purchase of Risperdal Consta(R)
Pharmaceutical Royalty Monetization Asset (PhaRMA(SM)) Secured Notes due 2018
issued by you (the "Notes"), we have requested a copy of the Private Placement
Memorandum, dated January 21, 2005, relating to the Notes (the "Private
Placement Memorandum"). In addition to receiving the Private Placement
Memorandum, we may also have conversations with you or your directors, officers,
employees, affiliates, representatives or agents (collectively, "your
Representatives") or receive additional information from you or your
Representatives about the Notes or your business. As used in this letter
agreement, the term "Information" means (i) the Private Placement Memorandum,
(ii) any additional information we receive from you or your Representatives
about the Notes or your business, and (iii) any internal reports, compilations,
forecasts, studies, analyses or other documents we prepare that incorporate or
utilize any information described in clauses (i) or (ii) (in the case of clauses
(ii) and (iii), whether oral or written, whether in tangible or electronic form,
or otherwise). The term Information will not, however, include information which
(1) is or becomes publicly available other than as a result of a disclosure by
us or (2) is or becomes available to us on a nonconfidential basis from a source
(other than you) which, to our knowledge, is not prohibited from disclosing such
information to us by a legal, contractual or fiduciary obligation to you.
As a condition to receiving the Information, we hereby agree that:
1. We (i) will keep the Information confidential and will not (except as
required by applicable law, regulation or legal process, and only after
compliance with paragraph 2 below), without your prior written consent,
disclose any Information in any manner whatsoever, (ii) will not use any
Information for any purpose other than in connection with our considering
or making an investment in the Notes, and (iii) will not copy or reproduce
all or any portion of the Private Placement Memorandum.
2. In the event that we are requested pursuant to, or required by, applicable
law, regulation or legal process to disclose any of the Information, we
will notify you promptly so that you may seek a protective order or other
appropriate remedy or, in your sole discretion, waive compliance with the
terms of this letter 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 letter agreement, we will furnish only that portion of the
Information which we are advised by counsel is legally required and will
exercise reasonable efforts to obtain assurance that confidential
treatment will be accorded the Information.
H-1
3. If we decide not to purchase the Notes, we will promptly inform you of
that decision and, in such case, and at any time upon our request, we will
(i) promptly deliver to you at our own expense all copies of the
Information in our possession (except as described in the following
clause) 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, provided, in each case, that we may retain one copy
of the Information, subject to the provisions of this letter agreement, if
necessary to comply with applicable law, regulation, legal process or
internal policies. Any oral Information will continue to be subject to the
terms of this letter agreement.
4. We acknowledge that the Private Placement Memorandum is dated January 21,
2005, and that you have not, and have no obligation to, update the Private
Placement Memorandum in any respect for events, developments or
circumstances (including, without limitation, the level of royalty
payments for Risperdal Consta or the sales of Risperdal Consta compared to
the projections contained in the Independent Consultants Report included
as Appendix A to the Private Placement Memorandum). No express or implied
representation or warranty as to the accuracy or completeness of any
Information is made by you or any representative acting for you or as a
broker or market maker for the Notes, and we agree that none of such
persons will have any liability relating thereto or for any errors therein
or omissions therefrom.
5. We agree to disclose Information only to our agents, attorneys and
employees who have a need to know the Information in connection with our
investment decision and who will be advised by us of this agreement, and
we will be satisfied that such agents, attorneys and employees will act in
accordance herewith.
6. If we purchase the Notes and then 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 and (ii) inform any
recipient of the Notes of such transfer restrictions, including the
requirement that such recipient enter into a confidentiality agreement
with you.
7. We acknowledge that remedies at law may be inadequate to protect you
against any actual or threatened breach of this letter agreement by us,
and, without prejudice to any other rights and remedies otherwise
available to you, we agree that you may seek injunctive relief.
8. 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.
9. This letter 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.
10. This letter agreement contains the entire agreement between you and us
concerning the confidentiality of the Information, and no modification of
this letter 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.
11. This letter agreement will terminate eighteen (18) months after the
earliest of (i) the date of this Agreement if we do not proceed with the
purchase of the Notes; (ii) the date we sell any Notes we own; (iii) the
final maturity of such Notes; or (iv) the date such Notes are paid in
full.
H-2
Please confirm your agreement with the foregoing by signing and returning to the
undersigned or its authorized representative the duplicate copy of this letter
enclosed herewith.
Very truly yourS,
____________________________________
[Please Print Name]
By: ________________________________
Name: ______________________________
Title: _____________________________
Address: ___________________________
___________________________
___________________________
Accepted and Agreed as of the date
first written above:
RC ROYALTY SUB LLC
By: _________________________________
Name: _______________________________
Title: ______________________________
No: ____________
H-3
